Category: Helen Clark

I am so sick of this obvious lie, pt 2

Unemployment under Lab and NatAnother obvious lie too many National supporters believe is that Labour are bad for employment (because they raise the minimum wage too fast), and National have “solved unemployment” (because they’ve made it harder to maintain benefits):

National supposedly solved unemploymentkey labour anti jobs party

Now, it is true that Labour raise the minimum wage much faster, and that National cut welfare (in a recession!). But the unemployment rates have been more like the other way around,* and anyone suggesting National are better than Labour at keeping unemployment down is either believing or promoting a lie.

Actually, it’s a couple of lies… but they’re both obviously bollocks to anyone who’s spent five minutes looking into them:

LIE 1:

“Raisng the minimum wage reduces jobs”

TRUTH 1:

Sydney Morning Herald

new york times

Business Insider

CEPR 1

CEPR 2

DOL 1

DOL 2

treasury

As usual, Gordon Campbell says it best:

If, as Key claims, Treasury has done research that shows major job losses would result from gradual increases in the minimum wage, then this amazing information would be world news – because the vast weight of academic research around the world ever since the groundbreaking David Card/Alan Krueger work in the US fast food industry 20 years ago, is that it would do no such thing.

LIE 2:

“National have solved unemployment by making it harder to get the benefit”

TRUTH 2:

I’ve covered this before, and so have many others. Basically, kicking people off the dole (or DPB/invalid’s/sickness benefit) doesn’t magically put them into jobs; it just increases the number of people lacking either work or welfare (which has hit a record 110,000 since National’s bennie-bashing “reforms”). Creating a desperate unemployed person doesn’t create a job for them to go into.

This confusion arises from a basic failure to understand the difference between individual problems/solutions and socio-economic problems/solutions, as sociologist C. Wright Mills pointed out 55 years ago:

Mills quote

* It started to get bad under the Lange (& Douglas) Labour government, which was actually more like a Bolger/Key National government than a Labour one. Of course, just like with debt, things are more complicated than one graph could show.

PS: Graph and truncated y-axis from tradingeconomics.com; annotations mine.

I am so sick of this obvious lie

Debt as percentage of GDP

Debt raw figures

I am so sick of hearing the blatantly untrue mantra that Labour are the party of debt and deficits, and the Wolf of Wall Street party are more responsible with money.

You only have to look at the figures to realise this is a lie. But it’s a very successful lie, because apparently hardly anyone actually looks at the figures.

Frank Macskasy does, and has been powerfully refuting this bollocks from National MPs and leaders for years now.

And yesterday, Mickysavage from The Standard responded to the latest idiot millionaire (good at making money, not so good at fact-checking National spin) to whom the corporate media has given uncritical voice to trumpet this propaganda. He says it better than I can:

Rod Drury: “What I’d like to see is the Government have another term because they’ve had two terms where they got the debt sorted …”

Mickysavage: “Such economic illiteracy coming from such a senior businessman is a worry.  It obviously needs to be repeated that in June 2008 Labour had paid off all crown debt and the crowns accounts showed a slight surplus.  By September 2013 net Crown debt had reached $60 billion and increases in debt are predicted for years to come.

