Archives for May 2024 | Josie Pagani



A weak budget for a weak economy

They are borrowing for groceries. We will have $14 billion in tax cuts over four years, when the Government expects its core debt to go up by $32b over the same timeline.

I counted 10 uses of the word “weak” in the summary of the economic forecast alone.

The key reason Treasury is downgrading growth forecasts is that our future productivity is getting worse. It warns, “Labour productivity levels are around 3% lower than in the Half Year Update,” which was only in December.

This was a weak Budget for an even weaker economy.

The Government‘s economic strategy is tailored for a fundamentally sound economy, where a firm hand on the till would sort out issues, all of which occurred for the first time in the past six years. To believe all that you have to ignore our structural problems.

It has been 50 years since we earned more overseas than we spent. Our productivity is dismal, so we work longer hours for less than nearly any developed country. We grow by adding people instead of by innovating. As a result, far too many kids live in poverty, and working families are squeezed. This Budget will see everything on that list get worse.

Here’s our basic problem: Big ticket costs in health, superannuation, crime and infrastructure go up by more every year than the economy grows. That’s been happening for decades. The population is ageing, equipment costs are rising, and we need to pay cops, nurses and engineers more to keep them here.

As expensive things keep getting pricier, more taxes or ever deeper cuts in other areas are needed to pay for them.

We are in a doom loop from which the only way out is an economy that undergoes a step change in productivity supported by a state sector that can deliver more and better.

Read Josie's review of the coalition government's first budget in The Post.

Listen to Josie with Heather du Plessis Allan and Phil O'Reilly on Newstalk ZB's Huddle.

Moving on from a candle-powered economy

Nicola Willis has two possible strategies:

Manage the status quo, with a Budget focus on fiscal tweaks: reduced spending through tighter focus, and modest relief by cutting taxes, even though tax cuts when we’re running a budget deficit will keep inflation higher for longer.

Or, a new economic strategy and fiscal decisions to support a plan to restructure the economy.

The difference between the two is the difference between giving a person a fish or a net. In the old metaphor, people forget that making a net requires going without the fish for now.

I won’t be judging the Budget on whether there are sufficient hand-outs and itches scratched, the DIY equivalent of a new sofa when what’s needed are renovations.

I want an industrial-grade plan to develop the economy, grow our industry and skills sufficiently to pay for hospitals and school lunches, and keep our kids here with good jobs.

Read Josie's pre-budget column.

I'm right, you're wrong. The left, knowledge and speech

Screaming “I'm right and you're wrong” until your opponent sees the error of his ways works well on my husband, but I doubt Julie Anne Genter would change her mind if new evidence emerged that the costs of cycle ways in central Wellington outweigh the benefits.

Knowledge is evidence based, but it doesn’t work by insisting on the correctness of your facts. Like science, it works by posing a hypothesis and having others set out to prove it wrong.
It advances only when others try to knock your idea down. If it survives the assault, then chances are it’s a good idea.

I asked Jonathan Rauch how the progressive left, once the champions of free speech, have become the “Gluten Free for Palestine” protesters intimidating and barring Jewish students from entering New York’s Columbia university.

Rauch (who is being hosted here by the Free Speech Union) says some who see themselves as progressive see “hate speech” as a form of violence used in the past to threaten minorities and soak societies with racism, homophobia and misogyny. The past was certainly soaked in bigotry. But that was not the fault of liberalism. It was a failure to embrace it.

Enlightenment liberalism existed in many cultures, including among those Muslim thinkers who rescued Greek libraries and texts. There is nothing colonial about the pursuit of knowledge through free speech.

The university’s “kindly inquisitors” (another Rauch book), who seek to protect people from offence with censorship, have good intentions, but “inevitably in all places and times, with only rare exceptions, the advocates of freedom of speech are the people who fear the most from censorship. And the people who have the power to censor are the least amenable to freedom of speech.”

“In the modern context of cultural and idea-making institutions of journalism and academia, for example, the power to censor is now effectively in the hands of the left.” It is human not to want to give up that power.

Read Josie's column on the left and free speech.

Julie Ann Genter, the Carr-Peters defamation suit and school lunches

Josie Pagani joined Nick Mills and Heather du Plessis-Allan on The Huddle to discuss Julie Anne Genter losing her temper at Associate Transport Minister Matt Doocey in Parliament, Winston Peters takes aim at former Australian foreign minister Bob Carr on AUKUS and Bob Carr accuses him of defamation, and the Government is set to announce a new model to provide school lunches at a lower cost, which could involve the use of packaged foods such as tinned fruit, muesli bars, bread and canned beans.

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