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Max Rashbrooke for The Spinoff attempts, as the Labour-led government approaches its first birthday, to divine whether there is a coherent ideological direction

Max Rashbrooke for The Spinoff attempts, as the Labour-led government approaches its first birthday, to divine whether there is a coherent ideological direction

By Max Rashbrooke*

In a speech delivered in January this year, Jacinda Ardern promised to explain the “why” that motivates her government. This sounded exciting: a chance to understand her core reasons for entering politics and the basis of her long-term ambitions. What followed instead was a grab-bag of challenges (“the growing prison population”), laments (“our contribution to international issues has eroded”), and vague desires (“we must be a government that is transformative and accessible”).

Does this lack of clarity matter? We are all biased towards our own interests: writers overestimate the value of intellectual rigour, just as athletes overemphasise physical strength. Previous governments with clear ideologies have done great harm; much good can be done addressing problems pragmatically.

But ideology still matters. A clear intellectual framework helps ministers govern coherently. It gives citizens predictability, a sense of what is to come. And it lends underlying cohesion to the messages and narratives that politicians pitch to the public.

These questions of philosophy were simpler, of course, for the previous Labour-led government, which came to power at a time when the centre-left had a clear vision. Helen Clark, like Tony Blair and Bill Clinton, followed the ‘Third Way’, accepting the primacy of the market but softening its rough edges with policies like Working for Families. This idea of tackling so-called market failures, underpinned by the work of thinkers like the British sociologist Anthony Giddens, gave government a reasonably solid rationale. (Though this picture may be clearer with hindsight than it was at the time.)

Now, famously, no-one knows what exactly the recipe is for the centre-left. The government that Ardern leads has, in any case, three parties with three different worldviews. And many of its leading lights – figures such as finance minister Grant Robertson and education minister Chris Hipkins – had their political formation in the 1980s and 1990s, a time when the centre-left was on the defensive and had to spend much of its energy winning concessions rather than formulating a coherent alternative.

So it perhaps not surprising that this government is more easily defined by what it is not than by what it is. Except in the fevered dreams of Stuff commenters, it is not obviously a socialist administration, nor even a democratic socialist one, as, say, a Corbyn government in Britain might be. There are no renationalisation or co-operative plans on the table. Despite New Zealand First’s influence, and a few policies limiting immigration and foreign house-buying, it is not consistently nationalist. And regardless of what the Greens might say, it is not a deeply environmentalist government.

Perhaps the most dominant trends in modern political theory are deliberative and participatory democracy, ideas that stress the importance of democratic discussion and direct citizen involvement in decision-making. Neither appears to have had much impact on a government addicted to traditional, expert-led, top-down reviews. The AUT academic David Hall has argued that this might be a ‘civic republican’ government, driven to remove all forms of domination from people’s lives. To a certain extent this is true. But aside from some signature outbursts by Shane Jones, the government has shown little appetite for a prolonged confrontation with economic power.

Ardern speaks occasionally about community, and her small-town background probably helps her understand the importance of local ties better than previous Labour leaders. But nothing she says deeply evokes the virtues of close-knit social bonds or unchosen community commitments. Labour’s large Maori caucus would be able to fill in such a vision, drawing on concepts like whakapapa and manakitanga, but appears not to exert that level of influence.

That is not to say, however, that this is a government without purpose. From Ardern’s speeches and from policy work overseen by Robertson and others, an outline of an intellectual vision can be discerned.

Feminist thinking clearly drives some sections of this government. Moreover, a phrase the prime minister often uses is that she wants New Zealand to be “the best place in the world to be a child”. This is a simple enough statement, but the policy implications flowing from it are profound, because to support a child properly is to bring to bear most of the apparatus of government.

Famously, Ardern also stresses kindness as a governing philosophy, in sharp contrast to her predecessor, Bill English, who once told a Wanaka arts festival that government “stands in the way of” care and compassion. That is not to say that his government was heartless, or that he never spoke in a softer tone. But the relative emphasis is still telling.

