Friday, 13 November 2020

Jacinda 2.0 is "Licenced To Govern" - But Not By, Or For, Us.

Government By Permission:  That phrase: “a licence to govern” brings into sharp focus so much which has been unclear to the tens-of-thousands of New Zealanders who voted Labour-Green in confident expectation of ushering-in a period of much-needed, but long-delayed, change. It explains why – in spite of her outstanding communication skills and empathy – Jacinda Ardern finds it impossible to follow the examples of Mickey Savage and Norman Kirk. 

WHAT HAS HAPPENED to Jacinda Ardern? What has become of the woman who promised to “transform” New Zealand through the “Politics of Kindness”? Where is the woman who forged a team of five million and coached it through the Covid-19 pandemic? Why is the woman who won 50.1 percent of the Party Vote refusing to respond to the needs of the poorest New Zealanders. What in the Blue Blazers is going on?

Contrast the present Labour Government’s refusal to give the poor a happy Christmas with this little vignette from Labour’s past.

“Shortly after his election as Labour Party leader in 1961, Arnold Nordmeyer was asked by the New Zealand Broadcasting Corporation to recall for its listeners ‘My Most Memorable Christmas’. He spoke movingly of the first Labour Government’s decision, in December 1935, to advance the equivalent of an extra week’s relief payment to all the unemployed as a “Christmas Bonus”. That single act of state generosity, he said, sent ripples of hope and goodwill through thousands of destitute families and hundreds of cash-strapped communities. By Christmas, its effects were evident across the whole of New Zealand.”

Alternatively, there’s the extraordinary interview conducted by David Frost with New Zealand’s newly-elected Prime Minister, Norman Kirk, early in 1973. About 3 minutes into the interview Kirk talks about the letter he received from a disabled woman, thanking him for the special Christmas payment he made to all social welfare beneficiaries in December of 1972, and telling him what the extra money had made possible. Here’s the link

Jacinda Ardern is rightly celebrated for her communication skills and for her demonstrations of empathy, but set her performances alongside Kirk’s in that interview and the huge gulf that separates the current Labour Government from its predecessor of 1972-75 is immediately apparent. Yes, the world has become a very different place, and the conduct of centre-left politics has changed dramatically. But human compassion and political authenticity are just as easy to spot in 2020 as they were in 1973. Something has been removed from our political leaders, something important. What is it? And who took it?

The answer – appropriately enough – lies in the turbulent history of the 1970s. At the heart of that history was Capitalism’s ruthless fightback against what its intellectual leaders regarded as the unwarranted, and increasingly uncontrollable, inflation of democratic expectations.

Capitalism’s problem, in a nutshell, was that too many people wanted – and were demanding – too much. Across the industrialised West, decade after decade of rising prosperity had freed ordinary people, especially young people, from the relentless pursuit of bread and butter. Having secured their freedom from raw material deprivation, people were seeking the freedom to become something more than an employee, more than a consumer. Working-class men; women of all classes; people of colour; gays and lesbians: all of these groups were demanding the right to be considered – and to become – fully human.

Nowhere is this phenomenon better described than in Ariel Dorfman’s seminal book on cultural imperialism – The Empire’s Old Clothes. In the first chapter of the book, Dorfman recalls being approached by a young woman from one of the shanty-towns that encircled Chile’s capital city, Santiago. Professor Dorfman, and some of his students, had come to help the shanty-dwellers repair the damage wrought by a recent flood.

“She came up to me and asked quite frankly if it was true that I thought people shouldn’t read photo-novels”, Dorfman writes – alluding to his crusade against the “industrial products of fiction.” Comics, soap operas, westerns, radio and TV sitcoms, love songs, films of violence: “you name it”, quipped Dorfman, “I had it under scrutiny.”

“So I stopped digging and answered her. It was true. I thought that photo-novels were a hazard to her health and her future.*

“She did not seem to feel any special need for purification. ‘Don’t do that to us, companerito,’ she said in a familiar, almost tender way. ‘Don’t take my dreams away from me.”

