In today's email we rate the debate, which came straight after another bombshell poll.
1. Labour ahead of National
Had enough surprises yet?
Last night's Colmar Brunton poll broadcast on TVNZ just an hour before the debate counts as yet another bombshell after a month of polling and resignation shocks. It put Labour two percentage points ahead of National in a poll taken in the week to Wednesday night.
Just remember where we were as recently as Sunday, July 30. Andrew Little was still the Labour Party Leader and Colmar Brunton's poll taken earlier that week had shown support for Labour at at a 20-year low of 24 percent. National was flying high at 47 percent, the Greens were at a record high 15 percent and New Zealand First was at 11 percent.
No one would have expected to write a headline like 'Labour ahead of National' just 32 days later.
Yet last night the same Colmar Brunton poll found support for Labour had risen 19 percentage points in that month to 43 percent and National was down six points to 41 percent. The Greens have collapsed a full 10 percentage points in that month to five percent and will be lucky to get into Parliament. New Zealand First has also fallen three points in that month to eight percent.
The month of August may yet come to be remembered as the month the electorate decided to change the Government. It was certainly the most politically volatile month of leadership changes and public opinion changes in New Zealand's modern political history.
Just to remind ourselves of this stunning list of events in recent weeks:
July 16 - Green Co-Leader Metiria Turei gave a speech revealing she deliberately claimed more benefits as a solo mum in the early 1990s than she should have, which she used to launch a campaign for welfare reform.
July 30 - Colmar Brunton showed the Greens had surged to 15 percent, Labour had fallen to 24 percent and Andrew Little's support as preferred Prime Minister was down at five percent, which was under Jacinda Ardern on six percent.
August 1 - Andrew Little resigned at 10 am that morning as Labour Leader and Jacinda Ardern was voted in as his replacement unanimously by the Labour caucus by lunchtime that day.
August 9 - Metiria Turei resigned as Green co-leader after revealing she had also falsely declared where she had been living and after family members anonymously challenged her story about being so poor she needed to commit welfare fraud.
August 22 - Peter Dunne resigned as United Party leader and Ohariu MP after a poll showed he would likely lose to Labour candidate Greg O'Connor. He cited a 'mood for change' in the wake of Ardern's elevation. His departure deprived National of one crucial supporting vote in Parliament.
August 28 - Newsroom reported Winston Peters was billed $18,000 by MSD for pension overpayments, penalties and interest because he claimed the pension rate for single pensioners, rather than the rate for living with somone not on a pension. He said he had repaid the money with penalties and interest. It then emerged National ministers had known about the issue. This week he accused them of illegally leaking the information to media. Support for Peters as preferred Prime Minister in the Colmar Brunton poll fell from 11 percent to four percent during August.
August 31 - A Colmar Brunton poll taken from August 23 to 30 showed support for Ardern as preferred Prime Minister had risen from six percent to 34 percent over the first 30 days of her leadership. That put her ahead of Bill English on 33 percent, although he had also risen from 26 percent over that month.
Phew. And there are still 21 days to go until the election, with another 20 days after that before the October 12 deadline that Peters has set for his decision about party he would support in Government.
There is now a better than 50 percent chance that Labour will be able to form some kind of Government after September 23, potentially with New Zealand First and/or a combination with the Greens, if they make it back to Parliament.
The wind is definitely behind Labour, although Ardern's performance in the first head-to-head debate with English did not lift Labour even higher on its foils.
2. 'Why are you losing?'
The hour-long debate began last night in TVNZ's studios at 7 pm, just an hour after the Colmar Brunton poll exploded into the mix.
It began with moderator Mike Hosking confounding his critics and confronting Bill English directly about the poll.
"Why are you losing?" he asked with his first question.
English said National's own polling showed National was a "bit better" than the 41 percent indicated in the poll and he jumped straight into his prepared lines about delivering for all New Zealanders.
Ardern began tentatively, while English was clear in his delivery and immediately hit his stride. He quickly launched an attack on Labour's plan to abandon National's tax cuts, referring to a meat worker at Horotiu who would miss out on $1,000 a year because of Ardern's plans.
English also scored some points when Ardern talked about her tax plans being driven by her values.
