Making Money

Printing Money! The knee-jerk outcry from New Zealand's politicians, journalists and right-wing economists is that Quantitative Easing is the same as "printing money". In reality, QE its a IMF-endorsed method of freeing-up the flow of credit to businesses large and small. The Greens' QE proposal was much more limited: to provide urgently needed capital for the Christchurch re-build.  Strangely, the fact that private banks "print money" every day elicits no outcry at all from the critics of QE. 

ARE YOU MAKING ANY MONEY? It’s a common enough question – to which most of us reply with a rueful “Not enough!” A fortunate few (they would call themselves the ‘hard-working’ and ‘talented’ few) might venture a smug “Oh, well, I can’t complain.” But the truth of the matter is that only two things in this world “make” money: governments and banks. (If you’re ‘making’ money and you’re NOT one of those two things, then you’re a counterfeiter.)

 

The funny thing about money – given how vital it is to our lives – is that hardly anyone knows anything about how governments create their currencies, and even fewer understand why banks are allowed to ‘make’ money at all. Indeed, a recent British survey revealed that most people assume that a bank’s lending cannot exceed the value of its deposits. The idea that banks can, by means of a simple accounting entry, create hundreds of millions of dollars, tends to be greeted with considerable scepticism.

 

Take the recent kerfuffle over the Green Party’s (now abandoned) proposal to use “Quantitative Easing” (QE) to both assist the Christchurch rebuild and lower the value of the New Zealand dollar. Earthquake Recovery Bonds, to the value of 1 percent of New Zealand’s GDP (approximately $NZ2 billion) were to be purchased by the Reserve Bank.

 

Adding such a large sum to the stock of Kiwi dollars would have devalued the currency by several cents against the US dollar – making our exports more competitive on international markets. Conversely, imported goods would have become more expensive, reducing consumer demand and thereby improving the country’s balance of payments.

 

The additional $2 billion – available immediately from New Zealand institutions – rather than being drip-fed to us from the grudging hands of foreign-based reinsurance corporations – was also to have been used to kick-start Christchurch’s still sluggish reconstruction, boost the country’s economic growth, and reduce the level of unemployment.

 

A reasonable policy, you might have thought, in the light of New Zealand’s over-valued dollar and the damage it is doing to the economy. But, no. The Green co-leader’s QE proposal was decried by politicians, journalists, bloggers and bank economists, as tantamount to “printing money”.

 

Were Dr Russel Norman’s QE to be adopted, they wailed, we would very soon find ourselves in the position of Zimbabwe: facing hyperinflation and using million-dollar notes to buy a single loaf of bread.

 

Worthless Currency: Weimar Germany's hyperinflation (1920-23) was the result of its government's attempt to monetize its reparations debt to the victors of World War I. In 1938, New Zealand's first Labour Government's use of "Reserve Bank Credit" to fund its massive state house construction programme did not result in a similar inflationary surge because the money was used to create tangible assets.

 

Now, if Dr Norman’s proposal had been to monetize New Zealand’s debt by repaying her creditors with newly-printed $1,000,000-bills issued by the Reserve Bank, then the jibes of his critics would have been well deserved. But hyperinflation only occurs when the expansion of the nation’s money supply isn’t matched by an answering expansion in the value of its material assets.

 

The $2 billion Dr Norman was proposing to inject into the New Zealand economy wasn’t ear-marked for the repayment of debt, but for the reconstruction of its devastated second city, Christchurch. It would have become the steel and concrete of a reborn central business district. Transformed into the weatherboard and roofing tiles of new and refurbished homes, it would have brought desperately needed relief to Christchurch’s long-suffering earthquake victims.

 

Sadly, the cacophony of ill-informed criticism directed at Dr Norman’s QE proposal was sufficient to bring about its withdrawal.

 

As I watched the Greens back away from their perfectly reasonable and generous plans, I wondered why we have heard no similar outcry against the QE being practised by this country’s Australian-owned banks.

 

Every month, New Zealand’s privately-owned financial institutions conjure billions of dollars out of thin air in the form of mortgages. No printing presses are required to ‘make’ this money – a computer does the job in a fraction of a second. And, when the mortgage is granted on an existing property, adding nothing to the nation’s stock of material assets, is the effect inflationary?

 

You betcha! So much so, in fact, that the Reserve Bank is casting about frantically in search of some way to prevent yet another housing “bubble” from blowing up and bursting.

