Hide Rodney: Estimates Debate — In Committee 
Hide Rodney: Estimates Debate — In Committee 
[Volume:632;Page:4146] 
RODNEY HIDE (Leader—ACT) 
: 
 It is good to follow Mr Doug Woolerton. I can only agree with him but I do not think he goes far enough. I agree that we should have tax incentives for exporters but why just exporters? What about tax incentives for workers? What about tax incentives for dairy owners? What about tax incentives for every business in New Zealand? Each and every one of those business people is working hard. Each and every one of those people could do with more money in their pockets. Mr Woolerton’s ideas were so good that he should be in Government. I say that we should have tax incentives for every working person and every business in New Zealand. 
But we are looking at Vote Finance. We could save a great deal of money in New Zealand because we have a Minister of Finance Dr Michael Cullen who knows everything. He actually does not need advice. He knows all about economics and he can grasp everything in a heartbeat. We have a Minister of Finance who does not need evidence or theory because his own ideology tells him everything. 
Michael Cullen knows as a fact that tax cuts do not work. Michael Cullen still believes—he used to teach history and I guess it has just carried on from that faculty—that tax does not matter. He believes that we can have any old tax rate and any size of government—it can be big small or medium—it makes no difference to the functioning of the economy. Michael Cullen illustrates this by saying that he would not work any harder if his taxes were lower. That is his complete grasp of the relationship between size of government tax take Government spending and economic growth. 
Of course Treasury being smart and being made up mostly of economists knows that is complete nonsense that taxes have an enormous effect on whether people choose to invest on whether people choose to be entrepreneurs on whether people choose to work a bit harder and in fact on whether people choose to stay and live in New Zealand. It does not take much of a change in our growth rate to change our fortunes over 5 years 10 years or 15 years. 
Michael Cullen in a speech he gave just this month to the Nelson chamber of commerce warned against tax cuts because tax cuts could give a fiscal stimulus. This was from a man who has overseen an increase in the size of government from 36.1 percent of GDP to a whopping 42.1 percent of GDP—a 16 percent increase; an increase per year of $25000 million. But in Michael Cullen’s world it works like this. He can take money off hard-working New Zealanders he can bring it into Government he can spend it on the most wasteful projects that even a kindergarten could not come up with throw the money against the wall and that is not inflationary. 
But oh boy if he did not take that money in the first place if he left it with a hard-working Kiwi mum or dad if he left it with a small-business person who is up all night filling out GST returns and who is part of the productive sector of New Zealand then those people might spend it on their groceries on some extra education for their kids on employing another person or on an extra plant for their business. To Michael Cullen that would be bad; that would be inflationary. 
So we do not actually need Treasury because we have Michael Cullen as the Minister of Finance and he knows everything about the economy including that tax makes no difference.