March 28, 2010

Time for a change of direction in economic policy

This afternoon I attended a fascinating and thoughtful presentation from four highly regarded leaders:  Rod Oram, John Walley, Selwyn Pellett and economist Ganesh Nana.  At long last we have serious commentators sound the warning bell regarding New Zealand's level of debt per capita. There is something fundamentally wrong with our economy - and this has been the case since the 1950s. The BERL economist included one key slide in his presentation which I have linked to here .

The full set of presentations are worth a look through.  They show the consequences of an overvalued New Zealand dollar - too easy imports and too hard exports.  The commentators provided a powerful critique of monetarist economic policies that have undermined New Zealand's hi-value export performance, employment, productivity and innovation. 

Given the extent of New Zealand's indebtedness there is a dire need to debate alternative policy prescriptions to figure out if there is a better way to improve New Zealand's plight for the next generation of kiwis.  Failure to grasp this nettle could see NZ subject to another firesale of its assets to overseas investors and the exodus of many of our children and grandchildren.

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