Wednesday, October 24, 2007
As an immigrant from the UK, I can remember when I first came to New Zealand in 1995 on a Working Holiday Visa, that I seemed significantly better off than I had been in Britain.
But, in the tale as I have repeated many times since, over the years, New Zealand living standards have barely changed, while those in England seem to inch-up by 2-3% every year and likewise Australia too has prospered, creating a now noticeable wide gulf in prosperity each time I visit.
Further confirmation of this comes in this story: Wages up so where's the money gone? - New Zealand, world, sport, business & entertainment news on Stuff.co.nz
It follows last week , as Whale Oil explains, when David Farrar showed emphatically that despite all the rhetoric we are hardly any better off under Labour and wealth grew faster under the previous National governments of the 90s.
Now, National has released figures that show that despite increased wages, the impact of taxation and inflation have robbed the average worker of all but $500 of the increased $10,000.
Labour has reacted by producing their own figures and surprise, surprise they show we are better off, BUT only if you have children.
Whale Oil says it begs the question, "Are Labour alienating the non-breeders by favouring Breeders?" And he believes Labour will suffer a backlash from singles seeing how much of their taxes go on to funding other people's children via Working for families when they have student loans to pay, etc.
Indeed, there are philosophical points about how much you should subsidise someone's lifestyle. Should people, families included, stand on their own two feet? What can we say of a tax system that subsidises families when their gross income tops $100,000 a year, as Working For Families does? What can we say of a tax system where you lose so much of any extra income that it does not pay to work harder or gain that promotion, as happens under Working for Families.
Still, WFF creates jobs for bureaucrats, allows Liarbour to claim it is offering tax reliefs, allows people to be bribed with their own money, and allows the middle class to become welfare recipients, thus enlargening Liarbour's dependent constituency.
Wouldn't it be better if tax could be kept as low and as simple as possible? That way, there would be no disincentives to work and promotion, families would not need subsidy, fewer bureaucracts would be needed, singles would not feel hard done by.
That might not be good for Liarbour, but I am sure it would be good for all of New Zealand.
UPDATE: Whale Oil uncovers this parliamentary exchange, which reports on the figures quoted above, where Dear Leader has possibly misled the house over definitions of what are tax cuts and what are tax relief.
UPDATE2: Colin Espiner of Stuff blogs today: Working for Families can't be tax cuts in drag.
Posted by FAIRFACTS MEDIA at 10:50 AM