 

And yes, you’re right, the Global Financial Crisis was caused by banks and finance houses “making money”. And, yes, it was governments – using their power to make money – that baled them out. And, yes, you’re right again, the mechanism still being used to painstakingly reconstruct the shattered global economy is called – Quantitative Easing.

 

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, 28 June 2013.

The Right To Say - "No."

ALL OUR HUMAN RIGHTS derive from the power to say just one word: “No.” If we cannot speak that one word – and be heeded – then we have no rights.

 

This right to refuse does not give us licence to do exactly as we please; but those to whom we entrust the authority to limit the citizen’s right to refuse must always be able to justify its use.

 

Jami-Lee Ross, the National Party MP for Botany, will soon introduce a bill to Parliament limiting the right of workers to say “No” to their bosses. His innocuous-sounding Employment Relations  (Continuity of Labour) Amendment bill, by authorising employers to recruit temporary staff to perform the duties of striking or locked-out employees, undermines, fundamentally, the latter’s right to refuse to work for the pay offered and under the conditions proposed.

 

Withdrawing their labour, as a means of inducing their employer to make a better offer on wages and conditions, is the only truly effective negotiating tactic available to employees.

 

Not that “going on strike” is an easy decision to make. Obviously, while a strike is in progress the workers involved will not be paid. The impact on the strikers’ families is readily imagined.

 

Nor are strikes easy on employers. While its workforce refuses to perform their normal duties, no business can function effectively.

 

This is, of course, the point. By imposing a financial penalty on both sides, the strike provides a strong incentive for the contending parties to resume their seats at the negotiating table.

 

One’s opinion on the rights and wrongs of going on strike is one of the great differentiators of politics. This is because it goes to the heart of how Left and Right define the legitimate limits of the individual’s rights. More simply: in which circumstances are we entitled – both individually and collectively – to say “No.”

 

It’s a paradoxical question. In order for the individual employee’s right of refusal to have any practical effect, it must first be joined with every other employee’s right to say “No.”

 

One worker, alone, is seldom able to negotiate with his or her employer from a position of strength. “If you don’t like the wages and conditions on offer here,” the boss will say, “there’s the door!” You may, of course, be lucky and possess a skill in short supply and which the business cannot do without. If so, then the boss will do all he or she can to persuade you to say “Yes.”

 

But, if the work on offer is easily mastered, the individual applicant’s position is hopeless. Take the job, or remain unemployed, becomes the choice. And if that is your choice, then be ready for the Ministry of Social Development to withdraw any assistance you may have been receiving as a “Jobseeker”.

 

Now the choice becomes: take the job, or starve. And that is no choice at all.

 

It is only through a union that the individual employee’s power to say “No.” can be realised. In the words of Ralph Chaplin’s celebrated union anthem, Solidarity Forever:

 

When the union’s inspiration through the workers’ blood shall run

There can be no power greater anywhere beneath the sun;

Yet what force on earth is weaker than the feeble strength of one?

But the union makes us strong.

 

To conservative politicians like Jami-Lee Ross, however, this strategy of preserving the individual’s rights by aggregating them into a single unit of advocacy and assertion is anathema. Rather than interpret the union’s collective voice positively – as a way of amplifying each member’s individual “No!” – the Right hears only a collective roar drowning out the minority’s refusal to be aggregated.

 

But that is not all the Right hears. In the collective voicing of workers’ demands, the conservative detects a baleful bass note of systemic danger. The winning of individual rights by means of aggregation may begin in the workplace, but what guarantee do the defenders of private enterprise have that it will stay there? Once individual citizens work out that they’re much more likely to secure the good things of life by working together, than they are by struggling alone, the foundations of capitalism itself begin to crack and crumble.

 

And so, Jami-Lee Ross proposes a measure that will render every union in the country powerless. Even if 100 percent of the employees on a worksite vote to strike, their employer will, nevertheless, be empowered to over-rule their unanimous shout of “No!” – by hiring temporary replacement workers.

 

If Mr Ross’s private member’s bill becomes law, then the only recourse available to those workers who still insist upon their right to say “No!” will be to physically prevent these replacement workers; these strike-breakers; these scabs – from entering the workplace.

 

Then, the only justification for Mr Ross’s newly minted authority will be the justification of force.

 

“No.”

 

This essay was originally published in The Press of Tuesday, 25 June 2013.

