When is a recession not a recession at all?
When is a recession not a recession at all?
GDP data out today is expected to show economic growth. It may also debunk the idea that we were ever in a recession at all. Will it have any bearing on this bread and butter election?
Mōrena, and welcome to The Bulletin for Thursday, September 21, by Anna Rawhiti-Connell. Presented in partnership with Z Energy.
In today’s edition: large scrub fire rages overnight in Canterbury with high winds forecast; fact checking the leaders’ debate; warning of delays at Auckland Airport on the first day of school holidays; but first, will improved GDP data have any bearing on this bread and butter election?
Support for Labour and National drops, National and Act could govern, just
Last night’s 1News Verian poll (there’s one every Wednesday until the election) yielded pretty similar results to the last few polls. National and Act can govern (just), with National down two at 37% and Act up two at 12%. Labour is down one at 27% and the Greens are up two at 12%. NZ First is once again over the threshold at 5% and Te Pāti Māori is steady at 3%. As with last week’s polls, the peripheral questions threw up a couple of more insightful nuggets. The poll asked if political parties should be upfront about coalition agreements prior to the election. 82% said yes. That question is currently most relevant to National who can not say they’re clear of needing NZ First to help form a government. Newsroom’s Jo Moir writes that ruling out New Zealand First would only serve to back Luxon into a corner so he won’t do it.
Lift in New Zealanders who think the economy will improve
As the Herald’s Thomas Coughlan points out, overseas votes can be cast from September 27 and advance voting starts on October 2 giving Labour a short runway to turn things around. In 2020, just under just under 2 million votes were cast before election day. Newsroom’s Marc Dalder finds a bit of hope for Labour in another poll question. The number of New Zealanders who believe economic conditions will improve over the next year has risen to 40%, while the proportion who think they'll worsen is down to 27%. Small and possibly cold comfort for Labour, with the Ipsos Issues Monitor showing New Zealanders are backing National as being most capable of managing almost every major issue of concern including inflation/the cost of living and the economy.
GDP data out today and may show we haven’t been in recession at all
I have to fall on my sword here because I said the Prefu forecasts and Stats NZ data out last week provided a final snapshot of the economy before the election. I forgot about GDP data which might be like forgetting about Dre except economists say it has less bearing on the Reserve Bank’s view of inflation pressure (paywalled) than other measures. GDP data is out today, and most economists are picking we’ll see a small lift in economic growth. They’re not waving a victory flag, however. ANZ’s chief economist Sharon Zollner said the data was volatile due to so many events, but it was clear "economic momentum is softening”. I’ve been told I’m a pedant for pointing out that you can’t say “we’re in a recession” in the present tense because GDP data is retrospective, so I’ll shut up about that but there’s actually a chance that adjustments made to data from the last quarter of 2022 and the first quarter of 2023 will show we were never in a recession at all.
Big ‘E’ and little ‘e’ economy
Christopher Luxon has been making a political meal out of the fact that we're the only country in the Asia-Pacific region to be “in a recession.” His beans and carrots rhetoric may lose some of it’s flavour today but it might not matter. If it vibes like “recession” and “bad economy”, it’s harder for technical economic information to slow that roll. Yesterday, news landed that our current account deficit has shrunk by more than economists predicted (that’s good-ish) but petrol prices may also hit $3.50 p/l by Christmas. Standard & Poor's global chief economist Paul Gruenwald said New Zealand's economy was in good shape last week, but a dozen eggs cost $9.30 last month. Last year I wrote a Budget Day preview and made a distinction between Budget with a big “B” and budget with little “b” to differentiate the government’s spending on big policy set pieces like health reforms from the growing strain of rising food and petrol prices on household budgets. It feels like we need to talk about “the economy” in the same way and the situation has reversed with big, long-term set pieces out and smaller alleviation measures in. The big ‘E’ Economy, or lack of big vision policy beyond somehow “growing the economy” or “managing the economy” is something economists, funnily enough, seem to be increasingly screaming into the void about. Obviously, big macroeconomic stuff is closely related to the smaller ways we feel strained but saying the economy is good or bad means different things to different people and we may find hard economic data is no match against the nebulous “mood for change”.
