John Key -the PM who destroyed the New Zealand economy

“He came in like a wrecking ball”

New Zealand’s very own Emmanuel Macron.

JOHN KEY AND THE 170 BILLION DOLLAR KNIGHTHOOD.

Via Facebook

MORE FAKE NEWS ( or outright lies ) FROM TVNZ.

- OUR CURRENT ACCOUNT SURPLUS.

After 9 years, New Zealand's largest TV channel is still lying to the public of NZ about the state of our economy.

They continue to report economic growth when we DO NOT have economic growth just massive population growth! ( just look at the per capita GDP numbers)

The government are 60 billion in debt and climbing every day.

Jacinda Ardern has openly stated that she is going to borrow billions to pay for her spending over the next 2 years.

New Zealand as a whole is now a record 500 billion dollars in debt with over 200 billion borrowed ( by way of the private sector) under John Key to keep our economy going.

What New Zealand's mainstream media do not understand is that NZ DOES NOT have economic growth, we have massive immigration deliberately set up by John Key to lie about the state of our economy to get votes.

The media continue to perpetuate the lie as they simply do not understand the difference between economic growth that creates wealth and prosperity through foreign exchange earnings, and population growth that creates homelessness, poverty, congestion, pollution and is primarily debt funded through massive mortgage debt.

In US dollars

JOHN KEY AND THE 170 BILLION DOLLAR KNIGHTHOOD.

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The most poignant comment of John Key's political career came on his last day in government.

As Key walked down the steps of the beehive for the final time, he was met by a reporter from TVNZ who asked how important it had been that he was seen as popular. Key's predefined answer was, of course it was important that he was popular in the publics eyes.

(Unfortunately, good leaders cannot always be popular, especially when tough decisions need to be made.)

In that one sentence, John Key summed up the objectives and policies of the National government between 2008 and 2016.

John Key never entered politics to help the poor or the homeless. He never set out to save our environment. His policies weren't to alleviate congestion on the roads or waiting lists in our hospitals, and Key never intended to help young Kiwis into their first homes.

John Key entered politics to fulfil a boyhood dream. He was drawn to the limelight and dreamt of rubbing shoulders with the All Blacks, playing golf with President Obama, visiting the Royals, and the other unique opportunities offered by the office of Prime Minister.

Once in government, John Key had one simple priority - take whatever steps were needed to keep the National party ( and himself) in government.

So what was his plan?

Governments everywhere have always lived and died on one thing - employment, not the economy.

This is a strange thing to say because the public associate strong employment with a healthy economy.

This is true, but with one important exception, that is when you are funding the economy with debt !!

John Key knew he couldn't grow our economy the proper way with exports. He didn't have the time or dedication. He entered politics for the rewards of office not to get bogged down in the mundane rigours of running a country.

So Key turned to debt to fund the economy.

But he couldn't use government debt as the media would have reported this quickly and it would have been political suicide.

So he turned to private debt using immigration to create a massive building and consumption boom.

Over his 8 years in power, New Zealand had the greatest increase in population, on a per capita basis, of any country in the world. And it has been funded, in the main, by debt.

Masses of debt. Over 100 billion dollars in eight short years or between 20 and 30 billion every year in mortgage debt since 2008

In 2008 when John Key took power, New Zealand had a population of 4.2 million people, and residential mortgage debt was around 130 billion. 8 years later the population had increased to 4.7 million, and mortgage debt had climbed to 247.8 billion dollars. A massive increase in 8 years.

By creating a building boom using immigration, you can keep a huge percentage of the population employed. There are very few sectors of the economy that are not affected by the demand from massive population growth.

Mortgage debt has been paying for builders and plumbers and architects and planners, it is also paying the wages of people working at Placemakers, Bunnings, Hirepool, Briscoes, Farmers, car dealers, real estate agents, lawyers, accountants and many many other professions.

But using immigration is an extremely perilous way of funding your economy. It destroys the environment, places enormous pressure on infrastructure ( because there is no wealth being created to upgrade services), and it creates a huge drop in the standard of living.

It is a short-term means of keeping unemployment low, but because it is funded with debt, is a long-term ticking time bomb.

