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Government By Cliché

The new government is making a weak start to its tenure. On Morning Report (RNZ, 28 Nov 2023, Prime Minister Luxon to lead first cabinet meeting), Mr Luxon repeated a comment such as he has made several times before: "The number one job is to rebuild the economy so we can lower the cost of living so everyone can get ahead". Three clichés in one short sentence!

First cliché. Is the economy destroyed, and therefore in need of rebuilding? Or is Mr Luxon planning to destroy the economy, so that it can be rebuilt? Or is he just speaking inane hyperbole?

Second cliché. Is Mr Luxon calling for deflation? Is he promising to lower the CPI (consumers price index)? That's a literal interpretation of what he said.

Or did he mean to say: 'lower the rate of inflation'? That is, did he mean to say that his aim is to slowdown the rate at which the cost of living is increasing? (We'll ignore for now the fact that 'inflation' and 'an increasing cost of living' are technically and practically different things, although they are related through the concept of 'rising prices'.)

For most of the 2010s, the Reserve Bank of New Zealand was waging a quixotic war against price deflation, on the basis that deflation is worse than inflation. Mr Luxon now seems to be saying that deflation is a desirable thing. Yet, as I understand it, the changes which he wants to make to the Policy Targets Agreement (the Government's contract with the Reserve Bank) are to create a single mandate that makes inflation compulsory.

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Third cliché. Can everyone get ahead? Ahead of who or what? The natural understanding of this aspiratorial cliché is the metaphor of a running race. In one sense everybody gets ahead if they all reach the finish line, because they will be ahead of the start line. But in another sense 'getting ahead' means 'winning' or at least 'not losing'; in this sense its logically impossible for everyone to get ahead.

As I understand it, 'getting ahead' is an awkward cliché for 'equality of opportunity'. 'Equality of opportunity' is a mantra for centrist liberalism which I suspect that the outgoing Chris and the incoming Christopher both subscribe to. The metaphor is that life is a running race (the human race?) and the starting point is at the 'age of majority'; say, 18. The ideal is that every adult starts as equals. (The two variations are the Act liberal race, which is like Formula One motor racing, where the most likely winners have favourable starting positions; whereas the Labour liberal race is more like the Melbourne Cup, where the more-likely winners are subject to a handicap.)

This concept of centrist liberalism explains why we are so obsessed with 'child poverty' and so little concerned with adverse outcomes in adult life. As the story goes, adults are 'free to choose' and must 'lie in the beds' that we (as adults) make for ourselves. In this narrative, children are not free to choose; social policy is therefore all about ensuring an equitable (or acceptable) starting line for the race of life.

The idea that everyone gets ahead seems very socialist to me. Under liberalism, some people do get behind. Necessarily.

Why do media interviewers meekly accept these clichés?

Two Other Clichés

I'll mention two other common clichés, without much elaboration. These are most often heard by mainstream commentators. Refer to RNZ The Panel part 1, 27 November 2023.

The fourth cliché is that we should have a longer parliamentary term (than three years) because we waste the election year on politicking, and waste the year after elections in getting set-up. It's an assertion repeated repeatedly; but rarely examined. Nobody mentions that the United States' parliament (Congress) has a two-year term. And few mention the fact that most United Kingdom parliaments do not go full term.

The fifth cliché is that 'there is only so much money' to go around. This glib statement is patently false, yet almost always presumed to be true; money is a social technology, not some magical mined mineral. This cliché, subscribed to by the entire Aotearoan political class in 2023, has jammed New Zealand politics into a tight stalemate; into a nasty zero-sum game that ruined the 2023 election. As a result, the new government, in being required to abandon one oft-lampooned method (taxes on foreign buyers of luxury homes) of funding nominal tax cuts, has been required to find another source of funds. So, shock horror, they are choosing a policy that they claim will increase revenue from tobacco taxes. This may well be a bad health policy, though it's not that clear. But the state of political discourse is so clichéd that the obvious solution – to budget for a slightly larger fiscal deficit – is 'off the table', politically speaking. 'Unfunded' (ie deficit) spending is a necessity in capitalism; somebody has to incur deficits (it might as well be the government); and as economies grow, total deficits must also grow.

A related cliché, which is less obviously untrue, is that 'borrowed money has to be paid back'. In fact, borrowed money must be serviced. In public finance, the near-universal truth is that borrowed money is serviced, both through interest payments and rollovers of principal. (Otherwise, money is paid forward, not paid back; eg when I pay down a bank loan, the bank advances that money to someone else. Money literally paid back is money destroyed.) This version of the cliché is like believing that God requires the universe to be 'paid back'.


Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.

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