Heather du Plessis Allan: Roger Douglas is right - we have too much debt

Today is 40 years to the day since Rob Muldoon called the snap election.  

Which then, of course, led to his defeat. Which then, of course, led to the incoming Labour Government, realised we were nearly broke as a country. Which then led to them embarking on the most amazing set of reforms which they do not get enough credit for to this day - and get way too much grief for.  

It is a really interesting anniversary for us to mark right now - as we find ourselves in a recession that feels like the worst that many of us have ever experienced. As we watch old names in New Zealand, like Smith and Caughey give up. As we see projections that the country's debt will just keep growing. 

Because today, Roger Douglas - one of the primary architects of those reforms back in 1984 - has given an interview saying we are as in as much trouble today, as we were back in 1984. By the way, if you ask why is Roger Douglas piping up again? He's not stopped, ay. You cannot stop the man. He's still pouring over all the government financials, still publishing his ideas, still calling journalists to tell us what he thinks is going wrong with the country. And in this particular interview, he points to a Treasury paper containing long-term fiscal projections, and he says if we carry on spending the way that we are, if you look at this paper, we're going to go broke.  

In particular, what he's worried about - is the projections for the cost explosion that's coming in healthcare, the pension, education and the cost of paying for the debt that we're racking up. He points to health specifically. He says it's currently 7% of GDP. In 35 years - many of us will still be alive by that time - it will be 11% Now that is just health. Never mind the pension. Never mind education. Never mind the cost of the debt. And he is worried that the debt is gonna blow out in this country. And he's right to be worried about it. Because if you just look at the budget documents that were published last month, that debt shows no sign of going anywhere other than up, it just gets bigger and bigger and bigger every single year. Now you tell me that he's wrong.  

And I'm not being miserable about it. I just wanna be realistic about it. You tell me that you disagree with him, that we are in the same position that we were in 1984. Our country is in a structural deficit at the moment. It means that we spend more every single year than we earn as a country. Our infrastructure is getting old. Everything is going backwards from crime, to the education system. We are tied up in red tape and dumb rules in this country. So he's right, isn't he? So here’s hoping the country and the government have the intelligence and the courage to do some radical things to fix this - just like the government that came in 40 years ago. 

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Episode Transcript

Speaker 1 (00:00):
Oh, you know what today is, don't you. Well, as
you probably you don't. You're not enough of a nerd.
Let me tell you. Today is forty years to the
day since Rob Muldoon called the snap election, which then
of course led to his defeat, which then of course
led to the incoming Labor government realized we were nearly
broke as a country, which then lead to them embarking
on the most amazing set of reforms, which they do
not get enough credit for to this day and get

(00:21):
way too much grief for it is a really interesting
anniversary for us to mark right now, as we find
ourselves in a recession that feels like the worst that
many of us have ever experienced, as we watch old
names in New Zealand like Smith and Coe give up,
as we see projections that the country's debt will just
keep growing. Because today Roger Douglas well, of course, one

(00:45):
of the primary architect of those reforms back in nineteen
eighty four. Today, Roger Douglass has given an interview saying
we are as in as much trouble today as we
were back in nineteen eighty four. By the way, if
you ask why is Roger Douglas piping up again day
the man. You cannotop the man. He's still pouring over
all the government financials, still publishing his ideas, still calling journalists,

(01:06):
you know, to tell us what he thinks is going
wrong with the country. And in this particular interview, he
points to a treasury paper containing long term fiscal projections,
and he says, if we carry on spending the way
that we are, if you look at this paper, what's
going on in there, we're going to go broke. In particular,
what he's worried about is the projections for the cost
explosion that's coming in healthcare, the pension, education, and the

(01:28):
cost of paying for the debt that we're racking up.
He points to health specifically. He says, it's currently seven
percent of GDP. In thirty five years, many of us
will still be alive by that time, it will be
eleven percent. Now, that is just health, never mind the pension,
never mind education, never mind the cost of the debt.
And he is worried that the debt is going to

(01:48):
blow out in this country. And he's right to be
worried about it, because if you just look at the
budget documents that were published last month that debt shows
no sign of going anywhere other than up. It just
gets burger and burger and bigger every single year. Now,
you tell me that he's wrong, and I'm not being
miserable about it. I just want to be realistic about it.
You tell me that you disagree with him, that we
are in the same position that we were in nineteen

(02:10):
ninety four. Our country is in a structural deficit at
the moment. It means that we spend more every single
year than we earn as a country. Our infrastructure is
getting old. Everything is going backwards, from crime to the
education system. We are tied up in red tape and
dumb rules in this country. So he's right, isn't he.
So here's hoping the country and the government have the

(02:31):
intelligence and the courage to do some radical things to
fix this, just like the government that came in forty
years ago. For more from Heather Duplessy Allen Drive, listen
live to News Talk said B from four pm weekdays,
or follow the podcast on iHeartRadio.