The deliberately low income economy


It be 20 years now since I first heard in 1996, a Government talking about wanting New Zealand to be a forward looking economically and socially advanced nation, going places and doing great things. It was at High School and the then National Government of Prime Minister Jim Bolger was throwing money around trying to win a third term in office. Three years later with another election looming, it was the turn of the Opposition…

Call it a conspiracy theory if you wish, but I know that I am not the only one who thinks that the minimalistic change in peoples incomes is a deliberate ploy. Successive Governments lasting a total of nearly 30 years have said that they will raise New Zealanders incomes. When the Labour Government of Prime Minister Helen Clark took office in late 1999, I thought that here might be an opportunity to make the New Zealand economy like the then Irish economy, which was humming with innovation. In the election that year Dr Michael Cullen had talked about the need for a knowledge economy based on good science and know how. Being politically naive I was quite impressed as were thousands of other New Zealanders. Prime Minister Helen Clark had talked about raising tax on the top 5% of income earners. Tertiary education Minister Steve Maharey talked about how Labour would do this and that for students.

Despite all the chat, Labour let the student debt bomb go from N.Z.$3 billion to over N.Z.$7 billion by the time it left office. Thousands of students completed their studies and left the country. Some went with the intention of paying it off, whilst others just wanted an easy ride and many said they would not be coming back. Interest free loans may have slowed the growth of student debt down, but no thought was given to how students might be encouraged to pay back their debt.

Successive New Zealand Governments have talked about science and knowledge based economies whilst under cutting the academic and research institutions where through methodical processes and abstract science, new technology, understanding and concepts have evolved. Right back into the 1990’s this under cutting of academia can be traced – the current National-led Government of Prime Minister John Key is not the first but rather just the latest to have participated in the deliberate under cutting of New Zealanders trust in science and scientists. Whilst bursts of funding have been announced here and there, real time funding of science has decreased considerably. And when scientists have presented findings that run counter to Government policy, they have been eye balled by the Government and even threatened with funding cuts.

But it is not just science that is suffering. The blue collar workers across all sectors of the economy have not seen a meaningful wage rise since the 2008 Global Financial Crisis, whilst higher incomes have continued climbing steadily. The service sector wages, which have never been the highest have – if my experience in the last three years is anything to go by – risen by a paltry 30-50 cents per hour each year. The people who work in these sectors on these wages often do long shifts or considerably over 40 hours. When they come home at the end of their shift they are too tired to know or care about the changes in Government policy that were announced in Parliament that day. All they care about – and this is totally understandable – is getting some relaxation, some sleep and getting ready for whatever the new day holds.

This is a dangerous state of play to be in, but that is precisely what is happening in New Zealand. It is wholly deliberate, because it makes the task of keeping New Zealanders toeing the line of the Government of the day that much easier. Both major parties are guilty of it to some extent. Will their probable coalition allies do anything to stop it? Who knows. But subservient New Zealanders that are expected to act like sheep instead of like humans who think and act for themselves are precisely what the Government wants.

2 thoughts on “The deliberately low income economy

  1. Yes Rob, the contraction of Science funding in NZ is not helpful to any NZ born scientists to return and work here. It is totally predictable that science graduates leave for post grad study and never return. I did, and I wished I had stayed away.
    And recovery of student loans is a disgrace. As a taxpayer funding those loans I object their non recovery.

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  2. And I might add that your and my preferred political party is largely ignorant of the advice of science and scientists. The 1080 issue by one mp supporting the hunting lobby in opposition to good science by Doc is disgraceful. It’s as if we do not wish to acknowledge scientific evidence or the members who point it out in the party.

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