Ten Years Ago This Week: Bill Birch's Last Budget

Jenny Shipley's Treasurer (remember them?) - Bill Birch.

THIS YEAR’S BUDGET harks back to an earlier, much simpler, period of New Zealand history; to another election year and another attempt to convince the electorate that National stands for a youthful and progressive alternative.

Flicking through the pages of Brian Edward’s Right Out: Labour Victory 1972 – The Inside Story, it is impossible not to be struck by the parallels between 1972 and 1999.

Then – as now – National was trying to "bed in" a new leader. Jack Marshall had taken over from Sir Keith Holyoake, - a "consensus politician" whose rather pompous style no longer seemed appropriate to the times. But the curious mixture of conservatism and liberalism, which Jack Marshall brought to the top job, made it difficult for him to settle on a consistent political persona. One minute he was "Gentleman Jack" promising to "put people first", and the next, a tough-guy with a "steel core", declaring National to be "Man for man, the strongest team". Marshall’s identity crisis was not helped by the all-too-obvious leadership ambitions of his Finance Minister. Where Marshall oozed uncertainty and confusion, Rob Muldoon radiated conviction and a powerful sense of purpose.

The public mood was profoundly hostile to this leadership combination. National had been in power for nearly twelve years and there was a widespread feeling that it was "time for a change". The prevailing Keynesian economic orthodoxy looked increasingly threadbare as inflation ate away ordinary consumers’ purchasing power, and pushed "the good things of life" further and further into the future.

Jack Marshall attempted to counter this sense of drift by swearing in a younger and more dynamic group of ministers, and by committing National to a raft of legislative initiatives in the area of social policy. His Finance Minister complemented the Government’s new burst of liberalism by dramatically increasing public spending.

Mrs Shipley and her Treasurer must be experiencing a strong sense of déja vu as they set the scene for the 1999 General Election. Like their predecessors, they are determined to "re-brand" their ministry as progressive and forward-looking. The opening lines of Bill Birch’s Budget Speech are, accordingly, filled with millennial promises of a new age. "The 1999 Budget", he says, "is about preparing the nation’s children for success in the 21st century, improving the capability for that task of all New Zealand working families, and giving disadvantaged families and children a much fairer shot at a good life in the future."

Unfortunately for the National Government, the headline items of this year’s Budget are too tentative, too constrained, too tightly targeted, and too obviously pitched at their richest supporters, for the "progressive" and "family friendly" label to stick. Its "Parental Tax Credit" cannot compete with Laila Harré’s Parental Leave legislation (less than half of all new borns will qualify!) and the promise to abolish the Broadcasting Fee (but only after the election) is immediately offset by a $47.00 rise in the motor vehicle registration fee. Verily, the Treasurer giveth, and the Treasurer taketh away.

Likewise, National’s Clintonesque emphasis on education, R&D and the role of information technology in the new millennium, has not been backed with anything like the appropriate levels of funding. A similar penny-pinching approach is evident in Maori policy. Tau Henare and his colleagues must be bitterly disappointed.

The abolition of stamp and death duties will, of course, be of most benefit to the already wealthy – as will the promised tax cuts. It just won’t wash. Such New Right orthodoxy has already become as threadbare as 1970s Keynesianism. Too many people now know that cutting taxes only leads to reduced public services. The formula – like the Government – has grown tired.

Time for a change.

This ‘From the Left’ column was originally published in The Dominion of Friday, 21 May 1999.

Unleash Hell!

The Fury of the Goths by Paul Ivanowitz

I’VE always considered the first ten minutes of the movie Gladiator to be some of the finest work Ridley Scott has ever produced.

The brutal engagement between the formidably armed Roman legions and the wildly undisciplined but unquestionably brave Gothic tribesmen is a fantastic piece of cinematography.

Russell Crowe’s "Maximus", the Roman commander, issues the grim order: "On my signal, unleash Hell." His well-trained centurions do not disappoint.

"On my signal, unleash Hell."

Scott’s design of the battle, I’ve always thought, owes a tremendous amount to a 19th Century painting entitled The Fury of the Goths, executed by the now long-forgotten Austrian artist, Paul Ivanowitz.

I’ve been an admirer of Ivanowitz’s masterpiece ever since, as a little boy, I encountered a reproduction of the painting in an illustrated encyclopaedia. As soon as I laid eyes on the opening sequence of Gladiator, I just knew I’d seen Scott’s battle scene somewhere before.

Of course a pan-German nationalist like Ivanowitz was not about to celebrate some unrecorded victory by Marcus Aurelius’ legions over a rogue Gothic tribe. No, The Fury of the Goths celebrates the much earlier defeat of the Roman General, Varus, by the proto-nationalist German war-leader, Arminius, in the Teutoburg Forest.

Ambushed as his line was strung out along the narrow forest trail, Varus and his approximately 20,000-strong army was utterly annihilated. A small expeditionary force, sent in by Caesar Augustus a few years later to learn the fate of "Varus’ lost legions" discovered a battlefield literally covered with the whitening bones of their butchered comrades. The terrified legionaries buried them where they had fallen, and fled.

At Teutoburg it was the "Goths" who unleashed Hell.

All of which will, I hope, serve to preface the following critique of the NZ Council of Trade Unions’ (CTU) lamentable failure to anticipate and respond forcefully to the new National Government’s first assault upon the rights of New Zealand workers – the so-called "Fire At Will" Bill.

It is several months now since I had dinner with the President of the CTU, Helen Kelly, but I clearly remember practically begging her to have the trade union movement in readiness for the National Party’s inevitable sneak-attack, and to – please, please, please – learn from and avoid the critical strategic error committed by Ken Douglas and Angela Foulkes in the first few months of the fourth National Government.

It was the CTU leadership’s failure to answer the Bolger Government’s introduction of the Employment Contracts Bill with massive industrial resistance by the organised working-class, that saw the level of union density in the private sector workforce fall from close to 60 percent, to around 10 percent. Their point-blank refusal to sanction and lead a General Strike destroyed, practically overnight, New Zealand workers’ faith in the trade union movement. It was a defeat from which the Left, in general, and the working-class, in particular, never really recovered.

Nine years later, and just as the New Zealand working class was lifting itself up off its knees, the CTU has, once again, failed to meet the Tory challenge. In spite of the fact that they knew the 90-Day Bill was a key element in the National Party’s manifesto, and in spite of the fact that the introduction of the Bill, under urgency, was an obvious tactic for Key’s Government to adopt, the trade unions were caught napping.

A CTU that had learned the lessons of history would have planned for just such a contingency. It would have prepared a campaign as comprehensive as Maximus’s punitive expedition against the unfortunate Goths. Most importantly, they would have let Key know that, should he attempt to begin again where Bill Birch left off, they were ready to give the signal to: "Unleash Hell".

But what did the trade union leaders actually do in the 30-day period between National’s victory and the introduction of the 90-Day Bill? They spent their time billing and cooing with the newly elected government, and debating whether or not the Maori Party should be considered a progressive force.

Instead of being ready to pour their affiliated members into the streets, and to rally the tens of thousands of potential members targeted by the legislation to the CTU’s banner, the best they were able to organise was a pathetic (and constitutionally suspect) petition to the Governor-General – urging him not to sign the Bill into law.

With courage and imagination, this past week could have been National’s Teutoburg Forest. Instead, it has turned out to be yet another victory for right-wing ruthlessness.

In 1991, more than 100,000 unionists marched and rallied against the ECB. That this vast mobilisation of working-class anger was never translated into a General Strike was a true tragedy.

In 2008, it was a few hundred e-mails to the Governor-General.

As Marx said: "the second time as farce".