Bac601 Financial Accounting - Free Assessment Answer

Some general questions to consider also:
What are the key areas of change discussed in the documentary?
Who led these changes?
Who fought against them?
What key ideas behind the changes are outlined?
Whose interests were served?
What effects did the changes have and on whom?
Note the impacts on democracy in ANZ.
Think about the links between ideas in the documentary and those covered in lectures & readings
Thinking about those who are homeless and/or unemployed and/or impoverished today, is this situation the outcome of their own lack of effort (a personal trouble)?, or of government policy (a public issue)?

The documentary “Land of Plenty-2002” highlights some economic concepts which were part of the revolution in New Zealand, and the main areas of change which affected the economy and the social wellbeing of the people.

In the 1950s and the 1960s after the World War II, New Zealand had a stable economy and what was referred to as a descent society. This meant that everyone had a right to a job and employment was sustainable.  Restriction of imports protected the local and new industries, and the centralized economic growth resulted in creation of wealth and full employment for all. However, this state of socioeconomic tranquility changed as soon as a new government took office in the year 1984. The new minister of finance decided to try a new way of developing the economy and after consultation with financial advisors, resolved to abandon the existing commitment to full employment which had very severe impacts on the citizens. The reserved bank was the task force mandated with formulation of policies to control inflation and maintain price stability.

Stratification of the socio economic dimension of the New Zealands began. On one side was a few who had retained their jobs and on the other hand was a big group of redundant and unemployed workers. The purchasing power of the redundant workers dropped and so were their living standards. The expensive loans and mortgages due to increased interest rates by the reserved bank meant that middle and low income earners had less to spend, less to live on and less to invest.

Income inequality among the citizens continued to thrive as factories closed down and more workers were laid down. The gap between the rich and the poor was widened as the economic policies affected low income earners more.  Unemployment caused families to begin depending on charity food while the jobless youth turned to crimes such as burglary.

As a result of reduced purchasing power of the many jobless citizens, many of them fell below the poverty line. Even for those who were employed, their wages kept on dropping and failure to accept the pay cuts would render one fired. The fear by workers to lose their jobs worked to the advantage of factory managers who cut their wages.

Representative democracy bore no fruits for the workers. The labor representatives failed to represent the workers’ grievances and that angered them and resulted to streets protests. They cited identity politics by their representatives in the labor ministry and accused them of using the workers’ situation for their advantage and mileage without caring for their interests. The unemployed felt marginalized and unheard by the ministry of employment for failing to give them long term employment contracts, and instead gave them short term contracts which had unreliable working hours and earnings. Instead, the government was involved in the imposition of its free trade policies. Poverty diseases began attacking them too and this only made their economic capability deteriorate even more.

In conclusion, the government of New Zealand did what they considered vital to control inflation even though it did not work out well for the citizens. Unemployment and poverty as a result thereof could have been avoided by implementation of inclusive and lenient policies which were not only to serve the interests of the government.