If Shamubeel Eaqub, economist, could change one thing it would be, “We need to increase the amount of our welfare payments, and we need to make them less conditional”.
Do you agree? What is your vision for NZ, or what would you change if you could heading into a post Covid world?
I think we need to reevaluate the unspoken assumptions we make about economics. We think of free market economics as free when in reality there are rules which are created by economists instead of govt. We pay tax to corporates rather than govt in the form of the profit portion of the product cost. neoclassical economics was created in the 60's. Every other aspect of our society has been upgraded several times over but we still have an old incumbent economic system.
Is interest still a concept which functions for the way we intended? Are sharemarkets how they are currently structured actually producing development or are they just allowing an avenue for lazy people to make money without actually contributing to our society? Is the concept of profit in large and multinational businesses actually creating positive outcomes for the products they produce, the price they are and the environmental sustainability of the product. If the profit motive didn't exist in large organizations the purpose of the organization would become producing quality goods and services rather than exploiting workers and cutting costs through disposing of waste into the environment. Maybe we need to lead a vision for a global economic system which is based on human development, not economic development.
If I could change one thing, it would be the largely-unspoken belief in "wealth creation". We do not create "wealth", we extract it from the biosphere using the energy available directly or indirectly from our local nuclear fusion reactor (the Sun). Wealth creation is a destructive cargo cult. There's nothing wrong with hard work and the entrepreneurial spirit, but when that morphs into selfishness, beneficiary bashing and tax avoidance it becomes divisive and destructive.
100% agree Graham, especially when you realise that the share and investor markets are the real beneficiaries of our society. If there is anything that Covid has highlighted its that the people who do the least work to earn the most money (investors) come before every other aspect of our society. Consider the controversy around rent strikes and mortgage holidays, it was taken for granted that renters should still have to pay rent, landlords should still have to pay their interest but banks and their shareholders who literally do nothing to create actual physical value were put first by our society. To the point where the govt created a wage subsidy scheme so renters could pay landlords so they could continue to pay banks.
Its time to stop this system of being able to make money simply through the virtue of having money. It should be the other way around. It should be easy to make and save a million dollars, it shouldn't get easier once you have a million dollars to make another million, it should get significantly harder passed that point. Usually this is where large tax on the rich would come into play but the rich have put consented effort in the 80's into lowering their tax rate. They don't want government taxes, so I guess we need to find another market mechanism to make it hard for them to hoard massive wealth they didn't actually work for at the expense of everyone else.