The Ministry of Social Development’s latest analysis of household incomes should make uncomfortable reading for the government. It shows that real equivalised median household incomes dropped by almost 3% from 2010 to 2011.
Now that’s some fine economist-speak, but in English it means that ordinary Kiwi families are $900 per year worse off than they were a couple of years ago.
$900 is a huge amount of money. It could buy all the kids’ school uniforms, or pay quite a few power bills. It’s enough for a whole neighbourhood to set up vegetable gardens!
But it’s $900 that your average family doesn’t have anymore. And National’s economic mismanagement is to blame. Their top-rate income tax cuts and GST rises saw top earners boosted up, but the middle and bottom went backwards.
Today in Parliament I asked the acting finance minister, Steven Joyce, about the MSD report. I wanted to get to the bottom of how National can possibly think that it’s fair for ordinary Kiwi families and the poorest New Zealanders to be much worse off under this government, while at the same time the richest New Zealanders have gotten huge tax cuts and are much richer now.
The minister was clearly uncomfortable, and in light of the facts he should be.
As expected, Mr Joyce trotted out the usual list of hollow National excuses.
But it was astonishing to hear him arguing (as the Prime Minister did yesterday, incidentally) that the 3% decrease was actually an increase!
“The point is over what period of time the median household incomes have increased…. The Member has selected a period from 2009/10 to 2010/11.”
Obviously I chose that period because it’s the period that National have been the government.
If we follow Steven Joyce’s logic it’s not important to rationally analyse the success or failure of the government of the day and its policies. It doesn’t matter to him that struggling families are getting poorer.
All that’s important to National is finding any historical comparison point which might make today’s disastrous economic figures look better. Evidently our acting finance minister doesn’t even understand inflation.
This is what National’s “brighter future” means. It’s an unfair and unequal society where the government helps its rich mates to get richer while making everyone else poorer.