And So It Begins ... : Roger Douglas announces radical tax reform in his
first Budget, November 1984. The regressive Goods & Services Tax prompted
considerable opposition, both within the Labour Party organisation and from the
broader labour movement. President Margaret Wilson, responding to rank-and-file
alarm, announced a full-scale internal economic debate to coincide with the
party's next round of regional remit conferences, scheduled for April-May 1985.
It was supposed to be a book about the birth of the
NewLabour Party, but somewhere along the way it became the story of what led me
into, and out of, the old Labour Party. In hopes of providing future political
studies students with a glimpse of what it was like to be a left-wing Labour
activist in the days of David Lange and Roger Douglas, I am publishing The Journey on Bowalley Road as a series of occasional postings. L.P. Hartley
wrote: “The past is a foreign country, they do things differently there.” May
these memoirs, written in 1989, serve, however poorly, as my personal passport.
Sunday, 21 April 1985
Our official title is the Economic Policy Group; ostensibly
we are here to discuss alternative economic strategies to those of the
Government we all slaved to elect barely twelve months earlier. Our true
purpose, though unstated, is clear to everyone present: we must defeat GST.
The new president of the Labour Party, Margaret Wilson, has
proclaimed a full-scale economic debate – to be held in conjunction with the
1985 round of regional remit conferences. It is an exercise in damage control.
Roger Douglas’s first budget has shocked the party. Central to the Government’s
monetary and fiscal policies is a dramatic shift from direct to indirect
taxation. A ten percent Goods & Services Tax (GST) will be levied on all
consumer items without exception.
The trade unions are aghast. A progressive income
tax has always been the cornerstone of New Zealand's welfare state. PSA economist, Peter
Harris, and FOL national executive member, Rob Campbell, will lead the fight at
the regional remit conferences. As Secretary of the Otago Trades Council, I am
determined to build an organised resistance to the GST proposal. Sean Fleigner,
Youth Representative on the New Zealand Council of the party; Mike Hanifin,
former regional organiser for the party in Southland and now a trade union
official based in Dunedin; Louise Rosson, an economics teacher at Moreau
College; Russell, the Convenor, and myself constitute the core of the fight-back
in the southern region.
Mike is the most accomplished tactician among us. He has had
the foresight to acquire a full list of the delegations to the Otago-Southland
regional remit conference. One by one we go through the names, ticking off our
likely supporters, crossing out our opponents. When we add in the block votes
of the trade union affiliates it is clear – we have the numbers.
Thursday, 25 April 1985
THE SEMINAR ROOM is filling up with members of the Castle Street Branch of the Labour Party. Widely regarded as a branch for the University of Otago staff, Castle Street has a surprising number of working class members. Many of them are here tonight: lured by the prospect of hearing Rob Campbell address them on the GST issue. It is my sorry duty to tell them he isn’t coming.
THE SEMINAR ROOM is filling up with members of the Castle Street Branch of the Labour Party. Widely regarded as a branch for the University of Otago staff, Castle Street has a surprising number of working class members. Many of them are here tonight: lured by the prospect of hearing Rob Campbell address them on the GST issue. It is my sorry duty to tell them he isn’t coming.
Campbell has sent me a copy of Peter Harris’s speech to the
Northern South Island regional remit conference. I don’t like the omens: it’s
the evening of Anzac Day – commemorating New Zealand’s most appalling military
defeat – and I am supposed to “carry the ball” with speech notes that failed to
convince the delegates at Westport.
All over the country Margaret Wilson’s economic debate is
proving to be an extraordinary catalyst for organisation and participation. The
Northern-South Island regional remit conference, held in the Labour stronghold
of Westport a few days earlier, attracts hundreds of delegates. The GST Debate
is ferocious. On the speaking order Peter Harris is sandwiched between
Associate Finance Ministers David Caygill and Richard Prebble. Personal attacks
proliferate. Outside the hall the Communist Party mounts a picket. Anderton –
an increasingly vocal critic of the Government’s policies – declares himself
and his supporters to be “the only opposition the Government’s got”. The vote,
when taken, is very close. The Government is saved by the 17 card-votes of the Canterbury
Hotel and Hospital Workers – all of them cast by Graham Harding
who, shortly afterwards, is appointed national secretary of the Police Association.
The debate at Castle Street is brief and brutal. The Left has
the numbers here and the objections of the good ladies of the university are
swept away by an alliance of socialist academics and ordinary workers. We take
the precaution of binding our delegates to vote against GST at the remit
conference on Saturday. The air after the meeting is full of snide references
to “cloth caps” – the Labour Right’s sneering epithet for the union-dominated
Left.
Saturday, 27 April 1985
‘THIS IS A SET UP!” Margaret Wilson hisses to Terry Scott, chairperson of the Otago-Southland regional council of the Labour Party. “Get me on the next flight out!”
‘THIS IS A SET UP!” Margaret Wilson hisses to Terry Scott, chairperson of the Otago-Southland regional council of the Labour Party. “Get me on the next flight out!”
Wilson’s agitation is understandable. Like some large,
pre-programmed machine, the regional conference is rubber-stamping the remits
of the left-wing/trade union alliance.
There is no debate. Nikki Larson, the delegate reporting back the decisions of
the workshop on economic policy, is reading out the resolutions and the
conference is endorsing them without discussion. I am finding it hard to
believe myself. Could it be that we are actually going to win?
The GST debate begins. Roger Douglas and Rob Campbell present
the arguments for and against. Campbell, a former lecturer in economics at
Victoria University, sets out the sums on a blackboard. His presentation is
cool and professional – almost detached. The audience listens intently,
struggling to absorb the numbers and the jargon. The applause is polite.