In her recent set-piece speech – or, if you prefer, TED talk – Ardern confusingly claimed that she wanted New Zealand to become “the country that we are already pretty proud of”. But she made the point much more clearly in her speech to the Justice Summit earlier this year, when she said, “I want us to simply be the country we already believe we are.” On questions of poverty, inequality and our ‘clean and green’ image, she suggested, a yawning gap exists between practice and vision.

Again, this apparently simple statement conceals a formidable challenge to the country, this time on moral grounds. Without appearing to upbraid anyone, Ardern is reminding New Zealanders that two of their most cherished beliefs – that this is both an environmental and an egalitarian nation – no longer bear much resemblance to reality.

But is there anything to give coherence and rigour to Ardern’s aspirations? The nearest thing this government has to a clear ideological framework is the wellbeing policy that the Treasury is developing under Robertson’s watchful eye. Part of the decades-long push to move beyond GDP growth as the main measure of success, it argues that the public’s ‘wellbeing’ relies on a whole host of issues, including non-material factors like their community connections, their state of health and how safe they feel, as well as material measures such as income and wealth. It also stresses that these things need to be achieved not just for some but for all.

Underlying these simple statements is the thinking of the Nobel laureate Amartya Sen, who argues that people should be able to lead “lives that they value, and have reason to value”. Governments cannot guarantee this outcome, but they should provide the wide array of services – such as health, education and welfare – that give people, in Sen’s terms, the ‘capability’ to lead such lives.

This approach, if done well, can be an inspiring one, with echoes of Aristotle’s argument that government exists to ensure people do not just survive but also flourish. And Sen is the perfect thinker for a progressive but non-radical government. He is both philosopher and economist, so his work translates easily into policy. He provides a clear critique of the utilitarian or satisfaction-maximising approach that has underlaid the crudest economics of recent decades. And he is firmly within the liberal tradition with which Ardern, Robertson and others are familiar.

That is not to say that wellbeing is without its problems. There are growing concerns that the Treasury’s policy will not properly recognise women’s work, and that a distinctively Māori perspective is going to be bolted on rather than being at the heart of the project. Moreover, government departments have long pursued the targets likely to be included in a wellbeing strategy; it is not clear that simply collating and reporting on them centrally will change much.

And while Robertson was trumpeting this approach well before last year’s election, his colleagues appear to be much more recent converts, if they are converts at all. So there is a danger that the wellbeing framework will be asked to do too much of the heavy lifting – to provide coherence in a way that is beyond its reach, or to substitute for a genuinely comprehensive worldview.

Nonetheless, it seems that what we have is a wellbeing government: an administration that seeks to implement kindness, to hold us to our ideals and to use the whole apparatus of the state to nurture children, under a slowly developing framework for flourishing lives. Whether kindness really can or will be made flesh is yet to be seen. And wellbeing is not quite the comprehensive ‘new idea’ that some would seek and that may or may not emerge in coming decades. But, in an uncertain and often unkind world, it might be enough for now.

*Max Rashbrooke is a guest writer for The Spinoff. This article first ran on The Spinoff here and is used with permission.

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They have no plan. Back to the 70s for NZ.

When every move they make is screamed at by the media and the conservatives (who are terrified of change) regardless of the merits. It puts a lot of pressure to only tinker.

Very easy to say from an armchair "I'd run the country with an iron fist. I'd make the tough calls despite the howls". You also wouldn't get a second term.

To be the president in China, one has to work his/her way up from
Ke level (an analyst 科级, around 900,000 people) to
Chu level (manager, 处级, around 600,000 people) to
Ju level (senior manager, 局级, around 40,000 people) to
Bu level (department CEO or minister, 部级, ) to
Guo level (more like Cabinet ministers in NZ , 国级, together with Bu level around 300 people)

Then, he or she will be required to successfully manage two large provinces in China with population over 100 million people.

The whole process takes 30+ years regardless of whether coming from an elite family or not. Only the best will weather the 30+ years and get to the top.

So, next time when you see Xi sitting with Ardern, you kinda get a sense of difference in their weight.

So, next time when you see Xi sitting with Ardern, you kinda get a sense of difference in their weight.

You're right, Xi is a bit fat. Has that whole winnie the pooh look going.

Although Xi has done a good job of keeping obesity rates low.

Not as good a job as Mao did, one of histories best.