A few years later, about the same time David Frost was interviewing Norman Kirk, Dorfman was in the same shanty-town for the opening of a new community centre – one of the many thousands of collective initiatives funded by the socialist government of Salvador Allende – when he encountered the same woman:

“I didn’t recognize her at first, but she remembered me. She came up to me, just like that, and announced that I was right, that she didn’t read ‘trash’ anymore. Then she added a phrase which still haunts me. ‘Now, companero, we are dreaming reality.’”

For nearly 50 years now, this is the dream/nightmare that has driven the politics of the Capitalist West. How to prevent ordinary people from making their dreams real through collective action. Certainly, it is no accident that the “cure” for too many dreams began in Chile. After the USA had “made the economy scream”, and General Augusto Pinochet’s troops had gunned down Salvador Allende in his Presidential Palace, it was to Chile that the “Chicago Boys” – the followers of Milton Friedman – came to show the world how Capitalism could be kept safe from Democracy.

And the “lessons” from Chicago just kept coming. Across the Tasman, Labor Prime Minister Gough Whitlam’s government was deposed in a bloodless coup by his own Governor-General (and CIA asset) Sir John Kerr. Fortunately for ordinary New Zealanders, Norman Kirk’s untimely (and extremely convenient) demise in August 1974 obviated the need for such a dramatic intervention here. (Although the CIA did help out the National Party by facilitating the production of some killer campaign ads for the 1975 general election.) Then, of course, there was the plot to topple UK Labour Prime Minister Harold Wilson in 1976, and the final coup de grace against the very possibility of democratic socialism – the capital strike against the French socialist government of President Francois Mitterrand in 1981. If the Left ever wanted to govern again, then it would have to lower its sights – and its red flags.

Back in the 1980s, there was a story, probably apocryphal, about Mike Moore and the powerful Australian television series The Dismissal – which dramatized the sacking of Gough Whitlam’s Labor Government in 1975. According to the story, Moore was determined to remind his colleagues about the dangers that lay in wait for Labour governments.

What Moore wanted his colleagues to appreciate was the overwhelming power that could be brought to bear against a government that threatened the interests of the people who really mattered. How vital it was to keep business on your side. How much damage the news media could inflict upon a political leader it didn’t like. How dangerous senior public servants could be if their ministers refused to accept official advice. Most importantly, he wanted to remind them of the risks posed to labour governments by stubborn idealists: politicians who refused to be guided by principled pragmatism and common sense. So Moore sat all his caucus colleagues down and made them watch every one of The Dismissal’s six, hour-long, episodes.

Was Moore on to something? Had he drawn the correct lessons from the fall of so many democratic socialist politicians and governments? More importantly, had other centre-left politicians, in other countries, reached exactly the same conclusion? Is that why the world ended up with Bill Clinton, Tony Blair, Gerhard Schroeder, Francois Hollande, Helen Clark and Kevin Rudd? Or, turning the question around, is that why the campaigns of genuine leftists like Jeremy Corbyn and Bernie Sanders so consistently come to grief?

The beginnings of an answer may be found in the following passage, taken from a speech delivered to the prestigious Wellington Club on 3 November 2020 by the veteran political journalist, Colin James:

“With National weak, Jacinda Ardern has political space to push real reform. Will she? Can she? Will Grant Robertson? Can he?

“Grant Robertson has stuck to fiscal and monetary orthodoxy. Jacinda Ardern told me back in 2018 that earns Labour a ‘licence to govern’, that is, tolerance by business and other sceptics. That is a clue to their cautious mentality.”

A clue, says James. Surely it’s something a little more definitive than that? A key, perhaps? Yes, a key.

