By Bernard Hickey
2016 was a big year for surprises and for politics driven by economics, so here's the big three numbers of the political economy over the last 12 months.
US$150 million - This was the amount Donald Trump's campaign spent on Facebook and Instagram advertising in the final weeks of the US Presidential election campaign. This was over three times more than Hillary Clinton spent on targeting voters through those social media and was credited in helping him squeak to victory in the Electoral College vote.
Clinton spent over NZ$200 million on television advertising, which was twice that of Trump, but his campaign was much more effective at hyper-targeting specific voters in specific states with specific messages tailored to them. Trump's digital campaign managers built individualised profiles on 220 million voters with up to 5,000 data points on each of them, including their ethnicity, their location, their spending habits, their net worth and their social networks.
In the final days of the campaign Trump was targeting up to 175,000 different individualised advertisements per day to either win voters over to Trump, or to discourage them from voting at all. Most people never saw these 'dark posts' in private news feeds. Trump shocked the world by winning 46 Electoral College votes in the states of Wisconsin, Pennsylvania and Michigan. He did that by winning those three states by a total of 77,193 votes. Nationally, Clinton received 2.848 million more votes than Trump, but his hyper-targeting and voter suppression worked a treat to scrape over the line in those states. If Obama's supporters from 2012 had voted in the same amounts and at the same rates for Clinton in 2016, she would have won the election.
The big question for New Zealand in 2017: who will win the election on Facebook?
70,282 - This was the amount of net migration to New Zealand in the year to the end of October, which is the latest data we have. This was yet another record high and represents population growth from net migration of over 1.5% in a year. That is three times faster than the migration rate into Britain, which helped lead to Brexit, and is almost twice as fast as the migration rate into Australia, which helped prompt the revival of Pauline Hanson.
Net migration over the last three years totalled 180,443, including 184,568 people who came here on temporary work visas or as international students. An Auckland University report published this week detailed widespread abuse of migrants by employers who paid them less than the minimum wage, overworked them and refused to pay them holiday pay and sick pay. Many such workers are hoping to get permanent residency, which requires the cooperation of their employers. The Reserve Bank has noted the surprisingly high number of working-age temporary migrants has suppressed wage inflation in the last three years.
Auckland has borne the brunt of this unprecedented population growth, with the combination of net migration and more births than deaths increasing the number of residents and motorists by almost 3% per year for the last three years. All it takes now is a rain storm to gridlock the city for hours and the housing shortage is now over 40,000 and growing at a rate of 5,000 a year. Employers are struggling to find workers who can afford to live in Auckland, and the Government is spending thousands of dollars a week to accommodate people in motels.
The big question for New Zealand in 2017 is: who will win the election debate over migration?
NZ$1 trillion - That will be the total value of New Zealand's houses by the end of 2016 if house prices keep going up at the rate in December that they have in the previous 11 months. The value of New Zealand's homes have risen by more than NZ$400 billion or two thirds over the last eight years. Those homes are not bigger or fancier or warmer or drier or have better views. They're the same houses, but interest rates are substantially lower and New Zealand failed to build enough houses over that time to match population growth.
Also over that time, New Zealand's home ownership rate has fallen to close to 60% and many young Auckland first home buyers have had to abandon their dreams of owning a home and deal with rents rising faster than incomes. Yet voters also rejected Opposition proposals at the last two elections for a Capital Gains Tax and now Labour has given up trying to campaign for any changes that would see house prices fall. Less than half of young renters voted at the last election, while more than 90% of property owners over the age of 50 voted. Politicians know this and have calculated that more voters want higher house prices, which means they can afford to ignore the renters.
The big question for New Zealand in 2017 is: will young renters start voting at high enough rates to change that political calculation in the same way that poor white voters started voting and changed the calculations in America?
A version of this article also appears in the Herald on Sunday. It is here with permission.