The government in its pre-election economic update forecast rosy growth and an improving economy.
In its policy framework, National set out what it called a 120 point economic growth strategy.
World headlines are full of economic doom and gloom. Agencies as conservative as the I.M.F. are saying that the global obsession with cutting deficits is damaging all the things we want from our economies: higher wages and more jobs.
So: what happens to New Zealand if the rosy forecasts don't come true, and the non-plan in National's manifesto doesn't save the day?
Here is my prediction. More state.
Stronger economic development policies, more state investment, more regulation, corporate welfare, the lot.
Change will come because the global conditions will worsen, and because the hands off model isn't up to the job. Eventually the facts will out.
The Auckland business crowd will hate it, but I think I am right with this. National will not face a neo-classicly inclined opposition. Key's instincts and those of Joyce are pragmatic. From milk to broadband markets, heavy handed state is already visible. All the options and opportunities will be on the 'do more' side of the plate.
Assuming for a moment I am correct, what are the opportunities and consequences?
For National, the loss of some vote.
For a liberal right wing party (like ACT used to be, but unlike the nascent Conservative party), the chance to become a serious player with some real pull among those who would hate this direction for National.
For Labour, opportunities galore. The ability to poke holes in the gaps between National's actions and its principles or values; to poke holes in state centric approaches; to benefit from a resurgent consensus that government matters.
It's early days. But in a year from now we will know. So far and based on the past three years, the evidence is in favour of my prediction.
Comments