That phrase: “a licence to govern” brings into sharp focus so much which has been unclear to the tens-of-thousands of New Zealanders who voted Labour-Green in confident expectation of ushering-in a period of much-needed, but long-delayed, change. It explains why – in spite of her outstanding communication skills and empathy – Jacinda Ardern finds it impossible to follow the examples of Mickey Savage and Norman Kirk. Those leaders believed the only “licence” a party needed to govern was the one given to them by the voters in a general election. Forty-eight years on from the Labour landslide of 1972; forty-eight years after that young shanty-dweller proudly informed Ariel Dorfman that she and her comrades were “dreaming reality”; Jacinda Ardern knows better. To drive a capitalist economy, it is first necessary to obtain a licence – from the capitalists.

But, securing the “tolerance of business and other sceptics” is not an easy thing to do. There are so many self-denying ordinances one has to offer-up: no capital gains tax; no wealth tax; no return to universal union membership; no restoration of the unconstrained right to strike; nothing to empower or embolden that reserve army of labour we call beneficiaries; nothing that might upset the business community, dairy farmers, or the fishing industry; and certainly nothing to combat climate change which in any way threatens the capitalists’ sacred right to make a profit. Nothing, in short, that could possibly upset the status-quo.

The most frustrating aspect of Jacinda’s “licence to govern” proposition is that in both historical and practical political terms she is, almost certainly, correct.

It is important to remember that both Ardern and Robertson were working in the Beehive during Helen Clark’s first term as Prime Minister. They would have heard the stories about the grim “Winter of Discontent” that followed the creation of the Labour-Alliance coalition government in the early summer of 1999. How the New Zealand capitalist class threatened to “put away their cheque-books” if there was even the slightest hint that some of the Alliance’s left-wing policies were about to be enacted. How the Finance Minister, Michael Cullen, had to abase himself before the nation’s “business leaders” at the Auckland Club. How Helen Clark felt obliged to swear that Laila Harré’s employer-funded child-care would only be introduced “over my dead body”.

The old Marxists may rail against Ardern’s and Labour’s “incrementalism” but when challenged to come up with an alternative strategy for operating safely under neoliberal capitalism, the system which, for nearly fifty years, has decreed anything more ambitious than piecemeal and largely inconsequential legislation verboten, they generally mutter something about “revolutionary action” and head for the bar.

They’re right, of course. Neoliberal Capitalism, by declaring democratic socialism and social-democracy out-of-bounds in the 1970s and 80s has, wittingly or unwittingly, left revolution as the only viable option. Not only when it comes to once again making it possible for the wretched of the earth to “dream reality”; but also when it comes to rescuing the only planet we know of in the entire universe where ordinary people’s dreams of becoming truly free and fully human can be realised.


* It would be interesting to know what Ariel Dorfman (who is still alive) makes of the sort of communications hardware and software that has become ubiquitous in twenty-first century societies. So much more powerful and compelling than the photo-novels and comics of the 1960s and 70s, our PCs, lap-tops, tablets and cellphones have made the corporations who manufacture and control them masters of the planet. The “industrial production of fiction” which Dorfman complained of back then seems quaint when compared to the scale of contemporary cultural imperialism’s reach and power. That capitalism has placed a portal to its material and imaginative production in virtually every hand on the planet should give us pause. Perhaps, like the young shanty-dweller, we will only be able to start “dreaming reality” when we throw the masters’ “trash” away?


This essay was originally posted on The Daily Blog of Friday, 13 November 2020.

36 comments:

Trev1 said...

You will never solve poverty by slicing an ever-diminishing pie into smaller and smaller pieces, which is what increasing benefits and raising taxes to pay for them does. You must grow the pie.

The main contributor to poverty in New Zealand is housing costs. I was shocked to read today median house prices have escalated by some 20% in the past year. This is not sustainable. It is also a dagger poised at the heart of the financial system. A large part of the problem is caused by the RBNZ's irresponsible quantitative easing and money printing.

