The savings debate has not always been well-informed, and it’s good that the government has put together a well qualified group to advise it. The last official inquiry was part of the 2001 McLeod Tax Review. Read more
John Maynard Keynes once wrote: “There is no harm in being sometimes wrong – especially if one is promptly found out.” Unfortunately for the world, the problems with Keynes’ ideas were not discovered promptly, and the lessons were too soon forgotten as Keynesian thinking enjoyed a revival with the recent global financial crisis and subsequent recession. At the time of the Great Depression in the 1930s, Keynes advocated fiscal stimulus – higher government spending or tax reductions – to boost total spending in the economy and put the unemployed back into jobs. Read more
In recent years Statistics NZ has done an excellent job of shedding light on the productivity performance of the economy. It made a further contribution with a release last month of productivity statistics at the industry level for the years 1978-2008. Read more
Parliament is considering a bill to amend the Local Government Act 2002 passed by the last government. It is a chance to improve democracy and performance in our councils. Read more
A few weeks ago I decided to look out for examples of economic fallacies that routinely appear in our media. It didn’t take long to make a list. Read more
It’s often said that “politics is the art of the possible”, usually by politicians who know they should be doing something in the overall national interest but aren’t willing or able to do it. The contrast is with Winston Churchill’s statement, “It is no use saying ‘we are doing our best’. Read more
A fundamental law of economics is that you can control the price of something or the quantity supplied, but not both. We saw that law in operation in the old Soviet system, with rationing and queues, and during the Muldoon wage and price freeze. Read more
Calls are mounting for the next phase of the government’s emissions trading scheme, due to commence on 1 July 2010, to be deferred. There are strong arguments for a temporary suspension of the scheme. Read more
Blimey, stone the crows! A few weeks ago something happened in Australia that I never believed possible. Read more
The annual budget is the main statement of the government’s overall economic and social programme. So in the first instance it needs to be evaluated in terms of the government’s own goals. Read more
Each year at about this time the OECD puts out a report on tax covering its member countries. Each year some media and politicians can be counted on to misinterpret it. Read more
As an example of poor quality public policy analysis, the Law Commission’s report on alcohol regulation will be a landmark for years to come. A 514-page doorstop, it ranks with the 1988 report of the Royal Commission on Social Policy which was dead on arrival. Read more
In a speech about New Zealand’s accident compensation scheme in 1996 I said, “The country was sold a pup which has turned into a pitbull terrier that mauls everyone it comes in contact with – accident victims, employers and politicians alike.” ACC minister Dr Nick Smith is just the last of a long line of ministers to inherit a scheme in financial crisis. There have been endless reviews of ACC since its inception. Read more
Business Roundtable executive director, the late Roger Kerr (1945-2011) spoke about the people and thinkers who influenced his ideas with Chris Laidlaw in 2009. The list is a mixture of the predictable and the surprising: Enlightenment economist Adam Smith, Roger's brother Alan (a surgeon who regularly spends time in Gaza volunteering his services), the philosopher Jean Paul Sartre, former Telecom boss Rod Deane, Shakespeare, economist Bryce Wilkinson and prominent American legal scholar Richard Epstein. Read more
Preparations for the 2010 budget will be underway in government circles. The 2010 Budget Policy Statement, which sets out the broad parameters, is due in December. Read more