Do you believe in fiscal miracles? Yes? Then get along to National’s conference.
There you’ll hear that, having incorporated this year’s tax cuts, National will fast-track a second round of tax cuts in April next year, a year earlier than those announced by Labour. And have another round in April 2010. Why? Because we deserve them and we’ve been waiting “far too long already.”
And.. wait for it… National will not borrow to fund this.
In fact, National will be more relaxed about running deficits in an attempt to boost the economy. This means that we can get our tax cuts and keep our core services!
Sounds like Keynesianism on steroids. I guess the Nats are depending on people not understanding the meaning of “structural deficit”.
You can sort of understand their reluctance to act responsibly, having watched the news media hound Cullen over recent years for his principled refusal to countenance a structural deficit, before finally caving into political reality and wearing the consequences.
Something’s got to give fiscally. Otherwise, the economic impacts will be painful. A rising exchange rate, striken export sector and stagnating economy. Followed ineluctably by gruelling readjustment as we regain our fiscal balance.
National must give us the sums that show how they can accomplish this fiscal miracle of cutting taxes whilst maintaining spending and not borrowing, during the downswing of the economic cycle. It doesn’t add up.
[Update: The Standard condemns the fiscal conjuring as spin.]
Tags: National Party