But the government also needs to step in urgently by requiring local government to rezone land for housing, by throwing out the constraints imposed by the RMA and by investing in roading and the 3 waters infrastructure to support housing development . It must also substantially increase its own investment in providing social housing. Sadly I do not consider Ardern and Robertson possess the understanding, skills or gumption to do anything positive to address these issues at all.

Unknown said...

CapitaIism is wealth creation, and can you Chris - or anyone - explain how poverty can be overcome without wealth creation ?
And profitability is a basic need for survival without which starvation is inevitable, and even hastened by more unprofitable work which consumes more wealth than what the unprofitable effort produces.
That is the reason for the inevitable unsustainability of "non-capitalist" socialism - the political pressure within it to consume more than what can be produced profitably.

Why not consider "peoples capitalism" on how to overcome poverty and a achieve a more egalitarian (in status) society >

Jens

Patricia said...

Trev1. A pie is not a fixed thing. A pie can only grow by people having the money to spend. If people on benefits were given another $100.00pw they will spend it and that spending will increase the pie. $100.00pw to the rich only goes into the Bank. That does not increase the size of the pie.

Anonymous said...

Hi Chris - your essay made me feel quite emotional for the wasted opportunities. Human nature is weak and bravery is rare. We are going down the gurgler with the rest of the world and it's important that people such as you can help to clarify the situation. It also helps to explain why the conspiracy theories exist as people know instinctively that things are not right but don't have the knowledge to understand what has and is happening. Thanks for your insights.
Best wishes, Marg

Trev1 said...

@ Patricia: I doubt if many "rich" people are putting their money in the bank these days with interest rates under one percent. Increasing benefits can make people worse off, by stoking inflation, especially in accommodation costs. We need people to invest in new businesses and new housing. We have a major supply problem in housing.

Unknown said...

Well, Marg - things cannot be right when we have too many people wanting to consume more of what capitalism produces - but refusing to participate in the efforts and risks of capitalism, i.e.the saving or creation of "surpluses" for useful (profitable) investments and security reserves.

Patricia is right in that if taxpayers give money to the poor for more consumption, only the consumption goods producers will reap a profit - at the cost of a bigger loss to taxpayers than the profits of producers, because taxpayers actually donated THE TOTAL COSTS OF THE PRODUCTION, of which the profit is only a fraction - and without which through depreciation and wear and tear, the production capacity of producers just deteriorates.

That's the natural fate of non-profitable or inadequately subsidized capitalism.

Cheers - Jens.

blondewithaniq said...

What Marg said.. and seconded as an older real UK Liberal, pre NeoLibLabouranywhere.
You and Dorfman actually almost made me cry.
I bought a one flat in the early 80s in Surrey with a 100% mortgage an employment agency main job and 2 p/t ones. I was 22. Couldnt happen for either of my kids these days. That is a crying shame too
Working class had real chances even then til Thatcher
Jax

Kat said...

"Why is the woman who won 50.1 percent of the Party Vote refusing to respond to the needs of the poorest New Zealanders.............."

Do the maths, the woman that won 50.1% of the party vote and smashed the boundaries of MMP has to respond to the needs of "every New Zealander".

Oh, just imagine if everyone was in work and being fairly rewarded for a fair days work. Call me old fashioned but that is the why we need a 21st Century ministry of.........

DS said...

Trev1 and others: Wee problem. We don't actually know how to "grow the pie" (economics is a good deal more complicated than cutting taxes, deregulating, and hoping that the benevolent capitalists will shower the peasants with largesse). There is also zero evidence that tax levels have any effect on long-term growth.

DS said...

The essay has one interesting implication. If neoliberalism is ever to end in New Zealand, it will be done by National, not Labour - National are inherently permitted to go places Labour cannot.

I would note, however, that there is one massive exception to all of this. Namely that in times of crisis, many things become possible. Never Waste a Crisis, and all that - one could get away with things in the current COVID environment that no Labour Government could dare do in normal times. Roger Douglas himself also provides some pointers - act quickly, so that your opposition doesn't have time to mobilise against you.

