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  Issue No 39 Official Organ of LaborNet 12 November 1999  




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All Black Fate Looms for New Zealand Right

By Noel Hester - ASU Services Branch

The New Zealand economic experiment - for many years the cherished role model of the Australian Liberal Party - is just about to face an angry jury.


New Zealand Campaigner Gary Preston Addresses Council

New Zealanders go to the polls in two weeks and the signs are strong the electorate is about to bury this fundamentalist monster with a stake right through the heart.

Although the electorate is volatile polls consistently point to a centre-left Labour-Alliance coalition forming the next Government.

Not even the All Blacks in the World Cup could conjure a 'feel good' factor to save the discredited and scandal-prone National government. Instead the Government is going to be judged, rightly, on its disastrous economic and social record.

An economic basketcase

The current state of the New Zealand economy is an indictment on 15 crazy years as a laboratory of radical, economic rationalist reform.

New Zealand's GDP per capita continues to decline relative to the rest of the developed world. Since the beginning of reform in late 1984 income per person has fallen by around 15 per cent relative to Australia and the rest of the OECD, and is currently about 20 per cent below the Australian level.

New Zealand's current account deficit , the difference between what the country earns and what it spends is a whopping 6.6 per cent of GDP.

Even more alarming is the country's huge investment deficit.

The outflow of property and entrepreneurial income has increased from 4.9 percent of GDP in 1993-1994 to 7.7 percent in the last year.

Respected economist Brian Gaynor of the New Zeland Herald says this is a result of the mass privatisations of the 1980s and 1990s.

'A number of the country's biggest companies are controlled by offshore interests because the Government's asset sale program was biased towards foreign purchasers,' he said.

'In the year to September 1998 the share of earnings attributed to overseas owners was $NZ3.2 billion. All of these earnings were remitted offshore.'

The most recent Provisional National Accounts contained appalling news for the economy. National savings are at their lowest level since 1979. The savings ratio has dropped in each of the last five years. For the last year was less than a quarter what it was in 1993. That included a period of two tax cuts. In neither case did those tax cuts lift national savings. If anything, the reverse is true.

Brian Philpott, emeritus professor of economics at Victoria University says productivity has dropped by half since the economic restructuring of the 80s and early 90s.

The former head of the New Zealand Institute of Economic Research and now Managing Director of Comalco, Kerry MacDonald, says the productivity rate in New Zealand is about one sixth that of Australia and well below the OECD average.

A very fragile democracy

An even bigger indictment of the money men who have taken over the country and their political lackeys is the alarming attitude of a growing number of New Zealanders to politics.

Many people - in a country once renowned for its robust civil society - have simply given up on the political process.

A comprehensive survey conducted this year by a team of academics from Massey University found that 39 per cent of New Zealanders favoured a team of experts or board of directors - not a government - making decisions 'according to what they think is best for the country.'

Seventeen per cent actually supported the idea of a dictatorship , with 'a strong leader' presiding over the country without having to 'bother with parliament or elections.' Two per cent favoured army rule.

Only 75 per cent supported a democratic system.

A nation of working poor

At the grassroots life is very tough. Wayne Thompson, a groundsman at a rest home in Auckland earns so little that he needs a top up of $80 per week from Social Welfare to live.

Two of his children at University already have student loans of $12,000 and $14,000 respectively. Because of a stuff-up with the Student Allowance payments this year his sons had to wait 5 months to receive their first payment, putting an even greater strain on the family finances.

'I worry about the kids owing that much money and they're only 22 and 23 years old. They're on the back foot in life before they've even started,' he said.

Total student debt in New Zealand now stands at more than $3.44 billion. Student loan borrowers paid more than $76 million in interest this year alone.

Tax cuts this year netted Wayne and his family a grand total of $5 per week. But what central government gave, local government took away. The bus fares for his 3 younger children to get to school went up 10 cents a section costing the family an additional three dollars a week.

'Three generations of my family feel alienated from the society they live in,' said Wayne. 'My 75-year-old father is so distressed at what's been going on that he wonders why he even bothered to go to war.'

'Friends and workmates are working their asses off, keeping their nose clean and not rocking the boat at work because their scared of losing their jobs.'

'We've gotta get rid of this National government and turn things round for working families. It's about time workers in this country got a break.'

Noel Hester is a New Zealand refugee working in Sydney. He'll file regular reports in the lead up to the November 27 ballot


*   View entire issue - print all of the articles!

*   Issue 39 contents

In this issue
*  Interview: Let Sleeping Dogs
Republican campaigner Jason Yat-Sen Li dusts off after Saturday’s vote. We ask him: where to now?
*  Republic: Readers Speak - Kerry the Face to Deface
We asked and you have spoken; Sydney heiress Kerry Jones is the Workers Online choice for desktop doodling, as the official winner of our Defacement of a Nation competition.
*  Economics: Understanding the Economy
Who was voted thinker of the millenium in a recent BBC Online poll? Karl Marx shooed it in. And another socialist, Albert Einsten, came second.
*  Unions: Come Fly Away!
With just four weeks to go, Labor Council's Organiser of the year Award is up for grabs. We've only had the one entry ...
*  Work/Time/Life: Better Times for Casuals in the Sunshine State
The Queensland Council of Unions has mounted a case in the Queensland IRC to increase wages for casual workers by up to $2.00 extra per hour.
*  International: All Black Fate Looms for New Zealand Right
The New Zealand economic experiment – for many years the cherished role model of the Australian Liberal Party – is just about to face an angry jury.
*  History: Who Remembers Egon Erwin Kisch?
Egon Erwin Kisch was a well known progressive journalist living in Germany when he was invited by the Australian branch of the world committee against war and fascism to speak at a conference in Melbourne in 1934.
*  Review: Bizarrism - Strange Lives, Cults, Celebrated Lunacy
The strange story of Donald Crowhurst or how to cheat and become a God.
*  Satire: Support Surges for Armenian Republic Model
The assassination by gun crazed extremists of the Armenian Prime Minister has been cautiously backed by Ted Mack and the Direct Electionist lobby as a possible new Republican model.

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»  Guest Report
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Letters to the editor
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»  [email protected] - Wasn't it Satire?

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