A Photograph Taken On Labour Day

Labour Day, Dunedin, 1894: As the unions mass in what is now Dunedin's Queen's Gardens, a mother leans forward to tell her children about the meaning of Labour Day. What would a mother tell her children about "the cause of labour" in 2013? That it died in 1991? Or, that it will be reborn in 2014?
 

WHAT SORT OF PEOPLE were they, this mother and her children? The photograph is dated Labour Day, 1894. The little family stands in a dog cart, watching, while across the dusty roadway several hundred unionists, their bright banners billowing against the regular lines of the city’s commercial hub, muster for their grand procession. The strict Victorian civility of the scene cannot mask the underlying political context: Labour versus Capital. How did that mother convey Labour Day’s meaning to her children on that overcast morning in October, 109 years ago?

 

Perhaps her husband, the children’s father, was among the union throng. He may have helped to build one of the many floats about to make their way up the city’s main street. Most of the trades were represented: carpenters, butchers, bakers; their carts festooned with the all the paraphernalia of their occupation. The bakers have loaded up great barrels of flour. On the cart’s sideboards a painted banner proclaims: “Peace and Plenty”.

 

The connections were clearer then. When work lay at the very heart of the human experience, and when the correspondence between the condition of labour and the condition of the community was obvious and indisputable. Without the carpenters, stonemasons and glaziers there would be no city to live in. Without the butchers and the bakers, no meat and no bread.

 

In the minds of the nineteenth century working-classes, mere ownership did not constitute the be-all and end-all of social significance. A factory without workers was an empty and expensive shell. The butchery or bakery, without butchers or bakers, had nothing to sell. Capital without Labour was a ledger entry – nothing more.

 

And perhaps that brute fact was easier to see in the colonies than in the Old Country. The churches and the town halls of nineteenth century New Zealand and Australia (and the rapidly growing states of the American West) may have looked as though they had stood above their Squares and Octagons for centuries, but the colonists knew better. The men and women who had built Christchurch, Dunedin, Melbourne, Adelaide and Chicago, all understood that the great settler cities which had exploded out of the raw landscapes of imperial ambition were overwhelmingly and unquestionably collective enterprises. Capital and Labour had arrived together: neither lived but by the efforts of the other.

 

It’s what the carpenter, Sam Parnell, had grasped the moment his feet touched the Petone foreshore in 1840. That this was a new land, with new rules, where the expectations of the masters back in England would be subject to radical revision. Here, the worker would labour for eight of the day’s 24 hours. Eight more would be for his rest. And the remaining eight would be for himself and his family. If the masters wanted or needed more than eight hours, then they would be obliged to pay their employees a handsome premium for the “over-time”.

 

Perhaps this was the grand old tale that the mother in the photograph told her children as they watched the Labour Day procession form up on that October morning long ago.

 

Newer stories, too, she’d have to tell. About how the Reverend Rutherford Waddell had preached against “The Sin of Cheapness”, exposing the sweated labour of the seamstresses, and how, from the resulting public outrage, the Tailoresses’ Union had been born. Of the Great Maritime Strike of 1890, she would have spoken. Of how the seafarers, the watersiders and the coal miners came together on 28 October 1889 to form the Maritime Council (New Zealand’s first effective union combination). She would have told her children how, though the nationwide strike was broken, the cause of labour did not falter: for in that same year the Liberals were swept to power on the votes of working men. And re-elected, she would have added, her eyes shining with pride, on the votes of working women. And of how the Liberal Government, earlier that very year, had passed the Industrial Conciliation and Arbitration Act – which would, on New Year’s Day, make the workers of New Zealand the envy of workers all the world around.

 

That woman’s children would, of course, live to see the great wave of social progress in which their parents participated rolled back upon the rocky reefs of war and economic catastrophe. The millennial dreams of their mother’s and father’s generation would not be realised, but the unrelenting push of the unions would achieve many of their most cherished objectives. The Welfare State and the 40-hour week would both become law when Labour finally took up the reins of government in its own name in 1935.

 

So what, if anything, should mothers tell their children about the meaning of Labour Day in 2013? That dreams, like photographs, can fade? Or that history, like spring, reminds us what hope is for?

 

This essay was originally published in The Press of Tuesday, 29 October 2013.

"Will You Take Revolution With Your Tea?"

Grass Roots Fervour: The American political class is only now becoming aware of how dangerous the monster created by billionaire far-right activists like the Koch brothers truly is. The recent stand-off between the Tea Party faction of the Republican Party and the Obama Administration - far from being interpreted as a defeat by the radical right - has only made it hungrier for more and larger confrontations with "Big Government". The New Zealand left could learn some valuable lessons from the American right's revolutionary intransigence.

 

SO, YOU THINK the Tea Party has just taken a “shellacking” from President Obama? Well, think again. Forget about the sneers and jeers of those inside the Washington Beltway: the people Tea Partiers dismiss contemptuously as “the political class”; because out there in “Redland” (the Republican heartland) the true believers are celebrating.