Brendon Harre said...

Yes massive reforms needed to make housing work. More than just RMA reform. NZ needs a much bigger public housing programme. In Vienna a quarter of the new builds are social housing -we need to copy that sort of model. We need to look at how local government is financed. And in our tier1 cities we need to integrate housing with mass transit.

Brendan McNeill said...

Putting your faith in politicians of any stripe is guaranteed to disappoint. They are sinners like the rest of us, not saints.

The Prime Minister has promised to "govern for all New Zealanders" not just those on welfare. Perhaps she means it?

For those with short memories, the government increased benefits by $25.00 per week in March, during the pandemic when many business were forced to close their doors, some never to reopen. Let's try and retain some perspective and remember for every benefit payment, someone in the workforce has to earn it first.

Guerilla Surgeon said...

Couple of things most people seem to ignore about all this. Firstly research has shown that the best way to improve poor people's lives funnily enough, is to actually give the money. The second thing is that as poor people they will spend all of it, and 99.9% of them will spend it wisely on improving their lives. Give wealthy people money in the form of tax relief and they don't bother spending it, they don't tend to put it into creating new jobs, they just socket away. And of course people spending money is what businesses survive on.
And Brendan... Still waiting for an answer on whether you still believe that Christianity is responsible for the beginnings of poor relief and education, given that I've provided you with evidence to the contrary. I'm doing an assignment on the backfire effect and your answer would be extremely helpful – either way. :)

Patricia said...

Brendan McNeil. ‘ Let's try and retain some perspective and remember for every benefit payment, someone in the workforce has to earn it first‘. No they don’t Brendan. You are looking at government spending as being similar to a household. A sovereign government does not rely on taxes to spend. Taxes are for different purposes. Go to YouTube and listen to some of the lectures by Bill Mitchell, Stephanie Kelton, Warren Mosler et al who all explain, most lucidly, on how the money supply works. That taxes are needed for a government to spend is just neo liberal claptrap and designed to keep the ordinary person ignorant and the money class in control.

greywarbler said...

DS Good to remember - and act by. Roger Douglas himself also provides some pointers - act quickly, so that your opposition doesn't have time to mobilise against you.

Who are the bodies making the plans for what is safe for Labour to do, AND still get re-elected by the centre? I would like to know who to hate
rather than spread it over those who are keen to make a big difference.

Nick J said...

GS, yes give the money direct to where its needed. Spot on.

On Christianity and charity I'd hazard a guess that charity predates it. That said charity is one of the Cardinal Virtues in the RC catechism, and was the primary driver of the Franciscans for a millennium. Calvin stuffed that up with predestination of the elect where being rich showed God's favour, hence no charity for the poor required. The Anglican Church gave charity to the poor through alms houses, Fabian socialism grew out of the Anglican tradition of looking after the poor.

sumsuch said...

'Transformational, rark'. I hardly remember Ardern's rubbish from then.

In those despicable focus groups she and Grant build their crouched backs on, couldn't they set up one where those disapprovers of meeting the needs of the desperate are then confronted with the best rational case for it? Writing that, I see the crouched backs are all Jac/Grant.

She can win one election without addressing the concerns of the concerned but she can't do without the, thinking long about the right name, the 35ists, the social democrats, or mine from 93 the demo-cratists? The last didna take. All us who love the people.

We seem to be circling her.

Not having read Machiavelli or her anti-CV ( her real experience of life and political life), I just have to despise her on her regularly pronounced principles. 'Governing for All' says the final thing about how politics comes first for her.

I understand she still has principles as a person but in that ... form, I don't care.

Unknown said...

How can one "grow the pie"?

The "pie" is for eating, so certainly you cannot "grow" it by eating more - but by saving and PROFITABLE investment in greater (and cheaper) production capacity.

