National’s Governing For (Crony) Capitalists – Not Capitalism.

Gimme, Gimme, Gimme! The late Bruce Jesson used to say that while National governed for capitalists, Labour governed for Capitalism. Jesson’s suggestion: that National was so firmly locked inside the individualist logic of the private sector that it struggled to see the broader capitalist picture; was a shrewd one.

WHY IS THE NATIONAL PARTY doing so much for landlords, property developers, trucking, and construction companies, and so little for everybody who isn’t already pretty well-off? It’s as if protecting landlords’ investments and building apartments and roads now constitute the whole of National’s policy objectives. Even their most faithful supporters in the farming community are being neglected by National’s present crop of leaders. What has happened to the National Party?

The late Bruce Jesson used to say that while National governed for capitalists, Labour governed for Capitalism. Jesson’s suggestion: that National was so firmly locked inside the individualist logic of the private sector that it struggled to see the broader capitalist picture; was a shrewd one. Certainly, no politician with even the most rudimentary grasp of the public interest would consider doing today what made National Cabinet Ministers of the past so notorious: ensuring that the gravel roads leading to their farms (so many of them in those far-off days were farmers) received a generous topping of bitumen.

But, how different, really, is seeing nothing wrong with sealing a seemingly random collection of rural roads at the public’s expense, from accepting a $1,000 per week government allowance for inhabiting a property one already owns, mortgage-free? The first example might have fallen under the heading of ministerial discretion, the second remains a perfectly legal ministerial entitlement. Real effort was – and is – required to bring these “entitled” National Party grandees to a more realistic understanding of their responsibilities.

Christopher Luxon’s problem with his Wellington accommodation allowance reflects his background as a corporate leader and property investor. Such perquisites are taken for granted at the CEO level, and very few, if any, eyebrows arch upwards when they are accepted. Luxon and his ilk float freely in the gravity-free milieu of the privileged. For these types, getting reacquainted with solid ground can be a fraught process.

At least when National was the party of the farmers its leaders’ feet remained firmly rooted in the soil. Drawing one’s wealth from lamb-sales, wool-clips, and cow’s milk is very different from watching property and share prices surge. Farmers are intimately connected to the real world. The best one can say about money is that it is a representation of the real world. Which isn’t the same thing – not at all.

So who are these capitalists on whose behalf National is governing the country? Predominantly, they are the capitalists involved in building houses, apartment buildings, and all the ancillary infrastructure that goes with property development. Not far behind them are the capitalists who use and build New Zealand’s roads – the trucking companies and the big civil-engineering firms.

What little understanding of Capitalism’s priorities National does possess is reflected in its support for the extractive industries of mining, oil and gas, forestry, and fishing. The party’s perception of these industries’ importance is sharpened by the quantum of their donations to its campaign funds.

That said, the number of these “crony” capitalists is insufficient to sustain an electoral party. National needs a Party Vote approaching 40 percent to have any hope of governing the country in coalition with the other parties of the Right. (Forty-eight percent if it seeks to govern alone.) But, to achieve these sorts of numbers, National needs to make a plausible pitch for the support of close to half the population.

To forge the necessary synergy between National’s capitalist cronies and its electoral base, its strategists have targeted those older New Zealanders in possession of their own, mortgage-free, homes – along with one or more rental properties. These voters may continue to make their homes in the leafier suburbs of New Zealand (electorally-speaking, National has long been the party of the better-off suburbs) or, they may have joined the burgeoning number of ageing Kiwis living in retirement homes and villages.

A great many of the people living in retirement communities will be cashed-up beneficiaries of the housing boom. As such, they have no interest whatsoever in Adrian Orr lowering the official cash rate. The higher the interest rates, the greater the return on their savings. They have no interest, either, in Wealth or Capital Gains taxes. When the time comes to sell the family business, they have no inclination to cut the Tax Man in on the deal. Certainly, National did not lose any votes by relieving these older landlords of Labour’s pesky tax deductions.

