Borrowing billions of dollars to stay still isn’t good economics.
The government can change that by spending less or taking more tax and it’s making progress on both those fronts.
But there are limits to spending cuts if it’s to keep its election promises - and it is determined to do that.
It has also said any tax changes will be fiscally neutral.
That leaves finding new ways to make money and extracting some of the mineral wealth which lies under our land could be part of that.
That idea isn’t universally popular and it’s no surprise that the leaked cabinet papers on possibilities for mining have been greeted with shrieks of outrage.
But a lot of that opposition is based on emotion not facts. If there is any mining it will be on a tiny amount of land and any applications will be subject to the safeguards of the resource consent process.
As Grey Distrct mayor Tony Kokshoorn said:
. . . there were “huge areas of the DOC estate that could be mined.
“The bottom line is that we are not going to let anybody ruin the West Coast, and the RMA [Resource Management Act] protects it,” he said.
Applicants will have to go through the consent process and that will ensure that any economic and social benefits from mining don’t come at the expense of the environment.
Emotion put an end to sustainable logging on the West Coast.
I hope it doesn’t put paid to new jobs and other wealth creating opportunities which could come from mining a small amount of land with low conservation values there.
Because if we’re not allowed to mine then how else are we going to pay for the services which we’re borrowing so much to fund?
I know it’s very unfashionable to comment on post more the 24hrs after it was written but here goes…
Nothing stopped sustainable logging in the West Coast, you can still cut trees in privately owned native forest, you just have to prove your managing it sustainably. The reason there is next to no native logging under those rules is it’s almost impossible to log NZ forests sustainably because all the target species are slow growing. The West Coast forestry industry was not growing the bush, it was mining it.
As to the current mining plans, I haven’t look at the leaked documents in detail, but from what I have sen it’s very had to see what the government is up to. I can’t see anyone getting resource consent to cut through river terraces or great barrier island. It looks a bit like Gerry Brownlee thought he saw a get rich scheme and didn’t think it through.
The last question is silly.
I’ve pointed out here often, that ‘wealth’ is only underwritten by the physical.
You can even stretch a point, and say it’s underwritten by energy – given that nothing is extracted, processed or transported without same.
The ‘wealth’ won’t get extracted, due to lack of energy, but there are a couple of other fundamental problems with your approach:
At the point of ultimate scarcity – there won’t be anything left to ‘buy’, so what’s the ‘wealth’ goint to be for , or mean?
Secondly, it’s only a temporary measure. I’ve mentioned the exponential function here before. “X hundred years” is the ignorant cry. Then you use the resource at an (exponentially) increasing rate, and start exporting it as well. Australia and coal being classic examples. All of a sudden you’re down to decades-only.
Most folk make the mistake of hanging onto the X, as if set in stone. So to speak.
There will never be enough wealth, now, to pay for what we have had, at the levels we have had it.
There’s no solution to that, so your question is pointless. We need another way of looking at things, and the Brownlee approach is just wasting time.