Editorial: Economy rules - so change of Govt unlikely

Prime Minister John Key reviews the 3rd leaders debate and his own and David Cunliffes tax maths, he also added New Zealand would look at supporting the US in fighting terrorists in Iraq. has plunged in personal popularity dropping by 7.3 points

It would be a surprise if New Zealanders change the government tomorrow. Even in the age of MMP, it has taken an economic shock or meltdown to move voters to throw out the incumbents. Changes in 1984 (Muldoonist folly), 1990 (the cataclysmic effects of the 1987 stockmarket crash) 1999 (the Asian economic crisis) and 2008 (New Zealand entering recession and the global credit crunch) followed turndowns which affected New Zealanders in their pockets, jobs and confidence.

Political parties argue over the direction and state of the economy, but no reasonable observer believes New Zealand is in a severe economic downturn, or facing global convulsions of the sort experienced before elections that have produced change.

National has steered the economy through the global financial crisis and the effects of the Canterbury earthquakes towards a fiscal surplus, so this election is its to lose. Unemployment has fallen and is not high by past thresholds. Interest rates are up, but again lower than when they have scared voters. Fonterra's international prices are falling and will shave some of the 2.5 to 3 per cent growth predicted for coming years. But growth there should be, because of the Christchurch rebuild and Auckland construction efforts planned by both sides of politics. Today's Herald-DigiPoll survey shows 58.2 per cent of voters saying the country is going in the right economic direction, up 4.3 points, compared with 36.3 per cent saying it is going wrong.

The issue rated most likely to influence voters tomorrow was economic management, on 36.9 per cent - about as high as the next three biggest factors combined.

Logic and polls say that despite all National's obvious deficiencies in personnel, judgment and politicking, its own flat-footed campaign, single-minded performances by the Greens and New Zealand First and the tumult of dirty politics and surveillance, a centre-right government, perhaps as a minority, should win again.

All things being equal, National will be the biggest party by some distance and thus the first call for others to deal with, even if only on confidence and supply.

The centre-left has been let down by Labour's no-show in this campaign. As stoical and optimistic as David Cunliffe has been, for him to lead the party to the mid-20s in public opinion when he deposed a man last year polling in the early-30s is the major puzzle of this election. He and his party have failed to connect. Should tomorrow night deny National the ability to form a government, Mr Cunliffe's challenge would be to stitch together five parties - including one he has denounced, one he has ruled out of holding ministerial posts and another which cannot hide its distaste for the fourth.

New Zealanders know a lot more about their leaders and parties now. The campaign has been thoroughly covered, most issues well-aired, policies debated and leadership examined. Today's final Herald-Digipoll survey confirms a trend shown in other surveys, showing the Internet-Mana alliance has shed support, probably because of public distaste for its founder Kim Dotcom.

The poll has another rich man's vehicle, the Conservatives, still a point or so shy of making it. We could end up with a House of Representatives closely resembling what we have had for the past three years.

Voters probably hope the campaign will lead to Parliament doing more to address child poverty, inequality, unease over digital surveillance, housing affordability and demand, repaying debt, raising the age of eligibility for superannuation, improving teaching and learning in schools and caring for our environment.

In the end, however, one thought rules them all. "It's the economy, stupid" may be trite, but it is true.

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