Chickens coming home to roost again

The following is an extensive extract from the Business Insider. I recommend ignoring my extract and reading the full post right here, but if you’re determined not to, go ahead and read my truncated version.

It’s a little technical and although my knowledge of economic theory is improving, I don’t understand all of it. But the implications for all of us are very serious. This is the stuff that John Key and Bill English seem able to gloss over but which continues to make a mockery of their ever-optimistic and perennially wrong economic forecasts. The 95% that I do understand isn’t really debatable. As you’ll find when you read it, there’s an inevitability to what is happening that lends it verisimilitude.

This is just part of the reasons why John Key gave up on catching up with Australia and Bill English made a virtue of our being poorer than our mates across the ever-widening ditch. The ill-informed, self-serving and uninspiring people you put in power don’t get it.

The last paragraph is spine-chilling, provocative, and hopefully will not come to pass.

Not yet.

Over to Raul Ilargi Mendoz…

…and quotes within quotes:
Continue reading “Chickens coming home to roost again”

Catching up with Australia

In your dreams John: not at this rate

Yeah, I know they’ve given up on the promise. The disgusting thing is they shouldn’t have. We can catch Australia. But the longer we leave it the more difficult it becomes – the people we need to do it will all be in Australia.

Since I last investigated our dreadful economic performance the plot’s thickened. The table below is the most current comparison of GDP per capita for the richest 51 countries in the world, click on it to see it full-size. The figures in the table are taken from the CIA’s World Factbook. You may not be enamoured of the CIA, but they do their homework.

You can find us quite easily. The reason I’ve made it so long is that we’re at the very bottom.

per capita gdg table

With a bit of Googling you’ll find figures from other organisations showing us at a higher position than 51st. It depends upon several things including how GDP is defined, how recent the figures are, and whom they include in the stats. Nevertheless, the trend is the same. Steadily downward and with no sign of relief.

Most often our position is quoted as in the 20s. That’s because they usually only include OECD countries. We’ve been overtaken by a whole gaggle of countries which aren’t even in the OECD.

Mr Bollard and Mr Key please note

    • Since the 2007 update Australia has moved up 5 places, New Zealand have moved down 5 places.
    • Before leaping to the conclusion that the Aussies are just digging dollars out of the ground bear in mind that minerals (including oil & gas) comprised only 8% of their GDP in 2007. 7% according to some.

But GDP isn’t everything

Yes, I hear your cry. There are more important things than GDP. I’d rather live in New Zealand than in wealthy Qatar or Hong Kong. I’ve been to both those places and they’re not my cup of tea. Nevertheless, although the best things in life aren’t things, there comes a point where relative wealth becomes important. When a country can no longer afford the level of health care, policing, educational resources, defence and welfare its people expect, then per capita GDP becomes a very big issue.

When the outflow of our most valuable people becomes a steady torrent our collective future well-being is at risk. We need these people creating wealth for New Zealand so that we can repay our rapidly rising debt. I need my grandchildren to live in my country.

We need these people to continue the precious New Zealand can-do, string-and-barbed-wire, punch-above-our-weight culture built up over a dozen decades and more.

We’re paying for our education system to churn out people to build Australia; the medical and dental professions are becoming dominated by people for whom English is a second language; soon we’ll fall behind Botswana and Khazakstan economically.

It matters alright.

  • To re-iterate, if you wish to find New Zealand in a hurry on this chart, we’re at the bottom of the table at #51.
  • When I was very young we were #2.

Pray tell me:

  • What resources do Liechtenstein, Luxembourg, Jersey, Singapore, Hong Kong, Switzerland and Iceland have that New Zealand can’t match or exceed?
  • Why can’t we compete, for instance, with the Danes? The Swede’s say about Denmark “Stand on a box and you can see their whole damn country.” Like many other economies on this list they have very few natural resources: just good people.
  • Greenland! Before the crash were they selling ice as well as fish? They’re down now but watch them rebound.
    If you want answers to these questions, check my links below.

