Gordon Campbell on the government’s tax cuts fixation

Long before the earthquake hit, the dodginess of the government tax cuts programnme was evident in the language of its packaging. It is being touted as a “tax cuts and family care” package. Yes, this $3 billion election bribe is going to be packaged as family assistance – even though, if it is going to be structured anything like the 2011 tax cuts package, the bulk of its benefits will be delivered disproportionately to the relatively well off, with only a showcase segment devoted to those truly struggling to get by. Hey, if the aim really is to offer ’family care’ to those truly in need, why not commit right now to targeting the entire $3 billion giveaway solely to those earning below the median wage/median household income?

Or better still, why not shelve the whole idea of tax cuts as a hopelessly inefficient way of delivering relief to struggling households… who are also facing rundown and inadequate services in health, education and housing. The track record of tax cuts is that they fuel income inequality, and add – at best – make only a few extra dollars of disposable dollars available for consumption. The better option (as always) would be to spend the money on both social services and programmes likely to generate sustainable wealth – because once the construction activity linked to disaster relief runs its course those jobs that are currently inflating our GDP figures will decline, and all that New Zealand will have done is to rebuild back to something like where we were before the disasters struck.

As others have noted, the likelihood of tax cuts is still being talked up, well before the costs related to the latest earthquake are known. This cost doesn’t simply involve the bill for the repair work on damaged infrastructure. There is nothing like a reliable cost estimate for the new configuration of road, rail and revived coastal shipping required to better serve New Zealand’s transport routes between the South and North Islands in a seismically uncertain future.

It seems utterly irresponsible to be committed to giving away the money needed for such essential work. But then, that’s typical. The Key government seems remarkably blasé about this country’s future needs : faced with an ageing population, an ageing health specialist work force and rising health costs related to expensive new drugs, the government has been starving the health system of funds – as a proportion of GDP – for the past six years. Rather than use the surpluses that Bill English is projecting until 2020 in order to make the necessary investment in the public health system, the money will be frittered away instead on a sparsely sprinkled programme of tax cuts.

It will have the desired political effect, though. Even crumbs will be gratefully received by the poor, and pocketed with only a twinge of guilt by the better off. Next year, Labour can be expected to tie itself in knots trying not to unduly criticise the meagre handout to its core constituency. Already, Labour leader Andrew Little seems to be trying not to advocate for the tax cut funds to be spent on social needs instead. This week for instance, Labour has been arguing that the money should be used to pay down government debt, even though our ratio of government debt to GDP is currently healthier than in many other comparable countries. Presumably, Little is trying to make Labour look like a “ responsible” alternative government. Sigh.

In May, Prime Minister John Key conceded that the driver for tax cuts was mainly ideological:

He said the choice they were faced with in the short term was either a billion dollars worth of tax cuts which would deliver a small amount of money to New Zealanders, or spend the money on other things such as cancer drugs. “Philosophically we believe in lower taxes and smaller government, and government’s definitely getting smaller,” he said. “The point is if we’re going to have a tax programme – we’re not ruling that out in for 2017 or campaigning on it for a fourth term. But having probably a bigger one, to be blunt.” When asked how much was needed for meaningful tax cut, Key responded: “$3 billion I reckon.”

Right. So for starters, we probably need to be asking these kind of questions:

(a) Is a tax cut of $3 billion still seen to be the minimum to deliver worthwhile relief to New Zealand households?

(b) Will this next tax cut round be structured differently to the 2011 round, and if so why, and how?

(c) Will the bulk of the tax cut benefits be delivered to those above or below the median wage and/or average household income, and if so in what proportions?

(d) Will the tax cuts increase or decrease the extent of income inequality in this country?

(e) Given the existing and looming needs in health, education and housing, why are (i) tax cuts and (ii) is a $1 billion spending spree on prisons being prioritised ahead of them?

