Keith Rankin, 8 September 2026 – Prime Minister Christopher Luxon has a complicated relationship with historical truth. His reputation is that he has little sense for history; this can make him come across as more tone deaf than he means to be.

A deeper problem may be that his generation (X) and the two following generations (Gen Y and Millennials) – the generations which predominate in the corporate media – are generally weak on historical nous; this means that New Zealand’s politicians tend to get away with egregious historical and statistical gaffs.

Part of the problem is that two humanities’ disciplines – languages and history (especially world history and economic history) – have been increasingly undervalued in the New Zealand education system. Too many New Zealanders in the media come across as culturally and factually sub-literate.

Communist Russia in the 1990s?

Three News from 7 September: (8′ in; originally from a Newstalk ZB interview with Mike Hosking) reports Mr Luxon saying: “It’s sounding a bit like Communist Russia isn’t it; I mean some of us lived through the 1990s or grew up in that era; it sounds very Soviet to me.” (The story was in relation to the Green’s proposed KiwiMart; see this from National and this from Green.)

Now Mr Luxon could have chosen the 1920s, the 1930s, the 1940s, the 1950s, the 1960s, the 1970s, or the 1980s; when ‘Communist Russia’ (aka the Soviet Union) actually existed. But he chose the 1990s, when Russia was arguably the most capitalist country in the world! That was the decade, after the fall of the Soviet Union, when the Russian oligarchs emerged and plundered Russia’s public infrastructure; subsequently they bought up London’s Belgravia and the nearby Chelsea Football Club.

And, if Communism is or was a problem for him, why was Mr Luxon cosying up to the Communist Party leader of Vietnam, just last month. (And see RNZ: Vietnam’s ‘most powerful leader’ since Hồ Chí Minh visits New Zealand, 13 August 2026.)

I accept that Mr Luxon probably meant to say the 1980s rather than the 1990s, but the parts of the 1980s which he may have remembered were the years of glasnost and perestroika; not the years of Josef Stalin, or even of that ‘cosy’ Russian Bear, Leonid Brezhnev. (Brezhnev, with US President Richard Nixon, ushered in the brief Cold War détenteof the early-mid 1970s.)

I am nearly 20 years older than Luxon, but I clearly remember (ie not just from books or docos) the difference between the 1960s and 1970s; the decades when I was the same age as Mr Luxon was in the 1980s and 1990s. (Maybe I’m a memory nerd? I still clearly remember shaking Walter Nash’s hand at the 75th Jubilee of the Paekakariki School in 1961. Maybe I wasn’t actually there, because I do remember the 1960s!)

Trans-Tasman Migration: facts, but not the whole Truth

This is RNZ’s Jo Moir and Ingrid Hipkiss reviewing an interchange with Mr Luxon relating to Trans-Tasman migration:

Hipkiss: “… National’s policies, he says, will keep people in New Zealand. So do you think this will make more Kiwis stay; because they’re still leaving?”

Luxon: “No, that’s wrong, I’ve said to you many times; we’ve had a 14% growth in Kiwis coming home from Australia … and Kiwis’ leaving is declining.”

Hipkiss: “So we’ve got 19,000 coming back; 47,000 still leaving though.”

Luxon: “I’m happy to send you the detail, but we’ve had a 14% …”

Hipkiss: “But net migration is 28,000.”

Luxon: “I’m happy to send you the numbers.”

Hipkiss, after Jo Moir enquired with his office. “What has the PM said?”

Moir: “You were both right … but the important number was the net migration … which shows an [ongoing] significant loss … he obviously made the comment that you were wrong [well he didn’t, but he sure gave the impression that he rejected Hipkiss’ figures] … I went back and asked what is it that he thought he was responding to? … I got a statement back saying ‘the point the PM was making is that it’s wrong to assert that the number of Kiwis leaving New Zealand is growing’; now that’s a point you didn’t make, but the spokesperson said that that’s how the PM interpreted your question … a few people commented that they were a bit surprised at the tone from the PM…”.

Hipkiss: “So, if none of the numbers were wrong, what is the strategy behind what Christopher Luxon was saying?”

Moir: “So basically he’s answering the bit of the question he wants to … and ignoring the rest of it … now this isn’t a new strategy … it doesn’t suit the government’s narrative to be talking about [a net] 28,000 Kiwis ditching New Zealand for Australia, so it’s a case of finding a way to only talk about [bits of the issue, not the nub of the issue] … which leads to obfuscating and evading other questions.”

The famous quote attributed to former United Kingdom Prime Minister Benjamin Disraeli was: “There’s lies, damned lies, and statistics“. Indeed this reputation is why the quoting of facts is commonly interpreted as the equivalent of a damned lie.

The factual statistics presented by Mr Luxon were clearly intended to deceive; so Mr Luxon (or his office) were being dishonest. The method of deception is to tell a bit of the truth but not the whole truth. Mr Luxon’s apparent guilt was accentuated by his perception that Ingrid Hipkiss was playing the same game; his office argued that he interpreted her statistical facts as being deceptive in the same way that politicians know they are routinely deceptive. But she wasn’t; her fact was the more important one. She just wanted the Prime Minister to respond to that core fact, which was the 28,000 net emigration figure.

The whole episode revealed the deceptive intent of the Prime Minister’s office; and showed that Mr Luxon has a rigidity about him; a preference to double-down rather than to fess-up when he discovers that he’s been caught out being ‘economical with the truth‘.

Congratulations to RNZ for their follow-up in this instance.

Making Sense of the point that Mr Luxon was trying to make

Yes, it’s true that there has been an increase in one-way travel by New Zealanders who were residing in Australia. But that need not indicate that New Zealanders in Australia are increasingly dissatisfied with life there. All it says is that there are now more New Zealanders in Australia; which means that, say, 5% of New Zealanders moving from Australia to New Zealand must be a bigger number than it was before.

Likewise, Mr Luxon’s mention that the number of New Zealanders going to Australia is decreasing doesn’t necessarily mean that the desire on the part of (especially young) New Zealanders to go is decreasing.

There are two issues here. The first is that emigration has both push and pull explanations. If the New Zealand push factor does not change but the pull factor from Australia diminishes, then that will see fewer emigrants, despite an ongoing high desire to leave New Zealand.

The second issue is that a single emigration follows something like a ‘bell curve’ over time, rather than a uniform pattern. Imagine the four years from 2023 to 2026; and a certain cohort of young New Zealanders coming to perceive that they would rather be making a go of life there than here. The actual departures start with a trickle, then accelerate as people make the various necessary adjustments and arrangements. Eventually, most of those with the greatest motivation to go have already gone, meaning that – after a while – that emigration impulse becomes less intense. Fewer people leave when most of those most wanting to leave have already left.

Conclusion

Our present generation of political leaders seem to find the known truth – the known knowns – a source of political tension and defensiveness. The reason that they don’t have the skills to negotiate facts when challenged is probably because the corporate media has hitherto done a particularly inadequate job of challenging them. Good on RNZ, this time, for ‘stepping up to the plate’.

About the writer:

Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.

Keith Rankin, 1 September 2026 – There is a lot of recent material on YouTube about a coming global financial crash. The text is the bond markets in, especially, the United States and United Kingdom. Medium and long-term interest rates will soar, it is alleged; these rates are set by the market, not by central banks. The subtext is that masses of money will flow from bond-markets into already-inflated sharemarkets. And that governments – if they are not already – will become helpless, hapless, and hopeless bystanders.

Refer The Bond Market Just Broke – A Financial Crash Could Be Next, Eureka UK. This is an orthodox commentary.

4’16”: “You have two arms of the same government trying to do the opposite things at the same time. The Treasury wants borrowing costs down, because it is drowning in interest payments. The Central Bank is worried about inflation, and the standard tool for fighting inflation is high interest rates. Both cannot win.” … 13’5″: [Joseph Brusuelas] “Governments will be forced either to tighten their belts or let inflation run riot. Mortgages will get more expensive. Investment in roads, schools and hospitals will have to shrink. Taxes will have to rise. Businesses will struggle, jobs will be lost, economies will falter.” [emphases mine]

The problem is being presented as a contradiction whereby the Treasury does not want higher interest rates while the Bank of England does want higher interest rates.

The solution is presented as the elected Government [represented by Treasury] having to bow down to the unelected Central Bank. ‘You are wrong, we are right, eat that!’, the Bank might proclaim.

The problem is presented as excessive government spending raising ‘borrowing costs’. In other words, the commentators – the Eureka UK presenter is a typical commentator – resolve the contradiction without examining it. The presumption is that a non-austere Treasury cannot have what it wants, and the Central Bank must have what it wants.

The presenter ‘concludes’ that there will be a financial crash and that: “the underlying cause [is] governments spending far more than they raise”. She does not once attempt to address the real underlying cause, the verifiably false narrativeabout ‘inflation running riot’ if central banks do not manage interest rates with an upward bias.

The unexamined parts of the conundrum are those parts I have emphasised: ‘The standard tool for fighting inflation is high interest rates’ and ‘or let inflation run riot’. There is simply no evidence that fighting a general inflation with high interest rates works, or that any of the inflations in western capitalist countries this decade have been defeated by higher Bank interest rates.

The ‘standard tool’ for fighting rising prices doesn’t work; further, it seems that there is no other tool. Clearly, if there is only one tool which doesn’t work the best thing is for the would-be inflation-fighter to do nothing. So, if the Central Bank stops fighting inflation – or ‘inflation expectations’, a phenomenon which may or may not be a phantom (or a bogey) like a psychosomatic pain – with high or rising interest rates then the whole conundrum goes away.

If we resolve the contradiction by requiring the Bank of England rather than at the Treasury to change its policy direction, then the dire fiscal prognoses itemised need no longer be a matter of concern.

This is a contradiction of the commentators’ – ‘expert’ and otherwise – own making. There is too much at stake; wiser heads should be sought to contest the pedlars of austerity who transfix governments.

The above notion of ‘inflation running riot’ is a farce, and needs to be called out as such. As noted in my Context: The New Zealand Residential Property Market yesterday, New Zealand (and other countries) had record low interest rates in 2019. Far from running riot, both inflation and house prices were subdued. And in 2007/08, with interest rates at 15-year highs, in New Zealand at least, both CPI-inflation and housing-inflation were ‘running riot’.

About the writer:

Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.

Keith Rankin, 31 August 2026 – Yesterday, RNZ played this episode of Context – Property Nation: NZ’s Housing Obsession, 27 August 2026. Contextis a podcast series in which well-known GenX audio-journalists Guyon Espiner and Corin Dann take a superficial historical journey on a topical social issue.

My first point here is that Espiner and Dann do what most commentators do; they conflate the urban real estate market (a land market) with the market for houses (a built market). The reason of course for this conflation is that both markets are substantially secondary markets – resale of developed land, resale of existing houses – in which houses and land are bundled together. It turns out that much of the history of housing is really a history of the financialisation of the land that houses sit on.

