The Government has spent up large in an attempt to stave off economic disaster. Photo / Mark Mitchell
The Government has spent up large in an attempt to stave off economic disaster. Photo / Mark Mitchell
OPINION:
Can we mount an argument of economic sabotage against the Government?
Let's ask a few simple questions.
Given we now know the plight of economic activity for the last quarter of last year was minus 1 per cent, do you think the current quarter we are just concluding, i.e.January, February and March (Q1), will be worse?
In this quarter we had the "lost summer" of tourism, the plight of so many in places like Queenstown has been widely documented.
We have also had two lockdowns in our biggest economy, with the flow-on effect that brings, as well as the fact the rest of the country, for a period, was in level 2 with the resulting cancellation of many large events.
The general consensus appears to be that a level 3 lockdown costs about $250 million a week in lost productivity and sales.
So, if you have come to the same conclusion I have, that means two quarters of negative growth - and that is called a recession.
Westpac had already, well before we got the Q4 figures of last year, predicted two consecutive quarters of negative growth this year - i.e. Q1 and the yet-to-unfold Q2 (April, May and June).
The general consensus appears to be that a level 3 lockdown costs about $250 million a week in lost productivity and sales. Photo / Hayden Woodward
Not only would that be three quarters of negative growth, it would also (when you take in last year's lockdown numbers) be two recessions, or what they call a double-dip recession.
This particular feat has been achieved despite the fact the Reserve Bank has made money pretty close to free and the Government has thrown billions all over the place in what we now know was a vain hope of staving off economic disaster.
In other words, they've thrown the kitchen sink at the place and we are still sinking.
What makes this particularly egregious is that it's been delivered against a back drop of spin that had the naïve believing that we were: 1 lucky; 2, doing really well; and 3, it's nowhere near as bad as it could have been.
The good thing about economic data is you can't argue with it because it's fact.
Need I remind the competitive among us, and that most certainly does not include the Government, our friends across the Tasman for the same period of late last year drummed up a result of 3.1 per cent.
That's 3.1 per cent to the upside. It was positive, and they added that 3.1 per cent to the previous 3.1 per cent which was in fact a record period of growth.
Ours was a record period as well. This country had never ever gone backwards at such a rate.
The frightening thing is, there is more to come.
What do you think the returns for our horticulture sector are going to look like, given we have chosen not to pick the apples, the kiwifruit and the grapes?
The Government let 2000 workers in from the Pacific nations to assist the horticulture sector but the industry needs between 10,000 and 15,000 people. Photo / Warren Buckland
Having pleaded for months with the Government to open the MIQ system just a little bit wider and let some Pacific workers in - Pacific, as in the area with no Covid, the Government acquiesced and let 2000 in. The industry needs between 10,000 and 15,000.
Mad campaigns were run to attract locals. Some locals got hired but nowhere near the number required, as yet again the Government was caught out in another of its theory-versus-reality exercises.
Yes, the pay was bumped, yes the transport was offered, yes the accommodation was sorted, but guess what? A lot of New Zealanders without work would rather keep on not working than pick fruit.
All the while, by the way, the MIQ system has been running well below capacity.
All the facilities MBIE cleared to operate have never come close to actually being utilised, so there was space.
Yet again it came down to attitude.
Dare I even raise the bubble and what that could have done for bottom lines if it had been reciprocated when everyone seems now to have accepted it should have been, i.e. about 180 days ago.
So here we are: $100 billion in debt and rising, an economy going backwards and continuing in all likelihood to go backwards, against Australia, Taiwan and Singapore and China who are largely doing the exact opposite.
The borders still closed, with tourism on its knees and no more help coming.
A rural sector being smacked through lack of labour and solutions.
What part of if this is giving you confidence in Labour's economic credentials?
How much longer can they run "the best economic response is a good health response" line, without the majority of us bursting into laughter.
They have tanked the economy.
If you can still afford it, enjoy the Lion King, or the Queen cover band. Good they got them in: It's not all bad.
