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Thursday, 4 November 2010

The gap

Lindsay Mitchell reproduces the two salient graphs from the 2025 Taskforce report, published yesterday.

In my mind, this graph is also very important:
The interesting point here is that when Labour was last in power (1999 - 2008) they actually managed to reduce spending as a percentage of GDP up until 2004. From 2005 onwards however its been a steep climb upwards again - remember what happened 2005 - 2008? Labour basically tried to spend its way back into power, succeeding at the 2005 election with interest-free student loans and working for families. Yet between 1999 - 2004 they actually greatly increased spending on hospitals, science and education and yet spending as a percentage of GDP decreased (by the same token National had a small blip between 1996 and 1999, probably due to the NZ First coalition disaster).