Wednesday, March 23, 2011

Using the earthquake as an excuse

Over on Public Address, Keith Ng digs into the government's books, and discovers what we all suspected: National is using the earthquake as an excuse. Its budget hole is caused not by the earthquake, but by its failure to get us out of recession. Here's the key figure:

So, rather than facing cuts to government services because of the earthquake, we're facing cuts to government services because National are shit economic managers, and that's their preferred solution. But to follow up on yesterday's thought, there's no difference between ripping money out of the economy through cuts, and ripping it out with permanent tax increases. It is, again, just a distributional question. And one of these solutions is a lot fairer, distributionally speaking, than the other. The fair way to solve this problem isn't through cuts, but by reversing National's unjustified tax cuts for the rich, which have created a structural (and strategic) deficit.

Of course, that's not what National is going to do. Instead, they're going to look after their mates, while making the poor pay for the recession. That is unfair and immoral. But its so very, very National, isn't it?