 

As they see it, victory was very nearly theirs. For 16 days, the whole, corrupt edifice of “big government” (as they would characterise the monuments, museums and national parks their representatives shut down) had ceased to function. Even more thrilling, from their perspective, was how very close they came to causing the United States to default on its debts.

 

And they’re right. The Tea Party came within an inch of plunging the whole world into a new financial crisis. Are they ashamed of themselves? Hell no! Are they downhearted? No way! Indeed, they can hardly wait until January and February 2014 when their “suicide bombers” in the House of Representatives will do it all again. Because next time – or the time after that – they absolutely will succeed.

 

Like the Bostonians who tipped chestfuls of British tea into Boston Harbour in 1773, the eponymous Tea Partiers of 2013 are looking to bring down an entire politico-economic system. In the twenty-first century, the Tea Party (and grass-roots citizens’ movements like it) is what revolution looks like.

 

Not like the Occupy Movement? Surely the youngsters who attacked Wall Street’s “one percenters” are more deserving of the title “revolutionaries” than these middle-aged (and older) mid-westerners who cannot distinguish President Obama’s minimal, privately-led and Republican Party-inspired health insurance scheme from fully-fledged “socialism”?

 

No, not the Occupy Movement. Because the Occupy Movement failed to do what every good revolutionary must learn to do: speak to people in language they can understand.

 

In 1917,when Lenin alighted at the Finland Station in Petrograd and was promptly hoisted onto an armoured car to address the workers and peasant soldiers who had come to greet him, he didn’t launch into a complicated explanation of the various hand-signals to be employed in reaching a consensus on what the soviets (workers’ councils) should do next. He shouted: “Peace! Bread! Land!” The three things his audience most wanted to hear. Adding for good measure the truly revolutionary slogan: “All power to the soviets!”

 

The Tea Partiers are only right-wing because they haven’t yet had an opportunity to realise how mistaken they have been in their choice of targets. The moment their social security payments are disrupted, or a Wall Street collapse wipes out their pension fund, their naïve prairie anger will very swiftly identify new, more traditional, scapegoats.

 

In the meantime, the left-wing of the New Zealand Labour Party could learn a thing or two from the Republican Right about how to keep their elected representatives under control.

 

The threat the Tea Party deploys with such astonishing effect against those who refuse to toe its political line is the threat of being “primaried”. In New Zealand terms: having someone run against you for your party’s endorsement. Nothing curbs a politician’s independent streak faster than a credible threat of de-selection.

 

Naturally, creating a credible threat first requires professional rabble-rousers to whip-up a firestorm of ideological fervour among the party faithful. The incumbents are then presented with a list of radical demands which they either adopt as their own, or find themselves replaced by somebody whose ideological purity is beyond question.

 

Thanks to Labour’s right-wing MPs’ all-too-evident disdain for their party’s left-wing policy preferences, conditions akin to those which allowed the Republican Party’s conservative base to be mobilised against Washington’s RINOs (Republicans In Name Only) are now fast maturing in both the Labour Party and the trade unions.

 

The political class should be very, very afraid. Because the rise of both the Tea Party in the USA and the Labour Left in New Zealand are but harbingers of the radical and unstoppable populist revolt that will soon bring financial capitalism to its knees.

 

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, 25 October 2013.

A Difficult Transition: Maori Abandon Enchanment For Transparency

Driving The Transition: The large iwi-based corporations - epitomised by Ngai Tahu's impressive corporate structure, headed by Mark Solomon (above) are driving the transition from tribal traditionalism to the rational bureaucratic norms of secular society. The journey was difficult and uncomfortable for the Pakeha's ancestors, it will be no less so for Maori.

IF WINSTON PETERS did not exist, Pakeha New Zealand would have to invent him. Very few politicians are willing to risk the opprobrium which inevitably accompanies serious criticism of things Maori. But as a Maori himself, Mr Peters enjoys a sort of immunity from “sickly white liberal” prosecution. It’s as well that he does. Otherwise, holding Maori individuals and institutions to account for the expenditure of public funds would be even more difficult than it is.

 

And Mr Peters willingness to point the finger at his own people’s shortcomings would appear to be catching. Over the past month we have witnessed two important examples of Maori journalists exposing what they claim to be serious problems with the management of significant amounts of public money by Maori trusts.

 

The first of these exposés involved accusations of mismanagement against senior figures within the Kohanga Reo movement. It was Maori Television’s Annabelle-Lee Harris and Mihingarangi Forbes who broke the story. In an item entitled “Feathering the Nest”, the Native Affairs programme drew attention to unusual patterns of credit card expenditure and a number of large unreceipted donations.

 

Considerable effort was devoted to thwarting the Native Affairs investigation – not least an unsuccessful attempt to secure a court injunction against the programme’s broadcast.

