Economists’ reaction to Govt papers

Press, 31 August 1984, Page 5

Economists’ reaction to Govt papers

PA Wellington The reaction of four Wellington economists to the documents released yesterday by the Government is: Suzanne Snively (Jarden and Company): “There is information in there that we have not seen before such as the extent to which we have been subsidising electricity and coal. The subsidy is bigger than I thought. If you were ever going to cover it with the

user pays principle you would be putting up charges quite dramatically. “Unfortunately the documents do not go into any great deal on that particular subject. “We have always known Treasury has kept an eye on the country’s economic situation, but what is so impressive about this is that they have written it down. As far as I know there was no real call on them to do

“In putting it together Treasury officials were taking a certain amount of risk that it would never see the light of day. It is very unusual for this type of information to be published in this public way.” Rufus Dawe (Westpac): “There is nothing radical or in any way surprising in them. Any economist who was surprised by what is in them must have been asleep for the last 10 years. “Some of the things such as floating the exchange rate may be a little impractical at the present time ... In a small economy and with a limited stack of expertise it is a big thing for a Reserve Bank to do at present.” Len Bayliss (freelance economic consultant):

“They are an extraordinarily high-quality piece of economic analysis, probably one of the best written in New Zealand in the last decade or so. “The chief value in it is a major analysis of why the New Zealand economy has performed so badly for so many decades. “It is a very valuable insight into Treasury’s thinking on the whole spectrum of the economy. “The information merely confirms what I have been saying — that we have a very dismal economic future unless there are some major changes.” Brian Easton (Institute of Economic Research): “The views expressed are almost identical to those that have been expressed all along by non-Government economists. In a number of places I happen to disagree with conclusions reached, but that is an honest disagreement. For instance, I would agree with the necessity to reduce the deficit, but disagree with the target suggested by Treasury. “The documents bring a lot of material together that would not normally be readily available and for that reason are good reference material.”