The March Of Folly: The Chinese Communist Party, speaking through the Xinhua News Agency, has called time on New Zealand's slavish devotion to neoliberal economics. If we are serious about restoring New Zealand's reputation after the Fonterra contamination scandal, then our obsession with applying market-based solutions to every problem must end.
“ONE COULD ARGUE the country is hostage to a blinkered devotion to laissez-faire market ideology.”
That, at least, is how one anonymous Xinhua commentator views the New Zealand dairy industry’s latest contamination scandal.
I say “at least” because the Xinhua News Agency’s opinion pieces generally reflect the thinking of the Chinese Government. Its sharply-pointed political critique should, therefore, remind us that, all glib neoliberal references to “Chinese Capitalism” aside, it is still the Communist Party of China that rules in Beijing.
That Xinhua opinion piece should also dispel any notion that Beijing is indifferent to the politics of its tiny, South Pacific, trading partner. Having drawn attention to our blinkered devotion to laissez-faire capitalism, Xinhua’s writer helpfully provided his readers with a telling example of its effects:
“Many New Zealanders fell victim to this when the construction industry was deregulated two decades ago resulting in damp and leaky homes that quickly became uninhabitable.”
Sometimes it takes an outsider to correctly diagnose an affliction to which its sufferers – that’s us! – have become inured.
The People’s Republic of China survives and thrives today because, unlike the Soviet Union, it was able to set aside the dogmatic certainties of its revolutionary founders before the damage they were inflicting became irreparable. (Who knows what might have happened if a Mikhail Gorbachev had taken power in Russia at the same moment that Mao Zedong’s pragmatic successor, Deng Xiaoping, set China on its new path to a mixed economy?)
Some have summarised Deng’s economic position as: tolerating as much market as possible, while retaining as much state as necessary. It certainly marked a radical departure from Mao’s “iron rice bowl”, which attempted to impose a raw equality of outcomes upon the entire Chinese population.
But, in allowing the market to do what the market does best (which no Chinese leader has ever construed to mean everything!) Deng was not deviating one step from the Chinese Revolution’s three central objectives: to remove the burden of foreign domination; to allow the Chinese people to stand up; and to create the material conditions for their country’s future prosperity.
Whether that prosperity was unleashed by the market, or planned and executed by the state, was, according to Deng, something to be dictated by the circumstances prevailing in each case – not by the inflexible dogma of the Communist Party in Beijing.
“It doesn’t matter if a cat is black or white”, Deng was fond of saying, “so long as it catches mice.”
It is now a matter of some urgency that we all grasp the fact that New Zealand is one of the mice the Chinese cat has caught. It is what the sharp tone of the Xinhua opinion piece is reminding us.
China singled New Zealand out among all the Western nations by granting us the huge advantage of a Free Trade Agreement. This vast, and still rapidly expanding, economic power agreed to take everything we could send her. In doing so, the Chinese Communist Party effectively guaranteed New Zealand’s prosperity for the next hundred years.
We have been very quick to pat ourselves on the back for this achievement. Indeed, to hear our politicians talk, one could easily get the impression that the whole thing was their idea. But such small nation chauvinism is misguided; it’s fatuous; and very, very dangerous.
What has been true for the last 3,000 years, remains true: that China never confers a benefit without a guarantee of reciprocation. She has opened her markets to our agricultural exports, and she expects those exports to be safe. She has consented to let us feed her children, and she expects New Zealand’s infant formula to be free of botulism.
Since 1984, New Zealand politicians have trumpeted the notion that the market is all-wise and all-powerful. That regulation – especially “heavy-handed” regulation – is unnecessary. John Key, in particular, has consistently devalued the goal of “100% Pure New Zealand” by declaring it a mere aspiration: “It’s like saying ‘McDonald’s, I'm loving it’ – I’m not sure every moment that someone’s eating McDonald’s they're loving it ... it’s the same thing with 100 Percent Pure. It’s got to be taken with a bit of a pinch of salt.”
Well, not any more, Prime Minister. Not if we want China’s doors to remain “a bit” open.
The era of “blinkered devotion” is over.
This essay was originally published in The Waikato Times, The Taranaki Daily News, The Timaru Herald, The Otago Daily Times and The Greymouth Star of Friday, 9 August 2013.