Good quality analysis will separate out the two components of this bundled retail market. But here I simply acknowledge that the dominant factor, historically, has been land prices. And I acknowledge the observation by Espiner and Dann that, as apartments feature more largely, that in itself is a matter of fundamental change in the economics of housing in New Zealand.

Having said this Espiner and Dann raised at least four further important points about what we may simply call the market.

First, that the market – especially in Auckland, New Zealand’s largest city – is in a prolonged bear phase; it’s been a falling market for four years, since 2022. Espiner and Dann underplayed the fact that, except for about eight months in 2021 and 2022, the housing market has been static or falling since 2017; that’s nine years ago. This skewed emphasis on the mini-boom of 2021/22 over the much more prolonged boom of 2012 to 2016 reflects, I presume, the story that Corin Dann in particular wanted to tell. I will come back to this first point, in my conclusion.

Second, that the pattern of the market which we have become used to is one of alternating periods of boom and stasis. Thus, the naïve wisdom which even serious commentators believed was that, if you stay the course, you cannot lose money on housing; a ‘wisdom’ especially applied to the Auckland market. While Espiner and Dann never really explained that ‘bull’ reality or its ‘bear’ successor, they at least acknowledged both realities.

I say “naïve” in particular because academics in finance should know that, in the long run, the fundamental market value of houses/land is the yield (ie, in this case, the rental value) of the asset. The most fundamental part of the rental value is the capacity of would-be renters to pay. If renters cannot pay more rent, sooner or later the market must stall.

Finance academics know that, in the medium term, market prices can outrun fundamentals because market players focus on ‘returns’, not just yields. Returns exceed yields when the expectation of capital gain is built into players’ expectations. We continue to have some important parties – especially the Labour Party – who have built-in expectations of capital gains in a market for which, in most years since 2017, there have been minimal or negative capital gains.

There are good reasons, in fact, to believe that the present correction to fundamentals still has a way to go. Further, there are good socio-demographic and financial reasons to believe that the lack of capital gains in residential property is a new structural reality. Cohorts of younger people are smaller and poorer; and the financial world has moved on to other more esoteric assets which players can game. (In this last sense though, we may note that after the next great depression – ie after the next global financial reset, the last reset began in the mid-1940s – when the next long cycle begins, there may be a return to real estate as a favoured asset. After the Black Death of the 14th century, land became very cheap.)

Third, Espiner and Dann uncritically parroted the industry-cemented narrative that the last boom – the mini-boom of 2021/22 – was solely a product of loose monetary policy. They should know that most phenomena have more than one contributing cause; and that when there are multiple candidates for the attribution of guilt, one or more of those contenders may not be responsible at all. Pursuing the model of guilty until proven innocent – and contemplating the possibility of innocence – is what we traditionally associate with totalitarian systems of ‘justice’.

In terms of the 2021/22 event – which was both a brief bout of real estate inflation and a slightly less brief period of annual CPI inflation above three percent – there were other causes.

Re the property market, there was the expectation that, by about 2021 or 2022, the market was due for a new round of capital gains; that is, regardless of monetary policy. (In most decades going back at least to the 1970s, the property market took-off in the years ending in a ‘1’ or a ‘2’. This is because the cycle, as widely understood by players, was a ten-year cycle. The cycle would be at its flattest from years ending in a ‘7’ to years ending in a ‘0’. For specific reasons, the property cycle was late to restart in the 1990s, but it did restart in 1993. In the 1980s, I was a party to a house purchase in mid-1982. It was $60,000. In early 1988 the house, with just a few added improvements, sold for $180,000.)

In 2021, it was only Aucklanders who were quarantined in their city, from August to December; though all New Zealanders were effectively detained in their country. And non-Aucklanders, far from the scourge of the Delta strain of the virus, were subjected to substantial pandemic policy overreach. There was a huge fear then that Covid19 mutations were escalating the pandemic, and that new money would be needed for New Zealand industry and the New Zealand government to invest in substantially-modified supply chains.

New Zealander households which had not faced income decreases – and there were many such households – had significantly fewer options about how to spend their incomes compared to in a normal year. There is no real evidence that a property boom in the second half of 2021 would not have happened if interest rates had been (say) two-percentage points higher.

Property bubbles are actually quite insensitive to interest rates. In the modern financial environment of floating and short-term mortgage interest rates, almost zero property investors in 1921/22 would have been expecting their interest rates to have stayed at their early-2021 lows. Players in the property market may be naïve; but not that naïve.

With appropriate hindsight, everything was in place for a new round of property inflation to commence in 2021, regardless of what the interest rates were at that particular point of time. Banks were flush, not only because of monetary policy. For a short while, they had few other customers they could profitably to lend to; their perception at that time was that business lending was more risky than property-market lending. And businesses, facing deep uncertainty, were cautious about taking on additional debt; the situation had the appearance of a balance-sheet recession, in which it is the role of government to become lead-borrower.

The real story about the 2021/22 property mini-bubble was not what started it, but what stopped it in its tracks. What happened was that, when the pandemic restrictions ended – pretty much all at once in January and February 2022 – banks quickly rediscovered their business customers; and saw that most were not insolvent. The pivot in the flows of money was determined by the changed state of the pandemic, not the interest rates which in New Zealand had been prematurely raised. Economic growth rebounded sharply in 2022, despite cost-inflation arising from both from the Ukraine-Russia War and from interest rate escalation. CPI inflation soon dropped, as interest rates also dropped. (Compare New Zealand’s recent CPI inflation with countries which kept their interest rates high.)

Fourth, Espiner and Dann mentioned that the property boom of the late-2000s happened despite rising interest rates. (Regrettably, they did not consider the possibility that the property bubble happened, at least in part, because of rising interest rates.) They did not dig deeper into this issue. Just as President Trump only seems to remember what the last foreign head-of-state or technocrat told him, Espiner and Dann used 2021/22 as a sample-of-one to form the basis for a much-repeated generalisation about a simple causal relationship from monetary policy to housing-market outcomes. The earlier examples were presented as contextual candy floss.

Consider the 2010s. Interest rates were low for New Zealand in the early 2010s, but high by international standards. The New Zealand Dollar exchange rate was overvalued, and the New Zealand economy was slow to recover despite improving terms of trade. Money moved into the property market after 2010 because punters thought it was time for a revival of that market and because banks still considered other forms of lending to be riskier.

Once underway, the market gained its usual momentum. The rise in interest rates in 2024 – at a time when European interest rates were falling to zero or less – failed to cool the property market, and also slowed down the economic recovery. Interest rates were lowered again in 2015, back to 2013 levels (OCR of 2.5%). In 2016 they were further lowered. It was really only in 2017 that the economy – with Steven Joyce as Finance Minister – that the economic cycle moved into a new expansionary phase. Interest rates continued to fall, bringing the OCR to just 1% in late 2019.

The historically low and falling interest rates from 2016 both revived the New Zealand economy and stemmed (ie not invigorated) that decade’s real estate bubble. CPI inflation remained at the lower end of the target band of one-to-three percent. In late 2019, the New Zealand economy had moved into its sweet spot of low interest rates, a stable (though still overpriced) property market, and low annualised rates of price increases. Low interest rates put an end to the property bubble by diverting money away from the property market and reviving the economy.

While theoretically low interest rates stimulate all types of borrowing from banks, in reality they mostly stimulate business borrowing and have least impact on real estate borrowing. Money is most pumped into real estate when interest rates are high, because banks are then less interested in other forms of lending, and because (in our world of flexible and short-term mortgage lending) real estate punters expect that interest rates will soon fall; property punters are interested in expected interest rates over the life of a mortgage, not just the interest rate on the commencement date.

Consider the 2000s. The New Zealand property market turned upwards in 2001/02, on cue, at a time of geofinancial and geopolitical turmoil. Interest rates were briefly ‘low’ after the 911 attacks (the OCR dropped to 4.75%!). By mid-2002, the OCR was back to 5.75%; that’s when the property bubble really got going. Following a brief fall to 5% in 2003, the OCR was steadily pushed up to 8.25% in the first half of 2008! As noted by Espiner and Dann.

In the years from 2004 to 2008, New Zealand’s tradeable economy tanked despite an improving terms of trade, the NZD was increasingly overvalued, and bank money was increasingly channelled into the property market because it had fewer other places to go. Much of this was New Zealand’s version of sub-prime mortgages, injected into the top end of the property market through finance companies such as Hanover. Almost all of those kinds of finance company crashed from 2006 to 2008, in what remains New Zealand’s greatest untold – or at least under-told – financial scandal. It was the high interest rates, and the ensuing increased concentration of money in property, which fuelled that devastating property boom.

Espiner and Dann presumed that that property cycle happened despite high interest rates; no, it was because of high interest rates.

The 2000s’ property boom was followed in New Zealand by only a mini-bust; conditions remained more conducive to money being fed into property than to ordinary businesses.

In the 1990s there was a sharp property boom confined to the mid-1990s. It started late in the wake of the economic devastation of 1991 and 1992. And it finished prematurely with the Asian Financial crisis of 1997 bringing interest and exchange rates down, soon reviving the real economy while disinflating the property market.

In the 1980s, the property market boomed on cue in 1981, at a time when CPI inflation was approaching 20%, meaning that properties were looking very cheap, and when interest rates – well below the inflation rate during a global economic crisis – pointed the way to reinvigorate the property market. After a pause in 1982 (when I bought that $60,000 house in Wellington) that market really ramped up in the mid-1980s, after the full introduction of Rogernomics in 1985; a package of financial deregulation, very high mortgage and other interest rates (like 20%), and a rising exchange rate making New Zealand an emporium of imports. The markets stabilised after the crash of late 1987 and early 1988, but neither the did economy nor the did the property market recover until election-year 1993.

Possibly the biggest property boom in New Zealand’s history happened in 1972 and 1973, with the big ‘favourable’ spike in the terms of trade and the revaluation of the New Zealand dollar, creating new previously unheard of opportunities to consume imports and to travel overseas. I was lucky in that I embarked upon my OE in 1974, when despite the crashing British financial markets, my New Zealand dollars were uniquely valuable on the world’s foreign exchange markets (and I put my money into US dollars and Swiss Francs rather than British pounds). The New Zealand property market had a longer than usual slump in the late 1970s, not because of New Zealand monetary policy, but because of a mix of world events and the rapidity of the 1972 and 1973 property boom.

Conclusion

New Zealand property market booms have never been driven by low interest rates compelling people to buy real estate. Rather, loanable funds have gone into real estate in large amounts when there was a lack of other compelling destinations for those funds; and when governments were reluctant borrowers despite a huge availability of loanable funds at favourable interest rates.

Our commentators Guyon Espiner and Corin Dann were good to make a number of important observations about New Zealand’s property past. But they made no real attempt to join the dots, to question the narratives they have repeatedly heard, or to understand the actual relationship between banking and real estate.

