In a piece in this week’s Sunday Star Times entitled ‘Let’s scrap the Labour Party and start again’ he describes Labour thus, “If the National Party are the All Blacks then Labour are the Auckland Blues: running around firing coaches, booking 50,000 seat stadiums for 4,000 fans while their best players leave to be a Pacific Economic Ambassador.” Sad, but true.
Mr Williams, an erstwhile supporter, says the ‘subtle incompetence’ of Labour has turned him towards the Greens. Meanwhile, other former party members who just can’t bring themselves to vote National are running into the arms of Winston Peters.
Take the latest stupidity from Labour – a universal basic income. This has been exposed not as ‘subtle incompetence’ but as total, unmitigated incompetence by the economists at the Taxpayers’ Union. These are people who employ real economists rather than schoolboy slogan writers to write economic policy. The Taxpayers’ Union has issued the following press release. The link to their briefing paper is included.
LABOUR PARTY’S UBI WOULD REQUIRE INCOME TAX RATE OF 50% +
A Universal Basic Income which avoided superannuates and beneficiaries being made worse off would require a flat rate income tax of more than 50% or drastic cuts in government services to pay for it, according to a new report released today.
The report, Money for all: the winners and losers from a Universal Basic Income, by economist Jim Rose, examines the Labour Party’s “Future of Work” proposal for a UBI and the more modest proposal by the Morgan Foundation.
A more affordable version of Labour's scheme, such as that proposed by the Morgan Foundation of $11,000 per annum ($210 per week), would cost $11 billion dollars more than the existing welfare system, while making solo mothers $150 per week worse off. For superannuates, a UBI at this level would see their weekly income reduced by $50.
Taxpayers’ Union Executive Director, Jordan Williams, says:
“We find it startling that the Labour Party would be floating the idea of a replacement to the welfare system that would see those most vulnerable in society being far worse off. A UBI replaces helping those most in need with handouts to the middle-class and millionaires.”
"If you take Labour's assurances that no one will be left worse off under their UBI, the amount would need to be so high that Treasury's economic modelling suggests that a flat income tax of between 50.6% and 55.7% would be needed to pay for it."
“Here is a political party which for years has rightly been telling New Zealanders that current superannuation entitlements are unaffordable. Now they want to effectively extend the same scheme to every New Zealander from the age of 18.”
“The Morgan Foundation proposes to pay for its more modest UBI with a tax on those holding capital. Such a tax would incentivise all those modern and innovative industries Labour want to encourage, to shift off-shore.”
Jim Rose, the author of the report, says:
“We don’t believe Labour have fully considered the consequence of a UBI on labour supply and economic incentives. People would almost certainly work fewer hours meaning that the burden of supporting the programme would be borne by a fewer number of taxable working hours, potentially requiring even further tax increases.”
"Even the Labour Party's own paper concedes that the taxes that would be required to fund a UBI higher than $11,000 per year may be 'unrealistically high'. The analysis in the report certainly backs that."
Key points and conclusions:
· The Morgan proposal would cost $10 billion more than the current welfare system but leave those most in need worse off.
· For a UBI to achieve any reduction in poverty levels, or to avoid it costing those in society who most need help, much higher taxes are required. These reduce the incentives to work and economic growth.
· A UBI which allowed those currently receiving benefits and/or superannuation would need to be at least $15,000 per year (equivalent to the current average level of benefits). To pay for this, Treasury estimate that a flat income tax of between 45% and 56% would need to be introduced (assuming other taxes stayed equal).
· Child poverty is not reduced by a UBI less than $15,000 per year because single parents receive no more income support than before.
· A UBI would likely push the New Zealand economy into recession off the back of the reduced labour supply from the windfall increase in incomes alone.
Money for all: considering a Universal Basic Income, is available here. Hard copies of the report are also available on request.
The same implosion of Labour that is happening in New Zealand is happening overseas, most notably in Britain, where the crazy Communist Corbyn is sinking the once great party into oblivion. Why? Put simply it is because the very concept of ‘Labour’ is irrelevant in a modern world. The ‘working man’ of the cloth cap, coal streaked face, and hobnailed boots is a relic of the past.
All that remains for former Labour stalwarts to decide is where they will put their vote next, the Greens or New Zealand First.