They NEVER give up.

You have to hand it to the right wing ideologues; they really do never give up trying to create their corporatist state. I wonder how much we paid disgraced former leader of the national Party and, god help us, former head of the reserve bank Don Brash for this odorous pile.

'400,000 will leave in next 15 years' New Zealand will lose another 400,000 people to Australia over the next 15 years, based on current projections of the income gap between the two countries, the 2025 taskforce says. The taskforce, chaired by Don Brash, is charged with providing recommendations on how to close the income gap by 2025. In its second report, released yesterday, it says OECD projections of each country's growth prospects would see the gap widen from 35 per cent to 42 per cent. "Can we close the gap?" Brash asked yesterday. "To paraphrase President Obama [in a recent appearance on The Daily Show]: Yes we can, but it may take a little time." 

It would require an unwavering focus on policies that would see the New Zealand economy grow nearly 2 per cent per annum faster than Australia over that period.Some steps the Government had taken over the past two years - like income tax cuts - are likely to have improved the country's growth prospects, Brash said, but others - like tax changes which have effectively increased the tax burden on business - are likely to have detracted from them.

"On balance New Zealand is still a long way from the kind of policies needed to have any chance of closing the gap with Australia by 2025, or even of making serious progress towards that goal."

The report recommends cutting Government spending and tax rates, and a rapid return to a structural fiscal surplus. It wants to "shift the boundary" between private and public sectors, with more of the former and less of the latter, including in health and education.

It favours at least the partial privatisation of state-owned enterprises. It calls for more robust and transparent cost/benefit analyses of major infrastructure projects, including plans for ultra-fast broadband. It is sceptical of the return on public sector research and development and advocates a freeze on that spending coupled with less micro-management of how it is distributed.

It wants a more inviting regime for foreign investment and is critical of the uncertainty recent Government statements and regulatory changes have engendered. And it favours "institutionalising" better processes for vetting Government spending and regulation - either in the form of a taxpayer's bill of rights or an "independent fiscal council" akin to the Congressional Budget Office in the United States.

The whole thing is predicated on current conditions, conditions that are changing more rapidly than ever in my lifetime and that are a long way from done in this phase.

Meanwhile Australia is a very small chain of overpopulated Islands of dubious fertility surrounded by sand and salt water. Its prosperity comes entirely from its willingness to dig up its mineral resources and sell them overseas, principally to China which depends for its demand on the US as buyer of first, middle and last resort. And the US just voted to rush headlong into a major depression, if not actual financial collapse.

Meanwhile the UK, a favourite destination of many Kiwis is also diving into a major financial and social mess.

Far from an exodus of population we should be preparing for a return of the diaspora as thousands of our kin find that they can't survive, or stand, living in the US and UK and come home. They will also be coming home broke and bearing skills such as investment banking that will be of little or no use to them here.

When China undergoes its own inevitable meltdown as its global customer base dries up and its US dollar reserves turn to fertiliser, Australia too will find itself in rather a surplus position vis a vis kiwis and they too will start coming home.

But Don Brash and his ilk don't want us to think about the really big picture, they just want to scare us into accepting their corporatist agenda, to hand over the private enterprise every possible thing that someone might possibly make a profit from if they drive down the quality enough, this especially applies to those things like health and education where the demand is pretty much inelastic.

And they have apparently decided that fear and envy of Australia is our biggest goad but since we have been rated as one of the top 5 nations in which to live, based on pretty much anything worth having, catching up with Aussie doesn't seem to have much point and, unless we suddenly discover that we have a million square miles of mineral rich desert in demand from a massively consuming global population, trying to do so is about in the same category as taking that LSD and thinking you might just catch up with that passing seagull.

As usual, life continues to be an intelligence test, and if we fall for this one again we will deserve the mess it lands us in.

Comments

[Account Deleted]

That's the sort of thinking you get when people's only measure of value is profit ... no wonder Umair Haque calls it the zombieconomy.
If you start measuring what really makes people better off, you start getting results like "we have been rated as one of the top 5 nations in which to live" - obviously whoever made that judgement was using more than GDP as a metric for prosperity and well-being.

[Account Deleted]

In case you hadn't seen it, here's the sort of thing Haque is talking about: http://blogs.hbr.org/haque/2010/06/four_economic_benchmarks_we_need.html