The "cheaper" will generate more sales without giving the poor extra money for nothing- and might even enable the to save for their own wealth ownership generation.

What other way is there to create anything without having to save for it at the expense of hand-to-mouth consumption potential ?

Brendan McNeill said...

Dear GS

That Christians were instrumental in poverty relief and education for the poor is such an established fact that I thought you must have been speaking ironically to state otherwise.

"Sunday schools were first set up in the 18th century in England to provide education to working children.[2] William King started a Sunday school in 1751 in Dursley, Gloucestershire, and suggested that Robert Raikes start a similar one in Gloucester. Raikes was editor of the Gloucester Journal. He wrote an article in his journal, and as a result many clergymen supported schools, which aimed to teach the youngsters reading, writing, cyphering (doing arithmetic) and a knowledge of the Bible.[3]"

https://en.wikipedia.org/wiki/Sunday_school

State education did not begin until 1870 in England, more than 100 years after church schools were well established.

The history of health care in relation to Christianity may also prove instructive:

https://www.nursing.upenn.edu/nhhc/nurses-institutions-caring/history-of-hospitals/

Christians have been caring for the poor since before the Book of ACTS.

Have you read Tom Holland's 'Dominion' yet?

All the best.

Guerilla Surgeon said...

Our Brendan, thank you for your answer. I see you are in fact immune to evidence as I had hypothesised. I did provide you with evidence that other religions instituted education and poor relief long before Christianity. You seem to have ignored that. Because in your previous statement about this you are suggesting that other religions did not in fact have anything to do with poor relief and it was Christians that began at all. I see you found a way round that by confining yourself to the Western world. Well done!

Guerilla Surgeon said...

Brendan – Forgot to say, I have ordered Dominion through my local library. So I haven't read it yet, but I have read at least a dozen reviews, not all of which have such a rosy opinion of it as yourself.

Nick J said...

Here's a link especially for GS, which I'm sure he will mainly agree with. It explains the system under which we live, Trump v Biden and how western societies operate which Chris alludes to.
https://www.jonathan-cook.net/blog/2020-11-12/biden-trump-left-populism/

DS said...

Brendan, the Roman Grain Dole predates the existence of Christianity.

Brendan McNeill said...

Dear GS

Well sure, if you elect to have your surgery in an 'ahem' non-western world hospital, then good on you. Or, if you happened to be poor in a non-western country and enjoy the benefits of their compassionate welfare system then no doubt (according to your theory) you would be just as well off as in our post Christian culture. But most readers will know where they would prefer to be poor, sick or both, even if they spent time at University de-constructing Western civilisation and being indoctrinated with its 'evils'.

I'm impressed that you have chosen to read Dominion. It shows a degree of humility that I didn't expect. I underestimated you.

You will discover Historian Tom Holland to be quite objective and often shows the followers of Christ in an unflattering light which may give you some comfort. I'm sure your critical eye will find faults, but it is extensively cross referenced. I'd be delighted if you let me know what you think of the book. I don't always read Chris' blog, but I do give him permission to share my email address with you should you want to contact me directly.






Neil Stockley said...

"Although the CIA did help out the National Party by facilitating the production of some killer campaign ads for the 1975 general election." I have taken an interest in the Nats' 1975 campaign ads for a long time - well, since 1975, actually - and have heard these claims many times. Where have they been verified, and by whom?

Ricardo said...

"Revolution as the only viable option" This is so funny, it has made my day. So who do we revolt against and for what?

The hundreds of thousands of small business owners earning 80k a year? Right up against the wall you lot. We nationalise the dairies, fish and chip shops and appliance stores.

We shoot all the farmers and appropriate their farms. That's worked before.

We storm the Beehive and execute the bureaucrats from Tawa and Haitaitai.

What are revolting for? better internet bandwidth. Big screen TVs, iPhone 12s.

I only ask that if we do revolt we get home for tea time, bangers and mash and the six o'clock news.

