See my post to linger for a graph of NZ median wages increases over time.
NZ has been living off globalization since it began exporting frozen meat in 1882. Earlier if you consider whale and seal hunting.
Both Cato and Heritage develop indexes of human and economic freedom that show a strong correlation between economic and human freedom and per capita incomes. So those countries like NZ that have opened their markets to trade have higher incomes, and the least free, like Cuba, North Korea, Zimbabwe and now Venezuela are doing terribly.
Economically speaking, what works and what doesn't work has never been more obvious.
That's a fair pint, I should have used median wages. Here's a link to median wages from 1997 to 2014 which shows median wages growing over that time horizon, except for a period after the GFC, 2008 to 2010. So your belief that average wages have only risen due to obscene CEO wages increases is not correct.
Andin, well my goodness, aren't you a happy chappy!! I thought everyone knew what GDP stood for, but apparently there is at least one grumpy leftie out there who doesn't know and couldn't manage to do a quick Google search before he or she vented their spleen all over the computer screen!! As linger pointed out, GDP stands for Gross Domestic Product, a measure of the finished goods and services produced in an economy in a given period. Not appropriate for a comparison with wages.
You also might like to know that average hourly wages in NZ are up quite substantially since 2008, from about $22/hr to $29.48/hr, so I don't know that you can say that any acronym loaded loafers have been on any wage earner necks. Yes house prices have gone crazy, but that is because the enviro leftie planners in city councils decided, in their brilliance, that in a country that is 1% built up, that NZers have to live on top of each other and can't expand a bit.
If you don't like globalisation, what do you propose NZ does with all its milk, meat, wool, kiwifruit, apples, manufactured goods software etc that NZ exports? Shall we stack it up outside your house/flat? Might get a bit smelly after a while, don't you think? And we shall tell all those 3 or 4 million tourists that they cant come and visit NZ as we don't like globalization?
Rob, if this is representative of the advice you give Labour, one can see why they are in so much trouble.
You are not comparing like with like, you are comparing increases in wages with increases in GDP as if they are the same thing, which they are not. Wages are wages and GDP is an economic aggregate measure. A real apple and oranges comparison mistake.
I don't know that you can say the free market has failed, because the choke points seem to be more regulatory in nature.
Regarding densification, NIMBYs certainly are one of the modern world's largest pains in the butt. They want everything frozen just as it is now, despite the fact that their property was once undeveloped. Having said that, AKL suburbs are so beautiful that I can't blame them for not wanting things to change. In a democracy, you can't ram massive unwanted change down people throats, which is the point of democracy, so I can't see how densification is a viable solution. It is part of the solution, but a minority part.
Having the urban boundary jacking up prices is a regulatory problem, not a free market problem.
I think things have to got to such a disastrous state, that hopefully people will be accepting of solutions that they might not like, but recognize have to be done as there aren't any other viable options. A land tax on non residents is a good start. Dialing back on non returning Kiwi immigration would be a good step too.
Designating land from Waitakere, through Kumeu & Dairyflat to Silverdale, and from Glenbrook to Clevedon as future residential land is a must. That would kill land banking and speculation and drop land prices overnight as the prospect of capital gains disappears in one fell swoop.
The infrastructure cost of bringing that additional land on line can be born by municipal organisations that borrow to build the infrastructure and charge section holders over 20 years so the AKL council doesn't have to pay it upfront. Looking at how some of the GST and other taxes collected in a local area can be used to fund infrastructure in that area would be good too.
Expanding AKL will be unpalatable to many on this blog. But what's the realistic alternative? Don't do enough and Kiwis will be truly stuffed with houses at 20 times incomes and a truly epic housing and financial meltdown will be certain at some point in the future, in a downturn or when interest rates normalize, as they will. This has to get turned around, and soon!!
Same as happens to any couple in the same situation in a major city such as Sydney, LA, Houston or London etc. You have a decision to make. Either you make the commute work, you move closer to the new job or you don't accept the new job.
There is some need to get together periodically but I know lots of well compensated sales / business development people who work remotely. In quite a few cases I think low paying jobs do need to be located together to allow for effective oversight and training.
I think tele commuting / remote officing will increase going forward, in NZ and everywhere. In NZ the UFB network will enable this and allow satellite offices to be a much better option for both companies and for employees.
As a Kiwi who lives overseas, contemplating the NZ and AKL housing market is like looking into a sea of insanity. With the median house price a 10 times median salary in AKL, severely unaffordable and one of the worst in the world, it is clear that the prevailing orthodoxy is failing disastrously. And that orthodoxy at city council level is a belief in compact cities and urban boundaries, with a population unwilling to densify.
Something has to change in a big way, incrementalism wont solve this problem. It seems up and out, and lots of both is required. To get infrastructure built, use urban utility organisations to borrow to build and charge section holders over 20 years. Foster satellite business centers so there are plenty of good jobs out closer to the burbs so commuting to the center is required only for a shrinking % of jobs. In this age of skype etc, geography is less and less relevant, jobs don't have to be close together.
Here's an interesting article that highlights how light rules and regs have helped a couple of cities either keep prices down or to innovate quickly.
Are you serious? "...your thesis that continuing the current global economic model will benefit the developing nations is simply not borne out by evidence."
That might come might come as a bit of a surprise to the 400 million Chinese that have been lifted out of poverty by the "current global model" which China began adopting in 1979 when the profit motive an international trade was unleashed in China. And thanks to that current economic model, between now and 2035 the middle class in Asia is projected to increase from its current level of 350 million to 3.5 billion. That is a hell of a lot of people positively impacted by "the current economic model". Due to this economic growth the IMF is projecting the poverty as we know it will be completely eradicated by 2030. That is amazing and something a leftie ought to be very happy about. But, no. If you had your way and implemented the CC policies, a lot of those people in developing countries would be kept down in poverty. I don't know that things would be quite as bad as they were during Mao's great leap forward, a previous piece of genius left wing thinking, but a lot of people would live a much shorter brutish life than they otherwise would.
That would be the consequence of the policy you are supporting, but apparently you don't understand that.