COMMENT:

National's finance spokeswoman Amy Adams has had a lesson in the adage that sometimes you just can't win.

Adams tells a story about the very first cartoon done of her as a politician. It exaggerated one of her features: crooked teeth.

Adams went and got invisible braces to straighten them, determined not to live a life of crooked teeth cartoons.

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Now the cartoonists play up the bags under her eyes instead.

So it is for Labour in its battle to get trust in handling the economy.

In election cycles there are battles and there are wars.

The battles are the one-off hits, skirmishes that plague a government for a short period before they are either staunched or get too boring and bogged down in minutiae to bother with.

At the current moment, battles range from things such as the Wally Haumaha inquiry, the waka jumping bill, any goings on with the Provincial Growth Fund, and tiffs with Australia about their deportation policy.

The war is the economy.

It is a long drawn out battle in which facts and perception battle and on which the 2020 election is likely to hang.

It is an unfortunate fact for Labour that of the two, perception is the more potent.

The word crisis is easy to use. For years Labour had insisted there was a crisis in areas from housing, health, and child poverty long before there actually was one.

Now it is getting a taste of its own medicine. Words such as a "growing crisis" on the economy are being bandied about after only incremental movements in indicators such as the unemployment rate and cost of living.

Business has the heebie jeebies and they are telling the government so.

Former Prime Minister Sir John Key's greatest gift to National leader Simon Bridges was not his endorsement of Bridges at the National Party conference. It was his warning about the economy.

Key did not blame the Labour Government.

He pointed to it being the autumn end of an economic cycle and the slowing of growth in China and deficits in the US, despite its strong growth.

Jacinda Ardern and Clarke Gayford leave Auckland City Hospital with three-day-old Neve. Gayford now sports a beard. Photo / Greg Bowker
Jacinda Ardern and Clarke Gayford leave Auckland City Hospital with three-day-old Neve. Gayford now sports a beard. Photo / Greg Bowker

Soon after that warning, the ANZ issued its quarterly business confidence survey showing it at its lowest level since the Global Financial Crisis.

Regardless of whether a slowdown is the Government's fault, Key knew full well it is the government who will wear the blame should things turn to custard.

Nor could he quite resist doffing his ANZ hat and donning his former National Party hat to observe that he knew who he would trust more to deal with it.

Key's warning echoed Deputy Prime Minister Winston Peters own warning from October last year. The difference is in the believability.

Key has a long track record of credibility on the economy and still has his finger on the pulse as a well-travelled and well-connected person who is chair of ANZ Bank. People tend to believe what he says.

Peters' past warning was dismissed as an excuse in advance. It does not help that he is now singing the opposite tune, insisting last week that the Emperor was wearing clothes, no economic slowdown was in the offing and National was simply trying to talk down the economy for political purposes.

Should it happen, people tend to like a safe batten the hatches approach – not sweeping change.

Enter Prime Minister Jacinda Ardern, who made it clear in her return-to-work interviews that she was preparing to try to defeat perception.

Businesses can expect a knock on the door. She is likely to find herself standing on many of the same doormats as National leader Simon Bridges and Adams, who are also planning a business roadshow to sell themselves as a "tight two".

Ardern has described business confidence levels as a matter of pride for her, and so will start to pit her own assurances against both the scepticism of business and the cage rattling of National.

Ardern has conceded that there is uncertainty in change, and the Government is planning change.

Whether the inherently sceptical business community will take Ardern's assurances at face value, as they would from Key or English, is the big test of her leadership. She starts slightly on the back foot. The abrupt and unilateral decision to halt future oil and gas exploration permits shocked business because of the lack of consultation.

At present, Labour's adherence to the Fiscal Responsibility Rules is its main wall of defence.

That was to provide some assurance to business as well as ensure a buffer.

Working against Ardern is the uncertainty from putting the job of coming up with major reforms into the hands of working groups and reviews. It prolongs uncertainty, leaving business unable to properly plan ahead.

The two making business most nervous are those on industrial relations reforms and the Tax Working Group.

The rumblings around the economy highlight the downside of having Peters as Acting Prime Minister for Ardern's six weeks of leave.

Peters did a solid enough job, but the reforms the Government are planning are primarily Labour Party changes.

Peters cannot sell Labour's direction as convincingly as Ardern.

For six weeks, that agenda was effectively on pause because Labour's best salesperson was away.

National has been accused of wasting the opportunity of that time by failing to get a big hit on Peters. Peters is not their target.

The past week has shown it used that time to dig its trenches and muster artillery for Ardern's return.

Skewering Labour on the economy is its best chance of regaining the Government benches and it has started highlighting areas where things are getting wobbly, including comparisons with Australia.

It talks about fuel taxes, changes to foreign investment, industrial relations changes, businesses facing higher wage bills and inflation outstripping wage growth.

To counter it, Robertson has repeatedly pointed out the fundamentals of the economy remain as sound as under National, the surplus and forecast growth are healthy, wages are going up and stimulus is on the way from the Families Package and infrastructure spending.

After Key's comments, Robertson took the very withered lemon and squeezed the bejeesus out of it to make at least a spoonful of lemonade.

Robertson observed even Key had pointed out it would be global forces that pummelled the economy – not Labour's policies.

Robertson's main concern is that it will become a self-fulfilling prophesy and businesses will needlessly cut back on staff and investment in preparation for a slowdown that may never have happened, thereby making it happen.

Robertson has taken solace from the business confidence surveys in former Finance Minister Michael Cullen's time which show the bias to National.

It is almost a year since Labour took over in Government. A year after Labour got into power in 1999, there was also a big slump in business confidence – down to the levels of the 1987 stock market crash.

The bigger worry for Labour is if that uncertainty starts to impact on ordinary workers through such as wages, unemployment, the cost of living and interest rates.

Ardern may want to tread carefully as she crosses no-man's land.