"You can't go shopping with your values," he said.
Ardern responded by arguing her values included wanting her generation to be able to afford to buy a home. She challenged English to say whether there was a housing crisis or not.
She also told English that having to save a $150,000 for a house deposit was not acceptable.
After an advertising break, Ardern was again asked why she could not give more certainty about a potential capital gains tax. She said she was being open about having a Tax Working Group, while National had kept its plans secret before the 2008 election for a Tax Working Group that eventually increased the GST without notice.
"I will not let this housing crisis continue and affect the next generation," she said.
English pointed to a recent moderation of house prices.
"Speculation has been beaten by getting 10,000 houses a year built," he said, referring to a recent moderation in price inflation nationally and slight falls in Auckland, including falls in land prices.
3. Fact-checking Bill on productivity
Later on during a discussion about the economy, English was challenged about a recent JB Were report from economist Bernard Doyle about productivity, which showed a recession over the last four years.
"JB Were are just wrong. They are way over-stating the case," he said.
Ardern said productivity had flat lined at best and she wanted to invest in people and skills through education to improve productivity.
The charts published by Doyle show what has happened to GDP overall, GDP per person and GDP per hour worked.
One shows GDP per hour worked, a typical and broad measure of productivity, being negative for the last three years.
Another shows the cumulative effect of that productivity recession on an indexed chart that includes how total GDP grew with the help of a net migration boom and a rise in labour force participation, rather than a rise in output per hour worked.
The OECD also made the point in its June report on New Zealand that New Zealand's productivity was lagging, and it made a series of recommendations about how to improve it.
The Government's own Productivity Commission, which English set up, reported in November last year in an 86 page report that New Zealand's productivity growth was still comparatively low.
As recently as August 7, Treasury reported its own analysis of various measures of labour productivity, including one measure using the Household Labour Force Survey (HLFS) showing that labour productivity growth was negative through 2016 and was down 3.3 percent in the year to March.
Even using an adjusted total hours worked series, Treasury found: "Labour productivity growth was estimated to still be negative in the year to March 2017 (-0.4%) and average productivity growth over the past four March years was essentially flat (-0.03%)."
"Using the QES (quarterly employment survey) weekly paid hours series as the hours component of labour productivity gives similar results (-0.2% growth in the year to March 2017 and slightly negative labour productivity growth on average over the past four years), suggesting the adjusted HLFS measure is a reasonable approximation.
In Parliamentary Question Time on August 15, Finance Minister Steven Joyce cited OECD figures in response to challenges from Grant Robertson using Doyle's and other figures.
Joyce said OECD figures showed New Zealand's GDP per hour worked had risen 9.6 percent since 2008, which was faster than Canada, Britain, Europe, Great Britain and the G7.
Joyce's figures include the natural bounce-back in productivity that happens during a recession when many businesses lay off workers. Over the last four years, productivity is flat, at best, as Ardern said in the debate.
English's outright denial of a productivity problem in the debate was Trumpian in its brazenness and disappointing from a former Finance Minister who knows that productivity improvements are ultimately the only way New Zealanders get richer in the long run.
New Zealand's economy has grown faster than others in the last four years, but only because of a surge in its population from migration and an increase in the labour force participation rate. New Zealand's economy grew because more people arrived, more people worked and they worked longer hours. They didn't work smarter.
4. My verdict on the debate
My overall impression was that English came across as clear, concise and more energised that he can appear in such situations. He targeted Adern on a lack of clarity on taxes and was solid without landing any killer blows.
Ardern was more subdued than some expected and did not butt in to rebut English's claims or those of Hosking as much as she could have.
She appeared tentative and slightly nervous early in the debate. She also didn't land any killer blows, although she delivered a few body shots around housing affordability and contested English's water attacks well.
Ardern didn't focus as much on child poverty or the problems with unhealthy housing as much as expected, and even conceded to English that the economy was strong, even if it was not delivering for all New Zealanders.
After the debate, Ardern said she was always self-critical and would reflect on where she could have improved. English said he was happy with the debate and noted Ardern's concession on strong economic growth.
If I had to give it a score, I'd give it to English on points, although the poll shock overwhelmed any of the news out of the debate. It essentially sucked the air out of the room.
