Our Worst Ever Treasury Secretary, Caralee McLiesh, leaves office with a brain wave on how to improve prosperity in NZ: put up your taxes

You'd be forgiven for not knowing the name of the NZ Treasury Secretary, since most of us have learnt not a thing from her over these past years regards how to make the country a more prosperous place. Caralee McLiesh has been the most invisible Treasury Secretary we've ever had. She's presided over a huge rise in public debt, high inflation, high interest rates, fiscal deficit blowouts, an incompetently designed wage subsidy scheme that had no claw-back (which would've meant companies that never ended up needing the public funds would've had to pay them back), appallingly low productivity growth for which she never provided a hint of a solution, and what is shaping up to be a triple dip recession, making our economy almost the worst performing in the world on the basis of GDP growth .

McLiesh then leaves it to her "exit interview" with the Herald to give her solution as how to increase prosperity in NZ - increase taxes. In particular, go after the assets of those who have worked hard all of their lives and are now over 65 by imposing capital taxes on their wealth. She gets her wires crossed, messing up one of the few things she manages to blurt out during her vacuous interview, namely that, “With an ageing population, we’re seeing an increasing share of Government transfers going to the wealthy, because of course, we have an increase in population of the over-65s, and some of those are in the higher income categories.” What's she on about? The over-65s may have more wealth accumulated over their life-times (which in NZ mainly comes in the form of a house they may own). But in terms of income, which the Treasury Secretary refers to, Stats NZ reports the over-65s are in the second to lowest income group. Its obvious why - they're mostly no longer earning wages and must rely on the pension & typically meagre savings. For those who own a home and live in it, no income derives from that asset, just expenses.

The figure below reports data from Stats NZ on this matter. It shows the Treasury Secretary could not have got it more wrong - the over 65s are in the lowest income group in NZ, with the exception of 18-24 year olds, many of whom are non-working students. Why didn't the Treasury Secretary explain the crux of the issue? We have a Pay-As-You-Go Pension System. Our over 65s already paid taxes when they were young to fund pensions (and health-care) for their parents' generation. Now they have themselves retired, our new young generation is doing the same for them. And so it goes on. The alternative is a funded savings-based system, whereby people start saving for their own retirement (and health-care) when they're young. Kiwi Saver is a start in this direction, but other nations have mandatory systems way larger than Kiwi Saver, which is too small to make a big difference. Why didn't the Treasury Secretary discuss how to strengthen savings-based schemes rather than talk nonsense about hitting "wealthy" elderly with capital taxes to force them to pay twice for welfare.

If  "tax the rich elderly more" represents the quality of advice the PM and Finance Minister have been getting from Treasury - no wonder NZ is in trouble. What's astounding about McLiesh's views is that cutting waste & bureaucracy & designing more efficient ways of running health-care doesn't figure in her comments. There are health systems abroad achieving better outcomes than ours at far lower cost. Single (public) provider, single (public) payer systems like NZ's (and the National Health System in UK) are falling apart. Yet improving efficiency & productivity appears to have never been of interest to McLiesh - only hammering the public to pay more for the broken systems she presided over. Asked what her legacy would be, McLiesh replied, “Any leader wants to leave things better than when they came". On that Key Performance Indicator, her tenure at the Treasury was a failure.

Sources:

https://www.nzherald.co.nz/business/nz-needs-a-capital-gains-tax-and-slimmer-superannuation-payments-outgoing-treasury-head-caralee-mcliesh-says/7UJDKN5NZ5BXFLXO3K7EQLU6SQ/

Why does Dame Professor Anne Salmond Defend the Treaty by Attacking Liberty? Don't we all, Māori and non-Māori, want to be free & our property rights protected?

