I'm actually surprised I didn't pick up on this sooner. But it seems like a policy proposal that could, in a very meaningful sense, reduce tensions between those of us who are of a more market-friendly strand and those of us who are more social democratic. Basically, New Zealand's Labour Party wants to put fiscal policy in the hands of the central bank.

For the uninitiated, fiscal policy is to do with the revenues and expenditures of government. Keynes - the namesake of Keynesians - advocated activist fiscal policy in times of recession such as deficit spending or cutting taxes.

Essentially, the Labour Party wants to give the central bank control over mandatory pension contributions, which could be lowered in times of slow growth or recession to boost aggregate demand. Scott Sumner, who like me is a neo-monetarist (usually adversaries of Keynesians), is quite taken with the idea, even though it'd probably be better to just stick with monetary stimulus.
 
However, I think it should go further than this. It should be expanded to all social security contributions, not just retirement savings. Put fiscal stimulus in the hands of the central bank, which is far better than it being in the hands of the legislature (can you imagine trying to pass another stimulus package?).

It's also translate-able. We all have social security in one form or another, with America's forms being eponymous and FICA, and the U.K.'s being N.I.

The best part? Lord Keynes himself is on board.

I am converted to your proposal…for varying rates of contributions in good and bad times. (June 16, 1942). Keynes, Collected Writings, vol. 27, p. 208.

…[Y]ou are able to show fluctuations in income of an order of magnitude which is significant in the context… So far as employees are concerned, reductions in contributions are more likely to lead to increased expenditure as compared with saving than a reduction in income tax would, and are free from the objection to a reduction in income tax that the wealthier classes would benefit disproportionately. At the same time, the reduction to employers, operating as a mitigation of the costs of production, will come in particularly helpfully in bad times.  (July 1, 1942). Keynes, Collected Writings, vol. 27, p. 218.

It's nice to see the Left some up with something so incredibly sensible.

For the econotards: New Zealand's Labour Party wants to give the central bank the power to vary mandatory contributions to pensions, so it can be lowered in times of recession to boost spending.

Sorry all that econo-jargon just melted my face off ._.

Oh come on! It wasn't that bad!

I added a bit for econotards.

Oh. That actually sounds like a great idea.

New Zealand, harmonising the Left and the Right since 1990.

Yes, let's have even more money stolen from us for "spending".

I think you misunderstood the point of the policy.

The point is that the government doesn't tax anybody to a higher degree in order to run a deficit - or as I assume you're insinuating, for the sake of corporate welfare (I actually agree with you there) - but to lower social security taxes on citizens to encourage them to spend their own money.

Or we could tax the shit out of the ΓΌber wealthy and corporations instead of taking money out of Grandpa Jones retirement savings.

Grandpa Jones isn't paying social security tax, though, since he's already retired.

The point is not who pays for the spending, the point is who is doing the spending. I would rather have consumers boost aggregate demand in a positive way than have the government carpet-fund every fucking sector in the economy when it doesn't even work - no matter where the money comes from.

That's the problem. It doesn't matter how much money the government has, it never helps us out.

I agree. Which is why I support cutting taxes across the board and think NZ Labour's policy here is top-notch shit.

I don't trust a bureaucrat any more than I trust a corporate exec, so I don't want either of them having my money. And, funnily enough, giving my money to the former will almost always result in it being in the hands of the latter.

I wish the British labour party was this sensible. >.>

We all do.

>mfw

I could see that. I can believe you look like that.

nah

i kno w0t u look like anyway

ur in my dreems