Coming back to Espiner and Dann’s central narrative about the housing market and monetary policy – a narrative which emphasised the 2021/22 mini-boom and subsequent reversion to stagnation or bust – the Reserve Bank must make new money available when it is likely to be needed. The Bank can ‘take horses to water – or water to the horses – but cannot make them drink’; if the money doesn’t get consumed by the horses which need it, it is more the unhydrated horses’ fault, not the Bank’s. In this case, the horses were the government – which could have borrowed the new money, not spending it all straight away – or the many businesses which were not yet in a position to recommence large-scale borrowing.

The New Zealand Reserve Bank did not make a huge mistake in 2021. It did what it had to do in an economic environment clouded in uncertainty. Yes, property borrowers got the money first; but the problem was that other parties were too slow to respond to the market signals being conveyed by the Bank.

It’s a convenient story for pundits today to attribute all our economic woes to the alleged Reserve Bank’s mistakes during the Delta-strain height of the Covid19 pandemic. That story of piling into the then Bank does no credit to today’s uncritical commentators, and perpetuates the problem of economic policy today being founded on a mix of historical unawareness and myths derived only from the very recent past.

About the writer:

Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.

Keith Rankin, 25 August 2026 – My sense is that, noting both the proposed social media ban and the India New Zealand Free Trade Agreement, Christopher Luxon – leader of the National Party and Prime Minister – would be more comfortable working with Labour on a longer term basis than with New Zealand First or Opportunity. But probably only if National is ‘top dog’ in such a grand coalition.

Ireland (STV) and Germany (MMP)

Ireland and Germany use voting systems familiar with New Zealanders (although STV is not familiar to Aucklanders). Both countries have ‘grand coalition’ governments.

In Ireland it’s the traditional parties Fianna Fail and Fine Gael in a minority grand coalition. The main Opposition is Sinn Fein, seen essentially as a party of the populist Left. There is no plausible coalition which could govern as an alternative to Fianna Fail with Fine Gael.

In Germany there is an unfortunate grand coalition which has majority support in the Bundestag, though only getting 45% combined party support in the 2025 election. There, one party (BSW; a party of the conservative-Left) got 4.98% of the vote, and missed out entirely. Another party to miss out entirely was the FDP (4.3%), once a centrist liberal party, but now a right-wing analogue of New Zealand’s Act Party.

The new Opposition in Germany is the populist-Right AFD (Alliance for Germany), which may soon assume government in Saxony-Anhalt (a federated eastern province west of Berlin), but which is no more viable as an alternative government for Germany than Sinn Fein is for Ireland.

The CDU/CSU (Germany’s ‘National’) got 28.5% of the vote last year, and the SPD (Germany’s ‘Labour’) got 16.4%; together these add to 44.9%. As a result of the coalition deal, Chancellor Friedrich Merz controls the Parliament (Bundestag) with the party support of just a quarter of the electorate. The SPD really had no choice but to participate, and the SPD’s ‘gung ho’ Defence Minister, Boris Pistorius, is really a man of the right.

If the BSW had got 5.00% instead of 4.98%, the outcome in Germany would have been a minority grand coalition with Green Party support, or a ‘grander coalition’ with the Green Party in Cabinet. Merz would still be in charge. The Greens and SPD combined have three fewer seats than does the presently all-powerful but unpopular CDU/CSU.

Germany has had CDU/CSU/SPD grand coalitions before. There was 2005 to 2009, and 2013 to 2021, under Angela Merkel. (Also in 1966 to 1969, in West Germany, under Kurt Kiesinger.) We note that all these grand coalitions were dominated by the conservative CDU – ‘National’ in Germany – the leading party of the CDU/CSU alliance.

An Aotearoan version?

As in Germany, I can only envisage a grand coalition in New Zealand with National as the larger partner. I cannot see a Labour-National government led by Chris Hipkins.

In a sense, Opportunity is Luxon’s opportunity. By choosing a ‘sleepwalk’ strategy for the 2026 election, Labour is vulnerable to losing votes to the more charismatic Opportunity Party; meaning that, no matter how small National’s party vote ends up being, it is likely to prevail – as in 2017, and 1993 – in the head to head battle against Labour.

The difference this year is that the only alternative to a National-Labour government most likely would be an awkward four-party arrangement led by a weak Labour Party with spineless Labour leaders. There would not be much of a dog for the tails to wag.

The lesson from Germany though is that, while these grand coalitions have been humiliating for the SPD, that party has survived these humiliations, and has even been able to lead – albeit with little spine – a subsequent government (2021 to 2025).

So a grand coalition in New Zealand in 2027 is a rat that the Labour Party might be prepared to swallow. Most National voters would probably favour such a grand coalition of the establishment-centre over a four-party right-wing government which National couldn’t dominate; most Labour voters would have to bite their tongues, but would still support Labour in 2029 as the most probable lead-party of an alternative government going into the 2030s.

An Aotearoan vision?

This would become a possibility if Opportunity could play a substantial role in a three-party coalition. New Zealand is not condemned to ongoing stale establishment centrism. That was the lesson of 1935 and 1938.

I see the two most probable outcomes for government in 2027 as a New Zealand version of the present reactionary-centrist German government, or a cautiously-radical pro-capitalist centre-left government in which the Greens and Opportunity together can inject a bit of spine and vision into Labour.

A spineful centre-left administration would pursue liberal economic policies, while rejecting the prevalent economists’ narrative of economic liberalism; economic liberalism – the gospel according to Act’s David Seymour – is also known as ‘neoconservatism’.

A spineful centre-left government would move away from fiscal conservatism, and stop prostrating itself to the God of ‘balanced’ Budgets. Governments are meant to be capitalism’s last-resort borrowers, and last-resort insurers, with a duty-of-care towards their citizens; and central banks are capitalism’s last-resort lenders. At present the grand coalition parties are behaving more like insurance companies which look for opportunities to renege on their obligations; like collectives unwilling to perform their societal function.

These days, governments only want to perform their requisite roles as borrowers of last resort (and borrowers of best resort) when they wish to increase ‘defence’ spending. Such military keynesianism – used with initial success in Germany to extricate that country from the 1930 to 1934 great depression – is the now-accepted exceptionalism which reveals economic liberalism as morally bankrupt and profoundly opposed to twentieth-century liberalism.

Germany, with its grand coalition, is once again heavily into military keynesianism. So too is Finland, which like New Zealand is a darling country which doesn’t live up to the hype which emanates around it.

There are ways out of the fiscal conundrum which Aotearoa New Zealand now faces. We start by imagining our way out of the intellectual treacle – the accepted narrative of bankrupt social science – within which we have become enmeshed. As well as good ideas, we also need to imagine some lesser ideas – such as the grand coalition – in order to pre-empt such intrigues, to avoid having them creep up on us as fait accompli with Christmas beckoning.

About the writer:

Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.

Keith Rankin, 21 August 2026 – On RNZ (Morning Report) on Monday, John Campbell said “Recent figures from Stats NZ show more than a third of 15 to 24 year-olds are unemployed or underemployed.” It’s still there on the website, in print, so has not been corrected. (Refer Butchery bucks trend with good job prospects, 17 August 2026.)

The above charts show what young New Zealanders actually were doing (and not-doing) around May 2026. It’s actually quite hard for researchers to compile these statistics properly, because of the ways they are presented by Statistics New Zealand; the diminishing number of RNZ backroomers probably do not have the time or the conceptual knowledge for this task.

To see the people in the categories mentioned by RNZ – unemployed or underemployed young people – look at the chunks of the pie charts from dark green to brown. For both charts, its just over a quarter; just over 25%. (In fact it’s 27% for 15-19 year-olds and 28% for 20-24 year-olds; “more than a third” means around 34%, or more.)

But even these more accurate numbers need to be unpacked. The major malaise intimated by Campbell is confined to two sub-categories shown: ‘job-seeker not student’ and ‘no described activity’. That’s 10.2% for 20-24 year-olds and 13.7% for 20-24 year-olds; bad enough for sure, but nowhere near the alluded-to 34%.

One of the other ‘problem’ sub-categories is much smaller than it used to be: ‘caregiver, no other activity’, aka ‘fulltime mum’. That sub-category, along with the two mentioned in the previous paragraph, are the so-called NEETs: ‘not in employment, education and training’. Actually, it is inappropriate to include fulltime mothers as part of a problem classification. (In the 1950s they would have been more like 25% than 3% of 20-24 year-olds!)

The majority of those 15-19 year-olds mentioned by John Campbell are in two other sub-categories: ‘student seeking employment’ and ’employed but underemployed’. If we add these underemployed to the NEETs we still get under 20% of that age-demographic.

The sub-category which most needs examining is ‘student seeking employment’. These are part of the official unemployment tally. Some of these 7.5% of 15-19 year-olds – perhaps a third of them, 2.5% of 15-19 year-olds – are functionally unemployed, in that they would leave education immediately as soon as they get a job, meaning that their ‘education’ is really youth childcare. But most of these 7.5% are part-time or fulltime students who are actively seeking some paid work, willing and able to commence work immediately, but who would continue to be students; they are aspiring to join the light-green group rather than the tan group.

The real tally of unemployed and underemployed 15-19 year-olds is about 22% (2.5%+4.5%+5.7%+8.8%) of their demographic. And, similarly, the real tally of unemployed and underemployed 20-24 year-olds is 24% (0.7%+7.3%+6.4%+9.7%) of their demographic.

Both are high – too high – but not over 33%!

The following two charts show these data for every quarter-year from January 2004.

As we would expected, the education data is seasonal, with people in holiday jobs during the holidays. Looking beyond that, the NEETS and underemployed are those shaded at the top, from purple to brown.

In May 2004 there were about 33,000 NEETS aged 15-19, out of a population of 300,000. In May 2026 there were about 70,000 NEETS aged 15-19, out of a population of 360,000.

In May 2004 there were about 49,000 NEETS aged 20-24 (including 17,000 fulltime parents), out of a population of 280,000. In May 2026 there were about 87,000 NEETS aged 20-24 (including 10,000 fulltime parents), out of a population of 330,000.

The NEET problem has doubled for 15-19 year-olds, and more-than-doubled for 20-24 year-olds.

Two particularly interesting young-person statistics for 2026

One. Since the end of the Covid19 pandemic quarantine (January 2022), the total population of 15-19 year-olds has increased from 315,000 to 360,000 (14% increase). Before 2022, the population of 15-19 year-olds had been steady at around 315,000 ever since 2006. While New Zealand today may be seeing rising numbers of older people, it is also seeing significantly higher total numbers of teenagers. Indeed, unlike many other countries with majority European or East-Asian populations, New Zealand should continue to have a proportionately adequate working-age population. New Zealand’s number one socio-economic priority is to invest in the capabilities of our substantial population aged 15-19, and our remnant and immigrant population aged 20-24. Investing means spending money now and soon, not squirreling it away.

