Parliament reconvenes today. Top of the list is more tax law, to ease businesses’ cash flows in the hope they will lay off fewer staff. John Key needs more chalk-marks before his 100 days end.
His first 83 days have gone swimmingly. The golden weather runs on and on.
He has smiled and joked a lot and been friendly with a disparate range of people, many of them not normally enthusiasts for National leaders, some not for any major party leader. He is likeable, which is a change.
He has assembled a support matrix which stretches logic but has been media-celebrated as inspired and as set to change the political geology. His MPs enthuse about recasting Maori politics to National’s advantage by admixing biculturalism and economic development. They think they have got Rodney Hide quietened down, in the tent.
Key whipped up a bustling pre-Christmas sitting of Parliament, though much of it was bottom-of-the-cliff crime-busting breast-beating and one item, stripping some employee rights, irked the Maori party.
He holidayed with Bronagh and the kids: the family man at play. (He spoilt it a bit by fantasising that in Hawaii he was getting real oil on the United States recession.)
He got a frequent telephone date with Kevin Rudd. As a result of one such chat, we learnt from Key several days before the Australian media got wind that it was the foreign banks that triggered Rudd’s decision to become a $A30 billion banker to the construction sector.
At the South Pacific Forum he mastered his briefs and got in synch with the consensus.
He fell off a step and broke his arm, then set up a futures market in bids for the plaster, thus mixing investment banker acumen with Kiwi bloke grin-and-bear-it.
He got biffed at Waitangi and said at length on radio he was shocked — this time the new-age Kiwi, not shrugging it off. But, true grit, he said he would keep going to Waitangi because, lapsing into quaint 1950s-speak, he wanted to promote “racial harmony”.
Lately he has been announcing props for a sickening economy.
It adds up to a sunny 83 days and there is every reason to think that, come 100 days at the “jobs summit” on February 27, he will still be sun and smiles.
That is in part because his persona and personable nature — his freshness — mark him as a different Prime Minister.
But it is also in part because he has yet to crunch a hard decision or take anything off the table in dealings with ACT, United Future and the public.
In fact, in this early stage of recession (depression?), he has wide political latitude.
Few except purists or people with an eye on the looming government debt burden quibble with his commitment of government resources to soothe households and support jobs in the downturn.
Indeed, some say he should be bolder and deliver something they call “shock treatment”, rather like mental health quacks used to give electric shocks to “cure” some conditions. They say that is what Rudd is doing in Australia.
But shock treatment can sometimes make things worse. If firms and the public think they smell panic in the government, they might clam up, fearing depression — that is, fear the sort of shock being administered is to jump-start an economy that has gone into cardiac arrest.
Key has a delicate balancing act: preparing people for tougher times and reassuring them it won’t turn really septic. That balancing act is sure to become more delicate when firms start firing people in larger numbers, as anecdotal evidence suggests is imminent and maybe already upon us.
Thus there are some boundaries to Key’s political latitude. And the longer this recession/depression goes on and the deeper it gets, the narrower those boundaries will become.
That will become more apparent as he tries also to make good his promise not to let government debt get near the $65 billion level the Treasury is now forecasting.
That means government spending cuts. One departmental chief executive tells me he has committed to holding his budget fixed in money terms for three years, which implies a deep cut (maybe up to one-eighth of staff) once fixed costs are taken into account. But this department is a policy department and policy departments are a small portion of total government spending. Key will need real cuts in actual services to make good his debt promise.
That will mean taking things off the table. All last year he insisted services would not be cut. At some point that won’t compute with his debt commitment (which in effect is deferred tax, the government’s version of hire purchase). Which commitment will come off the table?
And at some point his love-in with the Maori party will be similarly tested. To take a recent example, are we really going to have two national flags, as he indicated last week? How will that go down in National’s backwoods?
Key’s bad news is that the golden weather cannot go on forever. His good news is his sunny disposition: he might stave off autumn longer than most Prime Ministers.