Marching To Class War.

“We’re from the Employing Class, and we’re here to help”: What the bosses are saying, in effect, is: “We are having none of this. We will not participate in the creation of a minimum set of employment conditions across New Zealand’s industries. If you want Fair Pay Agreements, then you will have to impose them upon the employing class without its consent.” 

AROUND THIS TIME last week, I was thoroughly enjoying myself, writing a parody of “Onward Christian Soldiers” for Christopher Luxon. My take on the old hymn’s refrain had “Luxon’s soldiers” marching to “class war”. Some readers thought that was a somewhat inflammatory characterisation. Class war was soooo Twentieth Century, they insisted. Apparently, my paleo-socialist slip was showing.

Well, maybe not. Today (9/12/21) we learn that Business New Zealand has refused to partner with the State and the NZ Council of Trade Unions (CTU) in the roll-out of Labour’s long-awaited – and well-mandated – Fair Pay Agreements.

This decision can only be interpreted as a deliberate attempt by New Zealand’s employers to sabotage the tripartite structure of the FPA model. What the bosses are saying, in effect, is: “We are having none of this. We will not participate in the creation of a minimum set of employment conditions across New Zealand’s industries. If you want Fair Pay Agreements, then you will have to impose them upon the employing class without its consent.”

I don’t know about you, but that sure sounds like a declaration of class war to me.

How have “Luxon’s soldiers” responded to Business New Zealand’s decision. Well, Luxon’s Workplace Relations and Safety spokesperson, the dry-as-dust neoliberal, Paul Goldsmith, doesn’t really do “unbounded joy”, but, in a media statement released earlier today he certainly comes across as a Happy Chappy.

The Government should ditch its Fair Pay Agreement policy following Business New Zealand’s refusal to be the Government’s preferred partner,” crows Goldsmith. “The agreements would remove the flexibility and autonomy modern workplaces need to grow and flourish.

Oh boy, it’s been a while since we heard that kind of language. It takes me back thirty years to 1991, the year when the Employment Contracts Act came into force.

Goldsmith would have been 20 years old in 1991. For someone of his ideological inclinations, the ECA must have represented the capstone of the Neoliberal Revolution unleashed by Roger Douglas and Ruth Richardson. This crowning achievement, the one big “reform” that Labour dared not undertake, would have struck the young Goldsmith as absolutely sacrosanct. The effective destruction of the trade unionism across the private sector was the critical “reform” that made all the other “reforms” work. Confronted with a unified and confident working-class, Neoliberalism cannot succeed.

Hardly surprising, then, that Goldsmith’s statement included this little gem:

Business New Zealand’s withdrawal lays bare the fact that the national industry awards would have to be imposed by force – denying workers and businesses the right to sort out pay and conditions for themselves.

As if the ECA was not imposed. As if the Act did not, with one ruthless stroke of the legislator’s pen, wipe out rights which New Zealand workers had fought for and won, and which had remained entrenched in the country’s laws for close to a century. As if the people controlling the means of production, distribution and exchange; and those with nothing to sell but their labour – economic and social equals that they so obviously are! – were both clamouring for the right to arrive at mutually advantageous agreements without the pesky intervention of a trade union. As if the 500,000 New Zealanders who marched, rallied and struck against the ECA in March-April 1991 had only done so for a lark – because they had nothing better to do.

Flexible labour markets have been an essential element in New Zealand’s progress in the past 30 years, Goldsmith continued. They have enabled consistent economic growth and job creation, which is the only sustainable way to increase living standards in the long-term.

Umm, no, Paul, that’s not what flexible labour markets brought to New Zealand. The ECA was nothing more, nor less, than an open invitation for New Zealand employers to distil their profits from their workers’ sweat: making them work harder, and longer, for less.

In sophisticated capitalist countries, the state understands the value of an organised labour movement powerful enough to keep workers’ wages high. It is a necessary adjunct to the process of “creative destruction” that allows capitalism to rejuvenate itself. High wages encourage employers to replace workers with machines, or more efficient work practices, thereby lifting productivity – and profits – while building up an increasingly skilled workforce. Win–Win.

The ECA’s “flexible labour markets” – i.e. the destruction of the trade unions – excused the New Zealand capitalist class from doing business better and smarter. It condemned the New Zealand economy to appallingly low and seemingly unimprovable levels of productivity. That made us a low-wage country and sent our best and our brightest across the Tasman to Australia – where the equivalent of FPAs had kept wages high and boosted the productivity of Australian industry.

Though dry-as-dust Neoliberals like Goldsmith are too ideologically blinkered to see it, the ECA – far from being “an essential element in New Zealand’s progress in the past 30 years”, fundamentally weakened both its economy and its society. It drove our most talented citizens offshore, denying the taxpayers, who had contributed so much to the making of these highly-skilled workers, any hope of ever seeing a return on their investment.

There is, accordingly, considerable irony in Goldsmith’s claim that:

There should be a relentless focus on improving our productivity and lifting incomes.

If he was serious about either of those objectives, Goldsmith would be castigating Business New Zealand for undermining what is quite clearly the best hope of improving this country’s appalling productivity, while materially improving the wages of its workforce. Instead, “Luxon’s soldier” offers us this:

Unions now only represent 16 per cent of the private sector workforce – this is all about strengthening the role of unions.

He hasn’t even grasped the fact that union density in New Zealand’s private sector workforce long ago fell below 10 percent. In that brutal statistic is contained not only the tragic story of the National Party’s cold-blooded elimination of trade unionism as a mass movement wielding significant political power on behalf of the New Zealand working class; but also the shameful failure of the CTU to either fight for that class when they still possessed the power to bring the state to the negotiating table, or to do what was necessary to rebuild mass unionism when the political climate changed. (The reasons for the NZCTU’s failure must be left for a future posting.)

What Goldsmith needs no tutoring in, however, is the fundamental elements of class conflict – which achieved their clearest expression in the “flexible labour markets” made possible by the Employment Contracts Act:

Fair Pay Agreements will take us back to the failed policies of the past and should be scrapped, says Goldsmith.

With Business New Zealand drawing up their forces alongside the National Party and Act, it is pretty clear that the employers and their political lackeys have already declared the opening of class hostilities.

The real question now, of course, is whether Labour and the CTU have the guts to declare class war right back at them.

This essay was originally posted on The Daily Blog of Friday, 10 December 2021.