 

As a result of Native Affairs courageous journalism, the Ministers of Education and Maori Affairs have jointly demanded a full investigation of the alleged irregularities.

 

The second example involved what might be called a “whistle-blowing” broadcast alleging  serious instances of mismanagement at Tokoroa’s Maori radio station Raukawa FM. In an extraordinary sequence of events, the station manager, Rosina Hauiti, last month took to the airwaves with a long list of allegations against the station’s trustees. When the latter attempted to evict her from the building, Ms Hauiti barricaded herself against all-comers.

 

Though charges and counter-charges continue to fly, Ms Hauiti’s broadcast, like Ms Forbes, has produced the desired outcome – an official intervention. Te Mangai Paho, the station’s principal funder (to the tune of $384,100 per annum) has asked the accounting firm, Deloitte, to investigate Ms Hauiti’s allegations as part of their scheduled review of the trust board’s activities.

 

Speaking at the NZ First Party’s annual conference in Christchurch on Saturday, 19 October, the NZ First leader recalled the late 1980s and early 90s when many businesses engaged in “the greatest deceit” until dragged into line by improved systems of accountability.

 

Mr Peters said Maoridom had called for transparency in the past, but now fended off legitimate investigation with accusations of “Maori bashing”.

 

He claimed that: “Certain ones have gone back to that behaviour, where to challenge them was to challenge their mana, their breeding, any concocted excuse to get out of their responsibility to their own people and the taxpayer. It means that honest Maori, who are the great bulk of Maori, are imaged in the worst possible light, and it cheats them of a certain future.”

 

This newfound willingness to hold itself to account signals that a profound sociological shift is underway in Maoridom. Max Weber, the nineteenth century “father” of modern sociology, would have immediately recognised the processes at work.

 

As Maori capitalism develops (most obviously in the form of the large iwi-based corporation) it is producing scores of tertiary-educated, highly-skilled young graduates. Increasingly, these young Maori professionals are unwilling to tolerate either the business inefficiencies generated by traditional practices, or the injustices so often associated with charismatic leadership. They are past making excuses for, or (even worse) covering up the behaviour of those who will not budge from the old ways.

 

Weber, himself, described the process as a progression from the pre-modern to the modern: “The fate of our times is characterised by rationalisation and intellectualisation and, above all, by the ‘disenchantment of the world’.”

 

The Maori Party’s co-leader, Tariana Turia, is emblematic of Maori who still dwell in the “enchanted” realms of Maoridom. Early on in her political career she spoke openly about having a constant invisible companion: a spirit guardian who protected her from harm and guided her through important decisions.

 

Suffice to say this is not the sort of leadership-style, or decision-making process, the big iwi corporates’ young professionals are being taught at the Auckland Business School. Nor are they encouraged to regard the keeping of accurate records and being able to account for all items of expenditure as responsibilities fit only for lesser breeds. When dealing with shareholders – or taxpayers – neither inherited rank nor charismatic power is entitled to a free pass.

 

The transition from tribal traditionalism to the rational bureaucratic norms of secular society has largely been accomplished in the nations from which Pakeha New Zealand's forebears originated. It was not an easy or a comfortable journey. Nor will it be for Maori – as the recent examples cited above attest.

 

Transparency and enchantment do not dwell in the same house.

 

This essay was originally published in The Press of Tuesday, 22 October 2013.

"Low Trust Clients" Meet "No Sympathy State"

The Implacable Face Of An Implacable Regime: Victor Hugo's unforgettable bloodhound, Inspector Javert (played here by Russell Crowe) pursued the redeemed hero, Jean Valjean, with a zeal bordering on fanaticism. The so-called "low trust clients" of WINZ who, like Valjean, may have broken the law simply in order to survive, must now feel as though they are living in the pages of Les Miserables.

EARLIER THIS WEEK the Associate Minister for Social Development, Chester Borrows, announced a new category of beneficiary. From Monday, 14 October 2013, he said, Work and Income New Zealand (WINZ) would be applying the new “low trust client” rules.

 

According to the Minister, “low trust clients” are people already convicted of welfare fraud, or who have “had overpayments established following a fraud investigation”.

 

He expected the new rules would affect around 1,500 people per year.

 

“Give a dog a bad name and you may hang him by it” runs the proverb. And it is certainly very difficult to think of a reason why politicians and bureaucrats would want to pin the “low trust client” tag on beneficiaries other than their wanting to “hang” them by it.

 

Of course the State doesn’t hang people anymore – at least, not literally. (Although I’m sure there are more than a few New Zealanders who would gladly string up all these “welfare cheats”!) But those who have made it their business to make sense of MSD policy (Sue Bradford, for example) are in no doubt that the true objective of these highly provocative new rules is to make “low trust clients” feel so utterly wretched and worthless that they exit the welfare system altogether.

