by Russel Norman
Bill appeared before Parliament’s Finance and Expenditure Committee this morning about Vote Finance and the government’s fiscal strategy.
Bill says that he wants to cut NZ’s indebtedness.
I agree with him that NZ has engaged in debt fuelled consumption over the last decade, but why did he increase govt borrowing to fund tax cuts in the Budget (cuts focussed on the well off)? Even taking into account the increase in GST, he needs to borrow $1100m over four years to pay for the tax changes. Not fiscally responsible and adds to indebtedness.
And in terms of the current account deficit, the Reserve Bank’s Monetary Policy Statement released today says that the CAD will grow to close to 7% GDP by end of 2012. So Reserve Bank thinks Govt’s strategy will result in increased indebtedness for NZ. Not a vote of confidence.
A capital gains tax excluding family home would help balance the govt’s books, but National didn’t do that.
His increased borrowing is putting greater pressure on interest rates, and is one of the reasons for the Reserve Bank putting up rates today.
I asked about his meeting on February 18 with lawyers for overseas investors. He is consulting these lawyers about changes in overseas investment laws. He says that he might have had a Treasury official with him at the meeting. John Whitehead (head of Treasury) even offered to provide me with the notes taken by such official, which is odd given that they declined my OIA request for such notes! Shall follow up!
I asked him about a Tobin tax – he said that he wasn’t opposed to considering it if other nations built up a head of steam around it.
He denied there was a tension between the Govt’s extractive industry economic strategy and our clean and green brand. Hmmmm.
Published in Environment & Resource Management by Russel Norman on Thu, June 10th, 2010
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on the trolls and those who are unable to keep on topic
A qualified tax could be acceptable, as long as particular currencies were left out of it’s sphere of influence…
Essentially though I might be wrong , I think it would be quite affective of aust-NZ trading and that might not be too flash
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One option, apart from a CGT, is to adopt a Chinese policy on financing property – restrict access to “debt” for property investors buying up existing property. That would reduce demand for offshore borrowing.
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SPC Maybe apply both policies?
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Russel,
You can do all the questioning you want, but the truth is the current Green New Deal being promoted internationally by the Green Movement as similar to Roosevelt’s 1930′s New Deal implemented after 1930′s international bankster induced depression, is destined to fail for reasons I evidence in the below email I have previously discussed the Green New Deal with:
I hope we find you well.
A nice piece my friend.
Sadly, how many paragraph’s of it do you think the average Green Party representative would have bothered to read.
I was so excited when I completed my blog into which I feel is one of the best economics resources in in NZ re our debt management history, I thought people would gobble up such information seems how it was very much an admission of guilt from the very mouths of the major players, but sadly I was to come out utterly despondent as it became obvious that you will very rarely find anyone of influence willing to look right into into because they are co-operating with the corporate raiders, or they no longer have time to personally research anything indepth once in parliament, or once they begin to cotton on to what we are really facing they don’t ever wont to admit they are beginning to “get it” because then they would be expected to show some courage, stand tall and combat it.
Even more sadly the so-called Green New Deal talked up by the international Green Movement, especially out of England:
http://www.greenparty.org.uk/news-archive/3493.html
http://www.greens.org.nz/gnd
based on Roosevelts’ 1930′s New Deal implemented after the 1930′s bankster caused depression, is set to fail for the very same reason of not addressing the matter of the issuance of money supply and to the benefit of whom. They are essentially advocating once again hiring the burglar’s to become the head of security, and hope once again they won’t instead once again rip you off, as outlined in link below, toggle down to The Goldsborough bill:
http://www.michaeljournal.org/plenty50.htm
I must make it clear that although I very much support the return of the issuance of money supply to public authority to be issued as the monetary base without interest attached, I do not support the Social Credit idea of issuing large dollops of public credit to the populous by way of basic guaranteed income as I believe when the historical equivilent has been done it has proven to cause as destructive inflationary – deflationary wealth transfering cycles as the current privately designed and controlled interest attached monetary base of created credit.
I instead believe the Green New Deal projects should be funded with Public Credit as an ideal means of spending our own monetary base into circulation without interest attached in a productive manner which history has proven to be none inflationary – deflationary wealth transfering cycle causing.
Cheers
Iain
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