Oct 1, 2008

Excellent Suggestion From Fran O'Sullivan

Fran O'Sullivan is clearly as worried as we are about our true exposure to the global financial crisis. And she makes an excellent suggestion about how to respond. Lets open the books now rather than wait for the truth to emerge post election.

Why can't Helen talk John into colluding on the deal that really counts: A bipartisan agreement on a package to ensure the New Zealand economy doesn't turn turtle as the credit crunch becomes a long-term nightmare?

And we agree strongly with these comments

Neither leader has any excuse for failing to inject a reality check at this juncture. Clark has had nearly a decade of golden economic weather under her belt during her prime ministership.
This may have lulled her into a sense of false security. But she was Deputy Prime Minister after the 1987 international sharemarket crash and should be well aware how long it took for the New Zealand economy to climb back as our companies found themselves well down the pecking order in the hunt for international equity.
Key - who also ought to know better given his financial trading background - still appears to be clinging to the notion that his party's "well-structured economic plan" will ensure the New Zealand economy is hermetically sealed from the global shocks.
But the upcoming hunt for international credit will impose constraints on New Zealand irrespective of the underlying health of our companies in much the same ways they were impacted in the late 1980s/early 1990s.
Neither prospective Prime Minister seems to have grasped the nettle - at least publicly - that their plans to buy our votes at this year's election also need to be urgently recast.
Continuing on their respective "default" modes (Clark promising more cash to Labour's people and Key promising another round of tax cuts without compensating expenditure cuts) is questionable as will be obvious on Monday.
On that day, the parlous state of the Crown's coffers will be confirmed as Treasury releases the pre-election economic and fiscal update.