Ruthanasia

Ruthanasia, a portmanteau of "Ruth" and "euthanasia", is the pejorative name (typically used by opponents) given to the period of free-market policies conducted during the first term of the fourth National government in New Zealand, from 1990 to 1993. As the first period of reform from 1984 to 1990 was known as Rogernomics after the Labour Party Minister of Finance, Roger Douglas, so the second period became known as "Ruthanasia", after the National Party's Minister of Finance, Ruth Richardson.

Ruthanasia and Rogernomics can be viewed as complementary reform packages implemented by successive governments which were aimed at liberalising the New Zealand economy. The packages came after a period of intense protectionism and fiscal control, particularly under the administration of Sir Rob Muldoon's National government between 1975 and 1984. Muldoon's protectionism had culminated in a three-year wage and price freeze imposed by Muldoon, who simultaneously held the posts of Prime Minister and Minister of Finance, in an attempt to suppress rampant inflation.

Ruthanasia was controversial as the National Party had fought the 1990 election on a manifesto promising "The Decent Society" and implicitly repudiating the radicalism of the Fourth Labour Government. The Prime Minister, Jim Bolger, defended the move in his memoirs on the grounds that he had been badly misled in the run-up to the 1990 election as to the actual state of the New Zealand economy. Upon winning the 1990 election, Bolger and Richardson quickly became aware of two unrelated financial crises: firstly, that the Bank of New Zealand required an immediate injection of capital to avoid insolvency as a result of the poor performance of a NZ$2.8bn loan portfolio in Australia, and secondly that the outgoing finance minister David Caygill's projection of a modest fiscal surplus was inaccurate, and that the country instead faced a fiscal deficit of NZ$3.7bn (4.8%) for 91–92 if current fiscal policies continued. Current net public debt was 52% of GDP (43% after Telecom sale).

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