Not funny.

Mao did manage to improve Chinese life expectancy from around 35-40 at the start of the revolution to over 65 by the time he died.

There was a civil war the start of the revolution you absolute simpleton, the use of child soldiers was widespread, of course life expectancy was low.

Have any Hitler apologist statistics while you're at it?

What's wrong with you? Here read this study:

An exploration of China's mortality decline under Mao: A provincial analysis, 1950–80

Any fool can see that China's burgeoning population, that needed drastic measures to slow it down, wasn't the result of starvation.
Don't just hoover up the propaganda like a complete patsy..

(The child soldier thing is BS as well. They used that excuse in Vietnam too but Asians look young for their age. Britain deployed a quarter of a million under age soldiers in WW1 - )

What about Hitler and those Autobahns though? Two swell guys were Mao and Hitler.

Both sides employed child soldiers in the chinese civil war.

Are you a communist?

Look, I'm just stating facts. There is no need to get so emotional about it and keep going on about "child soldiers" and a completely different country. Chinese life expectancy improved pretty consistently under Mao's leadership. You need to talk to a few old Chinese folk about those times, I have. Why do you think they had a revolution? Because they were all well fed and living long, satisfying lives?

Obviously the CCP has done something right otherwise we wouldn't be so concerned about this emerging super power. If they followed Western guidelines they would be like a larger Philippines now.

I am not going on about child soldiers (lose the scare quores) as if this was something unique to communist insurgents in China. I am going on about it because if you just fought a civil war - and an invasion from Japan - where child soldiers were used a lot, of course life expetancy is going to be low. People can take months or years to die from their wounds after a war. Not to mention the huge impact that had on the economy. Do you think the scorched earth tactics and mass murders perpetuated by the japanese, communists, and the goverment itself had no effect on life expectancy a few months after it all ended!? It absolutely had a huge effect.

It is you who are the patsy who thinks life expectancy shotup because of Mao, and not because 2 decades of war had come to a close.

Obviously the CCP has done something right otherwise we wouldn't be so concerned about this emerging super power. If they followed Western guidelines they would be like a larger Philippines now.

For one thing, Marx and Lenin were westerners. It was an experiment following 'western guidelines' as you put it.

A larger Philippines? The obvious comparison would be the ROC on Taiwan. Match their GDP per capita with population of China, and there's no if or buts about super power status.


I can only assume that you have never heard of the Great Famine which happened during Mao's rule. Yes,climatic conditions exacerbated this,but much of the blame for many tens of millions of deaths must be attributed directly to changes in agriculture forced through by Mao. This was a man made disaster.
Can you produce hard evidence of the substantial increase in life expectancy which you say happened?.

So Mao didn't send food aid to Hungary or Yugoslavia when a fair proportion of the Chinese population were dying of starvation? Try reading Jung Chang's book Mao; the untold story. It is not a study with bias built in by political masters but an attempt to bring together actual history, much of which the Chinese themselves are uncomfortable with.

Was the small matter of 120,000,000 who were murdered or starved from 1925 to the time of Mao's death considered??

Apparently none of that had any impact on life expectancy in 1950, I'm told.

That is factually incorrect. While life expectancy may have improved, the study does not prove it was Mao's doing. It could easily be seen as a lagging country just catching up with the rest of the world. An alternative could be an inadvertent side effect of communist indoctrination, schools would be a perfect way to do that. The life expectancy of those starved to death wasn't so good either was it? Did you overlook the fact that the gains are attributed to reductions in infant mortality rather then people living longer?

And with all that going on he is still a lightweight and will be at the helm as China realises it has hit the limits to growth just like everyone else. Politics is a game of making promises with your childrens future, and the ability of the future has pretty much run out.

The IQ tests done on the third Reich are a pretty good indication that politicians are a pretty lacklustre mob.

An average IQ of 128 wasn't too shabby.





There's kindness, and then there's kindness.

Marama Davidson's version states that it is unfair to place any obligations on people claiming benefits.

Bill English's version states that you need to target interventions where they are most needed and, at the same time, have clear expectations that people will do their best to improve their circumstances.

I can't see that Marama Davidson's approach is in anyone's interest, including the person on benefits.

