Trapped within the neoliberal framework which has been the economic orthodoxy in New Zealand for the past twenty-five years, John Key and his National-led Government demonstrated again yesterday that they no solutions to New Zealand's economic problems - problems that won't be going away anytime soon.

What John Key's speech did starkly expose is that New Zealand ruling class has no clear strategy of how to pull the economy out of the mire.

With the cooperation of the trade union bureaucracy, it has tried to make workers pay for the crisis via wage cuts, cuts in hours and job losses. But, despite the almost daily stories in the media about an 'economic recovery', this strategy has not worked either.

Unemployment is now at 7.3 percent although John Key was telling us shortly before Christmas that unemployment had peaked. In June of last year , the Reserve Bank predicted the jobless rate could rise to as high as 7.2 percent by the middle of 2010. Well, we are already beyond that figure and the year has barely begun.

On top of that the number of people who cannot get enough paid work hours continues to surge upwards.

Has John Key got any solution?

No, he doesn't

Key's speech wandered all over the place, grabbing at anything and everything that suggested that he is a man with a plan, a man in control. Among other things he mentioned was 'research and development', more mining (I guess climate change is a low priority now, John?), and fast broadband. And he also mentioned the building of more roads. And Weta Workshops got a mention too, I think.

And, of course, he's hoping that tax cuts might boost the economy.

They will be funded by an increase in the GST which will hit the poorest of us hardest.

And Key looks set to go on another round of beneficiary bashing with his threat, among other things, to cut the unemployment benefits of people who have been on the dole for 'too long' a period. The implication is that they are 'bludgers' rather than victims of a crisis-ridden capitalist economy.

His bluster about 'encouraging' people into jobs - when there are few jobs available in the first place - indicates that beneficiaries are going to get kicked where it hurts the most - as they always do when the economy goes into a nosedive.

While his critics have accused Key of having no vision, he can get away with it because the opposition parties are not providing any clear economic alternative while the trade union bureaucracy has made life easier for Key by buying into the National Government's austerity agenda.

While Goff had a fine old time blasting Key in Parliament the fact remains that Goff and his Labour Party remain just as committed to neoliberalism as Key. The difference is in emphasis and not substance. It's a similar story with the Green's.

The fact remains that no progressive solution - a solution that benefits ordinary people rather than bankers and property speculators - is possible within the framework of the failed neoliberal orthodoxy.


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