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Large scrub fire rages overnight in Canterbury
Fire and Emergency NZ crews were called to a large fire on Mt Cook Rd in Pukaki Downs, north of Twizel at about 7.45pm last night. Six properties have been evacuated and a Fire and Emergency NZ spokesperson said active firefighting was “too dangerous” last night due to the high winds. MetService is forecasting high winds in the region that could reach gale force. Rain is also forecast. On Tuesday, NIWA meteorologist Tristan Meyer said the winds that battered the lower North Island on Monday were indicative of El Niño becoming more intense due to warming ocean temperatures, and it was a precursor to a hot, dry and windy summer.
Debate wash up worth your attention
There’s quite a lot of post-debate follow up to add to the poll news. I’m in the acceptance phase of a Kübler-Ross-esque election trough now so power through with me on this mix of the worthy and light-hearted. Auckland University’s Public Policy Institute (PPI) ran their eyes over the debate to fact check statements from both Chris Hipkins and Christopher Luxon. The PPI found Luxon to be the main offender on making false claims in the debate. Hipkins had to clarify his claim that fizzy drinks had been banned in primary schools - they haven’t. RNZ’s Ella Stewart looked into Luxon’s claims that “every single health outcome has gone backwards” under the Labour government. “Six years, not one has improved for Māori or for non-Māori,” he said. Stewart zones in on health outcomes for Māori. RNZ’s Farah Hancock has done a language analysis on the number and types of words used by both leaders. RNZ’s Checkpoint caught up with Sky Rens, who asked the “should rich people had any responsibility for poverty” question during the debate last night. Rens says she feels “defeated” and “disheartened” after the two Chrises “danced around” her question. Calum Henderson has run a mile in the shoes of Tuesday night’s post-debate panel and catalogued every single sporting analogy used. Finally, the first hour of yesterday’s Gone by Lunchtime Megapod is available as a standalone podcast. Toby Manhire, who is alive and well (I think, maybe he’s still going?), Annabelle Lee-Mather and Ben Thomas offer their own assessments of how the debate went.
Youth Wings: The Debate – coming soon
You’ve met the young leaders from five of Aotearoa's main political parties in Youth Wings, released on The Spinoff this month. Now, watch them go head-to-head on all the big issues facing Aotearoa in Youth Wings: The Debate, premiering today at midday on The Spinoff.
Click and Collect
Warning of delays at Auckland Airport as 15,000 travellers are expected to pass through on the first day of school holidays
MP Michael Wood spoke candidly with Toby Manhire about his airport shares ordeal during yesterday’s Megapod
Boil water notice must stay in place for one of Queenstown's water treatment plants until it is upgraded or switches to another supply
Employment Relations Authority asked to step in over senior doctor pay dispute
Shout out to Stuff’s Hamish McNeilly whose
Substack is wrapping up. It’s been a great source of news and views from Dunedin, and provided extra background to a lot of his stories.
Click and Elect
The Herald’s Derek Cheng on why Labour’s 30% prison reduction goal made no sense, and axing it also makes no sense (paywalled)
Gone by Lunchtime Megapod exclusive — Chris Hipkins does read a book or two
Christopher Luxon searches for mojo at a goat farm
National will scrap Wellington’s Golden Mile plan if contract remains unsigned
Act Party unveiled its updated education policies yesterday and is promising online league tables, restricting funding for ECE providers that fall short of teaching the basics, and letting school boards take over other, failing schools
Here’s how many people tuned into the TVNZ leaders’ debate
The Newshub Nation powerbrokers' debate airs tonight at 7.30pm
Duncan Greive examines how the spending cuts of a potential National-Act government might play out for an embattled New Zealand media. Gabi Lardies provides an astrological guide to the election for every sign, from laid back Taureans to type A Virgos. Lauren Marrion pens a thank you letter to the Robin Hoods of the Auckland Transport outage for her week of free travel. Gabi Lardies shops one of Te Pāti Māori co-leader Debbie Ngarewa-Packer's iconic outfits. Tara Ward recaps the first week of hijinks on Celebrity Treasure Island.
Sporting snippets
The 12-year-old who won the AIMS Games golf tournament last week has been playing with his coach’s clubs. Not anymore.
This Rugby World Cup is almost playing out as two separate tournaments, writes Gregor Paul (paywalled)
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The thought of Simeon Brown being anywhere near the baubles of government office really does give me the craps.
(No relation)