An Assad Victory Is Syria’s (And The World’s) Least-Worst Option

The Spoils Of Victory? Syria 2013. Those who cry "Let justice be done - though the heavens fall!", are seldom to be found living amongst the ruins. The World's options in Syria are rapidly narrowing. It can either allow Assad to restore enough order to make meaningful peace talks possible, or, by increasing arms shipments to the rebels, risk the whole of the Middle East erupting in flames.

 

RIGHT UP UNTIL its actions triggered World War I, hardly anyone in New Zealand gave a damn about Serbia. Until very recently, the same was probably true of our relationship with Syria.

 

Even now, with images of Syria’s gruesome civil war nightly smearing the world’s television screens, I find myself reacting to the rapidly rising body-count with a mixture of pity and frustration. As the angry, anguished faces of the slayers and their victims flash before me, I demand to know what could possibly be worth so much suffering?

 

Freedom?

 

Democracy?

 

Observing the “Arab Spring’s” slow descent into its entirely predictable winter of democratically-sanctioned fanaticism, I impotently admonish the opponents of the Syrian dictator, Bashar Al Assad:

 

“Be careful what you wish for!”

 

Freedom and democracy are probably impossible now, anyway, wished for or not. Too much blood has been spilt and too many homicidal sectarian passions aroused, for the ballot to be seen, miraculously, as an acceptable substitute for the bullet. The time for compromise in Syria was at the very beginning of the conflict – and that moment has passed. Neither side can now afford to rest until all their enemies are dead and absolute victory secured.

 

Of all the potential victors of the Syrian civil war, it is of Bashar Al Assad’s Baathist regime that the world has the least reason to be fearful. For all its faults – and they are legion – Assad’s government is now the only armed force in the country still committed to preserving Syria’s territorial integrity and to its continuance as an independent nation state.

 

Assad’s opponents can no longer credibly commit to either of those objectives. Whether its leaders are willing to acknowledge it or not, the Syrian rebellion has taken on the character of a Saudi and Qatar financed Sunni jihad. Victory for the rebels would dissolve the existing boundaries of the Middle East – thereby unleashing a wider and infinitely more dangerous war into which the whole world could be drawn.

 

By upholding Syria’s rights as a nation-state, China and Russia are, contrary to most Western commentary, making the most useful contribution to the preservation of both the regional and the global peace. It is the United Kingdom and France – both major arms exporters to the leading Sunni monarchies and emirates – that have opted to further inflame the Syrian crisis by bullying the European Union into lifting its ban on selling arms to either side of the conflict.

 

If the UK and France end up putting their thumbs on the strategic scales in Syria, the United States will have no choice but to weigh-in alongside them. This would result not only in the Russian Federation stepping-up its arms shipments to the Syrian Government, but also in the Shia republics of Iran and Iraq increasing the size and capability of their own military and paramilitary contingents (including the Lebanon-based Hezbollah Militia) currently fighting alongside the Syrian armed forces.

 

A fiery crescent of conflict, extending from Iran in the east, to Lebanon (and Israel?) in the west, and threatening all of the states to its immediate north and south, will be the inevitable outcome of any strategy which does not take as its starting point the restoration of the political status quo ante in Syria, the disarming of the rebels, a full amnesty for all of Assad’s opponents, and the drawing-up of a new constitution for the Syrian people – to be guaranteed by all five permanent members of the UN Security Council.

 

Whether they be English, American or Spanish, civil wars only end when one side decisively defeats the other. Unless it is the West’s desire to prolong the agony of the Syrian people indefinitely, its best option is to call upon the Sunni monarchs to cease arming the rebels and allow the Syrian armed forces to re-establish something approximating order.

 

That would be the least-worst-case Syrian scenario. The alternative – an oil-fuelled (and quite possibly nuclear) conflagration devouring the entire Middle East – could hardly avoid setting the whole world on fire.

 

This essay was originally published in The Dominion Post, The Waikato Times, The Taranaki Daily News, The Timaru Herald, The Otago Daily Times and The Greymouth Star of Friday, 21 June 2013.

Manufacturing Consent - In A Corporate Box?

Manufacturer Of Consent: Walter Lippmann (1889-1974) provided what might be called “The Owner’s Operating Manual” for mass democracy in the Twentieth Century. Whether his theories are relevant to the Twenty-First is increasingly doubtful - as the four Labour MPs who recently accepted Sky City Casinos' corporate hospitality are discovering - to their cost.

