The chart below by poverty and inequality activists shows that Europeans, Maori and Pacifika are all much better off since 1988.
The increase in percentage terms for Maori and Pasifika household incomes is much larger than for Europeans as Bryan Perry (2015, p. 67) explains when commenting on table D6 sourced by Closer Together Whakatata Mai:
From a longer-term perspective, all groups showed a strong rise from the low point in the mid-1990s through to 2010. In real terms, overall median household income rose 47% from 1994 to 2010; for Maori, the rise was even stronger at 68%, and for Pacific, 77%. These findings for longer- term trends are robust, even though some year on year changes may be less certain. For 2004 to 2010, the respective growth figures were 21%, 31% and 14%.
The reforms of the 1980s known as Rogernomics stopped the long-term stagnation in real wages that started in about 1974 as the Facebook linked chart below shows.
The reforms of the early 1990s under a National Party government including a massive fiscal consolidation and the passing of the Employment Contracts Act was followed by the resumption of sustained growth in real wages with little interruption since. The good old days was long-term stagnation in wages. These economic reforms in the 1980s and 1990s also lead to a substantial decline in inequality.
New work by Chris Ball and John Creedy shows substantial *declines* in NZ inequality.
initiativeblog.com/2015/06/24/ine… http://t.co/f94fw4Bhae—
Eric Crampton (@EricCrampton) June 24, 2015
The wage stagnation in New Zealand in the 1970s and early 80s coincided with a decline in the incomes of the top 10%. When their income share started growing again for a short time in the 1980s, so did the wages of everybody after 20 years of stagnation.
The top 10% in New Zealand managed to restore their income share of the early 1970s and indeed the 1960s. That it is hardly the rich getting richer.
To paint pre-1984 New Zealand, pre-neoliberal New Zealand as an egalitarian paradise, as one of the most equal countries in the world, the Closer Together tweet and Max Rashbrooke both had to ignore 60% of the population and the inequalities they suffered.
“New Zealand up until the 1980s was fairly egalitarian, apart from Maori and women, our increasing income gap started in the late 1980s and early 1990s,” says Rashbrooke. “These young club members are the first generation to grow up in a New Zealand really starkly divided by income.”
Racism and patriarchy can sit comfortably with a fairly egalitarian society if you are to believe the Twitter Left. The biggest beneficiaries of the return of wages growth were Maori and New Zealand women. The gender wage gap in New Zealand is the smallest in the OECD.
Perry (2014) reviews the poverty and inequality data in New Zealand every year for the Ministry of Social Development. He concluded that:
Overall, there is no evidence of any sustained rise or fall in inequality in the last two decades. The level of household disposable income inequality in New Zealand is a little above the OECD median. The share of total income received by the top 1% of individuals is at the low end of the OECD rankings.
Utopia, you are standing in it! 
Recent Comments