I said some weeks ago that Treasury's predictions of an eventual worst-case 7.2 percent unemployment rate was unrealistically optimistic.
Yesterday the Treasury, dominated by neoliberals, issued a new forecast and this time its suggesting unemployment will tip the 10 percent mark which, roughly, means another 60,000 will be signing on at Work and Income.
I still think Treasury are fudging this one. This is no mild recession - this is a global economic meltdown - and I certainly think it will go beyond the 11.1 percent of 1992. When does a recession become a depression? Certainly a official unemployment rate heading for 12-13 percent is more than a recession - especially when we consider that the official unemployment rate does not cover people not claiming a benefit or working part-time.
Bill English, revealingly, won't predict how bad he thinks unemployment will get - which means he thinks its really going to be bad.
Has he got any answers? No.
Prime Minister John Key though appears to be a world of his own. He said that a increase of 60,000 within the next year 'seemed a bit high'.
This new forecast come against the backdrop of the G20 conference that achieved little other than paper over the cracks between countries. There certainly wasn't anything in it for working people.
The International Labour Organisation are predicting that a further 30-50 million people will lose their jobs over the coming months.
Before the commencement of the G20 summit the International Monetary Fund boss himself, Dominique Strauss-Kahn said “Bluntly, the situation is dire.”
He went on to say that millions of people will be pushed into poverty and hardship which will “affect dramatically unemployment and beyond unemployment for many countries it will be at the roots of social unrest, some threat to democracy, and maybe for some cases it can also end in war”.
While capitalist politicians around the world, including our own Parliamentary 'representatives', have no answers to this crisis at least Venezuelan President Hugo Chavez has been promoting a different path. Last week he said:
"It's impossible that capitalism can regulate the monster that is the world financial system, it's impossible. Capitalism needs to go down. It has to end. And we must take a transitional road to a new model that we call socialism."