SEATED in Sky City Casinos’ lavish corporate box, Labour’s four errant MPs probably weren’t thinking about Walter Lippmann. Their minds were more likely filled with the thrill of watching the All Black’s defeat the French. Even so, seated there, high above the masses, Phil Goff, Annette King, Clayton Cosgrove and Kris Faafoi were offering living proof of Lippmann’s political theories.

 

With the enfranchisement of women in the 1920s, democracy – as a political system – assumed something close to its final form, and Lippmann, though barely in his thirties, was determined to shape its future development. In this regard, the formidably intelligent young American journalist was hugely successful. More than any other political writer of his generation, Walter Lippmann provided what might be called “The Owner’s Operating Manual” for mass democracy in the Twentieth Century.

 

At the heart of Lippmann’s critique of mass democracy lay his pessimistic view of the ordinary voter’s capacity for political decision-making. The average person’s grasp of politics, wrote Lippmann, was that of “a theater-goer walking into a play in the middle of the third act and leaving before the last curtain”.

 

Flesh-and-blood voters were simply not the “omnicompetent” citizens America’s founding fathers had declared them to be. The world had grown much too complex for the direct democracy of the New England “town meeting” – where equal citizens came together to decide what should be done in their little corner of the world. According to Lippmann, the modern citizen was just one small and largely inconsequential member of “the bewildered herd”.

 

Lippmann’s genius lay in understanding that although the management of a modern capitalist society was well beyond the capacity of the ordinary citizen, it nevertheless worked best when ordinary people genuinely believed that their opinions mattered, and that their government really was giving them what they wanted.

 

Democratic government, Lippmann claimed, had become a kind of vast confidence trick.

 

Reposing the “just powers” of government upon “the consent of the governed” was an arresting political principle, but, in practice, could only be made to work when the people best placed to run complex societies: experts, specialists, bureaucrats; “a specialized class whose interests reach beyond the locality”; had, themselves, already “manufactured” the popular consent upon which the system rested. (In manufacturing this consent, Lippmann’s own profession, journalism, would obviously play a pivotal role!)

 

Under the modern democratic system which Lippmann envisaged (and which, through his weekly syndicated newspaper column and his many books, he largely defined and systematised) elected politicians, journalists and “specialists” of every kind constitute a permanent, self-sustaining matrix of governing “elites”, whose purpose is to justify the ways of the democratic capitalist system, both to itself and to the volatile and ill-informed citizens who keep it running.

 

Which brings us back to the four Labour MPs in Sky City Casinos’ corporate box.

 

The four undoubtedly believed that they were engaged in elite interactions that were as normal as they were unremarkable. By inviting leading figures of the Labour Right to their corporate box Sky City Casinos were reassuring them that they understood Labour’s need to make a large public fuss over the vexed issue of Auckland’s new convention centre. Public opinion on this matter was still in a raw state and much more needed to be done before voters could be reconciled to the convention centre. Both parties understood that the right-wing of Labour’s caucus would be crucial to that consensus-building process. The invitation was Sky City Casinos’ way of saying: “We’re all in this together.”

 

Back in Lippmann’s day, the news media would probably have left them to it. It is, after all, precisely at these sort of informal gatherings that specialists and professionals build the networks that keep the system running. Telling “the bewildered herd” that their supposed shepherds had been spotted drinking wine and nibbling hors d’oeuvres with the jackals and the wolves would only confuse and upset them.

 

But, Walter Lippmann never had to contend with Twitter or Facebook. Back in the 1920s and 30s the lucky snap of a sharp-eyed photographer still had to negotiate the labyrinthine hierarchies of a daily newspaper before it reached the public. The gossip columnist was still answerable to his or her editor.

 

Quite what Lippmann would make of today’s “citizen journalists” with their trusty cell-phone cameras, “Instagrams”, “tweets” and all-but-uncensorable blogs, is anybody’s guess. It is also very hard to see how his system of managed democracy can long withstand the insatiable appetites of the 24-hour news cycle. Thanks to the new communications technologies of the Twenty-First Century, the herd is not only becoming increasingly bewildered, anxious and restless, but it is also increasingly prone to dangerous explosions of social and political rage.

 

The days of four Opposition MPs enjoying a few quiet wines in the corporate boxes of their faux foes may be over.

