|Labour Saver? Thanks to Michael Cullen’s clever alchemy, the base metals of neoliberalism could be transmuted into the glittering gold of “modernisation”; and the grim squares of betrayal transformed into happy circles of fulfilment.|
SIR MICHAEL CULLEN’S DEATH leaves Helen Clark as the sole remaining adult in Labour’s room. While he lived, Cullen’s influence on the present government was considerable. He was one of the few Boomers this Gen-X government listened to with genuine respect. Was that because Cullen took care to reassure his protégé, Finance Minister Grant Robertson, that the Labour-led Government’s economic settings were more-or-less correct? Undoubtedly that helped, but so did Cullen’s formidable intellect, his sense of humour, and his undoubted possession of that increasingly rare commodity – political wisdom.
Cullen called his recently published memoir Labour Saving. The title is instructive. Like so many Labour Party members confronted with the unrelenting radicalism of “Rogernomics”, Cullen had to decide how best to preserve the political party responsible for improving the lives of so many New Zealanders. Unlike Jim Anderton and his followers, he was convinced that the humanitarian essence of the Labour Party could be safeguarded without jettisoning Roger Douglas’s neoliberal programme.
It was a conviction he shared with Helen Clark, and without it their formidable political partnership would have been impossible. It is no small part of his legacy that, alongside Clark, he was successful in convincing both Labour’s remaining members, and an increasing number of centre-left voters, that the “reforms of the 1980s” were compatible with Labour’s core values. What historians will be called upon to decide is whether Clark-Cullen’s social-democratic rhetoric was ultimately reflected in Clark-Cullen’s on-the-ground achievements.
What cannot be disputed is Cullen’s immense usefulness to the Lange-Douglas Government as the Rogernomics “revolution” was passing through its early critical phases. Nowhere was this usefulness more evident than in the internal party debate over the introduction of the all-important Goods and Services Tax. Without the revenue collected by GST, the dramatic cuts in personal income tax would not have been possible. These reductions were absolutely essential if Rogernomics was to be accepted and, more importantly, supported by the New Zealand middle-class.
It was Cullen’s job to defuse the widespread opposition to the clearly regressive GST that was growing within the Labour Party. He did this by moving an amendment to any remits opposing GST. The amendment appeared to endorse the opposition to GST unless the inevitable increase in the cost-of-living of low-paid workers imposed by GST was fully offset by income tax reductions.
The choice of Cullen as the promoter of this “No GST unless …” solution was extremely shrewd. Within the Labour Party, Cullen was widely credited as having liberal-left leanings. Prior to winning the St Kilda nomination in 1981, he had been an active member of the Castle Street Branch of the Labour Party. Founded by the late Austin Mitchell, Castle Street, like Auckland’s Princes Street, was seen as a haven for university-based radicals. If Cullen was convinced that the regressive effects of GST could be offset by tax-cuts, then Labour traditionalists – as well as Labour “modernisers” – could vote in favour of Douglas’s “reform” with a clear conscience.
It was a template which would serve Cullen and the neoliberal Labour Party extremely well over the years that lay ahead. Decisions objectively inimical to the interests of low-paid workers and beneficiaries could be presented simply as new and better ways of achieving Labour’s traditional objectives. Thanks to Cullen’s clever alchemy, the base metals of neoliberalism could be transmuted into the glittering gold of “modernisation”; and the grim squares of betrayal transformed into happy circles of fulfilment.
The success of this strategy was compounded by the departure of the traditionalists’ leader, Jim Anderton, in 1989. With him went the party members who understood the true implications of the Rogernomics Revolution, and who possessed both the will and the wherewithal to oppose it openly in party forums. Though Anderton’s NewLabour Party – which in 1991 became the Alliance – harried Labour relentlessly throughout the 1990s, it could not, in the end, compete with the immense power of the Labour “brand”. As a former lecturer in social and economic history, Cullen rightly wagered that the doggedly loyal working-class voters who re-elected him to Parliament every three years would never abandon the party of Michael Joseph Savage.
Cullen also understood what so many of Anderton’s Alliance voters did not. That in the 15 years since the election of the Fourth Labour Government in 1984, neoliberalism had so firmly embedded itself in New Zealand’s key economic and administrative institutions that it could only be dislodged by an upheaval of revolutionary force. Neither Clark and Cullen were revolutionaries, which is why, when confronted with an employer class spooked by the genuinely social-democratic policies of the Alliance (Labour’s coalition partner between 1999 and 2002) they capitulated without a fight.
Stared down by the A-team of Auckland employers gathered in the Cathedral Room of the exclusive Auckland Club on 24 May 2000, Cullen blinked. The following day, speaking to yet another group of angry employers, Labour’s Finance Minister purred: “We want to be a government that moves forward with business, not one that watches indifferently from the side-lines.”
Sobered by what soon came to be known as “The Winter of Discontent”, Cullen proved as good as his word. The big reforms that constitute his political legacy: The Superannuation Fund; Working For Families; KiwiSaver; far from being the solid social-democratic victories Labour presents them as, were actually a sequence of inadequate workarounds for the problems created by neoliberal policies Cullen now knew better than ever not to challenge.
The Superannuation Fund (quickly dubbed the “Cullen Fund”) kept billions of dollars safely out of the hands of cash-starved ministries. This sequestering function was amply demonstrated by the speed with which the National Government suspended contributions to fund its GFC and Earthquake recovery projects. Working For Families, far from being “communism by stealth” acted as a giant wage subsidy for New Zealand employers. KiwiSaver, a privately run scheme, unguaranteed by the state, poured billions into the pockets of financial institutions. Social-democracy, at least as Mickey Savage and Norman Kirk understood it, had been murdered in the Cathedral Room.
With Cullen’s passing, the Labour Party has only Helen Clark to turn to for advice and consolation about the hard business of preaching Labour kindness while delivering neoliberal cruelty. Frustratingly for the present Labour Government, Clark is a much more protean figure than her former Finance Minister: less prone to staying put and saying only the right things.
Those who locate themselves on the centre-left will miss Michael Cullen. They’ll miss his prodigious intellect and his wickedly witty tongue. They’ll miss his wisdom. He has, however, left them with an enigma.
Who was he? This son of a London artisan who won a scholarship to the upper-class Christ’s College? This radical history lecturer who hung John Ball’s challenge to the English peasantry: “When Adam delved and Eve span, who was then the gentleman?” on his office wall – and then went on to accept a knighthood? This “too clever by three-quarters” MP with a left-wing reputation – who was willing to sell Rogernomics to a confused and disoriented Labour Party? This Labour Finance Minister who left state housing underfunded and beneficiaries’ children unassisted by Working For Families?
Sir Christopher Wren, buried in the heart of his greatest architectural achievement, St Paul’s Cathedral, wrote his own epitaph: Si monumentum requiris circumspice “If you would see his monument, look around.” Looking around at the New Zealand he has left behind him, how should we sum up Sir Michael Cullen’s legacy? Who won? Who lost? And who will eat that shame?
This essay was originally posted on the Interest.co.nz website on Monday, 23 August 2021.