If businesses can take flight to Australia, why not Michael Cullen? The Minister of Finance is seeking refuge on the other side of the Tasman from the latest gloomy business confidence statistics. He likens the steepest fall in confidence in 16 years, as measured by the Institute of Economic Research, to a similar trend in Australia. This, Dr Cullen says, indicates that the blame should be attached to rising interest rates and petrol prices, not political decisions.
Doubtless those factors play a part in Australia, but so, to a far greater extent, does the considerable huff that business there has got into over GST. Pessimism in New Zealand is undoubtedly of a different origin and runs much deeper.
The latest Dun and Bradstreet world survey confirms as much. It concluded that business confidence in Australia was stable. New Zealand, in contrast, has only Italy for company on its grisly slide.
Even if Dr Cullen could square off attitudes in New Zealand with those in Australia, it would offer no solace. That would mean merely that three countries, not two, were out of step in a world of galloping optimism. Rather, the minister should acknowledge that the Government's recent charm offensive has not had the desired impact on the business sector. And that he has so far failed to deliver the sort of economic leadership that was the hallmark of his immediate predecessor, Sir William Birch.
Sir William was a relentless and effective articulator of the National Government's economic agenda. If Dr Cullen has been equally busy, he has not had anything like the same effect.
It could be that the minister's style leans too much towards sermonising. More fundamentally, of course, his message is not always palatable to business. Clearly, the Government's attempts to placate the sector, whether through changes to the Employment Relations Bill, a fiscally responsible Budget or closer consultation, have failed.
And it is to everyone's detriment that Dr Cullen's message about the strength of New Zealand's economic fundamentals - a low dollar, a buoyant growth outlook and a thriving export sector - has fallen on deaf ears. Sliding business confidence has become infectious, feeding through to consumers. There, it has had a devastating impact on the likes of house and car sales.
In such circumstances, it must occur to Dr Cullen that more drastic action is needed to bring business onside. Quite realistically, this might involve just one grand gesture. Dr Cullen need not look too far for that sign. During a speech in Hong Kong earlier this year, he dangled the prospect of New Zealand matching Australia's company tax rate. From next July, the Australians will offer a rate of 30c, compared with our 33c, a cut which further threatens New Zealand's fading competitiveness.
Dr Cullen told his Hong Kong audience that the Government would act only when the economy was healthy enough, and that would not be in the next three years. Clearly, he was worried about a lower tax take. Now, however, he might ponder whether other priorities should take precedence.
Enacting a lower company tax rate would encourage the foreign investment that delivers high-tech industries and new jobs. And in a manner that does not dilute a centre-left Government's ideological intent - the dilemma it faces with major changes to workplace legislation - it could send a clear message of support to business.
The lifting of the present abject pessimism should not be all down to the Government, however. The business sector has been guilty of an overreaction that paid no heed to economic fundamentals. It should recognise that export prosperity will inevitably filter through to the domestic sector.
There are signs that confidence may have turned and that the clouds of unreality are lifting. The patient, however, remains very sick. A shot of tax relief and a course of self-help videos might be all that is needed to get that patient up and running.
<i>Editorial:</i> Cullen could take lessons from Birch
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