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August 23, 2005



Despite all of what you've written here, the consenus seems to be that these reforms have helped NZ, and that they are now better off because of them. Do you dispute this?


Let me put it this way: I question whether the reforms have helped NZ as much as people have said they do, and as discussed in the thread on Marginal Revolutions, whether the measurement of improvement is the correct one, given that NZ now also has a lot of ills that it didn't have prior to the reforms.


Perhaps I can give a first hand account. I grew up during the reforms in NZ. My father had previously paid up to 60% tax on his income, and had contributed full to the national superannuation fund and all of the social welfare systems. My sister is 10 yrs older than me and went to through university for free in the late 80's before the universities were "reformed". On leaving university unemployment levels were peaking, and she eventually left for the UK (never to return, 10 years on she is still there, and has settled there for good it seems). By the time I went to university my father had retired. I received full state support, and despite working and saving (since I was 14 yrs old) right through university, I left with a student loans debt of $30,000. (Of which $8,000 was interest that had accrued while I was studying, at a rate of 7.8% p/a x compounded daily). Upon graduation I spent 15 months working part-time anywhere and everywhere and applying for real work fruitlessly. Eventually I left to work in Japan, where three of my classmates were living. I later moved on to London and we had a reunion of my university house (college dorm) in central London, including the house chancellor (dorm master?). In a survey from my school old boy's association, 6 years after leaving school 85% of school graduates were living and working overseas. As far as I know more than half of them are still overseas.

That's what NZ gets for it's economic reforms. Social diaspora. With negative natural population growth of -2.6% per year, we must currently have at least 50,000+ new immigrants and returning citizens a year to balance the 48,000 residents and citizens who leave every year, otherwise our population will decrease. These figures do not include students and tourists. These may not sound like large no.s of people, but with a resident population of only 4 million people, we don't have a very full country to begin with. 38, 000 emmigrants a year is of 1% of the whole population leaving EVERY YEAR. Statistically around 50% of emmigrants born in NZ eventually return. In perspective, this would mean 1.6m Canadians leaving Canada every 5 years, and a new population of 1.7m Canadians arriving over every 5 years. Long-term I think these kinds of migration levels have a negative economic effect, as well as undermining social and political stability. It's also a bloody shame to see people fleeing such a beautiful, rich and rewarding country because of economic reasons, especially when it's not uneducated, poorer groups who are leaving, but motivated individuals who have studied for an education, and who are the most likely of groups to contribute to the country's development were there a place for them to do so. The reforms have made class division a part of NZ society, and many people on the dividing line (such as my family, and graduates from my small, beautiful by quiet home town) are going overseas to try to get ahead, with ideas of clearing their student debts with higher incomes overseas and saving enough money to start a business or buy a home when they return.
That is a result of the reforms.


Thank you Tobi for your contribution even though I've been leaving this blog terribly neglected.

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