Any inquiry into the banks yet?

Bound to be - if you can so easily distract attention from yourselves with a ComCom enquiry into petroleum prices, you’ll quickly need another distraction soon - just a case of spacing them out until the next election with Joe Public thinking they’re doing a great job, whilst at the same time actually achieving nothing.

The problem with new Labour evangelising NZers to kindness and socialism is that it ignores incentives.
It will probably end with nagging coercion, and failure of central Govt planning.
Arden like Clark probably disapproves of most NZers private opinions and values.
However NZ needs a bit of central control for a few years given that National was absent at the wheel.

Actually, socialism is the future for everyone. The democracies have long since passed the point of no return economically and what will replace them will be anything but democratic...

Hi 4th estate. Just to confirm we’re operating from the same understanding, I’ve copied a dictionary definition of socialism below:
“a political and economic theory of social organization which advocates that the means of production, distribution, and exchange should be owned or regulated by the community as a whole.”
From that sentiment , can you name a successful socialist country?

The best economies clearly have a good balance of social spending and private spending. They are mixed economies. Norway, Finland, Denmark, Sweden, Switzerland being the best examples of balance.

Scandinavia also has very high tax rates to achieve that. I dont think Kiwis will be too keen paying those levels of taxes whether left or right. I mean just look at fuel, just a few cents tax and the whole country has a meltdown.

Personally I don't care if the tax rate is high, so long as it well spent, as I figure overall it will be of benefit to the country. I object to a high tax rate, and having it squandered on junkets and crony capitalism, and SJW agendas.

The problem is too far left or right and the rule become authoritarian, and then the powerful look after themselves first, usually at the expense of the community (this also occurs in the middle) So no true socialist country will ever succeed because the theory ignores human nature. the true solution is in the middle, with a firm basis in democracy, including the ability of a people to sack a government before the end of the electoral term, and the rule of law to protect all with no favour. Even our little utopia here at the bottom of the pacific doesn't deliver this.

Ocelot, Murray - I agree with you both. I asked the question hoping to get 4th estate to reassess their comment as if we accept that socialism is the future uncritically then we are in for an interesting time ahead...

Like Clarke/Cullen, Adern's government will just tinker around the edges of the neoliberal settlement that has prevailed since 1984.
And in that belief they are hopeless idealists.
As philospoher Zizek points out eloquently, this government - like so many mainstream labour parties - is disastrously utopian. It is utopian idealism to think that you can just tinker around the edges of a system that is recreating Dickensian levels of inequality in the western democracies. It is utopian to think everything can stay more or less the same and we can just muddle on while wealth polarises so sharply. The instability inherent to the present settlement cannot be contained indefinitely.

Hi cs, looking at historical inequality charts inequality rapidly increased since 1971 and the abandonment of the gold standard. Neo liberalism does typically increase inequality and is part of the equation but it also raises the living standards better than anything else across all demographics. Money creation however has transferred more wealth to the already wealthy for a negative benefit to society. Good inequality vs bad inequality.
Arden’s government would be hopeless idealists if they keep our money creation model and expect things to get better. They will be left with aggressive redistribution as their only option to combat “inequality” of which they also seem to take a non nuanced view of.

Withay... I would argue that the adoption of monetarism post 1971 under the cover of a bout of OPEC induced cost-push inflation and the end of Keynesian social democracy because workers were getting too much of a share caused the rise in inequality. But I suspect we'll never agree on that!
Commodity money is not the answer. The gold standard era was not one of great stability. Money is fundamentally not a commodity or veil over barter. To understand it that way is just a dead end. But I suspect we won't agree on that either.
What I see is the rise of neo-fascist parties worldwide that adopt sensible Keynesian fiscal stimulus/functional deficit spending. Like Trump. Like Salvini. And guess what - growth ensues! Then all the nasty, Handmaid's Tale, side of the socially conservative right-populism gets a foothold too. That is the result of the utopian 'business as usual' mainstream Left.
This book very good on money - - and on how economics got it wrong for so long.