 

From the point of view of the MSD and WINZ, purging the welfare rolls of low trust clients is a “win/win” solution. Not only is the state spared the expense of paying out legitimate entitlements, but the MSD’s new policy practically guarantees a sharp decline in all claims – fraudulent and legitimate.

 

Few New Zealanders would have any idea of how fraught the entire experience of signing-on for, receiving and retaining a social welfare benefit can be. The whole process is anything but straightforward and to a great many people seems calculated to belittle, stress and all-too-frequently humiliate the applicant/recipient.

 

The most vivid memory most people take away from their first visit to WINZ is how long they were made to wait. Even those who followed the rules assiduously: made appointments and arrived ahead of time; will regale their family and friends with horror stories of being made to wait for hours at a time.

 

Many people who live at some distance from their nearest WINZ office and are reliant on public transport simply cannot wait, and so miss their appointments. Predictably, missing an appointment with one’s WINZ case-worker is regarded as a serious misdemeanour: do it too often and one’s benefit may be docked – or even stopped.

 

Only rarely will these citizens encounter a WINZ staffer who clearly and comprehensively spells out exactly what they are entitled by law to receive from the state. The consensus view among those receiving WINZ “assistance” is that the MSD operates on the rule-of-thumb that if applicants don’t ask, then WINZ staff are not obliged to tell.

 

At the average WINZ office what you don’t know (and are not told) can prove extremely costly – both to you and to those who depend on you.

 

Even the much-decried “benefit fraud” isn’t always what it seems.

 

WINZ’s over-riding priority is to get people off welfare and into work. Unfortunately, it does not distinguish part-time and/or casual work from full-time employment. At WINZ, a job’s a job, and the moment you get one you’re no longer entitled to a Jobseeker’s Allowance. And if your job only lasts a month? Well, that’s too bad, because now there’s a “stand down” period lasting several weeks for you to get through before once again becoming eligible for state assistance.

 

In the meantime there’s rent, food and power bills to be paid. What WINZ calls fraud is often no more than the actions of desperate people doing whatever they have to do to keep themselves and their families fed and clothed and a roof over their head.

 

It’s what makes the note of smug self-righteousness in Mr Borrows’ latest announcement so very hard to take.

 

Like Jean Valjean in Victor Hugo’s Les Miserables, New Zealand’s beneficiaries find themselves pursued by a state as remorseless and relentless as the implacable Inspector Javert.

 

The great French novelist coined phrases like “social asphyxia” do describe the constricting effects of poverty and injustice, but even the mighty Hugo would have tipped his hat to a phrase so utterly suffocating in its unkindness as “low trust client”.

 

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, 18 October 2013.

Low Turnout Won’t Be Fixed By “Online Voting”

Hackers To The Rescue? Professor J. Alex Halderman (second from right) and his merry band of hackers showed just how vulnerable online voting is to outside interference. According to Halderman, "it’s going to be decades, if ever, before we’re able to vote online securely".

 

THE JUNIOR WOODCHUCKS GUIDEBOOK was one of the comic-book artist’s, Carl Barks’, most prescient gags. Whenever the hapless Donald Duck’s adventures with his three nephews and his squillionaire Uncle Scrooge went awry, it was to this extraordinarily handy little book that Huey, Dewey and Louie – Woodchucks all – invariably turned. You’ve fallen from a plane without a parachute? Need a quick course in basic Lizard? Want to know how to lull a dragon to sleep? Then - quick! Consult The Junior Woodchuck Guidebook!

 

For those of you wondering what a Junior Woodchuck might be: they are Carl Barks’ gentle send-up of the American scouting movement. What makes the master comic-book storyteller’s creation of The Junior Woodchucks Guidebook so prescient, however, is that in 2013, nearly 60 years after its first appearance in 1954, practically everyone carries the equivalent of the Woodchucks’ Guidebook in their pocket.

 

Our smartphones, with their connection to the Internet and its vast, inexhaustible search-engines, can now transform us, just about instantly, into experts on just about everything. Who needs The Junior Woodchucks Guidebook when they’ve got “Google”?

 

This increasing reliance on the Internet and its wonders is worrying. Carl Barks may have relied upon The Junior Woodchucks Guidebook to get himself and his cartoon creations out of innumerable tight spots, but we would be extremely unwise to do the same.

 

Writers, dramatists and comic-book storytellers are allowed to bring in a deus ex machina to keep the narrative moving along, but politicians and administrators have no such licence. Though we might be forgiven for thinking otherwise, the conduct of democratic elections is not the stuff of comic-books or classical Greek tragedies.

 

And yet we are subjected to constant claims from politicians, challenged to “do something” about the declining participation-rate in national and local government elections, that the solution lies “online”.

 

This is what the Mayor of New Zealand’s largest city, Len Brown, told reporters on Saturday after being re-elected by barley a third of Auckland’s eligible voters:

 

“We will do online voting next time, there is no doubt about that. I think that maybe postal voting has had its day. People really don’t do much in the way of sending mail anymore.”

