Robertson Rivals Scrooge at Christmas
New Zealanders waiting for hip and knee surgery and other medical procedures, and families struggling to put food on the table will be funding increased profits for banks and corporate investors following Finance Minister Grant Robertson's $12 billion borrowing announcement yesterday.
Those banks and investors will be rubbing their hands with glee over the Christmas present they've been delivered.
They'll get increased profits from the taxpayer funded interest payments on the government’s new borrowing.
Banks especially will be popping the champagne corks given that the money they lend is created out of fairy dust in the first place, a fact confirmed by the Bank of England, the German Bundesbank, and our own Reserve Bank.
Those sources confirm that banks don't lend their depositor's money, they create new digital money when they lend - a sum already amounting to about $20 billion every year.
The additional interest burden on taxpayers will add to the $6 billion of taxpayer funded interest already wasted by the government sector on its current borrowing.
The 1956 Royal Commission on money and banking declared that " the Government has itself adequate powers to create money through the Reserve Bank".
That means that the government sector could fund all it's borrowing from the Reserve Bank.
Instead of a $12 billion one-off spend, the government sector could have $6 billion each and every year to invest in health, education, infrastructure etc, without increasing borrowing at all, if it simply drew on the funding capacity the Royal Commission confirmed it could use.
Just like National before it, Robertson has confirmed that this government is more focused on boosting investor profits than it is in delivering a better quality of life for the majority of New Zealanders.