Part 2 – Part One was 25 June, 2024
The result will probably be a dominance of conservative governments as the socialists will find it difficult to form stable, credible governments in this virtual FPP environment.
There is one group that I didn’t mention in the previous article and that is ‘the workers’. The average worker has been largely ignored by major parties in recent years, much to the detriment of those parties and of the workers.
National continue to support the middle classes and the well-off but the traditional champion of the worker – the Labour Party, has been more focussed on beneficiaries and developing policies to help them fight off the improving Green and Maori parties.
A couple of weeks ago, I was discussing politics with my brother-in-law, aged 80 and a Labour voter all of his life, as were his parents before him. When discussing the last election, he said, “I voted Labour because that’s what I do. I know they are as useless as sXXX and stuffed the place up, but I wasn’t sure the other side would be any good.” He went on to voice his criticism of Labour politicians in general as “none of them know what it is like to be a worker!”
This is an area Labour must get back to, if it wants to become a credible force. Relying on Chippy’s crumbs of thought will not do it. Likewise, it is an area the other side could concentrate on if they want to help the Greens press the knife into the Labour back a bit more. The way for either side to provide any real gain for the average worker is incredibly obvious; give them more money but do it genuinely through a rework of the tax system, not by making them into State dependent beneficiaries with schemes such as Working for Families.
So how could this be done?
Providing Workers with more money is the easy part. Firstly, change Working for Families into the tax deduction it was meant to be, rather than the social welfare payment it became. Apart from anything else it would automate the payment and remove the necessity for a bureaucracy to manage these payments which would be a significant cost savings for the country and free up some administrative staff for a healthy outdoor job, picking apples or working on infrastructure projects. The second part is quite simple also, and that is, to alter the tax rates on the various breaks. For example, earnings up to $15,600 per annum are now taxed at 10.5% and I suggest this rate should be zero. If we then start applying our tax rates in the next bracket we see some really beneficial effects on Workers. For example, someone on the minimum wage with two children would have no tax to pay giving them an additional $141 per week. Likewise, if the same person was on an average wage their take home pay would increase by approximately $250 per week.
Next question is how does the government function if it forgoes screwing workers for the level of tax for which it has previously screwed them? The answer once again is quite simple, get your money elsewhere. Consider what other countries do. The OECD average for percentage of tax taken from income is 24%. In New Zealand it is 41% so there is great room for improvement using taxes such as financial transaction tax, social security taxes, land tax etc.
A major change could be made to our nation’s tax structure and if a Labour opposition was to announce this, they would break the path of doom that I see currently lying in front of them. The challenge for them is to find the intellectual rigour to form such a policy and unfortunately intellectual rigour is an area of weakness for them. Conceivably, a National led government could come up with such a policy, but they would be reliant on ACT to do the thinking for them. May happen, may not.