Great reply, for your first point I think we can both agree that 1971 was a tipping point for many things. As to why, you could well be right, I haven’t looked at that aspect as I’ve been more interested/focused on another angle. Both our scenarios give the same outcome, wealth undeservedly going to the already wealthy.
Regarding commodity money, I agree with you in some ways. I would contest however it is still better than what we have now. Bitcoin was a great outline of what money should be - decentralised, properly scarce, transportable, (not a commodity) etc however it had some shortcomings unfortunately but the characteristics are more what I’m after and believe that would go a long long way to fixing bad inequality.
I’m confused by “sensible Keynesian fiscal stimulus” as we don’t have that now. Are you talking about removing private banks ability to create debt money and giving that power to the government exclusively? I could see that having a bit of a chance of success but combine that with our current money creation system and we will just kick the can down the road as always while seeing ever diminishing returns.
Will have a look at the book thanks.

Money is promises guaranteed by a sovereign state. It is true that private bankers have created money and that money has ended up with the wealthy (at least partly because bankers are much more likely to lend to the wealthy than the poor).

However I am not sure a monopoly on issuing credit would have had a different outcome. I.e. China do not have a real private banking sector and government effectively issues 100% of credit. Yet, the outcome (in that most of this credit ends up with very few people) is the same. Sure, it may end up with those in key power positions and those most loyal to them. But I don't see how is this any better than the outcome we had in NZ or western world in general.

Our government currently runs a surplus. That means it takes out more money in taxes than it puts in in the form of spending and welfare payments. We also run a current account deficit meaning foreigners save our currency. So government saves and foreigners save. This means the private domestic sector has to go into increasing debt to spend and keep things afloat. Households, unlike governments, are households. They cannot print money. So private debt will only get you so far until households reach the limits of their income to repay debt. We are at this limit now in NZ despite low interest rates (they can't go much lower can they???). Businesses refuse to invest much when they have no prospect of increased sales. So we get the current stagnation.
I would advocate an increased government deficit to stimulate demand without relying on household borrowing. Some ideas would include free healthy school lunches, free preschools,subsidised basic dentistry for all, increased wages for teachers, a job guarantee programme at the minimum wage so all those who want to work can work the hours they need.... The flow of money into the economy would stimulate demand and in turn businessess would start investing as people had more money in their pockets to spend. The limit of course is real capacity in the economy and inflation. Right now there is spare capacity. A sensible deficit spend would not be massively inflationary. You could issue public debt to "finance" the deficit or just have the reserve bank print the money like they do in Japan. The impact on inflation would be the same either way.
My opinion is that we risk a right-populist backlash in all democracies unless that state steps in and starts dealing with income inequality, underemployment and growth reliant on ever-increasing household debt.
I do not think ending banks' credit creation is the answer. You need that. But they should be heavily regulated.
Essentially I think we should use fiscal policy rather than rely on interest rates to stabilise the economy.
I urge you to read up on Modern Monetary Theory becuase I find that the most convincing lens through which to view macroeconomics.

Thanks again for the reply, we’ve gone back and forth once before and I took a lot away from it so I appreciate your response.
Key sentence of your first paragraph, “households can only go so far before until they reach the limits of their income to repay debt”. Yes, but with money creation that limit is exponentially further than with out money creation. We have cycles in business, credit etc. but what money creation has done is blow those cycles out and increase the size. No money creation equals smaller correction vs money creation which equals the GFC. What did we do to “fix” the GFC? Create more money which has only increased the debt and backed us into a smaller corner hence my kicking the can down the road and ever diminishing returns comment. This is the fallacy of Keynesian ideology, what caused the issue? Credit, what will fix the issue, more credit!
We need a correction as we have well exceeded our productivity/debt servicing capacity and this was faciliteted by money creation.
Spending to stimulate is so delicate. In your examples, all the areas you’ve suggested wont realistically increase our production capacity much or at all, it will only redistribute money most likely (in my opinion) to less productive areas. It is spending to increase our confidence so we borrow and create more money hence reinforcing the cycle. Our current issue is we consume more than we produce, if the gov is to spend money atleast make it towards productive ventures.
Japan isn’t the best example for this either. The BOJ is now a top 10 shareholder in 40% of japans listed companies. They bought into these companies with borrowed not printed money. They have to pay it back! They are forcing their citizens into debt to prop up their economy which will eventually fall leaving their citizens to bear the brunt again just like the US and the GFC. It’s not only money creation but this Keynesian theory that transfers wealth from poor to rich.
If banks went back to being a middle man not a money creation machine everyone would be better off. Instead of the profits being whipped away overseas the majority would stay local and certain asset prices I.e. housing wouldn’t be so inflated.
Interest rates could control an economy better if they were left up to the market much more effectively than being controlled by central banks. That way we wouldn’t overshoot so far with credit.
Finally, where has modern monetary policy got us? There is a rediculous amount of debt worldwide that requires more debt to be created just to service it. Is it really the best way to operate? This is why we need infinite growth otherwise everything will collapse.
I heard a quote recently “Keynesians are some of the most intelligent people, yet also some of the most unwise.” It sums up my feelings. An overly complex system has been created when simplicity was needed.

