New Orleans and Tax Cuts

The Left have come up with their most scurrilous claim yet: that the break in the levees on the Mississippi Delta is directly a result of George Bush’s tax cuts. Their inference is that National’s proposed tax cuts will lead to a similar disaster in New Zealand.

Balanced commentators note that the collapse of the levees was based on several factors; the fact that the levees were designed to protect New Orleans against a Force 3 Hurricane. Katrina was a Force 5.

Second point: accusations that the Bush Administration neglected the levees isn’t borne out by the facts. Responsibility for funding the levees was shared by both Federal and State authorities. Squabbling over the funding of the levees, and levee shore-up projects, have gone back twenty years; i.e., long before the Bush Administration was around to reduce taxes.

Thirdly, even if it can be maintained that the Federal Government was wholly responsibly for maintaining the levee infrastructure, there is no link between tax cuts and a run-down of levee infrastructure. In this respect, the Left scores an own-goal. What it suggests is that the Federal Government has got its spending priorities wrong.

National’s forecasts through to 2008 show a continuing rise in taxation revenue, even after the marginal rates of income tax rates have been reduced. Government spending is forecast to continue to rise. No currently planned infrastructure project is at risk as a result of income tax reductions.

The real threat to infrastructure development is not lack of revenue to fund it, but bad spending priorities by Government. Labour, through its massive over-investment in bogus and low quality education courses, superfluous spending on dubious PC schemes, and the burgeoning public service, indicate quite clearly that Labour has no spending priorities whatsoever. Their priorities are not “core infrastructure”, but feel-good, trendy plans to impose its liberal agenda on New Zealand.

New Zealand has no direct equivalent of the levee infrastructure along the Mississippi. What we do have, on the other hand, are core roading and energy requirements that aren’t being met due to highly cumbersome resource management processes that kill development; an education system that is well-resourced but atrociously managed; a welfare system that creates disincentives to work; a justice system that is in such disarray that victims don’t bother reporting crime anymore; and a health system that concentrates itself on bureaucrats, rather than patients.

These are the core infrastructural issues facing New Zealand. Solutions to these problems are found not in throwing more money at the black holes of waste. Rather, they are sorted by having the political resolve to get roading and energy projects completed, focusing education on achievement, creating incentives to work and disincentives to cheat the taxpayer, and a health system that concentrates on delivery of service, rather than screeds of ideologically-based policy analysts discussing the modes of delivery.

Labour’s solution is to continue to strangle the economic goose through an oppressive taxation regime. National’s answer is to make Government accountable for responsible spending of taxpayer funds, and to use Government’s authority to make best use of that spending.

The tide of public opinion has reached the high water mark. Labour’s defence of its own policy agenda isn’t holding up. Their shoddy scare tactics aren’t working either.