Election results 2020: Richard Prebble - No surprises in 'social credit' election

Act leader David Seymour arrives at the party's election night function by boat. Photo / Brett Phibbs

OPINION:

Having picked the result, now I am asked to explain it. Two main reasons; Jacinda Ardern and Covid. Labour was toast in February having over-promised and under-delivered.

The National Caucus is toxic. From Jami Lee-Ross taping phone calls to MPs leaking. Four leaders in three years. The madness of making the inexperienced Todd Muller leader.

New Zealand First has been a dead party walking from the moment Winston decided not to go with National.

Labour campaigning for National voters with the conservative no-change message of "strong, stable government" meant those who want "transformational" change had no choice but to vote Green.

Richard Prebble. Photo / Stephen Parker

The Green wealth tax gained the Greens votes from Labour and gained Labour votes from National to stop the Greens.

Helen White in Auckland Central and Tamati Coffey in Waiariki both ran poor campaigns. Neither should have lost.

I predicted Act's good result back in February when National was doing well. After Jacinda, David Seymour is Parliament's most respected MP. It is a great line: "If one MP can achieve so much, how much more effective will Seymour be with some mates?"

For 30 years both Labour and National have followed prudent fiscal management.

This election both major parties abandoned fiscal prudence and promised a government-led recovery to be funded by massive borrowing.

Every week the Government is issuing a billion dollars of government bonds. The trading banks buy the bonds and immediately on-sell to the Reserve Bank for a profit. The Reserve Bank buys the bonds by "printing" the money. It is social credit.

As Walter Nash observed; "If social credit works, no one else has to."

Act was the only party opposed to this enormous debt. Economist Ludwig von Mises famously said "expansionist monetary and credit policy is illusory and must end in a slump, an economic crisis".

Huge majorities seem invincible. After the Muldoon landslide I was in a written-off caucus of just 32. Three years later we out-polled National.

There is going to be a swing back to the right. Voters on the right now have a viable choice.