 

Not a good idea, Len, as a moment’s consultation of your electronic Junior Woodchucks Guide would have told you.

 

According to the Professor of Computer Science specialising in cyber-security at the University of Michigan, J. Alex Halderman, putting the electoral process online would be extremely risky:

 

“In order to vote online safely, we’re going to have to solve some of the hardest problems in computer security. How do you secure servers against remote attackers? How do you secure people’s home computers against spyware? How do you prevent people from being tricked into visiting the wrong website and giving away their passwords? All of these things are subjects of active research, but it’s probably going to be many, many years until we solve them. That’s why I think it’s going to be decades, if ever, before we’re able to vote online securely.”

 

And Professor Halderman knows what he’s talking about, because three years ago he and three of his top computer science graduates successfully (and perfectly legally) hacked into an online election pilot set up by the District of Columbia’s Board of Education.

 

The Board, supremely confident that their online voting system was secure, cockily challenged anyone who thought they could hack into their software to go ahead and give it a try. Professor Halderman’s team more than rose to the challenge. Not only did they successfully hack the Board’s system, but they also made sure that the test election was “won” by “writing in” the fictional robot anti-hero, Bender, from Fox-TV’s animated sci-fi series Futurama. (The runners-up were HAL from 2001 – A Space Odyssey and the Master Control Programme from Tron.)

 

Those wishing to learn more about Professor Halderman’s slam-dunk demonstration of the dangers of online voting should watch the YouTube video – just search “Hacking the Washington DC Internet voting system”. I would heartily recommend that Mayor Len Brown treat himself to repeated viewings.

 

And before all the computer geeks out there respond with the example of Estonia: permit me to point out that the Estonian on-line voting system relies upon the fact that every Estonian citizen is required to carry an identity card bearing a unique identity number. Personally, I’m not so sure that New Zealanders are ready for mandatory identification cards. Not after all that passionate debate over the GCSB surveillance legislation. But, I could be wrong.

 

The other problem with Estonia is this: if the Estonian government decided to elect its own “Bender” – who would know?

 

Online voting, warns Professor Halderman, is no different from any other system reliant upon computer software. (Novopay? WINZ? ACC?) “Small mistakes” can lead to “huge problems.”

 

This essay was originally published in The Press of Tuesday, 15 October 2013.

Trading in "Free" For "Fair"?

But Will Labour Make It? With David Cunliffe announcing the return of "Red Labour" following a rank-and-file instigated "revolution from below", the Party's 30-year adherence to the Neoliberal "free trade" ideology may be coming to an end.

LABOUR’S 30-YEAR COMMITMENT to “free trade” may be coming to an end. The test will be three weeks from now when the party gathers in Christchurch for its annual conference.

 

At last year’s conference, delegates were willing to offer only the most qualified support to the Trans-Pacific Partnership (TPP) negotiations – and it required repeated interventions from former Trade Minister, Phil Goff, to secure even that limited endorsement. This time Mr Goff may not be so successful at fending off the TPP’s opponents.

 

Labour’s “Free-Traders” face some very substantial obstacles. The greatest of these is that the party’s commitment to trade liberalisation, like its commitment to the Reserve Bank Act, is emblematic of Labour’s 1980s embrace of Neoliberalism.

 

Throughout the 15-year reign of Helen Clark serious public criticism of these neoliberal shibboleths was verboten. Goff struggled (with limited success) to keep the ideological disputation in-house. David Shearer could not manage to do even that.

 

Had the news media paid a little more attention to the revolution that was taking place on the floor of last year’s annual conference at Ellerslie, and devoted a little less effort to chasing non-existent leadership challengers, they may have noticed the explicit repudiation of “Rogernomics” included in the 2012 Draft Policy Platform.

 

It is a measure of the intensity of the behind-the-scenes ideological battles that have been raging in the Labour Party since Ellerslie, that last year’s passionate condemnation of Rogernomics has been dropped from this year’s Draft Policy Platform.

 

How much of the document’s watering-down is attributable to the intervention of Grant Robertson, the preternaturally cautious chair of Labour’s policy council, is far from clear. But even in its new – and ultimately binding – iteration, the document registers an unmistakably leftward shift:

 

“Labour holds that government must play an essential role in managing and developing the economy. We reject the notion that free markets on their own will deliver either long-term prosperity or just distributional outcomes.”

 

When spoken by the new party leader, David Cunliffe, this is the sort of anti-neoliberal rhetoric that brings Labour’s newly empowered rank-and-file and affiliates to their feet a-whooping and a-hollering.

 

Considerably less inspiring is the Draft Policy Platform’s statement on international trade:

 

“Labour will support international trade and investment agreements that promote New Zealand’s economic wellbeing and support fairness, transparency, sovereignty, and sustainability.”

 

But even in this rather colourless sentence there’s more than enough to cause political problems for those caucus members determined to preserve the bipartisan consensus on free trade by backing the TPP.

