I continue to believe that our Prime Minister, John Key, is a man of remarkable talent. In this speech to the Waitakere Enterprise Business Club he has shown to me his ability to separate the chaff from the wheat. He has not resorted to base politiking and yet has somehow created a political vision as to where he can lead this country, and make it a winning economy, during these times of financial despair.
He has also chosen not to dismantle our welfare systems at a time when they are most needed. Although I despise 'welfarism' and its social effects and the dehumanisation of its recipents, I think that a certain level is necesary to support those most affected by adverse conditions. I do not condone those who use it to fund a life of non contribution to society.
I have copied the most of the speech below.
We live in challenging times.
It’s been more than a year since the first tales of financial ruin started to trickle out of Wall Street. What started as a trickle has gathered momentum. Each week we are being met with more bad news about the state of the global financial and economic system.
There can be no doubt that these waves of bad news have darkened New Zealand’s economic outlook. We are a small open economy and our fortunes rise and fall with those of the wider global economy.
The IMF predicts that global growth this year could be the weakest we have seen since World War II. And, even worse from New Zealand’s perspective, it predicts that the advanced economies, which make up most of our trading partners, will shrink by 2 per cent.
The resulting forecasts for our economy are sobering. Falling growth rates. Lower commodity prices. Falling demand for our exports. Rising unemployment.
I know that some in this room are already feeling the effects of these global events, while others will be worried for their prospects in the months ahead.
I share your concerns. We are certainly facing a tough couple of years ahead.
But let me be clear from the outset. I am confident that we will get through these tough times together. The New Zealand economy will recover strongly.
As Prime Minister, I have made that recovery the number one priority of my Government, and all my Ministers are working towards that goal.
Later on in this speech I will announce a series of initiatives designed to provide some relief to the small and medium-sized Kiwi businesses that will play such an important role in that recovery.
Before I do so, let me outline how this package fits in with our wider Jobs and Growth Plan for the economy.
The Government’s Jobs and Growth Plan is about keeping the economy running as strongly as possible, easing the sharpest impacts of the recession and preparing our economy for future growth. In support of this plan, and in light of the deteriorating global economic situation, we have already taken several steps aimed at protecting Kiwis’ jobs and financial security.
We have overseen the introduction of retail deposit and wholesale funding guarantees.
These are designed to maintain the liquidity of the financial system, and to ensure our economy can continue to function.
We are carefully watching the operation of these schemes to ensure they are working. We are also keeping a close eye on the banks to ensure that large cuts in official interest rates are passed onto everyday Kiwis.
Secondly, we have moved to lessen the impact of unexpected job losses through the introduction of our ReStart package. This package, introduced before Christmas, will provide extra support to those hit hard by redundancy, and it will lessen the shock of sudden job losses.
Thirdly, we have passed legislation to introduce extensive personal tax reductions on 1 April this year. These tax reductions will help New Zealanders make ends meet and reward their hard work even as international conditions worsen. They will inject considerable stimulus into the economy.
Fourthly, we will add to that stimulus with a series of fast-tracked Government building projects. These will keep more New Zealanders working as the international crisis hits home.
I will announce details of these projects next week. They are specific projects that were chosen because they are worthwhile and can be geared-up quickly. They will employ Kiwis with diggers, hammers and spades in regions throughout New Zealand. And in turn they will help keep suppliers and sub-contractors, shopkeepers and sales staff in business.
Larger, longer-term infrastructure projects will also be announced in the coming months.
The combined effect of this infrastructure spending, together with tax reductions, will mean that New Zealand will experience a fiscal stimulus amongst the top five in the developed world, when compared on a relative basis. That stimulus package will help keep our economy ticking over even as global demand falls, and it will help many businesses and families keep their heads above water.
In addition to these measures, three weeks from now I will be hosting a Jobs Summit.
This will bring together industry, business and other employment experts, including training providers, iwi and unions, and will be designed to harvest practical ideas for keeping people in jobs and helping them to find new jobs.
I will ask the participants at the summit to leave their ideology at the door, and to instead focus on what will work for everyday Kiwis.
I will ask them to think about what actions they can take to keep their fellow New Zealanders employed.
And I will ask them to come to the table in a positive and collaborative spirit with the intent of agreeing on concrete, achievable measures.
The resulting ideas will feed into the Government’s next steps in what I like to call our rolling maul of Jobs and Growth initiatives.
The Government will remain open-minded on future steps that may be required as economic conditions worsen over the next few months. I am very conscious however that steps taken today to stave off the international crisis should not be devised in such a way as to undermine the economy in the years ahead.
There is a balance to be struck.
We simply must ensure that decisions taken now neither undermine the future prosperity of our country nor diminish the opportunities available to this and future generations of New Zealanders.
Because despite the wishes of some commentators and despite the gloom on the horizon, my Government won’t lose sight of our determination to make a lasting difference to the lives of New Zealanders, now and in years to come.
That means rejecting some of the alarmist suggestions that will be made to us.
It means being careful, and making decisions in a disciplined way.
And it means avoiding the temptation to spend any amount whatsoever, without regard to the trade-offs that expenditure may have for the future of New Zealand. We simply must weigh up the fiscal costs of initiatives we take now against what those costs will mean for the Government books in the longer-term. Because I know, and you know, that if we borrow excessively to look after the taxpayers of today, we will end up saddling our children with a mountain of government debt.
In the more immediate future the prospect of an excessive level of debt would swiftly bring a downgrade from credit agencies, leading to higher interest rates and lower growth rates into the future.
So we need to be sure that the decisions we make now really hit the mark.
You can be confident then that over the next two years, as times get tougher, my Government will continue to act responsibly, because we know that a short-term sugar- fix today could lead to a diet of debt later.
While we must be careful we can also take heart that the economic situation presents some real opportunities.
When it comes to the recession we need a dose of reality but we also need a dollop of confidence. During this global downturn, we can work to improve the performance of our economy relative to other countries, and we can emerge better off.
That’s the second, longer-term goal of the Government’s Jobs and Growth Plan.
It’s about improving the fundamentals of our economy. A tax structure that rewards hard work. Reform of the Resource Management Act to allow people to do more things. Reducing the red-tape that saps initiative and good ideas.
It’s about policies that will future-proof our economy and set us up for a strong recovery.
These include our “Build New Zealand” proposals to future-proof our country with investments in roads, public transport, schools, housing and broadband. When our economy starts to recover we don’t want New Zealand to be constrained by inadequate transport networks and essential facilities. We want to be ready to grab opportunities for growth.
It also includes our “Frontline Services” policies to improve public services by getting more out of existing resources. Because just as the days of cheap and easy credit are gone, so too are the days of Governments being able to spend ever more without being accountable for results. Getting better value for taxpayer dollars is part of the day-to-day business of my Government. We will run a value-for-money ruler over everything we do.
We will also pursue “Education for Success” policies to tackle the long tail of underachievement in our schools. Because the future prospects of our economy depend on each and every Kiwi being able to make a skilled contribution.
These are the policies I campaigned on and they are policies I am committed to implementing.
Furthermore, they are policies that will play a critical role in supporting jobs and growth in the long-term. They are about ensuring that steps taken to improve our economy today can endure in the decades ahead.