I knew it…

Bernard Hickey has once again cut through the crap and shown us where the real problem is…government spending.

As I have blogged previously, i don’t subscribe to the ‘ it’s only a paper loss, don’t worry about it” school of thought.  If i had lost that much money (paper or not) i would be worried.  But Bernard has delved deeper and found what I had long assumed, though I must admit I am stunned by the magnitude.  He blogs…

But the really interesting stuff is on the other side, where spending is up 9.7% on the previous year at $32.126 billion. The biggest movers are health, up 9.8%, and core government services (bureaucrats in Wellington), which were up 33.8% at $1.7 billion.

Government spending is growing at a rate of 9.8%, which was more than twice as fast as revenue growth at 4.5% and twice as fast as estimated nominal GDP growth at around 5%. The government is eating the economy.

Holy guacamole Batman. 33.8%. Good Grief.  Comments on Bernard’s blog allude to the recruitment drive that various (MAF in particular) government agencies have been doing.  No wonder its hard to get decent workers, they are all sipping lattes in Wellington. (Maybe Poneke could verify this)

As per Bernard’s usual humor in stimes of crisis

Watch the OBEGAL. It is barking that the government is spending too much and taxing too much and employing too many bureaucrats. It is biting us with low productivity growth because our best and brightest are becoming highly paid bureaucrats who now call themselves senior policy analysts. We’re all paying for this with higher wages costs, higher inflation and lower GDP growth.

Ignore this month’s deficit. Pay attention to a government eating the economy. 

Just watch the voters spit them out in November (sooner if we can wangle it)

You can view Bernard’s full blog here

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