New Zealand has a different idea - "You Can't Spend Your Way out of the Crisis"
The Wall Street Journal reports that things have changed in New Zealand -
Over the past nine years, Helen Clark's left-wing Labour government rode the global economic expansion and used the revenue surge to expand government welfare programs, renationalize industries, and embrace causes like global warming. As a result, the economy stagnated while Australia took off.
"We have been on a slippery slope," Mr. Key says, pointing to the country's slide to the bottom half of the Organization for Economic Cooperation and Development's per-capita GDP rankings. "So we need to lift those per-capita wages, and the only way to really do that is through productivity growth driving efficiency in the country."
Key is Prime Minister John Key. He is practically, not ideologically, driven. He grew up in state-provided housing after his father died so he knows how government can help.
About Washington he says, "You've saddled future generations with an enormous amount of debt that then they have to repay. There is actually a limit to what governments can do."
One thing government could do to help its citizens is to cut income taxes. Strange how that is the last thing most governments want to do. Bucking the trend, New Zealand's government has. It is also reviewing entrenched regulations.
"Good regulatory reform can be an important catalyst toward driving economic growth and coming out of the recession faster," Mr. Key says.
Key's ideas are based on the centuries-old experiences of free economies. In a free economy people freely create and produce and government has a few essential services to perform. In a free economy taxes are low, which encourages productivity. In a free economy big business is not given billions in government hand-outs - taken from the taxes of hard-working citizens. In a free economy the laws protect citizens. They don't oppress and stifle them. Please note that we don't call the free economy capitalism.
Key says, "We don't tell New Zealanders we can stop the global recession, because we can't. What we do tell them is we can use this time to transform the economy to make us stronger. . ." In the meantime, New Zealand won't be going into debt.
It will be interesting to see what happens.
It would be lovely to visit.