Bill Ralston: How an economic downturn could reshape the political landscape

New Zealand is now closed. Apparently, the country is full and we don’t need or want any more people. Immigration Minister Kris Faafoi, because he was ill, made the announcement recently through his ventrilo­quist dummy, Economic Development Minister Stuart Nash. This was a shame, because Nash was unable to answer questions from industry leaders about the country locking its doors to temporary and skilled migrants.

Of course, a couple of hundred multi-millionaire “investors” are still welcome, but, for example, hard-working, poverty-stricken Pacific islanders, Filipinos and Indians doing jobs that few Kiwis would consider doing are told to stay home once our Covid-19 border restrictions are lifted. Prior to the doors being locked, migrant workers filled vacancies in about 5 per cent of the workforce in areas such as aged care, fruit picking, dairy farming and other such tasks that the 4.9 per cent of us who are unemployed have little or no interest in doing.

“Is it because … the wages are too low?” Nash asked rhetorically. My guess is, no, Stuart, it is because the work previously done by migrant labour is hard, difficult to do well and often remotely situated. The fruit crop has already been reduced by 14 per cent because of the labour shortage brought about by Government restrictions and reductions on temporary workers coming in to do the picking. Spread that kind of productivity drop through the rest of the industries that use migrant workers and it’s inevitable a post-Covid economic recovery will become much harder.

The Government appears to be planning a significant restructuring of the way the economy operates, warning that tourism and primary industry, for example, will look very different once the borders are opened. If correct, this radical change could further impede the recovery.

An economic downturn or a recession as a result of this change could reshape the political landscape. Current polls show National has run aground on about 27 per cent while Labour basks in more than 50 per cent support. National must be praying for a financial crash to turn that around, because it’s doing little else that will recommend it to voters who have abandoned it for Labour.

Let’s face it, National leader Judith Collins has been resoundingly rejected as a potential prime minister by nearly 95 per cent of the population, almost a quarter of whom are National Party supporters.

However, there is no obvious successor in her caucus. Former leader Simon Bridges has little hope of a return to his old job, with internal party polling when he was leader showing he was overwhelmingly viewed negatively by the public. Swapping Collins for Bridges would simply reduce the party’s chances further.

The only other serious aspirant, Christopher Luxon, is as unknown to voters as was the ill-fated Todd Muller when he assumed the leadership, then crashed and burned. Voters are unlikely to easily accept another unknown.

One reason for locking the country’s doors to migrant workers may be that, somewhere in the Beehive, there is a forecast of rapidly rising unemployment and Labour is moving proactively to try to forestall the problem.

A worse problem for the Government would be a significant rise in interest rates. Low rates have meant many punters have drastically overextended themselves on huge mortgages for overpriced properties and a rise would be very ugly, indeed.

So, the only thing that can turn it around for National in the foreseeable future is an economic calamity that destroys the public’s confidence in Jacinda Ardern, Grant Robertson and Labour so that voters, in desperation, turn to the Nats regardless of who is leading the party.

Good grief.

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