 

Mr Cunliffe sent shockwaves through the trade liberalisation lobby even before he clinched the party leadership on 15 September; by warning that the TPP posed a “quite difficult and complex issue for New Zealand”.

 

His concern over such “fish hooks” as the future of Pharmac and the sovereignty-threatening potential of “investor/state disputes”, coupled with his doubts about the genuineness of the promised agricultural opportunities, must have made TPP boosters worry that Mr Cunliffe had just come from a briefing with Professor Jane Kelsey!

 

Small wonder then that business columnist, Fran O’Sullivan, whistling loudly in the dark, wrote glowingly of Mr Goff’s undimmed enthusiasm for a TPP agreement.

 

“Labour’s Phil Goff is back in business, adding his strong and rational voice to New Zealand's advocacy for the completion of the Trans Pacific Partnership.”

 

Like so many of her journalistic colleagues, Ms O’Sullivan has yet to grasp how fundamentally the rules of the political game have changed.

 

Mr Cunliffe and Labour’s rank-and-file are now locked in a radical embrace. If Labour’s new leader decides to consummate their “red wedding” by promoting “fair”, rather than “free” trade (which would ease Labour’s relationship with the Greens considerably) then there’s nothing Mr Goff, or the other fading Rogernomes of the broken ABC faction, can do about it.

 

Mr Cunliffe’s keynote speech to the Christchurch conference will undoubtedly make Labour’s new political trajectory much clearer. Expect to hear something on free trade. Just don’t expect it to be business as usual.

 

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, 11 October 2013.

Targeting The Policy Agreement

Policy Target: The Reserve Bank Act (1989)  It was one of the Neoliberal Counter-Revolution's primary objectives: to keep the interfering hands of politicians as far away from the controlling mechanisms of monetary policy as possible. Otherwise known as strangling the economy in order to save it.

 

SOME ARE CALLING IT irresponsible meddling, others talk about the need to regain control of our destiny. Whatever it’s called, it’s attracting a lot of attention. And not a little concern.

 

For nearly thirty years both of New Zealand’s largest political parties have faithfully adhered to the doctrine that a country’s monetary policy is best determined by an independent central bank. Furthermore, that the prime focus of monetary policy must be keeping inflationary pressures under the strictest control. In practice, that’s meant keeping the interfering hands of politicians as far away from the steering-wheel as possible.

 

New Zealand embraced this monetarist view the central bank’s role with special fervour. Our current Reserve Bank Act, passed by the Fourth Labour Government in 1989, places enormous economic power in the hands of a single person, the Reserve Bank Governor. He alone is responsible for carrying out the Act’s primary function: ensuring “stability in the general level of prices”.

 

The only democratic check upon the Governor’s power comes in the form of the Policy Target Agreement (PTA) negotiated periodically with the Minister of Finance. It isn’t much of a check though, because the only real debate is over the permissible range of inflationary fluctuations. If the inflation rate goes above, or stays below, the agreed levels for too long, the Governor intervenes.

 

The mechanism he uses to do this is the Official Cash Rate (OCR). By raising or lowering the price at which the privately-owned banks can access liquid funds on a short-term basis the Reserve Bank is able to expand or contract short-term demand in the New Zealand economy and hence (at least theoretically) keep prices under control.

 

The use of this single, blunt economic instrument has fuelled repeated property booms, blown out New Zealand’s balance-of-payments, and undermined our manufacturing exporters.

 

So, why did our politicians give so much economic power to one, unelected government official? Why is something so critical to the health of our economy as setting core interest rates not the responsibility – as it once was – of the people’s elected representatives?

 

Answering that question takes us to the heart of the “Quiet Revolution” in economic management, in which the Reserve Bank Act (1989) played so important a part. Essentially, the decision to remove the management of monetary policy from the politicians’ hands was inspired by the growing fear among political and economic elites that the democratisation of economic policy formation had gotten out of hand.

 

The deadly confluence of the economic, political and social crises that characterised the 1930s, and which led to the human disaster of World War II, had largely discredited the laissez-faire economic doctrines which spawned them. Rather than go on entrusting the elites with the conduct of economic policy, the citizens of the victorious democratic powers made sure that those responsible for the big economic decisions were politicians accountable to themselves.

 

The result was a 30-year period of unprecedented economic expansion, during which, in the USA, the share of national income going to the top 1 percent of income earners plummeted to less than 10 percent (from a pre-war high of close to 20 percent). Between 1945 and 1975, thanks to successive post-war governments’ commitment to policies aimed at full-employment and wealth redistribution, and to preserving the bargaining strength of trade unions, the standard of living of ordinary working people rose steadily.

 

With their economic and political power fast eroding, the Western elites seized upon the inflationary pressures unleashed by the Vietnam War and the Arab Oil Embargo to discredit the democratic conduct of economic affairs.

