Budget papers show Treasury preferred 50% net debt limit to 20-40% range adopted by Govt; Treasury warned lower debt target risked Govt “passing up on productivity and growth enhancing investments”.
Hey Bernard, the per capita card spending chart is even worse than it looks. If you assume the % of cash transactions was higher in 2012 than it is today, the situation is even more dire.
Interesting that Treasury’s even making these recommendations, I’d falsely imagined they were pushing the 30% debt limits. Happily it does give Chippy more backing to his starting this debate, also further erodes Bishops
My wonderful daughter in law gave me a little BWB Text to read. I am now immersed and finding it enlightening, hopeful, novel yet grounded in the past and full of Aha moments. I can recommend “The Economic Possibilities of Decolonisation” by Mathew Scobie & Anna Sturman most highly. For this past molecular endocrinologist, who used to think that homeostasis was easy to aim for, the wise and gentle words in this book sooth my seething mind. Thanks Buzz.
Oh dear. Is poor Simon Watts broken? Which of his imaginary friends is telling him that they "love" paying other countries for climate mitigation that we could just do locally? Which one of them says that sort of thing is "nice"? How does he square the circle of cancelling all our climate mitigation efforts and then claiming he didn't inherent a mitigation plan? These people are living in the Upside-down.
I misheard the last bit if Bernard's podcast this morning. Referring to Simon Watts, I thought he said we'd need to "follow up this moron" ... when it was actually along the lines of "follow up more on this".
There doesn't appear to joined up government thinking on climate - that's generous, there is no thinking on climate other than"get rid of what Labour wanted".
BUILD MORE ROADS - BMR - will look good on blue caps warn by Nats.
Advise all to read “mission economy:a moonshot guide to changing capitalism” by Mariana Mazzucato. She discusses Bad theory and Bad practice in economics and 5 myths that impede progress. Myth 3 is “government needs to be run like a business” the other 4 are excellent also and apply to NZ very aptly.
I was involved in the health reforms of the 1990’s wrongly on the neoliberal capitalist side, mea culpa. Reti and Levy are both Harvard business school on the health “business” and will move us to the American system with the Rich getting service and the devil take the rest. The ideas superficially read well but the system must be FUNDED for all at a proper OECD level.
Ah, but if the state could have done more on it's own the opportunities for private sector parasites to get their bloodsucking funnels into us more would have been less.
The more detailed health targets are notable for nothing on, arguably, the two most important parts of health - support for primary health/GPs and support for public health.
The ominous thing in Dr Reti's announcement is the 'more use of private hospitals' (instead of funding our hospitals properly). It is clear that the underlying plan is to, over time, privatise our public health system. Same for public schooling - charter schools are a trojan horse.
I agree with those who are staggered at Simon Watts' comment about meeting NZ's 2030 target (our interim Paris target): To reiterate, Watts says "The challenge is, and I've got to be realistic and up front, even if we did everything that I could do today in the next 65 months, because time is my biggest challenge really, what can you do in 65 months?”
So, he's moved quite cynically from recently reiterating that NZ is committed to the 2030 target, even if it means buying international units at high prices, to now saying it's unattainable, and asking rhetorically, "what can you do?" to reduce gross emissions over the next 5 years. Some of us were worried that he might make this this shift, in our submissions on the Government's 2nd draft Emissions Reduction Plan.
What's most grating is that Watts claims the Govt "didn't inherit a plan when we came in that would have hit that target" - this is quite misleading as the Climate Change Commission gave them a credible plan on 22 November 2023 --see p.140 of the Advice given to the Govt on that date. That plan involved things like "increased EV uptake and shifting to low-carbon transport".
Because his Govt did not decide to accept the plan, their options were reduced to either buying costly units overseas, or reneging on the 2030 target. They are now clearly heading for the reneg option, the slippery and unconscionable way out.
No wonder Rod Carr has spoken very strong words about them.
1) Wilfully ignoring all the evidence that provides a contradiction to their ultra free-market plans.
2) Setting up our health and other sectors for privatization (it will be deliberately broken so badly that anyone who can afford to, will stampede into private insurance care - as they are doing now. IF they can afford to, of course).
3) Reneging on our climate commitments and killing off NZ's nascent mode-shift while wearing a "who farted" look and pointing at the last government.
4) Trying to act like a business but actually not acting like a business: a good business invests for the future - nothing always comes of nothing.
5) Gutting the core civil service so those pesky bureaucrats can no longer have bandwidth to provide inconveniently truthful advice or institutional knowledge.
6)The not that very convincing fibs and evasions that they know - that we know - fool nobody.
What can possibly go wrong?
