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  • rmacculloch

In the lead up to the NZ election, a crucial issue that may heavily influence the outcome is also the oldest one in the book. Namely, the question of whether the left-wing party will increase taxes whereas the right-wing party will not. In the view of DownToEarthKiwi, Labour's strategy of not identifying practically any future cuts in government spending to reign in our burgeoning public debt will leave them heavily exposed. Why? Since public debt is forecast to explode from 20% to over 50% of GDP the next few years. And a party that offers no plans to cut any forms of government spending to counter this increase becomes a party that is likely to increase taxes.

The Finance Minister has just claimed that "National would need to cut tens of billions in public services to meet its debt target". However, Kiwi public debt can easily be brought under control with no cuts to public services. Simply by stopping existing government transfer schemes to high income, wealthy folks, our debt mountain could be flattened. Some examples include:

- subsidies to Kiwi Saver contributions

- free tuition fees and interest free loans to students from wealthy families

- winter heating payments to high income earners

- corporate welfare to businesses

- accelerated depreciation tax allowances to the forestry, farming and bloodstock industries

Stopping such schemes alone would cut debt by more than $30 billion over 10 years. None of these cuts involve reducing public services. Furthermore, speculation that taxes may rise in the future would end - speculation which can depress investment and consumption spending, thereby knocking the stuffing out of the economy, right now. See:

  • rmacculloch

Today we do a quick comparison between how long it takes to do a build in New Zealand in 2020 compared with construction times nearly one century ago.

Work commenced on the site of the SkyCity Convention Centre in December 2015. It will be able to host around 4,000 people. The completion date is now estimated to be 2nd December, 2025, around 10 years after work began. By that time, physical conference meetings that involve long-haul travel are likely to be viewed as environmentally unfriendly and so moved increasingly onto virtual platforms like Zoom. Meanwhile, down south, Christchurch Cathedral was left in ruins after the earthquake back in February 2011. Nearly 10 years later, it still lies in ruins.

Now flick to the United States. Excavation of the site of the Empire State Building, located on Fifth Avenue between 33rd and 34th streets in Manhattan, New York, began on 22nd January 1930. It was officially opened for business on 1st May, 1931, just over one year later. The Empire State Building has a capacity of around 35,000 people, being 20,000 tenants and 15,000 visitors.

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Robert MacCulloch

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