 

Politicians, they argued, were unfit to determine economic policy precisely because they were prey to electoral pressures. Only when populist politicians, like New Zealand’s Sir Robert Muldoon, were legally precluded from interfering with the free play of “market forces” could the scourge of double-digit inflation be defeated. And that free play could only occur after the “market distorting” influence of high taxes and excessive government borrowing, inefficient state-owned enterprises, and the power of the “over-mighty” trade unions had been dismantled – comprehensively.

 

The imposition of what came to be called “neoliberalism” thus represented not a “revolution” in economic management but a “counter-revolution”. And absolutely crucial to its success has been the 30-year bipartisan consensus that no other economic doctrine is to be given a serious hearing anywhere. Not in the news media; not in the schools and universities; and certainly not in the two main political parties: National and Labour.

 

Hardly surprising, then, that serious disquiet is growing among those whose job it is to defend the neoliberal counter-revolution at all costs. Not only is the Reserve Bank under attack from the Greens (whose modest levels of electoral support make them more irritant than threat) but also, and most alarmingly, from Labour.

 

And once Labour’s re-democratised monetary policy – what’s next?

 

This essay was originally published in The Press of Tuesday, 8 October 2013.

Crowning The Dummy

Like A Beckett Play: An overwhelming sense of fragility; of life in suspension; of history sucking up every available atom of breathable air. When will New Zealanders stop looking up to a monarch and start looking around - to themselves?

IT WAS A SCENE that would have done Samuel Beckett proud.

 

An old woman sits primly in an armchair, warmed by an electric fire. The fussily furnished room is festooned with family photographs and ceramic knick-knacks. The atmosphere of the scene is stuffy and oppressive. There’s an overwhelming sense of fragility; of life in suspension; of history sucking up every available atom of breathable air.

 

Seated opposite the old woman is a middle-aged man with an over-eager smile. He is dressed like a prosperous provincial accountant, and it is clear that just being in the room with the old woman represents the fulfilment of a boyhood dream.

 

They are talking to one another – although it is difficult to say what about. The old woman’s conversation is polite but inconsequential. She speaks as if she’s reading the lines of a play once popular, but now only ever performed to modest and ageing audiences.

 

Undaunted, the middle-aged man listens intently: his attention not at all diminished by the old woman’s sing-song delivery. Clearly, some weird alchemical miracle is taking place. In the middle-aged man’s brain the old woman’s leaden commonplaces are being transmuted into the purest rhetorical gold.

 

Beyond this and all the other rooms in the castle, the world goes on its merry way. Fallen empires refuse to rise. Children are blown to pieces by suicide bombers. Billions are wagered on stock markets and trillions consigned to tropical tax havens. Ice melts in the arctic. Deserts advance. Lovers embrace.

 

But in this stuffy drawing room nothing changes. The old woman sits and talks inconsequentially to “galloping colonial clots” who hang upon her every word, believing, in spite of everything that they have seen and done and made of themselves, that the bizarre tableau of which they are a part is more than it seems.

 

That it matters.

 

Another notable scene occurs in Ettore Scola’s 1982 movie That Night In Varennes. The plot revolves around a group of travellers who get caught up in King Louis XVI’s abortive attempt to escape the revolution in Paris.

 

As the revolutionary government’s officials dither, a debate ensues concerning the nature of monarchy among those now stranded at the local inn. Some of the travellers, in true Enlightenment fashion, dismiss monarchy as irrational. Others remain convinced of its quasi-religious power. Its magic.

 

As if to prove both sides correct, the King’s servants roll into the room a tailor’s dummy adorned with the royal regalia of France.

 

In a wonderful cinematic moment, the waiting peasants bare their heads and fall to their knees. Even the sceptical intellectuals find it difficult to resist the urge to doff their hats and bow low.

 

Monarchy weilds only as much power as people are willing to give it. Our ancestors long ago stripped the British monarchy of all but a recondite residue of its former political authority. What is it, then, about Queen Elizabeth and her peculiar family that continues to enthral a clear majority not only of her British subjects, but of New Zealanders as well? What is it that could possibly make our ruthless, currency-trader Prime Minister sit like an excited schoolboy on the edge of his seat in a stuffy Balmoral drawing-room?

 

The Frankfurt School’s, Erich Fromm (1900-1980) would tell us that New Zealanders’ on-going love affair with the British Royal Family, and the monarchical institutions they inhabit, stems from our abiding fear of, and desire to “escape from freedom”.

 

To be truly human, Fromm argued, men and women must free themselves from all that obscures the realities of existence. Our unique capacity to reason and to love makes each human life a challenging and painful experience; it can also make life glorious and transcendent.

 

For too many of us, however, the dangers and uncertainties of freedom keep us in a child-like state of fear and neediness. Thinking for ourselves is difficult and risky; better by far to adhere to the collective wisdom. Ruling ourselves is also difficult and risky; better by far to be guided by the myths and traditions of the past.