And, just quietly, what do we think of Rod Carr's strangely strong and prophetic closing remarks to his tenure at the Climate Commission? Cassandra like. And we will all be joining him in good time I feel.
I am reminded of a book written by the late Bruce Jesson during the 1980s restructure of the NZ economy and which he published just before he died. It was called, I think, "Only their purpose is mad". I liked that title then, and forty years later it seems to me to dissect the problem with admirable, scalpel-like precision. It might make a good subtitle for the Kaka Bernard!
Random question for anyone(slightly off topic but out of curiosity).
What is the reason why governments borrow in foreign currency? After learning about NZ borrowing in NZD at fixed interest rates & my Parents come from Barbados who borrows in foreign currency (typically USD) I was wondering why that would be?
Barbados is considered a 'developing' country, does that have anything to do with it?
I have only recently come to understand this and doubt my ability to explain it clearly, but I'll give it a go! It's because an smaller or emerging economy has less monetary credibility with their own currency, so might only be able to borrow in a stronger currency. Their own currency is likely to be more subject to value fluctuations. However, borrowing in foreign currency then leaves them vulnerable in a debt crisis, as their own currency might have devalued, making it even harder to pay back foreign debt. Puts them in a double bind. NZ has been able to make the shift to borrowing/issuing bonds in its own currency.
"...what can you do in 65 months? Simon Watts" - well Simon, could yiu use your majority shareholding in the gentailers to set a feed-in tariff to incentivise distributed rooftop solar?
Perhaps you could import the solar equipment and pass it on at cost?
How about a 100% depreciation rate for a business ev purchase?
Electrifying industry and transport would go some way to the goal, surely.
Hi Bernard, trying interpret how this report from Westpac fits into the topics discussed in this post and the overall fiscal policy direction this govt is headed. Overall it seems tailor written to support a restrictive stance in the name of pulling back crown debt UNTIL you read the last bit about productivity. I don’t understand enough about trade deficits also. to see how factors also. Would welcome you veiws
Hey Bernard, the per capita card spending chart is even worse than it looks. If you assume the % of cash transactions was higher in 2012 than it is today, the situation is even more dire.
Interesting that Treasury’s even making these recommendations, I’d falsely imagined they were pushing the 30% debt limits. Happily it does give Chippy more backing to his starting this debate, also further erodes Bishops
Yes but new treasury secretary will change the tone again I am sure.
What a disaster. I feel old and tired and despairing.
Ditto
me too.....
My wonderful daughter in law gave me a little BWB Text to read. I am now immersed and finding it enlightening, hopeful, novel yet grounded in the past and full of Aha moments. I can recommend “The Economic Possibilities of Decolonisation” by Mathew Scobie & Anna Sturman most highly. For this past molecular endocrinologist, who used to think that homeostasis was easy to aim for, the wise and gentle words in this book sooth my seething mind. Thanks Buzz.
Oh dear. Is poor Simon Watts broken? Which of his imaginary friends is telling him that they "love" paying other countries for climate mitigation that we could just do locally? Which one of them says that sort of thing is "nice"? How does he square the circle of cancelling all our climate mitigation efforts and then claiming he didn't inherent a mitigation plan? These people are living in the Upside-down.
I misheard the last bit if Bernard's podcast this morning. Referring to Simon Watts, I thought he said we'd need to "follow up this moron" ... when it was actually along the lines of "follow up more on this".
Perhaps (like that other fellow) he has "the concept of a plan."
There doesn't appear to joined up government thinking on climate - that's generous, there is no thinking on climate other than"get rid of what Labour wanted".
BUILD MORE ROADS - BMR - will look good on blue caps warn by Nats.
Release please Bernard
Advise all to read “mission economy:a moonshot guide to changing capitalism” by Mariana Mazzucato. She discusses Bad theory and Bad practice in economics and 5 myths that impede progress. Myth 3 is “government needs to be run like a business” the other 4 are excellent also and apply to NZ very aptly.
I was involved in the health reforms of the 1990’s wrongly on the neoliberal capitalist side, mea culpa. Reti and Levy are both Harvard business school on the health “business” and will move us to the American system with the Rich getting service and the devil take the rest. The ideas superficially read well but the system must be FUNDED for all at a proper OECD level.
Keep up your good work.
Patrick Medlicott
Ah, but if the state could have done more on it's own the opportunities for private sector parasites to get their bloodsucking funnels into us more would have been less.
The more detailed health targets are notable for nothing on, arguably, the two most important parts of health - support for primary health/GPs and support for public health.