(f) Is it responsible to prioritise tax cuts before the government has received reliable estimates of (i) the repair costs of the earthquake or (ii) the costs involved in devising the best configuration of road rail and coastal shipping to better serve the South to North freight routes in future or (iii) the cost of the support package needed for local businesses affected by the earthquake to get back on their feet?

This week, Bill English has been talking as if none of this matters because there are allegedly predictable surpluses of 8 or 9 billion dollars rolling in by 2020. If that’s true – and if the government can really afford to throw $3 billion out of its aeroplane in the general direction of taxpayers in what is (co-incidentally) an election year…what was all that language about the need for belt tightening about? Unwittingly, it seems we have all been serving as workers on National’s re-election effort, and have been engaged in building up their campaign treasure chest.

Trump and Obama

Back in 2008, Barack Obama was elected on a tidal wave of expectation by his centre left fans who felt that, at last, things were going to change in Washington, and a President who listened to their needs and understood them would be taking up residence in the White House. The reality set in soon enough. To a disappointing degree, the Obama presidency delivered business as usual. Even so, some 24% of US Republican voters this year still felt that Obama may be the Antichrist.

In 2016, similar forces of convergence are massing on the hopes of the centre right to far right. Donald Trump’s supporters have been set up to experience something of that same sinking feeling. Over the past week for instance, Trump has been pressured by Republican chieftains and foreign leaders (such as Japanese PM Shinzo Abe and by the combined leadership at APEC in Peru) not to follow through on his campaign promise to dump the TPP trade deal. Change it in your image – John Key reportedly joked that the TPP should be renamed the ‘Trump Pacific Partnership” – but don’t dump it, has been the core message. Mayors of major metropolitan centres are also calling on Trump not to deport – as he promised to do – the millions of undocumented migrants.

Obviously, Trump will not ignore his agenda entirely and particular Presidents do make a difference. George W. Bush for instance, invaded Iraq and thereby triggered terrorism consequences whose effects are still apparent, worldwide. Similarly, Trump can be counted on to stack the Supreme Court bench with conservatives, with effects that will last for decades. Moreover, his appointments to key positions so far – in defence, national security, the CIA, as attorney-general etc – have been fringe-dwelling nutcase figures far from the Washington mainstream.

Even so, and over time… while no one knows how Trump will react to the pressures of convergence, the likelihood is something more like Washington’s business as usual will prevail. We know already that Trump is a man who likes to be liked, and that he has a short attention span. He may conclude that simply going along with the boring stuff may be the best way of fitting in time for a round of golf. Like George W. Bush, Trump will delegate. The scary factor may not be Trump, but the quality of his apprentices.

Finally…some good news

One of the unexpected happy outcomes of 2016 has been the return of hip hop’s beloved icons, A Tribe Called Quest with their first new album in 18 years. The death last May of Phife Dawg (a long time sufferer from diabetes) had seemed to be the final blow….After all, Michael Rapaport’s great Beats Rhymes and Life documentary had shown just how crucial the chemistry/rivalry between the scrappy, combative Phife and the charismatic, naturally gifted Q Tip had been to the group’s identity.

Well, surprise. The We Got It From Here album is a showcase of the warmth, inventive wordplay and instantly recognisable beats that we associate with A Tribe Called Quest, but without the results sounding like merely a nostalgia trip. In the year of Trump, the return of ATCQ has been a consolation. Here’s a track from the new album…

And for old times sake, here are a couple of way back whens. “Scenario” is still infectiously great in itself, but is lit up near its conclusion by the sudden appearance of a young and ferocious Busta Rhymes.

Finally…on the rooftop overlooking Linden Boulevard in Queens the young ATCQ have a ball performing “Check The Rhime”. Last week a stretch of this same Linden Boulevard was officially renamed Malik Phife Dawg Taylor Way in tribute to the man, and to the group he inspired.

17 Comments on Gordon Campbell on the government’s tax cuts fixation

  1. hip hop’s beloved icons??? Do these words even belong in the same sentence? You’re over 60 and and you like this stuff?