For 20-24 year-olds, while the population increase since 2006 is somewhat higher than for 15-19 year-olds, the post-Covid19 population increase is negligible; and total population is well-down on what it was in the late 2010s. New Zealand is seeing a substantial impact, through emigration, of its failure to invest in its young adult population; a result of the government’s emphasis on a futile attempt to get back to fiscal surplus while sanctioning the depreciation of the government’s revenue base. Government cutting off its nose to spite its face.

Two. The number of people aged 15-19 in employment as their only measured activity was in May just 16,500 out of 360,000; that’s just 4.6%! In the Great Depression years of the early 1930s, this figure would have been over 50%, with another 30% seeking more hours. And it would also have been around 50% in the 1960s.

For 20-24 year-olds, this employment-enough figure is now 40%, along with 3% as fulltime caregivers. In the 1960s, the total of these two numbers would have been around 90%.

Education and Training and Daycare

Some might say that, with education and training much more dominant today as measured activities, New Zealand is investing in its young people. But investment in people is a ‘game of two halves’. New Zealand is only really playing the first half; that is, formal education.

Further, it’s not entirely clear that secondary and tertiary education in New Zealand really are investment activities; to some extent, it might be argued, they are becoming a young-adult extension of childcare, a place during the day to put (physically or virtually) a growing excess of people because there is nowhere else for them to go. Young people are not scarce. Not yet.

About the writer:

Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.

Keith Rankin, 26 August 2026

The above chart shows average weekly hours worked over the last 40 years. It’s calculated by taking total hours worked – according to the Household Labour Force Survey – divided by the population aged 15-69. Triennial elections are depicted in red.

The data series commences in 1986, in the year after the very neoliberal Rogernomics economic policy regime was implemented. Employment in the 1980s peaked in 1986. New Zealand’s long recession cycle began that year, interrupted by a brief ‘sugar hit’ before the August 1987 election and by a partial recovery in 1989/90.

Overall, this data is as accurate a picture attainable of the busts and growth phases of the New Zealand economy. This series – of hours worked – does not show the cyclical lag generally associated with unemployment data. Based on the latest data shown here, the cycle would appear to have turned down again, after a mini-boost in the summer of 2025/26. (There was a similar upturn in 2011.)

The chart also shows, in a stylised way, the relationship in post-1984 New Zealand between labour supply and hours worked. While the fluctuation in hours worked is a direct function of the demand for labour – which in turn is a function of aggregate demand in the national economy – the state of the labour market feeds back into labour supply. Labour supply can be understood as the total number of hours offered to employers.

The clear increase in labour supply over the period as a whole is known as the added-worker effect; refer my Retirement Age Labour in New Zealand, Scoop, 16 July 2026.

Wikipedia is too restrictive of its definition of this effect. In the 1980s the main demographic of additional workers was ‘married women’. In the 21st century the main demographic of additional workers is older people who would otherwise be categorised as retired.

In the 2020s another important demographic is young people (15-24) who would otherwise have been in fulltime education. In the Great Depression of the early 1930s, the biggest group of additional workers was single young women; though all demographics other than males aged 20-64 did show up as additional workers.

It is important to note that to be an additional worker you do not have to be employed. You only have to be in the labour force, meaning that you prioritise income earning over some other activities such as education or care-giving or voluntary work or leisure. And additional workers include people who hug their jobs; such as people who might otherwise have retired, had a child, or taken a gap year.

Then there is ‘additional work’, mainly characterised by existing workers seeking a second or third job, which is part of the added-worker effect. Strictly, labour supply is measured in hours, not people.

Unemployment of ‘primary breadwinners’ was generally regarded as the prime inducer of additional workers. Thus, if ‘Dad’ became unemployed or was obliged to work fewer hours in his main job, then so also ‘Mum’ became unemployed; meaning that ‘wives’ entered the labour force when their husbands became unemployed or underemployed. But rising housing costs – especially rents and mortgage interest – are also important drivers of people over 15 seeking additional work. Also falling wages relative to consumer prices drive people to seek more hours.

The added-worker effect is an income-effect, whereas the mainstream economists’ narrative emphasises the price (ie substitution) effect. Under the income effect, a household suffering from a rising ‘cost of living’ will seek more hours of work to compensate. Under the price effect, households facing lower hourly real wages (eg because of unanticipated CPI-inflation) will reduce the number of hours they want to work (or quit their jobs, or not look for replacement jobs); choosing more leisure instead, or maybe ‘choosing’ to become a beneficiary or a discouraged worker. This mainstream view emphasises the concepts of voluntary and involuntary unemployment, and has inspired the definitions used internationally for counting and calculating unemployment.

Thus it is hard to get a firm measure of true unemployment; of the gap between labour supply and labour demand. A measure of untapped labour.

Conceptually, the best measure of unemployment is to subtract hours worked from hours offered, and then to get a percentage by dividing by hours offered. The problem is that we have no reliable data for hours offered. What we can say is that more hours are offered when material living standards decline, and that this effect of ‘seeking more hours’ is revealed when the economy subsequently recovers; when the economy subsequently settles into a growth phase. This means that the unemployment undercount is proportionately higher during an economic crisis than during economic good times.

My ‘labour supply’ plot above is estimated, showing significant increases in labour supply with each economic crisis, and small reductions in labour supply at times when official unemployment falls to the (‘normal’) 3% to 4% range. (There is a delay in the reductions of labour supply, because there is typically a substantial debt accumulated in the critical years.)

Thus, in 1992, true unemployment in Aotearoa New Zealand was about 22% (still less than in the early 1930s), double the official 11%. True unemployment in 2006 was about 5.8%. At the end of 2009, true unemployment was 16%. True unemployment in 2019 was about 5.2%. In 2026, true unemployment is 11%, double the official rate.

Note on Net Immigration

My analysis here does not take any account of immigration. The data is adjusted for population, so when immigration is rapid, population growth is also rapid. I would note, however, that we would expect that the labour supply – hours offered per person – is generally higher for immigrants; reflecting the circumstances which led to them being accepted as immigrants.

Finally

The biggest driver of increased labour supply this century has been additional work offered by people aged over 65. And the highest level of underemployment occurs at present among people aged 15-24. Thus, increasingly, younger people are being supported by older people.

So far, this is the exact opposite of what the ‘financial literacy’ advocates – pension fund lobbyists – keep telling us. Those advocates claim that younger people from now onwards will be overemployed supporting retired and unwell older people; eg streaming into our aged-care and health-care facilities as needed care workers. We can afford more aged-care services – despite what the bean-counters tell us – precisely because we have a substantially underemployed cohort of young working-age people. Young people seeking paid work are not scarce; and the scarcity of money to pay them is a scarcity of choice.

Today we see neither overemployed young people nor any serious effort to invest in the productivity of our young labour force. Our polytechnics are focussed primarily on profiteering from international students; they are businesses first and educators second.

About the writer:

Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.

Keith Rankin, 14 August 2026 – As I see it, the Opportunity Party represents the ‘radical centre’ of politics; distinct from the stale ‘establishment centre’. Indeed the true and original meaning of ‘radical’ was ‘innovative’, and not extreme. Thus the Liberal Party of Balance, Seddon, Reeves and Ward was understood in its time – in the 1890s – as a radical political movement.

In its American adoption – much of it inspired by New Zealand – 1890s’ liberal radicalism became 1900s’ progressivism. The word ‘progressive’, these days has been adopted by the ‘establishment Left’, which is importantly different from the radical centre. So ‘radical centrism’ is the phrase which best fits the new conceptualisation.

Universal Income

The important departure from establishment politics – a departure, embraced by Opportunity, whose time is overdue – is the Universal Income. In embracing this departure, Opportunity have created an unnecessarily fearful response within the halls of establishment politics.

My suggestion is for Opportunity to acknowledge this fear, and to present twenty-first century radicalism in a cautious way. In the mid-1960s, young men wearing long hair created a fearful response in post-war society. By the early 1970s, such hair was normalised, and had become largely non-threatening.

Universal Basic Income

In this regard, Opportunity presents its particular policy for a universal basic income (UBI, or ‘Citizens Income’ as they call it) as an aspiration; as a basis for public discussion and not as a scheme to be imposed on those people who push-back from engagement with the concept.

We may not have many available years for this discussion, because if AI (artificial intelligence) achieves anything like that anticipated by its backers, our liberal economies will collapse under the strain of so much income being redistributed from the owners of labour (the majority; the 75 percenters) to owners of new capital (presently, the minority five percenters already at the steepening apex of the wealth distribution). As with any prospective tsunami, we should at least make an effort to be prepared.

‘We are all Beneficiaries’; the basis for a bottom-line policy

Prime Minister Christopher Luxon – an intellectual barnacle impeding social and economic progress – expresses the fear of the people he represents as ‘Opportunity wants to make us all beneficiaries’.

Opportunity’s approach should be to emphasise that we are already ‘all beneficiaries’; in part by pointing out the obvious, and in part by some judicious, sensible, and inexpensive reframing.

And to note that receiving a benefit is literally a ‘good’ thing, not a bad thing. The essential meaning of the word ‘beneficiary’ is a recipient of financial benefits deriving from ownership of shares or membership of a trust or a Friendly Society or a Building Society, and the like. The use of the word ‘beneficiary’ – over the word ‘pension’ still widely used in Australia – resulted from a deliberate modernisation of thinking in New Zealand in the late 1930s, making social financial benefits a simple extension of private financial benefits.

Almost everybody with an active KiwiSaver account receives an annual benefit of $260 from the government. That’s enough to sustain the claim that ‘we are already all beneficiaries’.

New Zealanders aged over 65 receive a universal basic income as a social financial benefit (New Zealand Superannuation, formerly National Superannuation); from 1940 to 1974, in the time of its predecessor, a basic universal retirement income was known as Universal Superannuation. US, NS, and NZS have been a core part of the centre-right political programme in New Zealand since the first National government in 1949. They are present and longstanding benefits, payable to poor and rich alike; though those rich people who disagree with the idea of universal benefitdom are free to opt out.

A specific ‘bottom-line’ suggestion

Opportunity could propose, as an interim measure pending a wider societal discussion (comparable to the recent discussion about the Treaty of Waitangi), that the government replaces the present 10.5% and 17.5% concessionary tax rates with a ‘personal tax credit’ which for everyone receiving more than $53,500 of annual taxable income would be $150 per week. The tax credit payable for people receiving less than $53,500 of annual taxable income would be less than $150 per week.

The net ‘dollars-in the-pocket’ effect would be a 39 cents per year gain for people receiving more than $53,500 per year, and a zero gain/loss for everybody else. The total annual fiscal cost would be about one million dollars.

Why do it if there is no significant change in after-tax incomes?

The important change is conceptual; and the power of conceptual changes should never be underestimated. The personal tax credit would be fully understood as a ‘benefit’ – in the very best sense of that word – and there would be no doubting the truth that every taxpayer is also a beneficiary. So this policy would lay to rest Luxon’s rhetorical bogey.

Next, this reconceptualisation of what we have at present does two other important things.