The ominous thing in Dr Reti's announcement is the 'more use of private hospitals' (instead of funding our hospitals properly). It is clear that the underlying plan is to, over time, privatise our public health system. Same for public schooling - charter schools are a trojan horse.
Good on you, Rod Carr. How refreshing to read of an actual leader, telling it like it is.
Thx Bernard
I agree with those who are staggered at Simon Watts' comment about meeting NZ's 2030 target (our interim Paris target): To reiterate, Watts says "The challenge is, and I've got to be realistic and up front, even if we did everything that I could do today in the next 65 months, because time is my biggest challenge really, what can you do in 65 months?”
So, he's moved quite cynically from recently reiterating that NZ is committed to the 2030 target, even if it means buying international units at high prices, to now saying it's unattainable, and asking rhetorically, "what can you do?" to reduce gross emissions over the next 5 years. Some of us were worried that he might make this this shift, in our submissions on the Government's 2nd draft Emissions Reduction Plan.
What's most grating is that Watts claims the Govt "didn't inherit a plan when we came in that would have hit that target" - this is quite misleading as the Climate Change Commission gave them a credible plan on 22 November 2023 --see p.140 of the Advice given to the Govt on that date. That plan involved things like "increased EV uptake and shifting to low-carbon transport".
Because his Govt did not decide to accept the plan, their options were reduced to either buying costly units overseas, or reneging on the 2030 target. They are now clearly heading for the reneg option, the slippery and unconscionable way out.
No wonder Rod Carr has spoken very strong words about them.
Ralph Chapman
Ah yes,
1) Wilfully ignoring all the evidence that provides a contradiction to their ultra free-market plans.
2) Setting up our health and other sectors for privatization (it will be deliberately broken so badly that anyone who can afford to, will stampede into private insurance care - as they are doing now. IF they can afford to, of course).
3) Reneging on our climate commitments and killing off NZ's nascent mode-shift while wearing a "who farted" look and pointing at the last government.
4) Trying to act like a business but actually not acting like a business: a good business invests for the future - nothing always comes of nothing.
5) Gutting the core civil service so those pesky bureaucrats can no longer have bandwidth to provide inconveniently truthful advice or institutional knowledge.
6)The not that very convincing fibs and evasions that they know - that we know - fool nobody.
What can possibly go wrong?
And, just quietly, what do we think of Rod Carr's strangely strong and prophetic closing remarks to his tenure at the Climate Commission? Cassandra like. And we will all be joining him in good time I feel.
I am reminded of a book written by the late Bruce Jesson during the 1980s restructure of the NZ economy and which he published just before he died. It was called, I think, "Only their purpose is mad". I liked that title then, and forty years later it seems to me to dissect the problem with admirable, scalpel-like precision. It might make a good subtitle for the Kaka Bernard!
Cool Photo Bernard, the flower is very pretty.
Random question for anyone(slightly off topic but out of curiosity).
What is the reason why governments borrow in foreign currency? After learning about NZ borrowing in NZD at fixed interest rates & my Parents come from Barbados who borrows in foreign currency (typically USD) I was wondering why that would be?
Barbados is considered a 'developing' country, does that have anything to do with it?
I have only recently come to understand this and doubt my ability to explain it clearly, but I'll give it a go! It's because an smaller or emerging economy has less monetary credibility with their own currency, so might only be able to borrow in a stronger currency. Their own currency is likely to be more subject to value fluctuations. However, borrowing in foreign currency then leaves them vulnerable in a debt crisis, as their own currency might have devalued, making it even harder to pay back foreign debt. Puts them in a double bind. NZ has been able to make the shift to borrowing/issuing bonds in its own currency.
This link provides a good summary: https://www.investopedia.com/terms/f/foreign-debt.asp
"...what can you do in 65 months? Simon Watts" - well Simon, could yiu use your majority shareholding in the gentailers to set a feed-in tariff to incentivise distributed rooftop solar?
Perhaps you could import the solar equipment and pass it on at cost?
How about a 100% depreciation rate for a business ev purchase?
Electrifying industry and transport would go some way to the goal, surely.
I’ve opened this one up too after clearing 100 likes.
Hi Bernard, trying interpret how this report from Westpac fits into the topics discussed in this post and the overall fiscal policy direction this govt is headed. Overall it seems tailor written to support a restrictive stance in the name of pulling back crown debt UNTIL you read the last bit about productivity. I don’t understand enough about trade deficits also. to see how factors also. Would welcome you veiws
https://library.westpaciq.com.au/content/dam/public/westpaciq/secure/economics/documents/nz/2024/09/Economic-Data_180924-Credit-rating-primer_bulletin_18Sep24.pdf