 

This essay was originally published in The Press of Tuesday, 18 June 2013.

Through A PRISM Darkly

Geek Chic: NCIS-LA's winsome techies 'Eric' and 'Nell' are so busy capturing the top-rating show's viewers' hearts that their constant breaching of citizens' civil rights and privacy passes, if not unnoticed, then, at the very least, unreproved. These, after all, are the people who stand between us and the 'evil-doers'. Against such powerful inoculations of popular culture, CIA whistle-blower, Edward Snowden's, revelations about the PRISM surveillance system are unlikely to spark outrage from more than the usual civil liberties suspects.

 

EDWARD SNOWDEN knows his geopolitics. Where better to seek refuge than in China – the nation most likely to shatter the five fingers of the Anglo-Saxon fist? For the moment, however, the former CIA technician and whistle-blower must be hoping that Hong Kong can hide him from the Anglo-Saxons’ five-eyed “PRISM”.

 

No easy task – as Mr Snowden himself admits: “I could be rendered by the CIA, I could have people come after me, or any of their third party partners – they work closely with a number of other nations … You can’t come forward against the world’s most powerful intelligence agencies and be completely free from risk. Because they’re such powerful adversaries that no one can meaningfully oppose them. If they want to get you – they’ll get you in time.”

 

All of which makes The Bourne Identity read more like a handbook than a thriller. And why Nicky Hager, the man to whom so many of New Zealand’s whistle-blowers have taken their secrets, describes Mr Snowden as “a brave man”.

 

But, does any of it matter? Will the world even be surprised – let alone shocked – at the extraordinary reach of the US National Security Agency’s panoptic surveillance app – PRISM? Isn’t it possible that the citizens of the Anglo-Saxon powers: the USA, the UK, Canada, Australia and New Zealand; far from applauding Mr Snowden’s courage, will condemn him for choosing not to stand with us – but with the terrorists?

 

It is, after all, the Anglo-Saxon nations which provide the biggest audiences for television series like 24 and NCIS. The heroes of these top-rating shows (both of which grew out of post-9/11 collaboration between Hollywood and the US national security agencies) are presented to us as the exemplars of courage and decency.

 

Whether it be 24’s Jack Bauer or NCIS’s Special Agent Jethro Gibbs, the message delivered to Anglo-Saxon viewers around the world is simple and compelling: “The US Government has got our back. These are the good guys who stand between us and the evil-doers.”

 

In every episode we witness these “good guys” – or their geeky side-kicks – routinely hacking into people’s computer hard-drives and tapping into their phone conversations/records. Indeed, these techno-savvy youngsters seem to inhabit a global panopticon from which nothing and no one can hide. Every CCTV camera is at their disposal and every GPS micro-chip ready to turn state’s evidence.

 

The simple cry of “Federal Agents!” grants these heroes warrantless entry to anybody’s property. When outraged suspects demand their rights, our good guys exchange knowing glances and ask them if they’ve read the Patriot Act. And, for those who refuse to co-operate there is always the failsafe threat of a one-way ticket to sunny Guantanamo Bay.

 

Fifty years ago, any agency wielding such totalitarian powers would have been listed among the enemies of freedom. That Americans are now quite comfortable with fictional good guys who sound and act like Soviet-era thugs is a measure of just how much Al Qaida took from the United States on 11 September 2001.

 

And not only from the United States. Thirty-six years ago Rob Muldoon’s plans to expand the surveillance powers of the Security Intelligence Service were met with huge demonstrations in all the main centres.

 

No such protests greeted the legislation which has, over the course of the last 12 years, dangerously extended the surveillance powers of the state. It’s as if agents Bauer and Gibbs have convinced us that: “If we have nothing to hide then we have nothing to fear.”

 

But, as Mr Snowden says: “Even if you’re not doing anything wrong, you’re being watched and recorded ... [I]t’s getting to the point where you don’t have to have done anything wrong you simply have to eventually fall under suspicion from somebody – even from a wrong call. And then they can use this system to go back in time and scrutinise every decision you’ve ever made, every friend you’ve ever discussed something with, and attack you on that basis to derive suspicion from an innocent life.”

 

Because, as the civil liberties lawyer, Tim McBride, observes: “[W]e do have something to hide, not because it is criminal or even shameful, but simply because it is private.”

 

The details of our lives belong to us – not the GCSB. We surrender the right “not to be known against our will” – at our peril.