First, it would give governments a new policy lever; and we sure are short of policy levers at present. The $150 personal tax credit could be raised (or lowered) in future Budgets. (I heard the statement “there are limited levers that governments can pull” 11 minutes into last night’s TVNZ’s One News.)

Second, the policy would beg the question: Why deny people receiving less than $53,500 the full personal tax credit? Thus Opportunity could offer an interim non-bottom-line policy – interim relative to its Citizens Income policy which depends on the separate matter of new forms of taxation – to extend the $150 personal tax credit from higher-earning adults to all adults, whatever their levels of annual taxable income.

Thus, the $150 personal tax credit would become a Basic Universal Income (BUI).

If properly understood, such a BUI would not be expensive to implement. For people already receiving Jobseeker Benefits, Assisted Living Benefits, New Zealand Superannuation, Student Allowance, there would be no change in ‘disposable income’; no change in the amount of money in those peoples pockets, wallets, or bank accounts.

There would be a little more disposable income for adults – other than the above-mentioned beneficiaries – on lowannual wages; and for adults (such as many students presently not receiving Allowances) on no annual wages. (Such a BUI would have zero impact on the present Working for Families programme of benefits/credits.)

The extension of the $150 personal tax credit – the present status quo, albeit re-imagined – to a $150 basic universal income would target extra social spending to where it is most needed; to young people and to caregivers.

(The mantra of economic liberalism since 1984 – known as neoconservatism in the United States – is that all benefits should be bureaucratically targeted; indeed Roger Douglas did in the 1980s convert Superannuation into a ‘clawed-back’ benefit called Guaranteed Retirement Income, reversed by Winston Peters as Treasurer in 1997.)

There is one other important favourable consequence of extending the present effective personal tax credit (PTC) to a BUI; that is that, for people who lose some or all of their current incomes, the core payment (currently $150 per week; strictly $149.61 per week) is retained. That money becomes a reliable provision which can at least put food on the table for persons in transition, or in distress arising from a sudden change of circumstances. A basic universal income, while far from generous, serves as an immediate bridging payment receivable as of right, and not granted through a successful application to a government or charitable bureaucracy.

2027

The PTC could be legislated for early in 2027, soon after the next government is formed. (In 2020, acting quickly, the Labour Government removed the entitlement of [mainly] women to gain a superannuation benefit as a ‘non-qualifying spouse’ [ie a partner aged under 65 of a superannuitant aged over 65], in a matter of weeks after the formation of the new government.)

The suggested PTC is just a rebranding of what we already have in 2026. And the BUI as suggested could easily be implemented in the 2027 Budget; it’s a matter of political will and imagination, not at all a fiscal risk to the nation. We are, already, all beneficiaries.

Then, from later in 2027, we could have a sensible discussion about having a universal basic income – and new taxes – in line with or alternative to Opportunity’s present fiscal philosophy.

If there is anything wrong with my suggestions, please tell me.

About the writer:

Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.

Keith Rankin, 13 July 2026 – I saw and heard this from Stuff reporter Molly Swift on Three News yesterday (12 August 2026):

“History shows that replacing a sitting prime minister in an election year doesn’t end well. The only time it has worked was in 1943 after Michael Joseph Savage died in office, and Peter Fraser took over.”

Michael Joseph Savage actually died in March 1940, not 1943. Peter Fraser – Savage’s deputy – subsequently became Prime Minister. Hardly a coup, though technically there was a contest for the party leadership. Fraser ran against two inconsequential backbenchers. There was never any doubt that Fraser would succeed Savage. Wikipedia, for Savage, simply says: “He was succeeded as head of government by his deputy Peter Fraser”.

Events in more Recent History, unmentioned yesterday

In August 1974 there was an event much like that of 1940. Norman Kirk died in office, New Zealand’s last PM to do so. There was a subsequent contest for the party leadership, and hence to become Prime Minister. Kirk’s deputy was Hugh Watt. There was a contest, however, between Watt and Kirk’s Minister of Finance Bill Rowling. Rowling defeated Watt; thus it could be said that Rowling ousted Watt. Rowling was defeated ignominiously in 1975 (and despite winning the popular vote in 1978 and 1981); but Watt would probably have suffered an even bigger defeat.

We should note that neither this event, nor the Savage-Fraser succession, took place in an election year. In one short sentence, Molly Swift got it thoroughly wrong, by saying both “the only time it has worked” and “in 1943”; and of course in implying that Savage could have remained prime minister despite his having passed away.

Not the “only time”: 1990, Geoff Palmer and Mike Moore

To my great surprise, as the failed coup unfolded yesterday, I did not see, hear or read any reference to the events of 1990. 1990 most certainly was an election year.

In that year sitting (Labour) Prime Minister Geoffrey Palmer (still alive and, I understand, well) was ousted just seven weeks before the election. His replacement was the late Mike Moore (who would only be 77 years-old if still alive).

While Labour was never going to win the 1990 election, the leadership switcheroo was an undoubted success. Before the Moore coup, Labour – crushed by the failure of Rogernomics – was projected to win just 7 electorates out of 97; four of these seats were the Māori electorates. At the time, Labour governed with 57 out of 97 seats, and 43% of the votes.

(In the 1987 election, Labour was unusually popular with people who normally vote National. Left-wing voters had nowhere to go. Subsequently, New Labour broke away from Labour, becoming the core of the Alliance Party in 1993.)

In the end, Labour won 29 seats in 1990; Labour, and their senior MPs, lived to fight another day. Indeed, in 1993, the combined Left vote was a landslide. Mike Moore nearly regained his position as Prime Minister. He might even have become one of our most warmly remembered Prime Ministers, and he certainly would have saved us from Ruth Richardson’s deeply problematic ‘Fiscal Responsibility Act 1994’.

As it was though, after the 1990 election, a group of right-wing Labour MPs broke-away to form the Act Party (Association of Consumers and Taxpayers). And after the 1993 election, another group of rightish MPs (including Peter Dunne) broke-away from Labour, joining some National MPs, to form the United Party. The United Party, in its various forms, went on to become powerbroker in three different Parliaments: 2002 to 2005; 2011 to 2024; 2015-2017.

1957, Sid Holland and Keith Holyoake; and 2017

In 1957, a very unwell Sidney Holland resigned as Prime Minister and National Party leader, just 12 weeks before the election. Holyoake, Holland’s deputy, replaced Holland without fuss. National only just lost the election; with Holland at the helm the defeat would have been much larger. The replacement of the leader, at late notice, boosted National’s vote.

Events which were mentioned yesterday

In 2017, when Jacinda Ardern replaced Andrew Little late in election year (this time while in Opposition), like Holyoake she boosted her party vote compared to what it would otherwise have been. Nevertheless, under a First-past-the-Post election, Ardern’s Labour (29 electorate seats, 38% of vote) was soundly beaten by Bill English’s National (41 electorate seats, 44% of vote). This result, however, was like 1993. The support for anti-National parties was significantly more than the support for pro-National parties; so, under proportional representation, the larger bloc of parties defeated the largest party. Labour proved to be much more popular after 2017 than it was when it ruled unchecked after 2020.

And of course there was 2020, when National replaced their leader twice, though while in Opposition, not in Government. Yes, National was substantially beaten that year. The only possibility of National not having been soundly beaten in Covid Year 2020 would have been if English had stayed on as party leader after his 2017 victory cum defeat. But that damage was done early in 2018, not in election year.

Have we finished yet this year with party leadership switcheroos?

Maybe not. There’s still time for a Palmer/Moore scenario, if National’s polls take a dive. And then there’s Labour’s Chris Hipkins. It’s not too late to replace him also, as Andrew Little was replaced, to give his party a boost.

Conclusion and Warning

Going into elections with very new leaders has generally given a positive boost to the Labour or National party. The warning however is Canada in 1993. My sense is that, as Nicola Grigg said, Erica Stanford is not “capable of leading the National Party or being prime minister”. Stanford is a competent micro-manager; but, I sense, that’s it.

In Canada in 1993, the fading Brian Mulroney stepped down in favour of the 46-year-old Kim Campbell. Campbell remains Canada’s only ever female prime minister; surprising in a country with outstanding feminist credentials.

In the previous Canadian election (1988), the Progressive Conservatives won 169 seats with 43% of the vote. In 1993, their vote plummeted to 16% and they only won two seats! (Eventually that party did revive, under Stephen Harper; but, like the Australian Liberal Party, it may now be in another morbidity crisis.)

That’s the ‘political death’ scenario Labour avoided in 1990 by replacing Geoff Palmer with Mike Moore. Under MMP, the death may be less spectacular, but also more fatal as other parties bed-in. My sense is that Erica Stanford would have been a Kim Campbell. The more pertinent question today is whether Christopher Luxon will be a Geoffrey Palmer, either by being replaced or by losing to the extent in the popular vote that Palmer would have lost in 1990. In 1990, New Zealand Labour avoided its Kim Campbell moment.

In the short meantime, our political commentators could do well to learn a bit more of our country’s political history. The deceased Michael Joseph Savage was not ousted by his deputy in the 1943 election year. And 1990 is not ancient history.

About the writer:

Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.

Keith Rankin, 10 July 2026 – National currently has 43 electorates seats, which represents 36% of all seats in a 120-seat Parliament. If National was to get 30% of the party vote and to retain all its electorates, it would be entitled to 36 seats in total (37 seats in practice, given some ‘wasted’ votes); although if Opportunity were to just miss out, that number would probably rise to 39 seats.

With 37 entitled seats, and all electorates retained, there would be a National overhang of six seats. Such an overhang could help the National-led coalition to retain power; albeit without Nicola Willis and Paul Goldsmith.

(In 1993, National got 35% of the vote, entitling it to 35 seats in a 99-seat Parliament. It won 50 seats, meaning that if that election was held under MMP, National would have had a substantial overhang. But it still would have lost that election, because there would have been fewer bigger electorates; only FPP – First Past the Post – saved National’s bacon in 1993.)

Labour presently has 17 electorate seats. Other parties have 11. The distribution of electorate seats may well not change very much in 2026.

The Arithmetic

Total seats are determined by party vote percentages. But electorate seats are determined, in New Zealand’s experience, mainly by the two-party National-Labour swing. (New Zealand voters are generally encouraged to consider the MMP electorate vote as a party vote, even though technically it’s a personal vote. Journalists tend to say things like ‘voting for National in the Tukituki candidate vote’, rather than ‘voting for Wedd in the Tukituki candidate vote’.)

What is new this time is that the two-party National-Labour swing is looking more muted than usual when one of those is struggling. Both parties’ polled percentages are in the doldrums. This means that, while National may lose a small number of electorates, it probably won’t lose many.

So, if National gets 30% of the vote, it may well be the least unpopular party in the new Parliament. But it will need to lose seven electorate seats in order to get Willis back into parliament; and eight to save Goldsmith.

Given that National will almost certainly lose some of its electorates – including my own of Waitakere (formerly New Lynn) – National will be unwise to pursue an overhang strategy. National may lose six electorates, just enough to lose its overhang but not enough to gain any list MPs.