Douglas is messianic. He scrawls figures on the blackboard
with violent energy, barking out his arguments like a parade sergeant. There is
an aura of absolute conviction about the man that is taking its toll on the
waverers. Will they hold?
With the opening salvoes still echoing through the packed
auditorium of Taieri High School, David Caygill rises to second the Finance Minister.
His rhetoric is polished but strangely unmoving. Nevertheless, his argument that a failure by
the Party to endorse GST can only be seen as a “No confidence motion in the
Government” strikes home.
It is left to Michael Cullen, MP for St Kilda and the
Government whip, to clinch the argument for the parliamentary wing. He moves an
amendment to our resolution opposing the introduction of GST. The delegates
must now decide whether they should make their support for the new tax conditional upon a clear
demonstration that the incomes of low paid workers will be fully protected.
It is all the delegates need. Our majority melts away as the
Government’s appeal to loyalty over-rides the arguments of equity. Campbell’s
figures clearly show that there is simply not enough revenue to fully guarantee
the incomes of the poor. But reason isn’t sufficient. Helplessly, I watch our
Sunday Morning Club comrades raise their cards in support of the Government.
Outraged, I see our Castle Street delegate vote against the instructions of her
branch. Cullen’s amendment is carried: 75 votes in favour, 54 against.
Out in the foyer, Roger Douglas and David Caygill catch each
other’s eye. Caygill sweeps his hand down from his shoulder, snapping his
fingers in a triumphant gesture of domination.
They expected to lose in Dunedin: they have won again.
This posting is
exclusive to the Bowalley Road
blogsite.
9 comments:
Thanks Chris - fascinating stuff. I was just old enough to be developing an interest in politics about the time that the fourth labour government was elected. I supported many of the policy positions (particularly economic) that they took. However in recent years, and as I have read more widely about the period particularly and economics generally, I can only offer a heartfelt ‘mea culpa’ and wonder what the hell was I thinking at the time! As a matter of interest have you ever thought of reviving your political magazine?
Well, it is amusing nearly 30 years after the event to read of the feverish attempts of the left of the Party to destroy their own government. What is forgotten by you (it seems) is just how dire New Zealands situation was back then. and was it ever realistic to expect Labour to have a radical left wing agenda back then, at the very time that New Zealand was looking for more freedom, not less. Mind you these are the very reasons I left Labour for National, because I knew economic freedom was part of Nationals DNA, albeit temporarily thwarted be Rob Muldoon. I also knew that Labours left would rebel against Roger, and it still seems Labour has yet to come to terms with his legacy - witness David Cunliffes recent speeches. Wayne
Keep em coming please, these are always a pleasure to read, even if the events depicted are gut-wrenching. I was not alive in 1985 and have never managed to get a real sense for just why a left wing party went down the neoliberal track. These help a lot with understanding why.
"Now tell us what 'twas all about,"
Young Peterkin, he cries;
And little Wilhelmine looks up
With wonder-waiting eyes;
"Now tell us about the class war,
And what they fought each other for."
twas fucking Douglas, Trotter cried,
"Who put the left to rout;
But what we should do after that
I cannot well make out;
Let's stay with Labour, and maybe
we'll get a famous victory.
Hello Wayne,
To blame the left wing of the Labour party for trying to "destroy" their government is a bit rich. A kinder and more accurate interpretation would be that they were attempting to hold the party true to its principles, something that is particularly lacking in the unedifying spectacle of the PM's ongoing support of that Banks on purely practical grounds (i.e. needing his vote). Whatever National has in its DNA, it is not freedom but pragmatism and a healthy self regard for their (your) own survival. Ironically you jumped ship a time that was “dire” for New Zealand, the circumstances of which were precipitated by a National government not a Labour one! Smugness from a politician who, in spite of all the blather about freedom being in the National parties DNA, none the less joined a party being run by a bully and an autocrat is, shall we charitably say, an interesting view of what constituted your idea of freedom at the time. Either that or you showed an astonishing prescience about the eventual fate of the fourth Labour government that, before they were even elected, was wholly missing in everyone else’s analysis either at the time, or since. Hmm I wonder which version is closer to the truth but then again hindsight (and self justification)is always 20/20. Still I would like to thank you for your comments. Debate is, whatever your political leanings, the sign of a healthy society.
Dire? As I remember the times, it might have taken a few months to get a phone, but we all had reasonably well paying jobs. Now it may be that something had to be done, but there was no need to ruin the economy for 10 years or so in order to accomplish that. And it seems to me that since then, some people have definitely acquired economic freedom, that people such as myself have lost it. How much freedom is there for someone working at a Mac job on the minimum wage? Not a great deal if you want to feed yourself and your family. The idea that the country was in such dire straits at the end of the Muldoon years is one of those myths that have become accepted – promulgated by idiots like Prebble the TINA people. Small-minded, bigoted, rigid ideologues. We would have been much better off without them.
"The law, in its majestic equality, forbids the rich as well as the poor to sleep under bridges, to beg in the streets, and to steal bread" Anatole France 1894.
This is the freedom that Wayne refers to, the freedom for both rich and poor alike to sleep rough and to go hungry. Some freedom!
Is that really the real Wayne Mapp? Of the original 90 day hire and fire law? If so, brave of you to set foot round these parts.
Politics in practice often seems to deteriorate into the rabid opposition to one thing or another. I see no intrinsic evil in GST and it seems to be a very practical way to gather tax (picks up a lot of grey dollars and undeclared incomes) but of course it should be "conditional upon a clear demonstration that the incomes of low paid workers will be fully protected" just as with any tax change.
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