 

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, 14 June 2013.

The End Of Merlin: Or, Was Dunne Done-in?

No Fool Like An Old Fool: In the Arthurian legend of Merlin and Vivien, the old wizard's infatuation with Vivien, a young lady of the court, leads to his downfall. The story of Peter Dunne's fall from grace bears a very similar shape and feel.

 

THE SELF-DESTRUCTION of Peter Dunne has unfolded with the dream-like logic of our oldest and unhappiest myths. How could the master shape-shifter have got it so wrong? Made so many mistakes? Let down his guard so foolishly?

 

These are questions Mr Dunne himself found it difficult to answer. Indeed, at the press conference announcing his resignation from John Key’s ministry, the Member for Ohariu observed more than once that he could offer no “rational” explanation for his behaviour.

 

Throughout his encounter with the assembled media pack on Friday afternoon, Mr Dunne maintained an extraordinary dignity and clarity. It was almost as if he was discussing the behaviour of another man – one he barely recognised as himself. Again and again, he denied leaking the Kitteridge Report on the GCSB. It was at home, he said, in his study, in a locked briefcase. But, yes, he had discussed leaking the report with Fairfax Media’s parliamentary correspondent, Ms Andrea Vance.

 

He sounded like a man bewitched.

 

More than one journalist has hinted that Mr Dunne’s fall owes almost as much to Ms Vance as it does to the man himself. Between 30 March and 7 April, the politician and the journalist exchanged more than 64 e-mails. It was to preserve the confidentiality of these exchanges that the Minister was ultimately moved to tender his resignation.

 

These extraordinary events have the shape and feel of a very old and tragic tale. The bones of the story may be found in the mythology of every culture, but I first encountered it in the legends of King Arthur and the Round Table. There it is called the tale of Merlin and Vivien.

 

In the words of Alice M. Hadfield, whose 1953 version of the Arthurian legends I grew up with as a child: “Merlin the Wizard was a wise man nearly all his life, but when he was old he fell into foolishness.”

 

Unwisely, for a person so high in King Arthur’s esteem, he allowed himself to become bedazzled by Vivien, a young lady of the court. “He became quite crazed about her, followed her about everywhere, and told her any secret of his magic she wanted to know.”

 

Though initially “flattered and excited by his attention”, the young woman soon discovered that it was not “altogether comfortable to receive so much devotion from a wizard, and after a time Vivien became very tired of it.”

 

This was hardly surprising since Vivien had been raised under the guidance and protection of another magician. An ominous development because, as Ms Hadfield delicately puts it: “One wielder of magic seldom likes another, and Vivien had grown up to have no love for Merlin.”

 

Merlin’s end came when he invited Vivien to view the treasures hidden in a subterranean cave whose concealed entrance only he knew the whereabouts. Allowing the old wizard to lead her to the cavern, Vivien waited until he was well inside before sealing up the entrance with an incantation Merlin himself had taught her.

 

“Only the person who had said the word could say the other word which would undo it”, writes Hadfield. “Merlin is sealed up in the earth by his own folly and pride till all spirits meet before their Ruler.”

 

Such is the tale of Merlin and Vivien, which, I’m sure you now agree, bears a not unfamiliar shape and feel – even to us, who dwell at several centuries remove from the Middle Ages.

 

For there is much in politics that still carries the whiff of magic. How is it possible that those blessed with every conceivable political advantage fail so abysmally to spark the public’s interest? Why do the voters flock to politicians so bereft of wisdom or imagination? From whence do the words and phrases that inspire nations arise?

 

These matters are not described as “the dark art of politics” for no reason.

 

Few would dispute that, until very recently, Mr Dunne’s career bore all the hallmarks of a master political magician. To have shifted with such ease from Left to Right, and then, without disturbing a hair of his trademark coiffure, from Right to Left, and back again to Right, he must surely have mastered the elements of more than a few political incantations.

 

But he is not the only powerful magician at the court of King John. And, as Ms Hadfield has told us: “One wielder of magic seldom likes another”. It may have been Ms Vance’s own magic that persuaded Mr Dunne to contemplate (at the very least) sharing secret information with her newspaper, but we would be foolish to rule out the possibility that she was working with more than just one political wizard.

 

Speaking on TVNZ’s Q+A, Winston Peters observed: “There’s no fool like an old fool.”