  2. From Robert Parry at Consortium News today.

    “Two weeks after Donald Trump’s shocking upset of Hillary Clinton, the imperious and imperial neoconservatives and their liberal-interventionist understudies may finally be losing their tight grip on U.S. foreign policy.
    The latest sign was Trump’s invitation for a meeting with Rep. Tulsi Gabbard, D-Hawaii, on Monday. The mainstream media commentary has almost completely missed the potential significance of this start-of-the-work-week meeting, suggesting that Trump is attracted to Gabbard’s tough words on “radical Islamic terrorism.”

    Rep. Tulsi Gabbard, D-Hawaii.
    Far more important is that Gabbard, a 35-year-old Iraq War veteran, endorsed Sen. Bernie Sanders in the Democratic primaries because of his opposition to neocon/liberal-hawk military adventures. She starred in one of the strongest political ads of the campaign, a message to Hawaiians, called “The Cost of War.”
    “Bernie Sanders voted against the Iraq War,” Gabbard says. “He understands the cost of war, that that cost is continued when our veterans come home. Bernie Sanders will defend our country and take the trillions of dollars that are spent on these interventionist, regime change, unnecessary wars and invest it here at home.”
    In the ad, Gabbard threw down the gauntlet to the neocons and their liberal-hawk sidekicks, by accusing them of wasting trillions of dollars “on these interventionist, regime change, unnecessary wars.” Her comments mesh closely with Trump’s own perspective.
    So, the surprise election results on Nov. 8 may have represented a “trading places” moment for the neocons and liberal hawks who were eagerly counting the days before the “weak” President Barack Obama would turn over the Commander-in-Chief job to former Secretary of State Clinton who had made clear that she shared their hawkish agenda of escalating the war in Syria and ratcheting up the New Cold War with Russia”
    Gordon maybe you should be letting up on the Trump bashing until he at least has served one day in office.

  3. Same old bankster and warmonger garbage. Trump is a tool, a puppet like his predecessors.
    The bankers that rule the usa (the “Oligarchy” )has had its perpetual and illegal wars going . Even coordinated with Russia and Australia to bomb Syria( albeit Australia bombed its stated allies ). Only the Banker’s media monopoly has been heating up a rotten cold war plate that you are eating.
    Its bullshit, Russian and American people are not interested in a cold war only the bankers corporations that profit off it are into that dish.

  4. And the Oligarch Hillary Clinton, the war Goddess, was going to be a better choice, eh Mikey?
    Yeah-nah, as they say in your country.
    As I told Gordon, hold your opinion’s, and that’s all they are, until Trump gets into office. At least with Trump the world has a slim chance.

  5. Trump is an Oligarchy player (as is Clinton).
    The people in this world need to wake up, if you are waiting for a silly toupee wearing TV celebrity or for a Clinton to save you, then you are a bigger fool than you sound.

  6. Puny pathetic “tax cuts” are but a distraction.
    Probably for the very wealthy or to give back a fraction of income it took from the poor while it ignores the inflation and how a corporation that sells its assets to foreign nations and has central banking system can allow all to economically prosper.

  7. Mikey, I don’t know how old you are, or what you do for a living, or even if you have a job. But why don’t you come into the real world? Ranting and chanting that “Trump is a tool, a puppet like his predecessors” and “ bankers rule the usa” may impress your circle of friends, but it surely is not constructive. Its infantile. Ranting on the sidelines. What’s your solution to the geopolitical challenges we all are facing?
    It doesn’t go unnoticed that your government is participating in the illegal War on Terror, by sending SAS Troops to Iraq. Why don’t you exercise your democratic right as a Kiwi to mitigate these actions by your government? You surely have the same effect on your government as the average American has on his/hers, right?
    We American “peacenicks” voted for Trump as the best chance that we may see the end of these wars. It was our only choice in the real world that I live in. What have you done?

