Espiner on the lolly scramble

Colin Espiner writes:

Good morning and welcome to this special edition of Who Wants To Spend Like A Millionaire (SLAM).

Joining us today are three contestants; Team Red, Team Blue, and Team Green. They’ll all be trying to spend as much of your money as possible in the time available. Take it away, guys.

Team Blue: “We’ll set up a new network of specialist teachers and principals throughout the country and pay them much more. We reckon it will cost around $359 million of taxpayers’ money.”

Team Green: “There is such a thing a free lunch and we’ll prove it. We’ll provide all decile 1-4 schools in the country with food and medical care at a cost of around $100m a year.”

Team Red: “Phffft. Pocket change. We’ll give nearly everyone in the country who has a baby $60 a week, even really rich people. There’s quite a bit of fine print but we’ll let you read it for yourself. It’s going to cost a whopping $528m every single year within four years.” …

And the losers? Taxpayers, who’ve found their elected representatives have collectively managed to write cheques totalling nearly a billion dollars in the first week of the political year. With another 46-odd weeks until the election, the mind boggles at how much largesse could be promised this year.

The last paragraph is the key point. Taxpayers have to fund every single one of those promises. The Government does not fund them. We do.

As I said, I’m actually happy to fund better pay for the top teachers. I’m not happy to fund a $60 welfare payment to someone on $145,000 a year and I’m not happy to fund turning schools into meal dispensaries.

The reason, of course, is that National knows Labour’s idea is likely to be popular. Giving away money always is, which is why the prospect of tax cuts is likely to be dangled before voters later in the year – although probably not actually promised just yet.

Tax cuts is not giving away money. It is not taking so much money off people. A very big difference.

Speaking of infants, Labour is going to have a hard time convincing me that giving everyone $60 a week just for having a baby is a good idea – or is likely to raise productivity (except perhaps in the bedroom). 

Indeed.

Labour’s first election-year salvo is therefore good politics but bad policy. National’s education announcement is costly, but might benefit us all in the long run.

Hopefully Labour’s leader David Cunliffe will come up with some other ideas besides mere redistribution of income as the year unfolds.

I hope so also.