Here’s a picture of a crucial period in our history.  

The nation is at an unfortunate but not completely unusual political and economic crossroads. New Zealand is having a financial crisis at the same time as an election campaign. Big decisions that affect all New Zealanders for a long time will have to be made in the heat and smoke of an election campaign while it is unclear exactly who is in charge.

The protagonists are a Prime Minister who has ruled the machinery of government with a velvet gloved fist for nine years and a popular newcomer who is widely expected to win. The Prime Minister’s attacks on the newcomer have become vituperative and personal. The Prime Minister has successfully bullied and corralled the ruling party and the mandarins in the bureaucracy into accepting the Prime Minister’s views. The Prime Minister appears to be personally driving economic and financial policy.

National Party leader John Key hit two hot buttons in his speech at the weekend when  he promised to increase government borrowing by 2% of GDP to invest in infrastructure.

First, he correctly pointed out that New Zealand needs to invest heavily in infrastructure to boost productivity. Second, he said the government needed to borrow to do it. The first hot button is crucial, but not so controversial. The second hot button is both controversial and crucial. Both should be central election issues. 

Key pointed out what everyone has known but has been unable to achieve for years:   New Zealand needs better infrastructure to improve our productivity and therefore improve our wealth-generating potential. NZ Inc needs to find ways to invest in this infrastructure quickly and heavily. New Zealand needs better broadband, better hospitals, better schools, better roads and better energy networks. We all know this. The question is how do we do it? 

The unsolved problems have always been: