No bailouts

Low dairy prices bite harder in New Zealand than elsewhere; dairy is a bigger part of our economy than it is elsewhere.

And so pressure for bailouts is potentially larger here than elsewhere. And so today's "Things I love about New Zealand": our Finance Minister's response to dairy prices:

English told TVNZ's Q+A yesterday that he doubted that would be a threat to the financial stability of the country, banks were stronger than at the time of the global financial crisis and the Government would not step in with any bailout for farmers.

"A few billion in losses is not a threat to financial stability. The regime that's in place now means the banks are stronger than they've ever been with a greater ability to withstand those losses than they've ever had."

He said there was a system for dealing with extreme hardship "because you are going to see, for a small number of dairy farming families, some real distress. But we're not going to be bailing them out."

It was disappointing to see Labour leader Andrew Little calling for bail-outs though. It's this kind of pandering that could box them in when they next form government. It is harder to say no to demands to do silly things when you demanded those same things from Opposition. See also: Labour on Pharmac.