We need action

A few hints:

  • More research and development.
  • Proactive mentoring in entrepreneurial skills for small and medium sized businesses.
  • Sort out our education services. Less technology, more 3 Rs. Get people with real work experience onto the education coalface.
  • Jobs, jobs, jobs.
  • What happened to the war on bureaucracy? Bring the public sector into the real world.
  • In case it’s escaped notice, the much-maligned employers are the people who create jobs and wealth.
  • Less arts and law degrees, more science and engineering.
  • Less time wasters in the student body.
  • Less welfare, more work.
  • Less borrowing for hire purchase, more for investment.
  • Less consumption, more work and education.
  • Did I mention jobs?

For more insight into where our country is going wrong read my series: New Zealand’s Economic Decline and watch Sir Paul Callaghan’s inspirational presentation Beyond the Farm and the Theme Park.


Someone else who understands the problem

Rod Oram
Rod Oram. He gets it.

Rod Oram is a controversial figure to many. Mostly he irritates the revisionist old school ignoramuses who got us into the mess we’re in. Those folk in farming organisations who believe that producing more lamb and milk powder will get us back into First World status aren’t too keen on Rod either. He sums up some of what I’ve been trying to raise awareness of in this article in the Sunday Star Times:

Time for a cultural revolution

My only gripe with Rod is that he doesn’t make enough noise about the issues. He—along with folk like Colin James, Fran O’Sullivan, Gareth Morgan and Leighton Smith—could make a big difference if they screamed louder.

These people don’t get it

If the views expressed by these leading lights are correct we may as well all bugger off to Australia on the next waka.

I belatedly watched the last episode of TVNZ’s Q&A. Interesting, not for enlightenment, but for the astonishing amount of waffle, cliches and platitudes crammed into one half hour programme.

And the total rubbish being talked.

Mike Williams, despite being a dyed in the wool lefty, spoke more sense than all the rest of them put together, although his fulsome praise of slippery slope Phil Goff put a dent in his verisimilitude. Watch the program yourself, then visit the websites of the Treasury, the OECD, the CIA’s World Factbook; review the facts and figures and make up your own mind whether these “experts” have got it together or not.

The panel comprised Dr Claire Robinson, very highly qualified and experienced in communications; Katherine Rich, front-runner for the National Party leadership not long ago; and Mike Williams, ex-Labour Party president. The views they expressed made me wonder whether we’re all in the same universe, never mind on the same planet.

Just to set the mood we had a clip of Dr Doom aka Allan Bollard saying: Continue reading “These people don’t get it”

Fran’s been wondering too…

Fran O'Sullivan: switched on economics commentator
Fran O'Sullivan. Another switched on commentator whose advice we should be heeding.

Ten ways to beat our snowballing debt

Fran O’Sullivan wrote a controversial column in this week’s Sunday Herald.  It’s attracted lots of heartfelt support from the economically literate and some equally enthusiastic vitriol from the usual suspects.

You can read the full text here. 90% of what she writes is gospel truth,  some of it is a bit outrageous. I’m wondering that she may be being a wee bit provocative for effect.

I  have a couple of caveats, but if we adopted her recommendations tomorrow we would be well on the way to turning this country around. We wouldn’t fix everything but it would be a good start for setting up a climate for growth and its resultant prosperity.

Fat chance.

Fran’s 10 suggestions in a nutshell

A précis follows, Continue reading “Fran’s been wondering too…”

Third world New Zealand

Old Mother Hubbard
New Zealand's cupboard is looking a bit bare too. It's time to halt the decline.

I despair for this country. The teachers want more money, the health sector wants more money, our defence forces are reminiscent of The Mouse That Roared, rich people and landlords only pay tax if they want to.

20% of our population lives overseas. Of those who remain, 12.5% of working age adults are on benefits and 20% of our children live in benefit-dependent families.

We’re still steadily sinking in the economic rankings relative to Australia, and to everybody else on the planet. Our jails are full to bursting—mostly with people who should be working in the community to right those they’ve wronged—the bureaucracies are inefficient and incompetently managed.

Our roads are dreadful but the transport playing field is tilted in favour of the trucking industry that’s wrecking them. Our biggest city and our capital are choked after decades of stupid transport decisions but all we do is build more roads and pour in more vehicles to make things worse.

We set up task groups of knowledgeable folk to tell us how to get out of the mess then we ignore the good advice we pay them big money to provide. There are many influential people who know what’s wrong and how to fix it but we ignore them. Continue reading “Third world New Zealand”