KEY POINTS:
Graham Scott, Secretary of the Treasury 1986-1993, was a unprepossessing public servant who spoke so quietly you strained to hear him. But I vividly remember something he said in a candid moment.
The country's most important economic number, he said, was government debt. When he travelled the world
with finance ministers and they talked to investment houses and credit agencies, the figure they focused on was the debt.
The very low public debt this country is carrying is largely a consequence of the Budget surpluses bequeathed to us at that time by a formidable finance minister, Ruth Richardson. These things might sound academic to most people but they are not.
They are the reason those people have enjoyed a world-class lifestyle far above the level that could be sustained by a narrow range of agricultural exports. When investors look at numbers like low inflation, manageable debt and balanced budgets they see good government and hold our dollar.
Good government is probably the best thing we have had going for us a while.
By the time Richardson and Scott ended their terms - involuntarily in her case - welfare spending had been re-oriented strictly to need, inflation brought down with a thump and a rapidly recovering economy was starting to produce revenue surpluses that were to last 14 years.
Until now.
The Treasury's pre-election fiscal update published on Monday has left me sick at heart.
The tiny surplus that remained in this year's Budget after Michael Cullen had finally given way to our demand for tax cuts has disappeared in this so-far-slight recession. And on current spending and taxation projections, the deficit will last 10 years.
Worse, the update was done before overseas financial markets went into the present seizure, which means the deficits will not be cured by whatever it takes to revive foreign credit flows.
This country has been doing so well you get complacent. You know the present Government has indulged in social initiatives that are largely wasted on the well-off, and that the past nine years have been Christmas time for state servants' numbers and pay, not to mention the protection of their work from competitive private providers.
But you saw Cullen reporting big Budget surpluses year after year and you supposed the new economy could afford this. Complacency was such that the National Party made little criticism of the new social outlays, preferring to beat the drums for the surplus to be returned in tax cuts.
Personally, I admired Cullen for holding out as long as he did. A surplus is a fragile consequence of a collision of forces that accountants cannot completely foresee. A government controls only the spending side of the ledger, and not all of it.
A reliable tax cut is a spending cut and National was noticeably less forthright on that side.
God bless Ruth Richardson. Not only did she leave a balanced Budget but her final act was to drive through Parliament the law that requires the disclosure of regular economic and fiscal updates from the Treasury.
It means we have heard the bad news before this election rather than after it. And it provides a rare opportunity to assess a potential prime minister before we decide to put him in charge.
How good is John Key really? He has been been so complacent about the public accounts that he and Bill English were already contemplating deficits after tax cuts and Key even advocated more debt to build unspecified infrastructure.
After the Treasury's news on Monday he sounded more sober. He said the party would re-assess accounts but remained confident he could "deliver" tax cuts. Politicians use that word to make soft decisions sound hard.
By Tuesday he sounded so responsible I dared hope they would decide to abandon tax cuts planned when there was a surplus to return. There plainly wouldn't be a surplus for the natural life of the next government unless he could bring himself to cut public spending fairly drastically.
The programme he laid out on Wednesday was pathetic. It contained one brave step - tackling the grossly generous KiwiSaver scheme - and removing a business research and development rort.
But those savings merely ensured his tax cuts didn't make the deficit worse. His tax programme is another me-too exercise, largely copying Cullen's phased raising of income thresholds but by slightly larger amounts and sooner. Labour's vengeful top rate will be lowered but only by 2c over two years.
At least he has abandoned the debt expansion, and he knows he will take cheap shots from Labour for the removal of some of the bait from KiwiSaver.
But when I see that even these savings would leave the Budget in deficit for nine years rather than Labour's 10, I'm left with the terrible foreboding that we've been here before.