Yesterday I asked:
Who’re we going to trust – Labour, who already knew what was happening and still don’t know what to do about it, or National who have assessed the situation and acted?
The Herald has also noticed that National came up with a plan two days after the books were opened but Labour, which ought to have been known about the sad state of the national accounts, has done nothing.
There has been a striking contrast in the response of the two main parties to the disturbing news that after 14 years of budget surpluses the Treasury now calculates the public accounts are set for a decade of deficits.
An announcement such as that, of which governments have ample warning, would normally be accompanied by some urgent decisions aimed at restoring the fiscal balance somewhat sooner. Instead, Finance Minister Michael Cullen merely congratulated himself again on having saved previous surpluses for a “rainy day” and looked forward to the problems it would cause for National’s intended tax cuts.
There was evidently nothing he thought necessary to change, either in his own programme of reluctant tax cuts that started this month or in the Government’s spending programmes that might have seemed affordable in better times. If Labour’s “rainy day” could last 10 years, as the Treasury forecasts, Dr Cullen and his colleagues seemed strangely relaxed about it.
He even observed that had he known in the May Budget how bad things would become, his tax cuts might not have been as generous. Evidently he can do nothing about those scheduled two and three years ahead. There could be no clearer admission that Labour does not expect the next few years to be its problem.
Has Cullen thrown in the towel or has he absolutely no idea what to do when faced with an economic crisis?
Keeping Stock also comments on the editorial.