Mike Hosking: The economic carnage in this country is heartbreaking

Author
Newstalk ZB,
Publish Date
Thu, 2 Dec 2021, 9:34AM
(Photo / NZ Herald)
(Photo / NZ Herald)

Mike Hosking: The economic carnage in this country is heartbreaking

Author
Newstalk ZB,
Publish Date
Thu, 2 Dec 2021, 9:34AM

You can't hide from simple statistics, because they are the truth and the reality. 

And this week's stats show there are fewer businesses opening in this country than closing.  

That's not just bad news, it's an indictment on the economic governance of this country. 

Yes, it's a pandemic, but the narrative is this country is doing well economically. It isn't doing well economically. 

It's doing well in some parts. If you're a real estate agent, you've done well, or you should have. If you are a bank, you have done well as people have borrowed up a storm. If you have an online presence and sell homeware, life has been good. 

But for the owners of 64,809 operations, life has provided an environment so poor you’ve closed the doors for good. It's important to remember that lots of businesses close every year. That’s the nature of start-ups, lots of them never get going. But in general terms, you will find more that open than close, and that is how you get growth. 

We are a nation of small business. Most businesses in this country, the vast majority, employ only a handful of people. It is the New Zealand dream to start your own business, to be your own operator, and to chart your own course. 

By the way, the critical detail in these new stats is that they are only up until February this year. The damage of the past four months is not included, and we can only imagine what the numbers will be when that detail fills out the whole picture.   

What makes it so egregious is the Government's line over economic wellbeing. The Prime Minister rolled it out on Monday during the light system announcement. She always drops in something about our economic strength and success, and she is never challenged. She should be, because it simply isn't true. 

The Reserve Bank thinks in the third quarter our GDP crashed seven percent. We went backwards. And the quarter we are now in, as we open up, will bounce but not enough to recover that damage. So, there is no growth. There is less than no growth. 

And now we know for the first time in years, there are more closures than openings. For every one of those closures there is a story, some heartbreak, and some shattered dreams. 

The ever-vanishing New Zealand economy is propped up by printed money, that's no plan.