Matt McCarten: Top salesman faces his stiffest sell on assets

Prime Minister John Key. Photo / Mark Mitchell

The opening salvos of the election were well and truly launched this week. Phil Goff was out of the blocks first with an excellent repositioning economic statement aimed directly at his party's core vote.

This makes good strategic sense. Labour has obviously decided any personality contest between John Key and Goff is a lost cause.

Instead, it has launched an election framework with three main economic points of difference with National.

Firstly, a flat tax cut for everyone on their first $5000 of earnings and raising tax on income over $120,000. It's simple populism and is going down well with the party's base.

Second, amending the Reserve Bank Act - a cornerstone of Rogernomics - is the clearest acceptance that Labour's adherence to economic neo-liberalism is over. Given that Goff was one of Roger Douglas' right-hand men, it's a big step.

But the third issue that may well define this election year is that Goff has promised there will be no asset sales. After the sale hysteria of the 1980s and the embarrassing, and necessary, government buyback of some of them, New Zealanders are in no mood to have their family silver hocked off yet again.

When Key followed Goff and gave his economic positioning statement he was on the back foot over his announcement of restarting public asset sales.

Trying to market the idea of selling off minority stakes in our profitable assets will be hard work. Convincing people selling public, profitable assets to those with spare cash so the Government can fund its tax cuts to the rich is near impossible, even for a likeable salesperson like Key.

It's a great circular money-making roundabout to get on if you're rich but most New Zealanders will see it for what it is - the theft of profit-making assets that is funding tax cuts to the wealthy.

There's little doubt that asset sales will be a dominating factor in the election. It may determine that Key, despite his popularity, will be the first one-term prime minister since Walter Nash.

To avoid that, he will have to win over the public on his asset sales programme but also keep his Maori Party coalition partner intact and on side. That's a Herculean challenge.

Hone Harawira's ongoing criticism of the Maori Party caucus' willingness to be the plaything of National has finally come to a head. If Harawira is expelled (there are no actual grounds for it, but this is politics) National will have its compliant junior partner to guarantee Key his second term.

However, if Harawira survives then there's a real possibility that Labour may be able to put together a broad coalition after the general election that includes the Maori Party.

But putting that distraction aside, the real disappointment this week was that neither Labour nor National, in their economic statements, was able to explain how we will get back the 50,000 jobs we have lost this term, let alone place the 100,000 other jobless.

That's because neither of them has a jobs plan. The truth is our so-called job creation policy is "cross our fingers and hope".

There is no doubt capitalism is in crisis and the world we have known is in freefall. The closing of the gap policy by both main parties with Australia is nonsense. Neither main party wants to tell us the truth.

Instead, we will have to rely on the Greens to come up with some intellectual heft about our future. Its leader Russel Norman will today present a comprehensive blueprint called "smart green economics".

It reminds us there's no such thing as unlimited growth; that we have to live within our means; that market forces must be regulated; that income equality through taxation is necessary; and we have to stop borrowing unless it's for sustainable infrastructure.

The detail will be announced today but it's ironic that serious long-time solutions to our economy will have come from the Greens.