 

Nor, it would seem, an old tale.

 

This posting is exclusive to the Bowalley Road blogsite.

"Hidden" - The New Zealand Version

Hidden In Plain Sight: Philip Glenister plays seedy small-time lawyer, Harry Venn, in the UK television series Hidden. The plot turns on the lethal manoeuvres of sinister business and media figures as they attempt to turn a hung parliament to their political advantage. In eighteen months New Zealand could be living through its very own version of Ronan Bennett's screenplay.

HIDDEN is a gritty BBC political drama series written by Ronan Bennett. Crucial to the plot’s development is a UK general election result from which no clear winner has emerged. As day after day passes without a government, and rioting convulses London, a billionaire businessman, working secretly with a ruthless media proprietor, prepares the public for a right-wing coup d’état. Though the screenwriter never reveals the political identity of the caretaker PM, the inference is strong that he’s a moderate Tory who’s usefulness to the powers-that-be is at an end.

 

Right here in New Zealand, in just 18 months’ time, life could very easily be imitating art.

 

John Key, the National Party’s moderate but unpopular leader, faces the near impossible task of creating a government out of an election result from which no clear majority is readily discernible – for either the Right or the Left.

 

The Governor-General asks Mr Key, as leader of by far the largest party, to try and form a government. Day after day drifts by without any sign of a breakthrough. All eyes turn to the leader of the Labour Party. Can David Shearer succeed where Mr Key is failing?

 

While Mr Key contemplates the election’s intractable political arithmetic, Mr Shearer begins pressuring the Green Party. He needs to know how badly their leaders want to be Cabinet Ministers. Is it possible that, for the sake of the country, they might step aside and allow Mr Peters and his NZ First colleagues to form a minority government with Labour? And would they then be willing to keep that government in office by voting it Confidence and Supply? When the Greens protest, Mr Shearer warns them that any refusal to step aside will almost certainly see Mr Peters pledge NZ First’s votes to Mr Key.

 

The Greens are in a quandary. As the third largest party in the new parliament, they should be in the box seat – but they’re not. On the contrary, pressures are mounting for them to be written out of the political play entirely.

 

Every day the mainstream news media finds a new way of branding the Greens as “too radical for government”. Business organisations warn of dire consequences for New Zealand’s economic future should Russel Norman and Metiria Turei come within a bull’s roar of the Cabinet Table. The country’s international credit rating comes under review and international lenders quietly voice their growing fear of a Labour-Green Government to the Governor of the Reserve Bank.

 

When the Greens point-blank refuse to rule themselves out of government, the political tension is ratcheted up a few notches. The news media immediately seizes upon the fact that National won more votes than any other party. Never before, they correctly claim, has the party which won the most votes been denied the right to govern. That being the case, thunder the nation’s editors, the onus falls upon the “responsible” parliamentary parties to provide National with a working majority.

 

With the Greens’ “irresponsibility” taken as a given, and with NZ First’s numbers falling just short of the majority “the country” so desperately needs, the private cell-phones of certain Labour and Green MPs begin to vibrate.

 

First they are offered the carrot: guaranteed Cabinet seats, High Commission postings, seats around some very important (and well-remunerated) boardroom tables. If that fails, they are shown the stick: video recordings of what they thought were “secret” assignations; terrifying estimates of the tax owing on their undisclosed offshore incomes; pretty-much everything they did last summer.

 

The Governor-General gives Mr Key just 48 more hours to form a government. Mr Shearer, secretly informed that a critical number of Labour and Green MPs are about to defect, announces his party’s unwillingness to enter into any kind of agreement with the Greens. Mr Peters announces NZ First’s willingness to join in a “Coalition of National Unity”. National’s caucus meets to deliver Mr Peters’ price – John Key’s political head.

 

The Governor-General invites Judith Collins to Government House.

 

This essay was originally published in The Dominion Post, The Waikato Times, The Taranaki Daily News, The Timaru Herald, The Otago Daily Times and The Greymouth Star of Friday, 7 June 2013.

Forewarned Is Forearmed

Composite Image: The release by party insiders of material outlining what amounts to a far-right plot to take over and drive the National Party sharply to the right indicates a level of factional intrigue that should give all New Zealanders pause. Godwin's law notwithstanding, the 1930s German precedents bear close scrutiny. Exposing the plotters is always better done sooner than later - before it is too late.