The defining brilliance of the US Declaration of Independence was its ideal of a government whose existence could be justified only if it was there to serve the people; to protect their freedoms & liberties. The awful alternative is a government that exists to force people to serve its own interests - by getting them to fight wars to enrich its political leaders - and by getting them to work hard, only for those leaders to steal what the people build. It takes prominent NZ academic, Anne Salmond, to tell us Kiwis don't subscribe to such ideals - the foundation stone of everything that has enabled nations to break free from their oppressive pasts; to achieve greater well-being and prosperity these past three centuries. Instead, Salmond's social, legal, anthropological, cultural, political & economic public lecture this week states, "Libertarianism, which elevates individual liberty and private rights over notions of collective responsibility, is historically and culturally specific. It traces back to strands in Greek philosophy & Christianity as well as philosophers like John Locke and John Stuart Mill. Its support among the NZ electorate is slight, as indicated by ACT's 8.4 percent share of the vote. Libertarianism is also radically at odds with the framings of Te Tiriti o Waitangi".

To argue liberty is not a feature of NZ culture is a patronizing misrepresentation and insult to us all: past, present and future. Who is Salmond to speak on our behalf as to what values we hold? Does she know more about them than we do? John Locke inspired the US Declaration of Independence - he was behind the line it begins with, namely "We hold these truths to be self-evident, that all men are created equal, endowed by their creator with certain unalienable rights, that among these are Life, Liberty and the pursuit of Happiness - that to secure these rights, governments are instituted among men, deriving their just powers from the consent of the governed - that whenever any form of Government becomes destructive of these ends, it is the right of the people to alter or to abolish it". It was used in Martin Luther King's speech at the Lincoln Memorial to support abolishment of segregation. Salmond's evidence that Kiwis don't subscribe to liberty and private rights relies on how many votes ACT won at the last election. But all our parties support liberty, private rights and happiness. ACT (and National) simply promote different ways of achieving them, like lower taxes, although liberty is also central to what Labour, Greens, NZ First and Te Pāti Māori stand for. Does it occur to Salmond that the Greens want less pollution because they believe young generations have the right to be free from the scourge of a bad environment, allowing them to lead happy lives, liberated from this threat? Does it occur to her Labour supports higher taxes on richer households so as to provide 'free' education and healthcare for children in low income families, whose only 'fault' is that their parents are poor? Does it occur to her Labour wants to liberate these children by securing opportunities and private wealth for them? As for John Stuart Mill's "utilitarianism" to which she refers - that good government is one providing the greatest happiness for the greatest number - it was the basis for PM Ardern and Robertson's Labour Party 'well-being budgets' & policy approach.

So who is this academic, Dame Anne Salmond, to speak on behalf of the National, Labour, Green, NZ First and Te Pāti Māori parties, and five million New Zealanders, telling us what we stand for; who we are; what our culture is; what ideals we subscribe to? Are we not free - do we not possess the liberty - to hold our own views? Does she seriously think our private cultural beliefs can be ascertained from who we voted for? Some of us don't even much like National PM Luxon, nor are fans of Seymour or Peters, but a clear majority did believe they were the best of a bad bunch at the time - the previous lot being so awful they had to go. On the Treaty, isn't the argument, even of Te Pāti Māori and its supporters, that it was framed to protect and guarantee the private property rights of Māori? That, in exchange for such protection, Māori agreed to being governed by an authority - maybe not necessarily "sovereign" - but at least one promoting a common law and order? Isn't that identical to John Locke's idea that "humans, though free, equal, and independent, are obliged under the law of nature to respect each other’s rights to life, liberty, and property". That we should "agree to form a government in order to institute an impartial power capable of arbitrating disputes and redressing injuries". Locke held that the obligation to obey civil government under the social contract was conditional upon the protection of our natural rights, including the right to private property. Whether it was John Locke and the US Constitution, or the Treaty of Waitangi, aren't we all talking similar ideas with similar aims in mind?

More generally, isn't it time New Zealand produced journalists, writers, academics, teachers and such like, who have the knowledge and temerity to hold to account members of the titled "establishment" like Professor Dame Anne Salmond, who pretend to hold a monopoly on the moral and intellectual high ground?

Sources:

https://newsroom.co.nz/2024/08/31/anne-salmond-whats-the-matter-with-the-treaty-principles-bill/

https://www.archives.gov/founding-docs/declaration-transcript

https://www.britannica.com/topic/social-contract