Colin James: After the binge, the lean times

After the binge election comes the economic slowdown. That will test the Government's mettle - and its fiscal solidity.

Whether it is Helen Clark or Don Brash who forms a Government - and the odds are it will be Clark - the easy life of high consumer spending, high profits and high tax revenue is over. It is discipline time.

And that puts the focus on the tax and regulatory environment and infrastructure.

Business, loudly critical of the Government and Finance Minister Michael Cullen before the election, will likely face a Government more dependent on the Greens - and maybe dependent also on the Maori party. And the Greens, recognising this is probably the last Labour-led Government term for a while, are determined to get more concessions than in the past six years.

They want in the Cabinet. Whether Clark can manage that with arch-enemy Peter Dunne also inside the tent will test her coalition skills.

The Greens have been coy about Cabinet posts and policy priorities beyond nominating four focuses: the environment (particularly water and fishing), energy (particularly on the demand side but also with an emphasis on renewables), safe food (so no genetic modification) and stronger (more costly) social support, including a $12.50 minimum wage.

This does not justify the scare stories about a Clark Government in the Greens' thrall. Their 5 per cent vote limits the weight they can throw around. They are realistic and the leadership these days takes the long view.

So roads will be built - not as fast as National said it would but at least according to the plan. If coal is needed to keep the electricity flowing, coal will be used. And free trade agreements will continue to be signed - the junior partner response (if that is what the Greens become) will be to focus on a stronger "buy New Zealand" campaign, maybe under a Green minister.

In short, Labour will be the main driver. The Greens' impact will be offset by United Future - which is close to National on tax and business policy. And, while Labour is planning more (though not major) workplace law, its narrow escape on Saturday might prompt a reassessment of its anti-tax-cut stance.

Of course, Clark isn't Brash and Cullen isn't John Key. If Brash gets to form the Government, the litany will be different: tax cuts boosting consumer spending and house prices and leaving more retained profits for investment, less workplace regulation, perhaps an easier ride through the Resource Management Act and generally a more investor-friendly regulatory framework.

But there is a catch, which the election demonstrated by denying National the landslide some picked. Profit-friendly policies do not automatically translate into parliamentary majorities.