Guerilla Surgeon said...

Brendan. You seem to have forgotten that you claimed that Christianity began both poor relief and education. I mentioned as someone else has done, that the Roman grain dole predated Christianity as did much of the poor relief in China and various other places, which stemmed either from governments or Buddhist monasteries. And of course I also showed you that various other religious groups started schools long before Christianity existed. You seem to have shifted the goalposts somewhat (sorry for the understatement).
Yet the most compassionate welfare systems in the world are not in Christian countries so much as secular ones. America is the most Christian country in the Western world and yet its poor relief is how shall I put it tactfully – crap. And it's education isn't the best either unless you are wealthy.
And I have one or two friends who have had expensive surgery and dental work done in places like Thailand or Sri Lanka, who have been pretty satisfied with it – it being cheaper than paying for it privately in their own countries.

Ricardo. I imagine that if people do revolt which admittedly is unlikely, some of them will be revolting for a chance not to have to choose between buying food for their families and a new pair of school shoes. Or even a chance to eat some bangers and mash, the price of decent sausages these days.

Brendan McNeill said...

Dear DS

Regarding ‘bread and circuses’, it’s one thing for the Roman State to make a pragmatic decision to use their taxation base to subsidise ‘food for the masses’ in order to stave off civil unrest, and entirely another thing for individual Christians to freely give of their earnings to help feed the poor.

The Jews had their own system of welfare expressed through the Mosaic law that pre-dated Christianity, so there is one example, but it is the same God providing the motivation.

Unknown said...

Historically, a violent, armed revolution ends up with the losing party being suppressed by force, if the winners are Marxist Socialists.
There were even made efforts by latter to eliminate or re-educate the "haves" altogether ( e.g. Stalinim) - but amazingly - this effort becomes too unpopular in the long term, can be sustained only by continuous brute force (e.g.North Korea), and tends to revert to mixed capitalism in a peaceful way, if strong suppression of it is not maintained.

So, what then is the most promising future for tho "have-nots" feeling suppressed under Social Democratic mixed capitalism ?

If Labour under Jacinda accepts achieving a 100% Ownership Society for its ultimate goal and vision, Labour obviously would govern not only for the benefit of a sectional interest of us, but for the benefit of all of us.

The poor become also "Haves", and even the plutocrat free market capitalists can end up with a sigh of relief, that even though there might be more competition by a wider spread of capital ownership, at least the threat for them of a violent revolution could come only from a normal (insignificant) proportion of anti-social troublemakers.

Cheers - Jens.

Hopeful said...

Thanks Chris. I see a common theme in this post, your previous post on US politics, and your book "No Left Turn." There is a basic structure followed by many (most?) left wing writers. This was first, I think, laid down in Orwell's Road to Wigan Pier:

5% of text describes the troubles of the world and that it is self evident that these are all due to capitalism.
1% of text states, without evidence, that some flavour of socialism is the obvious solution to these problems.

The remaining 94% is devoted to describing the moral and intellectual failings of those who fail to grasp these simple truths.

NZ has real problems. 2020 is the first year in my lifetime that I can truthfully say that the rich are getting richer (house prices up 20%) while the poor are getting poorer (unemployment up but only amongst the low income earners). The left needs to contribute a higher standard of argument if we are going to work our way out of this.

Not that I can offer any answers.

Hopeful said...

Couple of answers to Guerrilla Surgeon:

"Firstly research has shown that the best way to improve poor people's lives funnily enough, is to actually give the money."

This is true on the day but it matters how those people get that money. As they say "give someone a fish and they eat for a day, teach them to fish and they eat forever." We have been handing out an increasing number of fish since Bill Rowling's day. This has culminated in a number of men whose contribution to society is to sit outside a supermarket with a cup in front of them. In the UK they have reached the situation where children now get themselves out of bed, get breakfast and go to school while their parents sleep in.