Clearly National’s best strategy is to try to get its party vote up to 36%, which should gain National two list MPs. But 36% seems like a tall order. National only got 38% in 2023, when it easily outpolled the next largest party.

(And what if National’s Melissa Lee wins Mt Albert from Labour? The winner in Mt Albert – a four-cornered contest this year – may only need to get 30% of the electorate vote. Lee got 33.5% in 2023, and nearly won.)

Another trick might be, in electorates where current MPs have retired, for the new candidate to ‘have a cup of tea’ with the Labour candidate Gary Payinda, and campaign for the party vote only. For example, Lloyd Budd in Whangarei; though such a budding politician would probably be reluctant. Further, there are only four electorates in this situation.

(Though if Christopher Luxon is pushed, I suspect that he would be a late withdrawal as a candidate; National could then choose to not contest Botany. Then Melissa Lee could ‘fall on her sword’, and endorse Labour’s Helen White to win Mt Albert. Maybe not. Another issue; I see that Labour are running medical doctors in at least two electorates, Whangarei and Napier. These men, I presume, are desperately needed in their communities as doctors.)

A further trick might be to put pressure on an electorate MP to resign soon after the election – maybe Penny Simmonds who is now a superannuitant – so that Nicola Willis could take her place. While the by-election strategy worked for Andy Burnham in the United Kingdom, I can think of only one similar case in New Zealand; Robert Stout.

(Sir Joseph Ward – Prime Minister 1906-1912 and MP for Awarua, south of Invercargill, from 1887 to 1919 – did try to win the Tauranga seat in a 1923 by-election, but failed; and his Party was then in Opposition. But Robert Stout – another former Prime Minister [NZ’s youngest before Jacinda Ardern] – did shift from Dunedin to Inangahua to win the 1893 by-election; but he was too late to push Richard Seddon out of the Premier’s job. Having challenged Seddon, he was not invited into Seddon’s Cabinet. Inangahua was not to the urbane Stout’s liking; he became MP for City of Wellington in the 1893 general election.)

My guess is that, if National does get to form a government (after the 2026 election) despite having no list MPs, then David Seymour will be insisting on becoming Minister of Finance. Or Shane Jones? New Zealand First might have more leverage than Act. Jones would at least move the government away from stultifying neoliberalism, much as Bill Birch eased the pain in 1994.

Re Nicola Willis, it is interesting that the electorate of Wellington North looks like being a three-cornered contest. Jonathan Pitts might just win for National. He could then be asked to stand-down in favour of Nicola Willis; for him, that would be the pits, and Willis might not win the subsequent by-election. Should she fail to get back into Parliament, Nicola Willis could succeed Ruth Richardson at the New Zealand Taxpayers Union; as soon as Ms Richardson retires, that is. In that role, Willis might have more influence and less responsibility than she has at present.

About the writer:

Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.

Keith Rankin, 10 July 2026 – I note that the New Zealand ambulance service (Hato Hone St John), has experienced four days this last week of all-time record callouts. The reason is a mix of increasing numbers of middle-aged and older people, spikes in certain winter illnesses, and a possible increased incidence of chronic illnesses. (See One call every 20 seconds: Current demand for ambulances ‘unsustainable’ – St John, RNZ 10 August 2026.)

These ambulance callout data will be strongly correlated to mortality data.

I have produced these charts of the New Zealand population organised by generation (aka birth cohort). I have labelled these generations B (boomer, born around 1950), J (Jones, born around 1960), X (born around 1970), Y (born around 1980), M (millennial, born around 1990), Z (born around 2000), and Α (alpha, born around 2010).

In a ‘global North’ country with minimal international migration, the population of a generation remains essentially the same until people are in their forties, and then we see a contraction – a ‘die off’ – as mortality makes discernible inroads into that population. Where international migration is significant, it is populations aged between 20 and 45 whose cohorts are expanding.

Chart 1 looks at older generations, from B to M; Chart 2 looks at younger generations from X to Α.

Chart 1

The first thing to note in Chart 1 is the ‘baseline’ of people aged 35-to-39. This is in solid blue, and reflects substantial amounts of immigration and emigration of people aged under 35. Nevertheless, the outlines of birth numbers are clear. New Zealand’s birth peaks were in the early 1960s (late Gen J) and early 1970s (late Gen X). Then there was a substantial ‘baby bust’ (Gen Y) followed by a ‘baby blip’ (Gen M). We note that the principal reason for the excess numbers of Gen M people aged 35-to-39 is immigration, not a domestic baby boom; and it may well be that many of these people do not have ‘permanent residence’ status, so may be subject to forced emigration in the next five years.

We also note that current (ie June 2026) populations for each age group and birth-cohort (from Gen J) are marked by a big orange dot. These dots tell us that the numbers of younger Gen Js, Gen Xs and Gen Ys are fairly similar to each other, thanks to some evening out resulting from net immigration. But their numbers are much higher than the numbers of ‘boomers’ (Gen B).

The next thing to note is that, for the most part, generations reach their maximum size when aged 45-to-49. Net immigration to New Zealand increases these cohorts when they are younger adults; then generational die-off becomes the principal demographic dynamic after age 50. In the case of Gen X, the immigration effect predominated until ages 50-to-54. And then we see what looks like a discernible Gen X die-off from age 50-54 to age 55-59.

The working-age die-off of Gen-B is quite small, from about 245,000 people at age 45-49 to about 230,000 people at age 65-69 (a die-off of 15,000). The comparable die-off for Gen J looks to be somewhat greater: 25,000 (from 305,000 to 280,000). We also note that, for the span of Gen X, there is a worrying level of mortality as they reach their late fifties and early sixties.

It would appear that we may attribute to Gen J and Gen X – rather than Gen B – much of the present increase of chronic illness noted by Hato Hone.

Chart 2

This chart looks at younger generations. The ‘baseline’ given here – in solid red this time – reflects mostly births, though many of the births for Gen Α in particular will be births to parents born outside of New Zealand. Immigrants generally have relatively high birth rates.

Looking at that baseline, of greatest significance is a dramatically higher number of teenagers in the mid-2020s compared to what we were used to over the previous two decades. This looming labour supply bulge will compound the labour market difficulties currently being faced by 20-to-24 year-olds.

Next we look at the big orange dots, and note that there is a huge present population bulge for Gen M; the ‘baby blip’ generation has been substantially augmented by immigration. Given the state of the New Zealand economy, it’s unlikely that Gen Z will see a boost of immigrants aged 30-to-40, which is what Gen M experienced. Indeed, Gen Z may well shrink in New Zealand over the next five years; net emigration. So the Gen M bulge will remain.

New Zealand had 300,000 Gen M people born around 1990 when they were aged 20-to-24, and now has 410,000 people born around 1990. Given that we know a lot of millennials have emigrated, it would seem that as many as 40% or 45% of this birth cohort in New Zealand were born overseas. Is New Zealand the country in the world with the greatest churn of peak-working-age population, with more immigrants coming as many emigrants go?

Conclusion

New Zealand’s working-age population is in flux. Good for the international airlines which fly to Aotearoa, but potentially very difficult for the making of social policy. Mind you, if the policymakers don’t really know about these dramatically fluctuating demographics, then they will be blissfully unaware of the difficulties which they face.

About the writer:

Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.

Keith Rankin, 6 August 2026 – Yesterday, the latest round of ever-worsening labour force data was released. As usual, the Prime Minister and Minister of Finance are baffled and seeking scapegoats. They will never accept that their narrative, about how a nation’s capitalist economy actually works, is false. They have invested too much in that narrative.

And the mainstream media thrashes around as well, not knowing what questions to ask, and moving on when interrupted by interesting answers.

I listened to John Campbell’s tone-deaf interview (RNZ, Morning Report) with journalist-economist Bernard Hickey this morning. (This is not my first case of criticising Campbell’s style, where he tries to put words into his interviewees’ mouths; and when he gets answers that don’t fit his conceptualisations, he either pivots away from those answers or closes the interview. See my Modern Media as Unintended Propaganda, Scoop 17 June 2026.)

Twice, Hickey mentioned that many if not most of the few ‘new jobs’ are going to people aged over 65. (I did a recent analysis of the rising employment of people aged over 65. Mostly of course they are not taking new jobs from young people. Rather, they are hanging on to their existing jobs, often for many years after they reach the age in which they are entitled to both a universal pension and to withdraw money from their KiwiSaver accounts. See my Retirement Age Labour in New Zealand, Scoop 16 July 2026.)

Twice Campbell simply ignored this central and very interesting point that Hickey was trying to make.

Further into the interview, Hickey mentioned that New Zealand was in a “balance-sheet recession”. The interview immediately ended at that point. Campbell showed no curiosity as to what a ‘balance-sheet recession’ was; he had heard enough to sense that it was something he didn’t want to know about.

On the matter of the jobs going to over-65-year-olds and not going to under-30-year-olds, Hickey was trying to make a point which needed further examination. I sensed that Hickey was arguing against the universal pension, because the pension (New Zealand Superannuation) does not give older people enough incentive to get out of the way. Thus Hickey’s apparent argument was diametrically opposed to the more common argument that we have to raise the age of entitlement to the universal pension as a way of making sure that older people continue to work and don’t retire at age 65.

A very interesting discussion could have been had, about whether it is good or bad for people aged over 65 to be in paid work. The opportunity was lost, and I don’t expect to hear this discussion any time soon.

On the matter of the balance-sheet recession, this is a mildly heterodox concept which neither our mainstream economists, mainstream politicians, nor most mainstream journalists will touch; it is a concept which hints at a solution which is diametrically opposed to the principal point of principle – fiscal probity above all else, except when war beckons – that this government stands for.

A balance-sheet recession is a recession where the principal modus operandi of businesses is survival from actual or imminent debt insolvency. Under these conditions monetary policy – whether tight or loose – makes almost zero difference to what businesses do. It means that, in the absence of a very large external stimulus or debt write-off, the economy can only be restarted through an aggressively expansionist fiscal policy. The Aotearoa New Zealand government of course is doing the exact opposite; it’s pursuing an aggressively contractionist fiscal policy.

Businesses do not hire inexperienced workers when they are in debt-survival mode. We note that New Zealand businesses took on huge amounts of debt in the years after the Covid19 pandemic. Much of that debt was contracted in 2022 and 2023 when the Reserve Bank’s interest rate settings were high. There is a very high level of actual or imminent debt insolvency

Economists have had the full opportunity to learn about balance-sheet recessions, firstly from Japan’s experiences in the 1990s, secondly from the Global Financial Crisis of 2007 to 2010, and thirdly from the Eurozone Crisis of 2020 to 2014. But, for the most part, they have reneged on that opportunity; in favour of repeating, parrot-like, narratives about monetary and fiscal policy which they learned – uncritically – in the 1990s and 2000s.