 

Living in a republic there is nothing and no one to look “up” to: we can only look “around” – to ourselves.

 

But, in a monarchy, there is always somewhere safe to hide.

 

Even behind a prim old woman, in a stuffy drawing-room, in Scotland.

 

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, 4 October 2013.

Citizens Left Out Of The Water Equation

Enjoy It While You Can: The Tukituki River sparkles in the Hawkes Bay sun, but if the Ruataniwha Dam is built and intensive dairying is made possible further upstream, this iconic river will swiftly be transformed into what Green Party co-leader, Russel Norman, predicts will be "an industrial drain". Water is fast becoming New Zealand's most valuable natural resource and Federated Farmers - aided and abetted by the National Government - is determined to place that resource in private hands.

THERE’S ALWAYS A MOMENT when we realise that power has shifted. Trusted people and institutions suddenly turn against us. Those whose job it is to assess and avert public risk disappear. We hear rumours about wholesale sackings and forced resignations. Obvious and serious conflicts of interest are studiously ignored. And those in charge, while not guilty of telling outright lies, have unquestionably stopped telling us the whole truth.

 

Such extreme power shifts are generally confined to the corporate sector. And while they are never pleasant, and often very costly in personal terms, most of us nevertheless accept the process. The business world is not a democratic world: its unfairness and rapacity is largely beyond our control. Businesses fail, are sold, merged, asset-stripped, re-branded and downsized – and there’s not a lot any of us can do about it.

 

Beyond the business world, however, we do not expect to be left out of the equation. Employees may be required to subordinate their judgement to the entity paying their wages but, constitutionally-speaking, citizens are sovereign: their democratic judgements not subject to private-sector countermand.

 

Citizens do not take kindly to being treated as if they were employees.

 

But this is precisely what is happening. All over the country: from the Canterbury Plains to the Tukituki River in Hawke’s Bay; private interests are muscling in on public resources; compromising the integrity of public institutions; and trampling with ill-disguised contempt upon the rights of New Zealand citizens.

 

And at the heart of this power grab is – water.

 

 

I SHOULDN’T BE SURPRISED. On 19 November 2008, just eleven days after the election of the current government, myself and the right-wing political commentator, Matthew Hooton, were invited to address the National Executive of Federated Farmers.

 

Coming away from that meeting, I was impressed by three things.

 

The first was how much the Federated Farmers CEO, Conor English, looked and sounded like his brother, Bill, the newly elected government’s Finance Minister.

 

The second was the presence of Dr William Rolleston. Until that moment, I had only known Dr Rolleston in his role as one of New Zealand’s most outspoken advocates of genetically engineered agricultural production. That he was so closely associated with Federated Farmers was something I probably should have known, but was still rather disturbed to find out.

 

The third, and by far the most important, thing I took away from that meeting was Conor English giving me a quiet “heads-up” that the most important issue facing Federated Farmers, and New Zealand, over the next few decades would be the issue of who controlled access to what was fast becoming the nation’s most valuable natural resource – water.

 

 

MOST NEW ZEALANDERS don’t think too much about water. Most of us live in cities and towns which, for the better part of a hundred years, have enjoyed a plentiful, safe and remarkably cheap water supply. In the odd drought year we townies may be asked to refrain from watering our gardens, but most of us, for most of the time, don’t give water a second thought.

 

Matters are very different in the countryside.

 

Over the course of the past twenty years the New Zealand landscape has been transformed by the extraordinary growth of the dairy industry. Where once the cargo vessels leaving our ports were loaded down with carcasses of frozen lamb and bales of wool – as well as butter and cheese – our agricultural exports are today dominated the thousands of tons of top-quality milk powder produced by New Zealand’s world-beating dairy farmers.

 

That milk powder earns this country billions of dollars every year, but dairying’s “white gold” comes at a heavy cost. The successful dairy farm not only requires millions of litres of water by way of an input, but its hundreds of cows also discharge equally vast quantities of effluent by way of an output. That effluent inevitably makes its way into the nation’s waterways – polluting them to the extent that the lower reaches of more than half of New Zealand’s largest and most magnificent rivers are no longer safe to fish or swim in. And neither are their tributaries.

 

 

THE SHUTTING DOWN of democracy in the Canterbury Regional Council, and the more recent suppression of a Department of Conservation draft report on the sustainability of the Ruataniwha Dam, represent the working out in political terms of Conor English’s heads-up warning of five years ago.

 

New Zealand’s dairy farmers, and the enormous economic interests they represent, have decided to privatise the nation’s water resources – and the government is helping them do it.

 

Dr William Rolleston has even enlisted the reality of Global Warming to advance Federated Farmers’ cause: While New Zealand has plenty of water, he says, it's not always in the right place at the right time.

But, presumably, it will soon be in the right hands.

This essay was originally published in The Press of Tuesday, 1 October 2013.