How is it that the perpetuation of this dead end is considered the kind thing to do? People need to feel and be seen to contribute for society to maintain the social contract.


"The second thing is that as poor people they will spend all of it, and 99.9% of them will spend it wisely on improving their lives. Give wealthy people money in the form of tax relief and they don't bother spending it, they don't tend to put it into creating new jobs, they just socket away. And of course people spending money is what businesses survive on."

You need to learn some economics. Thomas Sowell is a great place to start. If people (or governments) have some money they will do one of three things: spend it (eat the fish), save it (smoke or freeze the fish) or invest it (make or buy more fishing gear).

The third option results in more fish which can then be redistributed. Also called "growing the pie." This is what a subgroup of rich people do when you "give wealthy people", CORRECTION, "let people keep more of their own" "money in the form of tax relief." These are the entrepreneurs. Even those who stash it in the bank add to investment as the bank then lends that money out to build houses etc.

This is the factual basis behind the Laffer curve, derided by the ignorant as "trickle down theory." If you can stand it you should listen to Mohammed El-Erian on BBC Hard Talk 14 Nov 2018. He describes this effect as it pertained to Donald Trump's tax cuts.

Good luck with your assignment.


Guerilla Surgeon said...

"give someone a fish and they eat for a day, teach them to fish and they eat forever."

Myth. It ignores the problem why someone is poor in the first place. And it's not necessarily because they don't know how to fish. He also needs equipment, and access to fishing grounds. Neither of which he can get if he is poor. They also need decent schools, housing, and neighbourhoods where they can live without the fear of crime. They need access to cheap finance, because no one is going to lend them any money except at huge interest rates if they are poor, even if they know how to fish.

I think my knowledge of economics is reasonable. I think you need to learn something about development economics Eva Vivalt is a good place to start.

http://www.dominionpaper.ca/articles/4100

Or maybe you could just look at this.

https://okpolicy.org/thats-a-laffer-top-economists-unanimously-reject-that-tax-cuts-will-yield-higher-revenue/

Or this – designed for laypeople.

britbunkley said...

Somehow Scandinavia managed to retain most (but not all) of their rights without selling out to neo liberalism, while NZ fell over instantly without fight...and then its been one step forward and two back since the early 90's.

britbunkley said...

For me this is the best article by Chris in a long time- with the terrific razor sharp historical perspective that he is so great at. Labour may have given small gifts such as increasing the winter energy payment (by far too little) but it still puts NZ at among the bottom of the pack for benefit payments (along with the other Anglo nations). Labour folded like a wet slice of bread with CGT. And then Ardern future proofed this neo-liberal sell-out by refusing to even consider CGT during here tenure. Why should NZ continue to remain among the most right-wing nations (among the lowest taxing and spending), and remain the only developed not to have a wealth/capital gains tax? Additionally, there was no effort to counter the shocking Trump level amount of disinformation on the tax floated by the “responsible” press. And why should NZ continue what is essentially a version of the US’s far right “right to work” laws? Why should NZ be among the only nations that allow non-union working staff to attain the same benefits on the backs of those who pay dues and risk their jobs by taking industrial action?

Nick J said...

GS I think my knowledge of economics is reasonable
You are probably correct, compared to Treasury economists you are well in front.

Unknown said...

Yes Guerilla Surgeon - before you can catch fish more effectively than just with your bare hands, you have to accumulate some capital in the form of effective fishing equipment.

The latest news - that there is a substantial (increasing?) proportion of first home buyers active in the housing market - shows us how capital ownership accumulation by the have-nots is being successfully achieved through our KiwiSaver efforts.

An accelerating step in that direction could be initiated by unconditionally granting the $1000.- KiwiSaver kick-start to all who have not received it so far, from "cradle to grave", for a start.

Some unemotional, rational discussion on the possible or imaginary pros and cons of it might be a refreshing change from just being critical of our politicians.

Cheers - Jens.