by Don Franks

In his September 24th post, “The election that left one third of us behind”, Bryan Gould put some basic questions:

“We have a pretty good idea of who the non-voters were. They were poor, often unemployed, poorly educated, with worse health than the rest of us, often brown-skinned, living in sub-standard housing and bringing up their children in poverty.

“Why did they not do at least something to ward off the changes promised by a re-elected National government? Are they really content with the prospect of a next three years that will see their rights at work severely curtailed, that will mean their being ‘moved off benefits’, that will produce further cuts in the public services on which they especially depend?

“How is it that the Labour Party has failed to engage with what many would see as their natural constituency?” Here’s how. Read the rest of this entry » Michael Roberts

The two major international economic agencies of the global capitalist economy continue to revise down their forecasts for economic growth in this year and next.

In an update to its forecasts made last May, the OECD announced that the “outlook had darkened for 2014 and 2015 for almost all the world’s large economies”.  The OECD revised down its forecasts for 2014 growth for all large economies except India.  It now expects growth of 2.1% in the US, 0.8% in the Eurozone and 0.9% for Japan, downward revisions in each economy between 0.3-0.5% points. The UK will be the leader among the advanced capitalist economies at 3.1%.  For 2015, the OECD continues to hope for a pick-up but even here it has again trimmed most of its forecasts. The US is forecast to grow 3.1%, down from the 3.5% forecast made last May, while the Eurozone and Japan are now expected to manage only 1.1%.

Real GDPThe OECD admitted that world GDP growth of just over 3% a year was well below pre-crisis rates, confirming that there has been no return to ‘normal’.  What is also interesting is that the so-called emerging economies are also slowing down.  According to the OECD, of the major ‘emerging economies’, China will

Read the rest of this entry »

indexby Daphna Whitmore

The election campaign was more colourful and circus-like than any I can recall. The result in the end was a lot more bland. National were miles ahead in every poll so it was no surprise they romped home on the night. They won the party vote in 59 out of 64 general electorates.

Although they could govern alone they won’t, and the government will be made up of the same parties as before.


On the leftish-blogosphere readers are being told to prepare for a grim three years where National will go full throttle neo-liberal. The same people have made the same predictions ever since National got in six years ago. They are still wrong. Key has signaled he has no surprises and that National are not about to lurch further to the right. Not only is Key not a neo-liberal, there is barely any support for that doctrine in NZ today.


The Act Party has been on life-support for years, and this election they managed to outdo themselves by halving the tiny vote they got in 2011. Act’s best contribution to the political landscape is the proof they provide that money doesn’t win elections. The Internet Party likewise. Read the rest of this entry »

tiredby Don Franks

One more day of shiny-faced candidate posters. After weeks of campaigning, the forced grins on election posters all start looking the same.

Excepting one, the poster headed: “The most powerful person in New Zealand”.

Images in this poster series include a young guy in a hoodie, a weary-looking butcher, an anxious-looking young mother and child, several tattooed people.

None of them smiling. If you had to guess their situation you’d say hard working folks, probably not so well paid.

The slogan below each face reads “your vote is worth as much as anyone in the country – get out there and use it”.

Each morning as I’ve jogged round the streets the posters have irritated me. A working life among tired-looking low-paid employees has taught me Read the rest of this entry »

1bcf318by Michael Roberts

Almost 1000 people attended the three-day Rethinking Economics meeting in New York, the follow-up to the recent RE meeting in London (see my post Rethinking Economics is an organisation set up by mainly postgraduate economics students concerned at the failure of mainstream economics to grasp the reasons behind the global financial collapse and its failure to open up the curriculum in university economics departments to economic thinking beyond mainstream neoclassical or ‘orthodox’ Keynesian ideas.

There seems to a huge interest among young economics students and academic economists to break with the ‘closed shop’ of mainstream thinking. And the New York chapter of Rethinking Economics was able to get some ‘big hitters’ from mainstream and heterodox economics to make presentations or join discussion panels. The whole thing was live-streamed across the globe.

Watching online, we were greeted with a panel composed of leading Keynesian guru and Nobel prize winner, Paul Krugman; Willem Buiter, now chief economist at Citibank and former professor at the LSE; and James Galbraith, son of the legendary JK Galbraith and one of the few heterodox professors of economics in a university post.

Failure of mainstream economic theory

The eminent three were asked why mainstream economic theory failed to forecast the global crisis and why it had struggled to explain it. Krugman said he held to the view that mainstream economic theory with its models of markets, representative economic agents and equilibrium analysis was still useful, but was inadequate without Read the rest of this entry »

Even the Economist, the house journal of British finance capital, is getting in on the act, fearing the social and economic consequences of massive inequality

Even the Economist, the house journal of British finance capital, is getting in on the act, fearing the social and economic consequences of massive inequality

Often, sections of the NZ left suggest, or argue outright, that the capitalists are out to smash  and pauperise the working class.  This claim is generally leveled at the National Party and takes the place of a serious Marxist analysis of capital accumulation which might reveal the objective needs of capital and various points in time and how these needs might be pursued in policy terms by the capitalists, the government and state.

One of the noticeable trends in recent years has, in fact, been the development of elite fears around poverty and inequality.  These present problems for the ruling class.  They don’t want an impoverished working class, at least not in the First World.  The problem is that capitalism isn’t really under anyone’s control.  The workings of the market system tend to widen inequality, while ruling class institutions have to deal with the fall-out (and, of course, the working class has to deal with the misery).  The ruling class is, essentially, caught in a bind by the contradictory results of the system over which they preside, but whose outcomes they can’t totally control.

One of the Marxists who has been looking at this contradiction is Michael Roberts, whose work we regularly republish on this blog.  In the piece below, Mike further explores capitalist fears that inequality is a primary cause of economic crisis, a view which is reflected by those on the left who adhere to under-consumptionist views of crisis rather than Marxist analysis centred on the law of the tendency of the rate of profit to fall.

by Michael Roberts

The argument that rising inequality in the US and the other major capitalist economies, as expressed in the work of Thomas Piketty and others (see my posts; and, was the major cause of the global financial collapse and the Great Recession, continues to gain traction.  As Paul Krugman put it only last week: “there is solid evidence that high inequality is a drag on growth and redistribution can be good for the economy”.

Now even mainstream economics and financial institutions have taken up the idea.  In a new report, economists at Standard & Poor’s, the US credit agency, reckon that unequal distribution in incomes (they don’t refer to wealth as Piketty does) is making it harder for the nation to recover from the recession.(“How Increasing Inequality is Dampening U.S. Economic Growth, and Possible Ways to Change the Tide.”)

That the S&P, at the heart of Wall Street, should take up this theme, shows that the near-record levels of inequality of income in the major economies is becoming a serious worry for the strategists of capital.  They fear Read the rest of this entry »

John Key: smarmy, yes; but neoliberal, no

John Key: smarmy manager of a bankrupt economic system, yes; but neoliberal, no

by Philip Ferguson

Much of the left have banged on for the past six years about neo-liberalism being the dominant economic policy in New Zealand.  Before, and for several years after, the 2008 election many on the left also claimed that John Key had a secret agenda to pursue a ruthless neo-liberal policy programme.

Here at Redline, and in our previous political involvement in the Workers Party, we argued that this was, to put it bluntly, nonsense.  The Key government was a middle-of-the-road government that gave a few things and took away a few things.  We also argued that a Marxist analysis, rather than the almost hysterical anti-National Party politics which typifies much of the left, would show that NZ capitalism needs extreme neo-liberalism like it needs Read the rest of this entry »