I love a good debate! Sharpens the wits.. Don't have time to really flesh things out - but a few points:
I wouldn't say QE or the use of monetary easing to inflate asset prices was particularly Keynesian. New Keynesian maybe (when the neo-classicals tried to reconcile themselves with Keynes). Keynes himself said lowering interest rates could be like "pushing on a string" in a recession. He advocated fiscal stimulus. Government spending to employ idle labour and to utlise idle capacity.
I would argue that deficit spending by a nation with a sovereign currency (Japan, US, UK NZ NOT GREECE) will NEVER result in sovereign default. Basically in Japan the government issues sovereign debt to pay for its amazing infrastructure and welfare state (which becomes Japanese people's savings). Then the BOJ prints money and buys the bonds back on the secondary market to control yields and long term interest rates. Japanese government basically owes itself its debt. It never needs to be paid back. If you really want to test your theory about Japan I would short JGBs. It's called the widowmaker trade. I would also note that despite all this functional deficit spending and overt monetary finance, no inflation. If the story about sovereign debt were true Japan would be collapsing under the required austerity already. The bond vigilantes would be running the show. Instead its GDP per capita is going up. Yes it has a declining population but its productivity and gdp per capita are looking good. Despite the large public debt.
I flirted with the Positive Money/Chicago Plan stuff but on balance I think that it would be just as unstable as our present regime. In fact there would be more runs on banks with no Reserve Bank to stabilise things. The animal spirits would control the show even more.
The things I mention are productive investments. In NZ we have a huge health crisis ahead of us with metabolic disease. Healthy school lunches would foster a much healthier workforce in the future with lower disability and dependency rates. See Japan for this. Least obese in the world. Part of that is their school lunch culture. You have to think long term. Free childcare allows women to work easing capacity pressures and getting some of our smartest most productive workers back in the workplace. The job guarantee means that workers no longer become alcoholic and depressed and maintain job skills in downturns or when suitable work in the private sector is unavailable. The workforce participation effects of long term unemployment are ameliorated. Roads and railways and all that hard hat stuff increase capacity - but so does better health, education and employment support for workers.
One of the main problems is that of household incomes. Incomes have fallen so far that the only way to maintain standards of living is to go into debt. In that sense households are consuming more than we can afford. And that can only go for so long. Fiscal stimulus through providing a higher social wage (childcare, dentistry, school lunches) could allow the household sector to recover and pay down debt and go out for dinner once in a while).
Housing needs to be regulated and taxed appropriately to deflate speculative bubbles. We need a much larger state housing sector.
I think Hayek was basically wrong about the evils of reserve banks and his desire for the state to do nothing. I think private money and banking with no state backstop is far worse than what we have now. If you read about financial crises prior to the Bank of England or the Fed you get a sense of just how painful the cycles were. I think Keynes was right when he said to Hayek that the quickest way to socialist revolution was to follow Hayek's libertarian sound money policies. The inequality and instability they would cause would be so far reaching that the internationale would be back at number one in the hit parade.
If you don't' allow the money supply to grow as the economy grows you need to accept permanent deflation. Which is all very well - unless you have any debt. Which we mostly do. And is not very good for business if you borrowed to invest and then the prices you get are lower and lower all the time. Deflation just isn't a good thing.
Anyway - very interesting. I would definitely check out Modern Monetary Theory - which is quite different to monetary policy as we understand it.