Whenever circumstances or information change, parrots and too many economists are unable to make the appropriate intellectual adjustments. Economic hawks, by and large, double-down. They remain hawks until death. They are more like clerics than academics.

Indeed Queen Elizabeth noted this inadequacy when she asked a group of economists why they had not seen the Global Financial Crisis coming. (Re the Queens Question, see Letter to the Queen 10 August 2009, and The Queen’s question returns with a vengeance Reuters 7 October 2023.)

Comparative Economic Growth

The chart below compares the economic growth over the last three years, with a number of other comparable countries.

The chart is very generous to New Zealand. It measures GDP in March 2024 and March 2026 with that of March 2023. If it had done whole-year comparisons, the growth for New Zealand over the last two years was actually zero. (See my NZ Economic Growth Over the Medium Term, Scoop 2 July 2026.)  Further, New Zealand has had a larger increase in its working-age-population than almost all of the comparator countries; this was not factored into the chart. And finally, New Zealand had such weak growth in the last two years despite receiving a record-high stimulus from export prices; almost certainly a bigger stimulus from this source than any of the other countries in the chart.

The chart measures three year-growth by reading the numbers which match the tip of the solid black bars. Thus Australia’s three-year growth was 5-percent, New Zealand’s was 2.3 percent, and Austria’s was minus 0.8 percent.

The solid black bars show the growth in the two years from March 2024 to March 2026. New Zealand’s is the smallest of all for that period; and, as noted above, a whole-year measurement would have been zero growth for the March 2026 year compared to the March 2024 year.

The hollow black-edged bars represent growth from March 2023 to March 2024. New Zealand was about average in 2023. A number of countries were in recession then, but all of them except Austria have fully bounced back; Austria’s bounce back remains partial. It is not my place here to comment about those countries’ problems, of which there are many. (‘Euro’ represents the Euro-zone within the European Union.)

I’ll note however that both the United States and United Kingdom have much stronger recent growth than New Zealand, essentially due to policies of military Keynesianism, which means that public-sector spending is playing an essential role; albeit a destructive role, given what the public money is being spent on.

Conclusion

New Zealand’s policy elites – including certain journalists at RNZ – have been responding to what is happening in the economy like possums struck by the glare of SUV headlights in full beam. And New Zealand’s non-policy non-elites have little response other than to go – quietly (in most cases) –  mad.

Some of the policy elites are going mad too, as well as dumbstruck by circumstances or intellectual rigidity. Just listen to this excellent interview from RNZ today: Tech: What’s the problem with data centres?. If these are the answer, then what is the question?

About the writer:

Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.

Keith Rankin, 8 July 2026 – Hiroshima Day passed yesterday almost unnoticed. (See this – Make anniversary of Hiroshima bombing ‘Disarmament Day’ – from Japan Times, and this and my this on Scoop.)

I have been pessimistic that the Russia-Ukraine War cannot end without it becoming a limited nuclear war (or worse). (See my Reckless Complacency Meaning the end of Nuclear Deterrence, Scoop, 24 July 2026.) But I’m now seeing Nato as an empty threat, and that some degree of my first scenario (non-nuclear) – “Moscow simply trying to pummel [or actually pummelling] Kyiv into submission” – may be what does achieve an end to the war. Not nice; just realism.

The reason I now see this as a realistic outcome is the substantial draw-down of Ukraine’s capacity to defend itself from aerial attack. Ukraine still has a spectacular offensive capability, which is proving more than an irritant to Moscow, and which can only make it more urgent in Moscow’s eyes to take timely advantage of Ukraine’s lack of defensive stamina. (Like Egypt in its World Cup match against New Zealand.)

World War Two analogy

I draw an analogy with the last year of World War Two (WW2) in Europe. Though, like all analogies, this is inciteful but not definitive.

In my analogy, Germany then is like Ukraine today. And United Kingdom then is like Russia today.

From June 1944 until March 1945 German V1 flying bombs and V2 ballistic missiles were launched at the United Kingdom and liberated Belgium. The principal target was London.

These missile attacks were far more than an irritant to Londoners. About 8,000 of them died; many more were injured. (Note, I am not referring to the London Blitz, which happened mostly in the latter part of 1940.) The worst attack in the last year of that war took place on 25 November 1944, destroying a Woolworths department store in southeast London; 168 were killed “outright”. Another very serious attack, early in 1945, was on London’s Smithfield meat market.

The military outcome of the European war – at least the defeat of Germany – was already certain at the date of the first V1 attack, which came after the success of the D-Day landings. In June 1944, the question was already whenGermany would surrender, and who they would surrender to. These attacks on London were acts of high-tech defiance and hubris; not a realistic attempt to reverse the outcome of the war.

From the British side, most of its carpet bombing (aka ‘morale bombing’) of German cities, and occupied Allied cities such as Le Havre took place in the months after June 1944. This may be compared to the present Russian bombardment of Ukrainian cities.

Thus the analogy is an enthusiastic but forlorn high-tech attack by the losing side against its winning rival; countered by a more lethal and more systematic bombardment by the Allied side. (The good news is that the numbers of civilian casualties by both Ukrainian drones and Russian missiles is less than the analogous numbers in 1944 and 1945. The British attacks on Germany were unnecessarily brutal.)

The analogy doesn’t fully work, in that in 1944 it was the winning side (United Kingdom) which was the proxy of a bigger power. Whereas today it’s the losing side, Ukraine, which is the proxy (of Nato). Essentially from the time of the 1943 Tehran Conference, the United Kingdom served as an American proxy; the American high command relieved the unfocussed and at times reckless Winston Churchill of any real strategic influence over the further conduct of the war.

No 2026 or 2027 analogy with Japan

Neither Moscow nor Kyiv is in a situation like Japan was in July 1945; though Kyiv may yet end up in such a situation. I can see no scenario in which Moscow would ever surrender to either Kyiv, Berlin, Brussels, or Washington.

My sense now, is, that the Ukrainian drone attacks on civilian and industrial attacks in Russia – the attacks on Wildberries are analogous to the rocket attacks in 1944 on Woolworths – will peter out as Russia, at a gathering pace, tightens the noose on Ukraine. Ukraine’s losses will be the greater the longer it takes to accept the motivation and greater strength of Russia. Russia could never accept German ‘peace-keeping’ troops in Kharkiv; or Odessa for that matter.

West Europe has only been a fair-weather friend to Ukraine, seeking unity amidst its own discord by rousing itself against a named enemy; but neither having the means nor the will to take its posturing to the next step.

Some say that Europe or Nato will ‘fight Russia to the last Ukrainian’. Economist Richard Wolff has concluded that Europe, coveting Russia and its lands which are looking better with global warming, is on a new quest for lebensraumin the East; lebensraum was Germany’s principal motive in WW1 and WW2.

I am coming to the view that western geopolitics nowadays is more a tragic case of imperial delusion obfuscated by unsustainable virtue-signalling and by smoke and mirror misinformation. Hopefully it will be all over by Hiroshima Day 2027.

About the writer:

Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.

Keith Rankin, 5 July 2026 – World War Two (WW2) was always a conflation of two wars, with three of the protagonists – United Kingdom, United States, Soviet Russia – playing significant roles in both wars.

Today I write on the eve of the 81st anniversary of the successful nuclear strike on the hapless Japanese city of Hiroshima. That targeted atrocity was committed by the United States military, under conditions of total secrecy, on the civilians of Hiroshima; it took place on 6 August 1945. It was a test-run, using an untested uranium explosive device. The main event was to be the aerial assault on the city of Kokura, scheduled for 9 August 1945; the dropping of duplicate of the already-tested plutonium bomb, as featured in the movie Oppenheimer.

My assessment is that WW2 ended on 30 July 1945, with the final acts of kamikaze resistance by Japan on the United States, and with the sinking of the USS Indianapolis in Philippine waters. There were no more Japanese attacks on the United States military.

After that, there was a round of gratuitous United States aggression on Japan’s mainland and a fully tightened noose. (Wikipedia August 1945: “In the heaviest raid of the war, on 2 August 1945, 800 B-29s dropped more than 6,000 tons of incendiary bombs on Japanese cities and killed 80,000 people.” and “The American government announced that every Japanese and Korean harbor of consequence had been mined, leaving Japan totally blockaded.” Checkmate.) It was now just a matter of creating a bit of ‘carrot’ to persuade Japan to sign the necessary paperwork. No more ‘stick’ could make a difference. (80,000 was the approximate toll of the subsequent Hiroshima bomb.)

Cold? War

Both the German and Japanese wars ushered in, not peace, but a new war in which the victorious western Allies turned against their two victorious eastern Allies. The effective declaration of war against Soviet Russia was immediate, and that against China was four years subsequent. Further, of the five ‘victorious’ Allies, two were not victorious at all. In no way was the position in the world of United Kingdom and France strengthened. Indeed we can say their positions in the world were substantially weakened; we can however say that these two former great powers were undefeated in any formal sense.

At the Potsdam Conference of late July 1945 – where Churchill was replaced by Attlee mid conference – US President Truman informed Stalin on 24 July of the threat of their decisive new weapon. (“He casually told Stalin that the US had a new weapon of unusual and destructive force” [Google AI].) That was an implicit declaration of ‘cold war’.

The Cold War rapidly heated at Hiroshima on 6 August. Russia’s near-immediate response was to declare war on Japan on 8 August, indicating a resolve to defend their interests in far-eastern Asia. Soviet Union forces entered Korea – notionally still a Japanese possession – on 10 August 1945. In the meantime, the United States dropped a duplicate of their tested plutonium bomb, on 9 August on the return journey from cloudy Kokura; on Japan’s city most connected with western culture, Nagasaki.

Under pressure from Soviet Russia’s advances, and still not fully understanding what had hit them – given that, by the beginning of August 1945, Japan had already been bombed, in five months, more than Germany had been bombed in three years – Japan and the United States were both under pressure to sign a quick peace deal with each other. The United States finally agreed to make an all important concession, and retain the role and status of the Imperial Emperor; these formalities were signed on 15 August.

Technically, based on paperwork, the Pacific War did not end until 2 September 1945, with the initial agreement between the United States and Soviet Russia to partition Korea. But that is best understood as a part the setting of the battle-lines for the Cold War, as were the partition of Germany and the ethnic cleanings of Eastern Europe

So I would date the end of World War Two to 30 July 1945, with the end of Japan’s offensive resistance (ie Japan’s final military action on foreign territory or international waters). And the beginning of the Cold War was 24 July 1945, when President Truman first used nuclear weapons to threaten Joseph Stalin. There was an overlap of about a week.

This means that, the atomic explosion over Hiroshima on 6 August 1945 was the first and most dramatic of many hot incidents in the Cold War. World War Two – or at least the war between The West and The Axis – was already over except for the paperwork.