Ardern also appeared slightly subdued after the debate and said she was surprised by the poll result. She warned the polls could rise and fall in the remaining three weeks.
She's right about that. We live in volatile times.
5. Tim Murphy's verdict
Newsroom's Tim Murphy also watched the debate and compared Jacinda Ardern's debut performance to that of Jordie Barrett against the Lions.
Murphy thinks Ardern probably narrowly lost the first leaders' debate on TVNZ to incumbent Bill English, but she showed enough of her positivity and agility to call it success in any case.
"Her debut was something like Jordie Barrett's first start for the All Blacks against the Lions. Young, a bit lopey and occasionally off balance, not quite all there yet but showing every sign of being the real deal," Tim wrote.
"English was as good as he gets. Loath as we all are to comment on leaders' appearances, he looked energised and even a little perma-tanned (perhaps National practised outdoors yesterday in Auckland's brilliant sunshine).
"More importantly, he was warm to the camera and in key moments like the final, 30-second statement he was animated, nailing his messages."
Tim also picked up on the signs of tension and nervousness on Ardern's face.
"Having said that she was nervous, her occasional 'resting face' facial expressions a watch all in themselves as she pushed her tongue inside her bottom lip and frowned at English when in split camera on screen. Heaven knows how on-edge she would have been had the poll not given Labour its moment.
"You don't tip National, or English, over without a fight.
"He came with at least one new line of policy attack. He several times tried to claim Labour intends to take New Zealand back to 1970s industrial relations, with national awards binding industries and the implication of nationwide strikes. It wasn't a feature of his campaign opening speech just five days earlier. Presumably National's campaign strategists have decided the spectre of unionism is as good an attack line as 'Let's Tax This' - their focus on a range of real and possible Labour tax plans (and 'levies' and 'charges' similar to the government's own imposts.)
"But the focus on Labour's Fair Pay platform gave Ardern one of her best moments of the hour-long debate. She accused English of scaremongering, said the model for the fair pay agreements in different sectors would be the care workers' deal which she said she was proud of and she was sure English was too. She expected one or two agreements each year under which employers in an industry would agree to raise wages.
English said the system would take New Zealand back to the 1970s.
"They used to call them national awards," he said. "We have industrial relations that are pretty settled. The last Labour government made adjustments to it very broadly and we accepted them."
"Questioned directly by moderator Mike Hosking (who was exacting on both, in his rat-a-tat, pop-economist kind-of way) whether New Zealand could be in for national strikes, Ardern had her most emphatic moment: "No. We. Will. Not."
English's criticisms were antiquated, Tim writes.
Here's Tim's full piece over at Newsroom.
6. And the verdict on Hosking?
Newsroom's Mark Jennings, who is a veteran of the television news and production business, didn't think the debate made for great television.
He noted the strangely subdued atmosphere in the studio and between the combatants, who were models of politeness.
"he big problem with the debate was that it lacked any sense of theatre or drama. The audience, small, mute and mainly sitting in the dark, might as well not have been there," Mark writes.
He was critical of Hosking's performance. The moderator also interrupted regularly.
"There were a few moments, like when he held English to account for nine years of inaction on dirty rivers, when it seemed he might spark up the debate, but overall his trademark confidence wasn’t there," Mark writes of Hosking.
"English and Ardern are similar – they are both nice people and it showed. This contest needed a disruptor, and it didn’t have it."
Here's a running count (courtesy of Newshub's Shaun Davies) of the interruptions from Hosking, which were higher for Ardern than for English.
7. Rod Oram's column
This week Rod Oram takes a closer look at the water debate.
He writes the vast complexities of water issues boil down to a simple political equation: More use + Less quality = Angry voters.
Here's his full column published first for Newsroom Pro subscribers.
8. One fun thing
Paul Goldsmith has a 'beam me up Scotty' moment in this news release about funding some of the cost of a particle accelerator in Melbourne:
"New Zealand will invest AU$15.1 million in a programme to construct several new beamlines at the Australian Synchrotron."
Have a great week. I'll be back with weekend reads next week.
Assuming there aren't any more bombshells...