Thursday, July 03, 2008

The difference a left-wing government makes

Today, the Ministry of Social Development released its report on Household incomes in New Zealand: trends in indicators of inequality and hardship 1982 to 2007. It's a big, crunchy document with lots of information to wonk on (like its predecessor from the Department of Statistics, New Zealand Now: Incomes), but the highlights are a significant drop in child poverty thanks to Working For Families, and a slight reduction in inequality. The most interesting bit however relates to changes in inequality over time. The graph below (Figure D.3 from the report) shows the change in real equivalised household income (basically, household income corrected for family size) at the top of each income decile between 1988 and 2001 - basically, who benefited from the Revolution:

No surprises there then. As I've pointed out before, the rich got richer, and the poor got screwed. Around 50% of New Zealanders were actually made worse off in real terms, for the direct benefit of the rich.

The second graph (Figure D.2 from the report) shows changes in the same statistic - real equivalised household income, at the top of each decile - between 2004 and 2007:

The difference is striking. Instead of the poor being further impoverished for the benefit of the rich, we have a much more equal distribution. No-one is worse off, but those in need generally benefit more (though as I've noted before, the very poor and beneficiaries have not benefited enough - a shocking failure of a Labour government).

This is the difference a left-wing government makes: between economic policies which funnel the fruits of growth solely into the pockets of the rich, and policies which spread them far more evenly. The question people should be asking themselves this election is "which society would I rather live in"?