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Home / Business / Economy / Official Cash Rate

Bernard Hickey: The year in really big numbers

Bernard Hickey
By Bernard Hickey
Columnist·Herald on Sunday·
17 Dec, 2016 04:00 PM4 mins to read

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Housing, immigration and Donald Trump generated lots of hot air, policy discussions and plenty of money go round this year. Photo / Chris Loufte

Housing, immigration and Donald Trump generated lots of hot air, policy discussions and plenty of money go round this year. Photo / Chris Loufte

Bernard Hickey
Opinion by Bernard Hickey
Bernard is an economics columnist for the NZ Herald
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$210 million
This was the amount Donald Trump's campaign spent on Facebook and Instagram advertising in the final weeks of the US presidential election campaign. It was more than three times what Hillary Clinton spent targeting voters through social media and was credited in helping him squeak to victory in the Electoral College vote.

Clinton spent more than $200 million on television advertising - twice that of Trump - but his campaign was much more effective at hyper-targeting specific voters in specific states with messages tailored to them.

Trump's digital campaign managers built individualised profiles on 220 million voters with up to 5000 data points on each , including their ethnicity, location, spending habits, net worth and social networks.

In the final days of the campaign Trump was targeting up to 175,000 different individualised advertisements a day to either win voters over to Trump, or to discourage them from voting at all.

Most people never saw these "dark posts" in private news feeds. Trump shocked the world by winning 46 Electoral College votes in the states of Wisconsin, Pennsylvania and Michigan. He did that by winning those three states by a total of 77,193 votes.

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Nationally, Clinton received 2.848 million more votes than Trump, but his hyper-targeting and voter suppression worked a treat to scrape over the line in those states. If Obama's supporters from 2012 had voted in the same amounts and at the same rates for Clinton in 2016, she would have won the election.

The big question for New Zealand in 2017: who will win the election on Facebook?

70,282
This was the amount of net migration to New Zealand in the year to the end of October, which is the latest data we have. It was yet another record high and represents population growth from net migration of over 1.5 per cent in a year.

That is three times faster than the migration rate into Britain, which helped lead to Brexit, and is almost twice as fast as the migration rate into Australia, which helped prompt the revival of Pauline Hanson.

Net migration over the last three years totalled 180,443, including 184,568 who came here on temporary work visas or as international students.

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An Auckland University report published this week detailed widespread abuse of migrants by employers who paid them less than the minimum wage, overworked them and refused to pay holiday and sick pay. Many such workers are hoping to get permanent residency, which requires the co-operation of their employers.

The Reserve Bank has noted the surprisingly high number of working-age temporary migrants has suppressed wage inflation in the past three years.

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Auckland has borne the brunt of this unprecedented population growth. The combination of net migration and more births than deaths has increased the number of residents and motorists by almost 3 per cent a year for the past three years.

All it takes now is a rain storm to gridlock the city and the housing shortage is now over 40,000 and growing at a rate of 5000 a year. Employers are struggling to find workers who can afford to live in Auckland, and the Government is spending thousands of dollars a week to accommodate people in motels.

The big question for New Zealand in 2017 is: who will win the election debate over migration?

$1 trillion
That will be the total value of New Zealand's houses by the end of 2016 if prices keep going up in December at the rate of the previous 11 months.

The value of New Zealand's homes has risen by more than $400 billion, or two thirds, over the past eight years. Those homes are not bigger or fancier or warmer or drier or have better views, but interest rates are substantially lower and over that time we failed to build enough houses to match population growth.

Also over that time, New Zealand's home ownership rate has fallen to close to 60 per cent and many young Auckland first-home buyers have had to abandon their dreams and deal with rents rising faster than incomes.

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Yet voters also rejected Opposition proposals at the past two elections for a Capital Gains Tax. Labour has given up trying to campaign for any changes that would see house prices fall.

Less than half of young renters voted at the last election, and more than 90 per cent of property owners over the age of 50 voted. Politicians know this and have calculated that more voters want higher house prices, which means they can afford to ignore the renters.

The big question for New Zealand in 2017 is: will young renters start voting at high enough rates to change that political calculation in the same way that poor white voters started voting and changed the calculations in America?

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