Latest / Best of Business / Andrew Dickens: Can we really say the rock star economy is back?

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Andrew Dickens: Can we really say the rock star economy is back? · Best of Business

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  Speaker 1: You're listening to a podcast from News Talks at be
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  Speaker 2: Ladies and gentlemen, the corner has been turned. The five
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  Speaker 2: year pandemic pandemonium has been tamed. This was the headline
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  Speaker 2: at the end of last week. Inflation is down and
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  Speaker 2: the very first interest rate cuts since the Reserve Bank
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  Speaker 2: realized that overstimulated everything five years ago finally happened. It's
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  Speaker 2: proof that tax cuts were not inflationary, said the Finance minister. Well,
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  Speaker 2: that's true, but it's not a sign that the cost
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  Speaker 2: of living crisis is over. Is it just me? Or
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  Speaker 2: do you think inflation and the cost of living increases
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  Speaker 2: are two heads of the same monster, and they're measured
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  Speaker 2: in different ways. So it's true that tax cuts are
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  Speaker 2: not being sucked up by discretionary spending so causing inflation,
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  Speaker 2: but they are being sucked up by the increases and
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  Speaker 2: charges brought about by a cut in government spending, a
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  Speaker 2: continued housing shortage and its costs, and local government trying
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  Speaker 2: to bridge the infrastructure deficit has been grown for decades.
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  Speaker 2: So that's where my tax cuts are going. I can
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  Speaker 2: tell you exactly my family's tax cuts are going straight
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  Speaker 2: into increased rates, and because we're on the end of
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  Speaker 2: a ferry line, increased public transport costs now that the
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  Speaker 2: subsidies had ended, because we've got three people using ferries
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  Speaker 2: of the house, so all the tax cuts are going
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  Speaker 2: straight pretty much into that, to be fair. So I'm
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  Speaker 2: not spending it on discretionary items, I'm not firing on
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  Speaker 2: the inflation. So it's still great news. The corner has
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  Speaker 2: been turned so much so that Thomas Coglan and the
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  Speaker 2: Herald said, put on your dancing shoes. The rock star
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  Speaker 2: economy is back, and we can thank Luxon and Willis,
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  Speaker 2: which is true. They did their part. It's also true
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  Speaker 2: that economists have been saying this would happen for over
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  Speaker 2: a year now. It's also true that economists have been
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  Speaker 2: saying all year that a lot of money has been dormant,
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  Speaker 2: waiting for a turn in the interest rates as a
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  Speaker 2: signal that it's all back on again. That is fine, happened,
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  Speaker 2: and so here we go, the rock star economy on
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  Speaker 2: the return. But was the rock star economy that we
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  Speaker 2: remember so fondly really ever a rock star in the
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  Speaker 2: first place, And do we really want it back. The
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  Speaker 2: rockstar economy was an economy of growth, spurned on by
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  Speaker 2: high immigration, low interest rates, and beg capital gains from
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  Speaker 2: a strangled housing market that was then spent by houseowners.
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  Speaker 2: It was a rock star as long as you had
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  Speaker 2: property that you could raise capital on. And throughout the
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  Speaker 2: glory days, many warned that there was no productivity gains
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  Speaker 2: in our rockstar economy, that there was too much reliance
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  Speaker 2: on dairy and tourism in our rockstar economy, that there
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  Speaker 2: was too much spending on fripperies in our rockstar economy,
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  Speaker 2: and that there was too little investment on infrastructure that
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  Speaker 2: will make us more competitive in our rockstar economy. Can
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  Speaker 2: we really say a rock star economy is back when
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  Speaker 2: we wait a month for a doctor's appointment or three
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  Speaker 2: months for surgery in a rotting past its use by hospital.
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  Speaker 2: Can we really be a rock star economy if we
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  Speaker 2: can't make enough electricity to keep the pulp and paper
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  Speaker 2: mills operating. Can we really say we're a rock star
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  Speaker 2: economy when half our water is lost in leaks. So
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  Speaker 2: here's the truth. The return of a key government style
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  Speaker 2: rock star economy will benefit me, It may indeed benefit you.
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  Speaker 2: It will be benefit anyone with equity, and look, I
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  Speaker 2: know I'm grateful and those people vote, but don't you
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  Speaker 2: want something better than that? Don't you think it's time
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  Speaker 2: the country point it's big boy pants on and fixed
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  Speaker 2: up the stuff that's been plaguing us for decades and
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  Speaker 2: makes us seem like a third world country. Because if
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  Speaker 2: we can do that, then we will be a true
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  Speaker 2: rockstar economy, and the people that manage that feat will
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  Speaker 2: be hailed as the true masters of this economy.
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