  8. There is no democracy.
    Dennis, yours is the voice of the oligarchy (and their perpetual war machine).
    You are delusional, convinced (and/or trying to convince others)that the oligarchy’s political tools the “evil” Trump/Clinton and noted problem makers are a ” save the world ” bet.

    The world needs saving from the oligarchy and its corporations busy with the market they own, drafting up other nations trade agreements, stealing IP ,we also need freedom from the ignorance the oligarchy’s media conglomerate spreads.
    The role players Clinton/Bush/Trumps of this world are but a tool used to allow these bankers to rule under the illusion of a “choice and democracy”.
    You seem upset that people might question the “democracy dogma” and break free of the 1%’s indoctrination process.
    Dogma that is false breaks apart upon questioning.
    There is no democracy in the govt, the govt is full of self serving lying weasels .

  9. We do not have a democracy in govt, we have a demon-cracy. We protest en masse and Bankster Key signs the TPPA! Sells the nations assets to foreign buyers and creates housing/employment problems and makes up imaginary ones.
    That is not a democracy.
    Politicians fight all day in parliament and get paid for it, creating problems not solving any, drive around in limos, eating and drinking on us never listening to submissions (its apparently enough that we are permitted to make them) .

  10. Poor you Andrew, locked in a musical time warp defined by your age. I’m 56 and am so thankful that I’ve been introduced to hip hop and it’s huge range of rich, powerful, melodious and lyrical styles.

  11. Anabel and Helen, more ranting and raving from the sidelines. So what’s your suggestions as to how your little Isle should be governed? Until you come up with with some alternate real world ideas nobody is going to take your posts seriously.

  12. No Dennis, the question is why should we be governed by a foreign private banking cabal that owns the Crown, the corporations that now drafts up the nations trade agreements?!

    Maybe most people believe your school boy theory of govt and alternate planet Key/Trump view & democracy propaganda. Your posts depict the stench of how the oligarchy treat people. With govt opposing views subjected to your inferiority complex and the classic ” tin foil hat wearers” response.

    If people stop believing (in the democracy dogma and they have a “choice of evil” crap) they will also stop willfully and actively consenting to be governed by the banking cabal.
    And that is the end of the current power paradigm that has been ruling this planet for too long.
    The system does not work, it is seen by many as dysfunctional and is contradictory in words and actions.
    The system is crumbing as the Oligarchy tightens its python like hold on the people with its globalization agenda.

    I can imagine the system’s loss of control and having power moving back to united compassionate and kind human beings is a scary thought to the greedy ” divide and conquer” profiteers that currently rule us.
    Imagine not needing to fund a bunch of ignorant charlatans ( parliament) or a costly corporate bureaucratic system that protects the Banker’s Crown only.

  13. One of the lamest, age-old and desperate attempts at shutting down a discussion has been the ‘well what have you done’ so-called ‘argument’. If the sole criteria for advancing an opinion was to be able to then directly and straightforwardly carry out what you were proposing, no discussion, dissent or debate would ever happen. What a terrifying world. Dennis – your condescending attitude towards a journalist expressing an opinion is not only laughable and lacking in any kind of intellectual rigor, you also fail your own criteria for expressing an opinion. So shut up like you believe we all should and go and change the government on your own.

  14. +Andrew Nichols Where have you been? I’m pushing sixty – ATCQ has been around since 1985. They and a long list of other hip hop bands are the artists saying it like it is, raising voice to the issues of our time, the poets of our generation. Seriously? Are you still listening to the Rolling Stones or something?

  15. RoseOConnor Kfay Good luck to you. At 58, I’m just not into angry often misogynistic chanting to a bassbeat pretending to be music. Gimme Salmonella Dub, Kora Fly my pretties or Fat Freddys Drop any day. I do concede however that as ones hearing declines one might mistake rap/hiphop as music once the abilities to hear higher melodic frequencies decline.

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