 

THE PHOTOGRAPHS could have saved 60 million lives. They were taken on 4 January 1933, outside the Cologne residence of Baron Kurt von Schroder, a well-connected German banker. Captured on film as they passed through the baron’s gates were Adolf Hitler, Rudolf Hess, Wilhelm Keppler and Heinrich Himmler. A little while later Franz von Papen, the recently dismissed German Chancellor and intimate friend of Reich President, Paul von Hindenberg, joined them.
 

Within hours, this photographic evidence of the Cologne conspiracy was in the hands of  Chancellor Kurt von Schleicher. By the next morning Berlin’s newspapers were denouncing Hitler’s “secret meeting” with von Papen.
 

It proved to be too little and too late. By 30 January Hindenberg had replaced von Schleicher with Hitler. The new Vice-Chancellor was von Papen.
 

Had the saner elements within Germany’s ruling class acted earlier, and with General Kurt von Schleicher’s readiness to expose the Nazi Party’s behind-the-scenes machinations with politically-driven bankers and businessmen, the world might have been spared the horrors of World War II and the Holocaust.
 

As the political philosopher, Edmund Burke, rightly observed: “All that is necessary for the triumph of evil is that good men do nothing.”
 

New Zealanders should breathe a large sigh of relief that “a few good men” can still be found in their country’s own ruling class, and that they have seen fit to act earlier – and, hopefully, with more positive effect – than their German counterparts of the 1930s.
 

The leaking of documents allegedly penned by the right-wing political consultant, Mr Simon Lusk, should be sufficient to forestall what can only be described as a sinister “long term plan to move the political centre to the right.”
 

Let me state very clearly at this point that I do not consider Mr Lusk to be a Nazi, nor indeed a fascist of any kind. If the material attributed to him (and he has not disowned any of it) offers us any guide, then Mr Lusk’s political beliefs match very closely those of the extreme right-wing of the United States Republican Party.

New Directions: Simon Lusk appears to be drawing his political inspiration from the far-right-wing of the US Republican Party.

 

What he appears to favour is the establishment in New Zealand of an outright plutocracy: a state in which, although the formal institutions of democratic government remain in place, their capacity to impede the interests of the very wealthy has been rendered ineffective by the intimidating tutelage of an ideologically-driven bureaucracy, and pressure weighted with crushing quantities of cash.
 

This impression is, once again, confirmed in the leaked documents, which state quite openly: “This means reducing the size of government, weakening the power of those who believe in big government, and investing for at least 20 years to ensure that these changes are permanent.”
 

Mr Lusk appears to have been pursuing his plans for a plutocratic (or, to use the language of the leaked documents “fiscally conservative”) government, led by members of an ideologically re-booted National Party, for at least three years. Tellingly, the earliest documents look to the United States not only for inspiration but funding.
 

In the document dated July 2010, it is proposed that the highly professionalised political culture of the United States be transplanted to New Zealand so that, over time, and with the interest accruing from an initial investment of $5 million from conservative American donors, “an enduring centre right majority, with a pro United States outlook on the world stage” can be elected to parliament.
 

There are those who dispute the attribution of “evil” motives to the author of these documents. They point to the fact that Mr Lusk has devoted considerable time and energy into making himself one of the very few professional political consultants operating in New Zealand. Is it not possible, they argue, that these documents, intended for the eyes of like-minded National Party members, might simply be Mr Lusk “writing his own job description”?
 

Well, yes, of course it could. But, even if that’s true, the sinister aspects of the plans attributed to Mr Lusk are in no way diminished. He is already credited with assisting four individuals into parliamentary seats: Sam Lotu-Iga; Louise Upston, Chris Tremain and Jamie-Lee Ross. Political commentators are constantly linking his name with the alleged leadership aspirations of Justice Minister, Judith Collins. The documents he is said to have authored speak openly of the present National Government being “a disappointment to fiscal conservatives” and promise “there will be a clean out” following the party’s next defeat.
 

New Zealanders deserve better than a hollowed-out democracy in which government of the wealthy, by the wealthy, for the wealthy becomes the norm.
 

Nor should it be forgotten that any political figure openly promising to make his economic and social programme “permanent”, is also promising to prevent its opponents from mounting a successful challenge. Ever.
 

And when the programme fails?
 

Who will there be left to complain?
 

This essay was originally published in The Press of Tuesday, 4 June 2013.