Tuesday, November 17, 2020

Even the banks can see which way the wind is blowing

Jacinda Ardern has famously ruled out taxing wealth in any way, saying "not as long as I'm Prime Minister". Meanwhile, Westpac is saying that its inevitable:

Rising public anger about growing inequality is likely to force the imposition of a capital gains or wealth tax in the next few years, according to the chief economist of Westpac.


"By mid-2021 we expect house price inflation will be 15 percent, roughly the same as 2016," Westpac chief economist Dominick Stephens said.

"The political and social fallout will be just as intense as it was back then."


"My pick is that some form of tax on wealth, land or capital gains will get over the line in the mid-2020s, when societal dissatisfaction with rising wealth inequality reaches boiling point," Stephens said.

The government really would be pushing on an open door here. But Labour is now constitutionally incapable of taking such opportunities, and by making it a personal promise, Ardern can't back down without losing face and admitting she was wrong (something politicians are highly averse to doing). Which means the only effective way forward is to get a new Prime Minister - something which will take another couple of elections and a lot more suffering and misery. And all of that suffering and misery will be able to be laid at the feet of Jacinda Ardern, who is kind only to the rich.