Minister of Finance fails GDP question

Photoshopped image credit: Pixy

Oh dear, oh dear! Ardern did not know the difference between GDP and the Crown financial accounts and now the Minister of Finance, Grant Robertson has displayed his ignorance about GDP for all to see. Quote.

Hon Paul Goldsmith: To the nearest billion dollars, what is an additional 1 percent GDP growth worth to New Zealand?

Hon GRANT ROBERTSON: I believe it’s about $800 million.

Hon Paul Goldsmith: $800 million?

Hon GRANT ROBERTSON: About that.

Hon Paul Goldsmith: Does he think that the people of New Zealand would expect their Minister of Finance to know that 1 percent of GDP is about $3 billion and that’s the amount of money that we’ve missed out on given the sharp decline in growth in the past year? End quote.


Please get out your calculator and follow along:

To quickly estimate one percent of a number, divide by 100. This can be easily achieved by moving the decimal point two places to the left. So 1% of, say, 293 would be 2.93. Or 3 to the nearest whole number.

See, that wasn’t so hard, now was it?

Back to the question in the house, “To the nearest billion dollars what is 1% of GDP?” And Robertson did not know!

If 1% of GDP was $800 million, the question was, “To the nearest billion” so Robertson should have answered, “One.” So Robertson failed English comprehension as well as finance.

The Minister of Finance, responsible for allocating the expenditure has no idea of the size of the New Zealand economy, he was out by a factor of nearly four. He thinks the New Zealand economy is a quarter of the size it actually is.

That is an F for Fail – Roberston. Well played Mr Goldmith, well played!

Screen grab: Whaleoil