The latest economic data have been released and it is not good news. There is basically full employment, incomes are soaring, interest rates are about to skyrocket, and inflation is out of control; the New Zealand economy has many difficult years ahead. All of this was preventable, and there is a glaring historical precedent I shall come to in a moment, but what is troubling is the astounding level of ignorance within the Beehive about all this.
In “left wing bore” circles (you know the sort of thing; the smartypants failed University lecturer Labour party activist who starts sentences with “oh what Shakespeare really meant was….”) – they have an obsession with social constructs. Their view of the world is that nothing much is real and therefore everything can be remade to suit the circumstances. One strange and deeply concerning example is the idea that money, let’s say a $10 note, passes through various hands; purchasing goods and services each time; but as it’s the exact same $10 note it’s just a ‘social construct’ and not real.
Where it gets a bit chilling (and if this doesn’t make your blood run cold: it should, dear reader) is the infantile notion that nobody need own or do anything, everything is “free” and handed out in abundance; all that’s required are two people (you and my good self, for instance) sitting on a comfy sofa passing a $100 note back and forth between us indefinitely! A sort of 4-year-old girl’s view of “cutting out the middleman”. This nonsense will be the economy (ahem “economy“) in Jacinda’s Jejune Communist Commune: simply remade and a seemingly perfect world is created as a result.
They also fail to understand that full employment means your economy is stagnating; back in 1995 when our economy was booming unemployment was around 8%. Full employment along with soaring incomes is a nightmare scenario. Imagine you hadn’t eaten for 3 days and then knocked back 5 shots of vodka; imagine the resulting shock to your body and you’ll start to get a general idea.
Where it gets rather troubling is the historical precedent. Britain suspended the gold standard during World War I in order to print money to pay for it (let’s be honest here folks): akin to the recent printing of money to deal with the pandemic. During and after the war incomes rose quite markedly due to a labour shortage (you can guess the cause of that!), akin to our border being closed for two years. Britain in the five years after World War I was living in the sort of fool’s paradise we are currently experiencing.
Eventually, the ‘adults’ had to take action and the gold standard was reimposed. The effect of this was deflation as prices started to fall and unemployment rose significantly; however, incomes didn’t fall (hint: universal franchise made that impossible!). So there was a situation whereby if you had a job you were doing quite well, your living standard was quite high, but then there were large numbers of people out of work who lived in great deprivation.
Sooner or later, folks, the music is going to have to stop and action will have to be taken. The falsely inflated minimum wage and other “kindness” twaddle mean there’s going to be a day of reckoning, but unfortunately there aren’t enough musical chairs to go around. The inevitable result will be a huge permanent gap between the “haves” and the “have nots”, and this preventable situation will be the legacy of Jacinda Ardern.
Sources
- newshub.co.nz/home/money/2022/11/nz-unemployment-rate-unchanged-at-3-3-pct-wage-growth-up.html
- measuringworth.com/datasets/ukearncpi/result2.php
(UK prices from 1914 to 1935; note the levelling off and subsequent fall from 1925)
(UK incomes from the same period; note how incomes still rose during the great depression! )