Of course many will then trot out Key’s mantra that Labour had left the country with a decade of deficits but this statement is essentially a lie. The Global Financial Crisis was the cause of the sudden change in the country’s finances but instead of Helen Clark and Michael Cullen being blamed I can suggest many other names of those who should take responsibility.  Names such as Wall Street, Morgan Stanley, Bear Stern and my personal favourite Merryl Lynch.  Because it was a bunch of robber merchant bankers that brought the world’s economy to its knees.”

~~~~~

UPDATE 30/08/2014:

Here’s a couple more graphs and a couple more quotes, to help illustrate the various impacts of the GFC (for which Key was partly responsible), the 2010 tax changes (which made tax regressive for the majority of incomes), and the Canterbury earthquakes.

However, please note that the main point of this blog was never to say National have been irresponsible with their deficits and debt (I tend to think they have been, but it’s a complicated question). The main point was to show that the right-wing suggestion that Labour are irresponsible with deficits and debt is completely unfounded.

Nominal GDP

Herald 2013:

“The estimated cost of the Canterbury rebuild has been increased … Mr Key said the budget would also show the estimated net cost of the earthquakes to the Crown would rise from about $13 billion to about $15 billion.”

befu13-27

Treasury 2011:

“Tax as a proportion of GDP is slightly below OECD averages and has declined markedly over the last few years … New Zealand has, like other countries, faced a cyclical decline in tax revenue as a result of the global financial crisis but there were also important policy steps which reduced tax revenue between 2004–05 and 2009–10.”

P.S. 16/09/2014:

I’ve written a sequel blog on the equally pernicious lie that National are better for employment than Labour, because (it’s assumed) beating up beneficiaries and keeping wages low are good for unemployment.

Let’s get one thing clear

NZ’s political parties at the 2011 election now updated for the 2014 election, according to PoliticalCompass.org

“It’s actually a very clear decision for New Zealanders. It’s sort of centre-right versus the far left.” – John Key today

Coming from the most right-wing prime minister in NZ’s history, this is the height of dishonesty and hypocrisy.

At most, Cunliffe et al will take NZ as far left as the Kirk government (1972-1975), which was the last government that didn’t make a total mockery of our claims to be an egalitarian country.

More likely, the next Labour government will be centrist or centre-left… still considerably to the right of traditional Labour values yet hopefully a genuine alternative to the neo-liberal inequality consensus of the last four Labour/National governments. Cunliffe has gone on record acknowledging that this neo-liberal inequality experiment has failed our economies and our people.

Meanwhile, Key, a long-time architect of this failure, is still drinking the neo-liberal Kool-Aid… dogmatically pushing National’s far-right, anti-democratic, economically idiotic, ultra-capitalist inequality ideology as far as we let him get away with.

Key, with his loyal servants in the corporate media, will attempt to claim the ‘centrist high ground’ and whip up McCarthy-esque hysteria about Cunliffe. For the second time in Cut Your Hair history, I’m advising: set your bullshit detectors to maximum.

Three thoughts on the Labour leadership

My preferred candidate…

1. I’m hearing a narrative from a few friends about Shearer being a nice guy betrayed by his MPs. I think this has it partly right but is largely missing the point. Shearer was betrayed first and foremost by the faction in caucus who put him in power – commonly known as the ABC (Anyone But Cunliffe) clique. They knew the wider party membership and affiliated unions wanted to move the party back to the left, and overwhelmingly supported Cunliffe. But they rallied behind the obscure and inexperienced Shearer instead.

It would take a charismatic political genius with a compelling vision to win over a party when you’ve been made their leader as a big fat F-you to its members. And it would take the same qualities to be a real match for Key. Shearer may be a nice guy but he’s certainly not a charismatic political genius with a compelling vision. Whatever truth there is to media speculations about Cunliffe and/or Robertson undermining Shearer, I don’t blame Labour MPs for being frustrated as Shearer mumbled and stumbled and bumbled for the last 20 months.

Fortunately, at last year’s party conference the grassroots members party successfully voted in a more democratic method of electing the leader – 40% current MPs, 40% party members, 20% affiliated union members (the ABC clique, not surprisingly, opposed this). It’s currently being implemented for the first time. So whoever the next leader is, he (they’re all hes) will have one major advantage over Shearer – the perception that he was chosen by the whole party. (This is also why Shearer should have called for an election on the new system directly after the conference… coming off his successful housing speech and showing courage and respect for the members, he just might have won his job back and a proper mandate to go with it).

2. The other narrative about Labour being crippled by infighting and struggling desperately in the polls is also quite misleading I think. Gordon Campbell and Frank Macskasy point out that division is normal for a major party in opposition and National’s in no position to judge. It’s worth comparing Labour now to National’s last era in opposition – note also election results and methods of changing leaders…

National Labour

3. I support Cunliffe for the leadership. If Labour et al want to defeat Key in 2014, they’ll need to do exactly what Shearer couldn’t do: Articulate a coherent and attractive vision, clearly point out how the Key government is failing New Zealand, and offer a genuine and compelling alternative. While Robertson, Jones and Cunliffe are all more charismatic and articulate than Shearer (and probably have better music taste), Cunliffe has the edge on coherent vision and genuine alternative. Of the three, Cunliffe has been the most clear about returning the party to its Labour roots, and opposing the shameful slide to inequality that all our governments since the 80s have tolerated (Clark) or actively promoted (Lange, Bolger, Key).

But I’m not getting my hopes too high. Cunliffe’s not the messiah, and sometimes he’s a naughty boy. He’s still only centre-left (if that) while Key is hard right. Plus, if he’s leader he still has to deal with a caucus full of dead wood, many of whom seem happy with the neo-liberal consensus, even though it’s crippling NZ’s health and their party’s credibility. And he’d have to find a finance minister who’s competent and on the same page (preferably Russell Norman).

I’ll still probably vote Mana as I want to support more radical critiques of the capitalist status quo. But if the next Labour government can end this National one, shift the centre slightly back towards equality, and do something about our horrendous child poverty problem, I think that’s a good thing.

PS: Best source of info and the range of opinion about all of this: Bryce Edwards’ political round-ups.