Note that the Cold War was a mix of hot proxy wars and nuclear brinkmanship

The Cold War started as an asymmetric war in Japan and Korea, and it continued to be a war fought almost entirely in locations other than the home territories of the protagonist and antagonist countries. (We may say that in 1949 China changed sides in the Cold War, and that there was overt civil war and US covert action in the islands – Kinmen and Matsu – just off China’s Fujian coast in the 1950s. Those islands are Chinese sovereign territory, but have never been subject to the control of the administration of the Peoples Republic of China. The United States did incur fatalities in 1954; and, that year, the then Secretary of State [John Foster Dulles] had advocated the use of “massive retaliatory power” against the Soviet Union, not appreciating the significance of Stalin’s death the year before, or the Peoples Republic of China.)

https://www.washingtonpost.com/world/asia_pacific/china-taiwan-us-military-cold-war-kinmen/2020/09/09/c2a5caa6-e6bc-11ea-bf44-0d31c85838a5_story.html

https://www.hudson.org/security-alliances/breaking-seven-decade-taboo-deployment-us-special-forces-kinmen-miles-yu

https://www.politico.com/story/2016/01/this-day-in-politics-state-department-nuclear-retaliation-1954-217456

And from Google AI (link effective for seven days):

March 1955: “During the First Taiwan Strait Crisis, Dulles publicly advocated for treating tactical nuclear weapons as conventional ordnance, stating that the US would likely use small atomic weapons in a general Far East conflict.”

January 1956: “In a famous interview with Life magazine, Dulles formalized his philosophy of ‘Brinkmanship’, boasting that intentionally pushing the Soviet Union and China to the very verge of nuclear war was a ‘necessary art’ to secure peace.”

Is such Dulles-style brinkmanship Nato’s present doctrine against Russia? Are we now in a new hot Cold War in which only one side is fighting through a proxy? Are we on the brink?

And/or maybe we are in the latest hot phase of a cold Anglo-American war against Russia which began in Crimea on 28 March 1854? Or which began in 1839, as a Great Game fought for the most part through proxies in central Asia?

Geopolitics is still largely treated as a game by its more entitled protagonists, despite all having changed for the world to see on 6 August 1945. Nuclear civilian collateral damage dates back 81 years.

Mass civilian damage precedes Hiroshima, of course.

Q. Which ship sinking, in world history, had the most ever fatalities?

A. The Sinking of the Wilhelm Gustloff in the Baltic Sea in January 1945, by a torpedo from a Soviet Russian submarine S-13, killed 9,000 German refugees, mostly jam-packed women and children. (Story from the National WWII Museum, New Orleans, 30 January 2020.) Lest we forget. Or maybe this is one of so many stories we were never told? Anyone who flirts with the idea of world war needs to be aware of such tragedies.

About the writer:

Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.

Keith Rankin, 31 July 2026

With the movie The Odyssey now in our cinemas, I decided to dip into Eric Cline’s book 1177BC; the Year Civilization Collapsed. While not specifically about the Greco-Trojan War, the book focuses on that period bordering on prehistory as one of a few major pivot points of the human experience on Earth.

In referencing 2020, however, Cline displayed a not uncommon naivete among historians in relation to a non-specialist (for them) topic or period. In the forward to the 2021 edition of 1177BC, Cline says in relation to an article he saw in The Guardian of 6 Feb 2020 (Humanity under threat from perfect storm of crises – study) by Fiona Harvey. The article begins: “The world is facing a series of interlinked emergencies that are threatening the existence of humans”.

We note that the date of the article, 6 Feb 2020, was in the week that Covid19 was first becoming a known problem in Europe. The article didn’t mention the new coronavirus, though; in large part because it referred to a study undertaken in 2019.

Referring to Harvey’s short article, Cline noted that the referenced study “had concluded that there are a number of principal emergencies facing us today: climate change with weather extremes; species loss; water scarcity; and a food production crisis. What was particularly worrisome, she said, is that “the combination of all … is amplifying the risks of each, creating a perfect storm that threatens to engulf humanity”.

This summary seems remarkably tame to us today, just seven years later. From a 2026 perspective, the 2019 metaphorical weather bomb was at most a ‘perfect storm in a teacup’. Indeed, 2019 was the least problematic year this century for the global economy. Even the terrorist attacks in Christchurch and Colombo – with Muslims being either victims or perpetrators – were in 2019 mere echoes of the tensions mid-decade, focussed on Syria and Iraq. The world was essentially at peace in 2019 (Afghanistan notwithstanding); people were confidently making expansive plans about their futures, and quietly making progress on decarbonisation.

Cline, writing in 2021 during the Delta wave of Covid19, concurred with Harvey, only adding the overblown Covid19 pandemic into the mix. Thus 2020 was his candidate to rival 1177BC.

Nowadays we can look back and see that the Covid19 pandemic was – in the sweep of human history – relatively tame in both its demographic and economic impact. And that countries like Sweden which argued against overhyping that event were broadly correct. The important but still understated story was the role of immunity, in both its initial absence and in the eventual global immunisation (largely through Omicron) which put an end to that fear episode.

A similar novel coronavirus pandemic had ravaged the world in the early 1890s, when the world economy was also highly globalised, but not even many epidemiologists know or knew much about it. That ‘Russian Flu’ was not as bad an event as the later ‘Spanish Flu’. And the Spanish Flu has rarely been cited as a turning event in human history; even though it probably was, given its likely contribution to the outcome of World War One. The numbers of people whose deaths were attributable to the global influenza epidemic of 2016-2018 was close enough to those attributed in 2020-2022 to Covid19; at least in the ‘Global North’.

2026 a Storm an Order of Magnitude more ‘Perfect’ than 2019

This year’s ‘perfect storm’ is, I would argue, at least ten times stormier than that of 2019. But I wouldn’t use that hackneyed storm metaphor to describe this year, because we can easily imagine 2027 to be worse. And 2028 or 2029 or 2030 to be worse again, especially given the hype coming out of Europe about an existential war taking place in or around those years.

As well as today’s obvious threats which did not feature in Harvey’s report, the four which were mentioned – climate extremes, species loss, water scarcity, food security – are all substantially aggravated in 2026, though generally less remarked upon (except in the immediate throes of the news cycle, as in the Spanish fires). Today’s bigger threats – including but not only these four – have largely become normalised, including the biggest threat of all, the threat of nuclear war. (See my Reckless Complacency meaning the End of Nuclear Deterrence, Evening Report and Scoop, 25 July 2026.)

In 2026 we chatter more about interest rates and government debt, and talk as if misframed ‘inflation’ is the biggest threat of all. Such macroeconomist micro-doom chatter is largely an aggravating displacement activity, prose we can cite if or when we – rich as well as poor – go down with our own Homeric Titanic (see the connection to Greek mythology here in Dark Titanic Powers and the Origins of Humanity); or, perhaps more aptly, the Lusitania.

In 2019, interest rates and inflation and inflationary expectations were all very low. Indeed, those were the days, Fiona Harvey’s article notwithstanding. We should learn the lesson about what was right with our world in 2019, rather than what was wrong with it.

Today’s escalated threat to humanity of geopolitical war is greater than the threats to humanity arising from failure to defeat and unseat adversaries such as Vladimir Putin and Masoud Pezeshkian. Rather the conduct of military stalemates – forever wars – is more than undoing the efforts of many of the rest of us to preserve the world and to secure food and water supplies.

Mars, seemingly, is trying to turn Earth into Venus. The angry western Gods of 1177BC remain part of the western mindset. The present efforts of those entitled humans with access to more dollars than sense, even if unsuccessful, may well result in a historical turning point to rival 1177BC. Cline was correct to note that “the combination of all [threats] … is amplifying the risks of each”. So much more so today than in distant 2019 or 2020.

And I haven’t mentioned AI once! Until now. That’s the other – other than the ‘cost of living’ – obsessive point of chatter today. How could the cost-of-living be anything but high when so many of our resources are being deployed to gaslight our planet and all its species? And when such trumped-up stupidity is being amplified by our software.

About the writer:

Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.

Keith Rankin, 29 July 2026 – Which has been the most nuked region in the world? It’s the Pacific. The first three nuclear weapons to be exploded were in New Mexico, Hiroshima, and Nagasaki. Two (in Japan) with Pacific Ocean shorelines; and the New Mexico Trinity site is the same distance to the nearest Pacific shore as Chatham Island is from Aotearoa’s North Island.

Despite those three early examples, the most nuked part of the world is not the North Pacific.

If we think of actual nuclear explosions – especially atmospheric ones – they have predominantly been in Oceania; in four sites which form something of a spoke-wheel around Auckland, as the map below (from Google Maps) shows. These sites of British, American and French explosions in the 1950s and 1960s – including the biggest atmospheric explosions, ever – are: Maralinga (Australia), Bikini Atoll (Marshall Islands), Christmas Island (the world’s biggest atoll, now in Kiribati), and Mururoa Atoll (French Polynesia).

Future nuclear war(s) – there may only be one – will be fought far from the decision centres of the belligerents. Just as Hiroshima was far from Washington and Moscow, and – as with the explosions of the 1950s and 1960s – the damage to life of the indigenous people at or near the nuclear explosions was not a major consideration.

The next nuclear war will be an asymmetric war, and Iran has just written the textbook of how-to-do asymmetric war.

Modern asymmetric war is all about the powerful belligerent(s) with lesser deterrence capability attacking the allies of the belligerent(s) with more layers of deterrence; especially allies which have on their territories poorly defended (physical or human capital) assets which contribute to the war effort of the more powerful belligerent. (See my Reckless Complacency Meaning the End of Nuclear Deterrence, Scoop 24 July 2026.)

Eight of the nine nuclear armed nation-states have capacity to launch weapons from submarines. Nowhere is out of nuclear range.

We, here, are on Russia’s radar. We have imposed various sanctions on Russian personal, and trade with Russia. (Though we have been quite happy to consume Russian fuel-oil that may have been laundered through Korean or Chinese refineries.) Yesterday, our lead story was about a man arrested in Russia for treason; allegedly spying for the SIS. Rhetoric in Wellington towards Moscow is as belligerent as it is anywhere.

Mordor was not always Mordor. Back in the good old Soviet Union days Aotearoa had a strong economic relationship with Russia (as with Iran, too), especially through the dairy industry; the relationship manifested then, in part, through cow for car swap deals. Remember the Lada cars which were not uncommon here in the 1980s? Some were refitted and re-exported to other parts of Oceania. Those cosy days of the Cold War are now long gone. (The downward slide possibly started in 1986 when a risk-taking local sea-pilot – inadvertently, or semi-advertently – sank a Russian cruise-ship full with Australian tourists.)

Russia is aware of the Five-Eyes ‘intelligence’ network. And will also be aware that Central Otago and Auckland are bolt-holes for some of the oligarchs whose intellectual property underpins America’s present global belligerence. And that companies like Rocket Lab are contributing to the activities of the United States’ Department of War, indeed launching satellites from Launch Complex 1. Russia may be aware that the local manufacturing industry has pivoted towards the supply-chain of the United States’ war industry, benefitting from United States’ military Keynesianism.

Should I be concerned, given that I live in Auckland?

About the writer:

Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.