The Odd Couple.

Strange Political Bedfellows: Matthew Hooton’s support for Winston Peters’ New Zealand Futures Fund reflects the Radical Right’s newfound reluctance to bet everything on the efficacy of market forces.

AS IF HE WASN’T IN ENOUGH TROUBLE, Matthew Hooton has now come out for Winston Peters’ New Zealand Futures Fund (NZFF). Not only that, but he is also calling upon Peters to lower the company tax rate:

“A 12.5% company tax rate, not the current 28%, would be a much better bet [when it comes to attracting foreign investors] than relying on his or any other Prime Minister’s sales skills, along with limos or helicopters from the airport and PowerPoint presentations for visiting funds managers.”

Hooton has been calling for a radical re-design of the New Zealand economy for some time now. But, as the above quotation makes clear, he holds out very little hope that the National Party – let alone its present leader – is either ready, willing, or able to accomplish anything resembling substantive economic change.

Hooton’s support for Peters’ NZFF not only reflects his own personal disillusionment with National, but the Radical Right’s newfound reluctance to bet everything on the efficacy of laissez-faire. Hooton is doubtful, now, that even an economy geared rigorously to the preferences of the market will automatically allocate resources in the most effective and efficient fashion. Judging from his latest NZ Herald column, this gadfly of the Right has grown sceptical even of Act.

It is, however, difficult to tell whether Hooton’s scepticism of Act is fuelled by his perception that the party is too radical, or not radical enough. After all, by roughly halving the company tax rate, the New Zealand state would be denying itself close to nine billion dollars of revenue. The size of expenditure cuts required to fill a fiscal hole that big would likely render the country ungovernable. It is important, always, to bear in mind the extremity of Hooton’s economic and political radicalism.

That political commentators of Hooton’s ilk are losing confidence in both the virtues of right-wing centrism, and strict free-market orthodoxy, indicates an ideological shift of some significance. Just how significant will be indicated by whether or not the USA once again embraces, or rejects, the leadership of Donald Trump.

A victory for Trump would represent not just a repudiation of Kamala Harris’s half-hearted social-democracy, but a rejection of the whole concept of self-regulating markets. It would signal that the intense personalisation of leadership, long a feature of the political sphere, has migrated to the economic sphere. Right-wing voters have long sought a leader willing to bang politicians heads together. Now, it would seem, those same voters are wanting, and expecting, a leader who will bang corporations’ heads together.

The loss of confidence in Christopher Luxon’s leadership, registered in the polls, and unmistakeable in Hooton’s column, may be a reflection of the Prime Minister’s failure to manifest the head-banging qualities so many right-leaning voters were anticipating. Luxon may believe himself to be the sort of guy who can bounce India into a free trade agreement because he “gushes at them or squeezes their shoulder” – to deploy Hooton’s withering phrase – but a surprisingly large chunk of the Right’s electoral base simply aren’t buying it.

Another indicator of this economic personalisation was the readiness of Chris Bishop, Shane Jones and Simeon Brown to assume personal responsibility for setting New Zealand on a “fast track” to economic growth and prosperity. Were they, like Hooton, registering the rising impatience of at least a sizeable fraction of the electorate with conventional decision-making processes? “Just get the bloody job done!” Was that the message being sent to the Government in National’s focus-groups? And, if so, why did the Coalition refuse to heed it?

The answer to that question was on display in RNZ’s “30 With Guyon Espiner” interview with Labour’s finance spokesperson, Barbara Edmonds. In the course of that unedited half-hour, Edmonds exposed the acute tension that now exists between the intelligent politician’s understanding of just how critical the economic situation confronting New Zealand has become; the radical measures required to address it; and the dispiriting combination of intellectual lassitude and political cowardice that more-or-less guarantees that nothing will happen.

Bishop’s, Jones’ and Brown’s enforced backdown on the Fast Track legislation simply confirms that, in National’s ranks, as well as in Labour’s, doing nothing will always find more takers than doing something.

Could this be why Hooton opted to sing Peters’ praises on the pages of the Herald? Whatever else he may represent, “Winston” has always stood for the idea that “the man in the arena” has more to offer the world than those content to be guided by process and convention.

Following the rules of the game was a sound strategy when the game produced a society in which those who worked hard and kept their noses clean could anticipate a comfortable life for themselves and (more importantly) for their children. But, as the imminent prospect of a Trump victory makes clear, that anticipation lost what little purchase it had on realism long, long ago. At a time when so many of the promises of the powerful are best read as threats, more and more people are abandoning the whole democratic idea in favour of putting a strong leader in command, and giving him the freedom to get on with it.

National’s problem is that Christopher Luxon is a successful, private-sector bureaucrat. He has little time for the man in the arena, seeming more at home with the persons in the boardroom. Fond as he is of invoking the waning “mojo” of New Zealanders, Luxon displays an equal deficiency of that quality in his performance as prime minister. For all we know, of course, Luxon may possess all the qualities needed to haul New Zealand out of the Big Muddy. It’s just that, to date, he has declined to manifest them.

There was time when, presented with a faltering capitalism, the electorate could turn leftwards towards the bright (if untried) promises of socialism. No more. Half-a-century has passed since a Labour Government even vaguely reflecting socialist principles held office in New Zealand. That said, if Edmonds’ responses to Espiner offer any guide, the Labour Party of 2024 is miles away from unleashing Rogernomics 2.0, but no nearer to raising the revenue needed to keep what remains of New Zealand’s welfare state on life-support.

And, right there, the grim reality of New Zealand politics reveals itself. Labour has nothing to offer but process and convention, a failure of imagination and courage that it shares with the National Party. Act can only suggest that neoliberalism’s so-far-unavailing remedies be applied with increased rigor. The Greens and Te Pati Māori display nothing but messy ideological incontinence.

NZ First may not, in the end, have what’s needed to lead New Zealand into the “broad sunlit uplands” that Winston’s namesake promised, but, as Hooton’s column suggests, it still has “a man in the arena” shrewd enough to point the way.

This essay was originally posted on the Interest.co.nz website on Monday, 21 October 2024.