Bernard does an excellent teardown of Luxon's doom loop. Aotearoa's net public debt is one of the lowest in the OECD and the Crown has a solid balance sheet.

It's the private sector that's leveraged to the eyeballs. Households are running at 160% debt to income and they can't afford to borrow. Farmers are ploughing the proceeds from favourable export earnings into paying down their loans. Businesses are just plain pessimistic, in spite of what all the booster surveys like to make us think. If the outlook was rosy, they would be in an expansionist mode...they're not.

The upshot of all this reduced appetite for credit is simple: Less new money is entering our economy than it needs to function. It's like an engine with low oil - keep running it like this and it will fail. We absolutely require govt spending to get the necessary liquidity for things to function. Start with a #UBI, social housing, and future-proof infrastructure,

Austerity kills everything it touches.