The Government's books do not reveal a rock-star economy. This year's budget surplus has slipped a bit, from hardly anything to almost nothing. Future surpluses have also been reduced, cutting the scope for spendups or tax cuts. The gap between the country's earnings and its outgoings, the current account deficit, slips markedly down the track. Total debt at its peak is now forecast to be $2 billion higher than previously thought. So the hope of sustainable growth remains slim.
None of this is an economic triumph or miracle. However, growth is up, unemployment is down and likely to carry on shrinking slowly, and some wages are increasing. Bill English repeats his predictable warning: "Don't put it all at risk", as though we had already reached nirvana. We haven't, and even a cursory look at the books reveals plenty to worry about.
The fall in dairy prices will affect the tax take but nobody knows how steep the reduction will be. Already the gloss is off. Yesterday's update of the books suggests that the reduction in debt to 20 per cent of GDP will come later than previously forecast. If National is re- elected, it won't start paying into the Cullen fund again till 2020. English makes the best of this, saying it shows there is no room for fiscal extravagance. But it's not a very inspiring message.
So the outlook is more constrained than we thought even a couple of months ago. Economic research agency Berl's report for the Greens issues a plausible Left-leaning warning: National will cut the health and environmental protection budget in real terms in the next few years. The Greens promise to reverse this trend and they promise, of course, that this will be affordable. They pledge a mini-budget to prove the point.
Elections are about moods rather than numbers, about hopes and fears rather than deficits and surpluses. The argument will not be settled by the battle of the contending budgets, if only because economic forecasts are more or less impossible. Treasury is no better at foreseeing the future than anyone else, and every party can hire economists to put together a plausible-sounding story. So the parties must all prepare their budgets, but they know that voters will choose among them on grounds of feeling and ideology, not on detailed judgments about the figures.
And just as the economic news is mixed, so the 2014 election seems split between cautious optimism and guarded pessimism. The country has come out of a long, slow patch but nobody mistakes the recovery for a boom. The electorate is divided.
Perhaps that is why neither the "Don't put it all at risk" nor the "Time for a change" themes have come through clearly in this election. There is a feeling of stalemate rather than a strong mood for change or a keen urge to protect a precious status quo. Enthusiasm of either sort is not the hallmark of 2014.
It is at these times, perhaps, where personalities loom larger than policy arguments. And in those circumstances the scope for nastiness rises. And perhaps that helps explain the extraordinary emotions unleashed by a book about dirty politics.
- The Dominion Post