How to make the tax and welfare system fairer for all Kiwis. Whiteboard Wednesday.
Channel: Gareth Morgan
Date: 02/12/2014

The Big Kahuna takes as its base assumption that we don’t, as a society, accept that huge differences in income are acceptable and that we therefore choose to redistribute wealth. While they are generally regarded as separate, the tax and welfare systems are fundamentally both methods of doing just that – redistributing income from those who have plenty to those who don’t.

In a nutshell, The Big Kahuna seeks to show that if the job of redistributing wealth and income is worth doing, it’s worth doing properly, so that the resulting system is fair to all, rich and poor alike.

Is the whole point of a tax and welfare system to redistribute from the well-off to the rest (we say it is)? Or is it just to transfer only to those in need—the “deserving poor”? There is a big difference, and our welfare state has strayed from its origins.

The Big Kahuna recognises a long forgotten truth about modern market-based economies – they produce an ever-growing abundance of stuff but if left to their own devices lead to fewer and fewer people owning more and more of it – a growing ‘concentration’ of resources in the hands of a few. A growing concentration of wealth can bring wide-ranging economic, political and social problems.