The media have for the last nine years been reporting our 'rock star economy' and our expanding growth. None of them have been reporting the truth, which is not a growing economy just a growing population, and the only thing that is 'rockstar' is the debt!

Alongside private debt, National was also using government debt.

When Key took over in 2008 government debt was 10.3 billion, this grew to 64.4 in 2016 when he left.

The media have blamed the Christchurch and Kaikoura earthquakes but the government's exposure to Christchurch was $18 billion, and Kaikoura cost $2 billion.

There has been minimal coverage of the effect of billions pumped into our economy from foreign insurance.

The GFC was another 'crisis' we had to deal with. The GFC was never quantified and was mostly covered over by the debt from immigration and strong tourism numbers.

New Zealand had limited exposure to the GFC, mainly from the collapse of poorly structured finance companies but we will have our real, and much worse 'GFC' when we stop immigration.

Most of the 50 billion of government debt borrowed by Key was spent trying to cope with the ever-expanding population.

Rising pressure on hospitals, schools, roading, police, etc was placing enormous cost pressures on infrastructure, but billions were needed above borrowings to retain our standard of living.

(National spent over 50 million between 2008-16 on motels for the homeless. This issue is still with us in 2018)

National was also taking money out of departments like DOC ( in 2015 $36 million came out of DOC's budget) to try to keep on top of rising costs in other departments.

But Key still ran 5 current account deficits in 8 years, mostly unreported because the media were preoccupied with employment numbers.

(An interesting statistic is the surpluses run in 2015/16/17, and the surpluses run today, are mainly taxes earnt off mortgage debt, as building houses underpins our economy.)

Even with government borrowings, infrastructure in 2018 is in semi-crisis due to population demands.

So how bad are things now?

Because the country has been funded mainly by debt for the last 9 years instead of wealth, there has been no appreciable gain in taxation, just massive cost pressure from the growing population.

Infrastructure is bursting at the seams trying to service another 500,000 'Kiwis', and there is simply no money other than more debt to bring our standard of living back to pre-Key days.

For example, Auckland has seen the greatest influx of people but has no more hospitals or substantial schools than 10 years ago.

But perhaps the most serious and damaging outcome from John Key's tenure is house prices and rents.

Houses prices in Auckland went up 91% under Keys National government due to massive demand and speculation. Immigrants and young Kiwis are now burdened with some of the biggest mortgages of any homeowners in the world!

The ramifications of all this debt are significant.

Mortgage debt will restrict lifestyles, it will affect health and education. It will hamper the ability to save for retirement and will cause enormous long-term stress.

This debt is not only going to be a huge burden for the mortgage holders but will have a massive impact on New Zealand with less discretionary spending into our economy.

The data shows that no government over an 8 year period in history has done more social, economic and environmental damage to New Zealand than the John Key and Bill English led National government.

There is no way back from the situation they have created only the possibility to make it worse if Jacinda Ardern carries on with immigration and borrows heavily at the same time to fund infrastructure upgrades.

In a lot of ways, our economy is now at the mercy of the Australian banks, being a total of over 500 billion dollars in debt.

The Labour Party need to understand the damage cannot be fixed by throwing debt at the problem. Burying the already mortgage-laden youth of New Zealand under more public debt is just wrong.

The bulk of New Zealand's wealth comes from our primary resources. Agricultural horticulture, forestry, fisheries, oil, minerals and tourism. All of these resources are capped. This means that the larger our population becomes the more the wealth from these resources is diluted.

The last thing New Zealand needs if we want to look after our greatest asset, our environment, and be prosperous, is a large population.

Now more than ever we need to look at industries away from our low production cost primary industries, to find other sources of income for our population. This has never been easy due to factors like our isolation from large markets and our high costs related to manufacturing.

In an article printed in the NBR, titled " A Paradise Lost, " the author argued it will take decades to recover from John Key. I disagree. Our environment will never recover from the 2008/17 period and I do not believe we will ever have the standard of living we had pre-Key.

If you want to put a 'positive' spin on things, you could say that bringing back Knighthoods by the National party was a fortuitous move.

Because both Key and English were able to receive one.