Economy so bad National won’t take advantage?
Heat on public sector bosses
Public service bosses face renewed pressure to cut spending as Treasury warns the economy will stall this year and unemployment reach 7 per cent.
Prime Minister John Key said the grim forecast gave new urgency to moves to screw down departmental spending to free up cash for road and other building projects to reboot the stalled economy. The Government plans to bring forward $1.5 billion in infrastructure spending to bolster activity, but Mr Key said it had to balance that against the need to control borrowing in the face of warnings New Zealand's credit rating will be downgraded if debt gets out of hand. Treasury told economic ministers yesterday that it believed the economy was in the "downside" scenario laid out in its December update. "What that means ... is that the New Zealand economy for effectively 2009 will stand still," Mr Key said. "What it also means is that by the 2009-2010 period, unemployment, we've been advised, could be 7 per cent, rising to 7 1/2 per cent by 2011." Unemployment is about 4 per cent now.
Watching the new cabinet and the depression and fear on each of the faces really gave an indication of the seriousness of the economic meltdown heading our way, apparently the capital gains tax-free property speculation bubble melded with a consumer culture of putting SUVs, plasma TV’s and cosmetic surgery on credit cards wasn’t sustainable (who would’ve thunk it) and now we reap what we’ve sown, and for a new and untested National, they are having to get to grips with the worst economic situation in a generation. The fear on the left has always been that National would use this economic crises to ram through a crazy hard right agenda, and certainly their tragic first two weeks where National and its allies pack raped the select committee process in an abuse of power you have to go back to 1998 to match certainly suggested we are in for a very bad regime of Daddy State hard right government, but I’m thinking that the economic threat is so great that surely the last thing on National’s future agenda is hard right crazy policy because right now NZ is looking to double its unemployment in only 2 years – the social impact of that is going to shake us to the core leaving National with little real movement to the hard right because visions of large numbers of unemployed angry, hungry people looking for someone to blame won’t need antagonizing.
posted by Bomber @ 7:18 am
2 comments
2 Comments:
Building/upgrading roads would involve spending money and creating jobs – two things the government should do during the economic crisis. The drop in consumption has resulted in firms having to lay off staff and cut production levels, or face collapse. The unemployed spend less due to having less income, while the employed tend to spend less due to having less financial security. Government intervention is necessary to halt the downward economic spiral.
I hope the Prime Minister remembers, that, he is the head of a country, not a company. Now, where are all the bright ideas - what have the National Party been doing for the past nine years in opposition? Creaming it, with a sweet salary - not really doing too much - sounds like the worst sort of state-beneficiary to me!
And, how's this for ridiculous, yet, not entirely surprising? - Don Brash is nominating (Sir) Roger Douglas, as, the "greatest living New Zealander". Well, gosh darn it, from one anti-nationalistic, free-market loving, fool,
to another.
How 'bout the private-sector compete with the public-sector? Wouldn't want to be anti-competitive now.
What are taxes, and, government for, after all?
Next thing, we won't need governments, just let the free-market manage the country - oh, but, where would justice be? Not all value is based on monetary gain and profit, there is such a thing as well-being and livelihood to consider - just in passing of course.
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