Also I would listen to some Robert Skidelsky youtube clips on Keynes and not go too much on all that contra krugman type mises institute depictions of his views. Paradox of thrift, fallacy of composition, the fact that economies can get stuck in a high unemployment equilibrium, that "we're all in this together" and that demand is just as important as supply.... this are all true today as they were in the 1930s....

To try and boil it down to it’s lowest level, sound money gives the power to the individual citizens and money creation gives power to, and encourages big gov. That’s at it’s core why I prefer sound money. Not saying both don’t have their flaws though.

Regarding japan and sovereign currencies not defaulting, it’s all a confidence game, that’s what it’s become. “Japanese government basically owes itself its debt. It never needs to be paid back.” There is an implicit understanding here that it will be paid back otherwise confidence is lost and they will default. That’s why we don’t accept money creation from individuals but we do countries. Also, what they have done there is really just taxation by inflation.
Sovereign currencies not defaulting is the same in that it’s held up by confidence. The US can only have their trillion dollar per year deficits because they are the worlds reserve currency. What do you think would happen to them if the lost that status?
Anything that is held up by confidence not the underlying asset (bigger fool theory), in this case productive capacity, is doomed to correct to or below its productive capacity. It was happening in the GFC until more credit was used to halt the correction.

Deflation is another word for increased purchasing power ;). Again, I would prefer this to inflation and the other things that come along with money creation. Yes there would be teething issues in a change from money creation to sound money but after that, people would hold less debt (safer economically) and purchase less superfluous trinkets. Not a bad thing in this world where we are consuming our resources too fast.

Finally, regarding social spending, one needs to be vary careful. When I get the chance I’m looking into social service implementation and it’s effects. For example, in 1974 the DPB was introduced, from 1976 (start of census data) to now, the single parent rate increased from 10% to peak at 30% coming down to approx 27%. Two parent households are much less likely to be in poverty and much better for the children’s upbringing, less crime later in life etc. I wouldn’t want to live in a society where there is no backstop but government programs can easily facilitate unintended negative outcomes and create dependency. Short term fix for a long term problem. That’s a bit of a tangent but it fits in to the big gov vs individual citizen theme to try and loop it back.

This government is in trouble. Jacinda stands up and has the gall to say we are being fleeced by the petrol companies after she just put up the petrol tax ! Turn out HALF of what we pay at the pump is TAX ! Now we get some legislation rushed through to look at the petrol station profits, which if you were trying to run your own business here on those low margins you would go out of business.

Bridges has already said the increase in petrol taxes won't be backed out by National, and indeed they were costed for National's transport plans. You might need to find a third party to vote for if that's the kicker issue for you.

I think he changed his tune on that this morning - saying they would remove the Auckland Regional fuel tax but not the general (consolidated fund) fuel taxes.

This is a great argument that has no end. To money or not? I've been lucky to have seen many societies in action, when I was young, which was when it really mattered. Arriving home in 1981 I couldn't believe how a country with so much to offer was so grumpy over a rugby tour. Since then many houndreds of thousands have left this land for pastures new, for better wages, for not having to listen to the persistent arguing going on inside this wonderful nation. Yes, debate is great, but we have the best system. It's not perfect but we get to vote once in a while and whilst a llot of people do not appreciate that, it is still a great thing. And a change in government once every so often is not the end of the world. Is it? yes we all have our favourite ideologies and yes we don't always agree with everything that goes on, but hey, what we have is very special on a global scale. It's a working class paradise, if you're prepared to work. If you don't want to work then we will look after you, but you will suffer as a person and you will drag us all down a notch with you. I'm not a great fan of the current immigration settings but I tell you they come to learn and they come to earn (to work).
I just wish more of us felt that way to begin with.

It's special on a global scale because we're suckers. Not only do we hold the door open for Kiwis who pay nothing to maintain the state that they'll flee back to things when go south internationally, but we're also letting huge numbers of other people in here despite a housing shortage in the tens of thousands. We're also dumb enough to keep voting for people with track records of promising to do something but ultimately doing nothing.