That these older-voters-with-money have children and grandchildren also works to National’s advantage. With more and more young people relying upon the Bank of Mum & Dad for the deposit on their first house, any measure depleting the Bank’s deposits is unlikely to be welcomed. Then there’s the touchy subject of their inheritance. Mum & Dad don’t live forever. These voters-waiting-for-a-legacy are not likely to support any party promising to impose an Inheritance Tax.

Which just leaves those Kiwis who want nothing more than to become the owners of the big mansions that feature on the front pages of the real-estate supplements. The sort of people without whom Lotto would go broke. “Aspirational Voters”, that’s what the political scientists (and the election campaign specialists) call them. The people who are never tempted to swap their avarice for a commitment to social justice – or even for a capitalist system that works! In their eyes, equality makes losers of us all. They may not be winners – yet – but by voting for National they at least get to feel like winners.

It’s just possible that National’s Simeon Brown has cottoned-on to the fact that these aspirational voters – especially the blokes – also feel like winners when they’re tearing down the highway in a gas-guzzling SUV. Nothing shouts “Freedom!” like a fast car. Not something that’s generally observed of busses and trains!

So, that’s National: the party that governs for capitalists – large, small, and aspiring. As proof of their commitment to the avaricious, they have promised, and are absolutely determined to deliver, tax-cuts. To pay for these National is perfectly willing to: defund the Police; keep the NZDF on its knees; run the risk that Foot & Mouth Disease will get past overworked border security staff; downgrade KiwiRail and the inter-island ferry service; pare-back public transport; see another generation of Māori and Pasifika children grow up poor, malnourished and angry, while they stand back and watch the public health and education services – those time-tested ladders out of poverty – fall apart.

It’s not the pathway to a thriving and profitable capitalist society. Capitalism works best when the state encourages it to lift the whole population to a level of comfort and security that makes increased productivity more than a pipedream. Historically-speaking, that’s been Labour’s goal – and achievement. More to the point, when National’s been intelligent enough to follow Labour’s lead, that’s been its achievement, too.

This essay was originally posted on The Democracy Project Substack on Monday, 25 March 2024.

The Second (And Final?) Crucifixion Of Winston Peters.

Stag At Bay: Twelve years ago, Winston Peters was still robust enough to come back from the political crucifixion which his political and media enemies had prepared for him. In his seventies now, the chances of a second resurrection are slim. We should, therefore, prepare for the last gasp of Old New Zealand’s very Kiwi corruption.

AND SO IT BEGINS. Once again, the enemies of Winston Peters are manoeuvring to eject him and his NZ First Party from Parliament. Once again the primary vector for their attack is the news media. And, once again, Peters is making it easy for them.

To understand what is happening and why requires (at least) two investigations. The first, into the chameleon-like character of NZ First and its leader. The second, into the uses to which New Zealand’s political journalists have allowed themselves – and are still allowing themselves – to be put.

NZ First, like its leader, has always had two faces. Outwardly, it is a conservative-nationalist party determined to preserve both the New Zealand character and the New Zealand economy from the cultural, political and financial impositions of foreign powers and peoples. Behind the scenes, however, Peters and his party have simultaneously positioned themselves as practiced and practical political enablers.

NZ First’s hidden face is a necessary adjunct to its public countenance. Throughout New Zealand’s brief history, conservative parties and crony capitalism have marched together in lock-step. In such a tiny society how could they not? Only the state has ever had access to the huge capital resources required to facilitate economic development. For capitalists, large and small, that meant securing their desired economic outcomes by cultivating mutually beneficial political relationships. Naturally, the individuals, businesses, and political parties involved in this activity were not at all keen to have their behaviour trumpeted from the roof-tops. If deals needed to be done, it was overwhelmingly in the interests of all parties that they be done in secret.

Up until the 1980s, National had been the go-to party for business leaders on the scrounge for government assistance. It would be wrong to brand what took place as “corruption”. (Although that is certainly what most Americans and Europeans would have called it!) Only on the very rarest of occasions were individuals quietly handed a brown paper envelope stuffed with banknotes. Not necessary. The rules of the game were clear. If a government minister intervened on a business’s behalf, then the very least it could do was make a generous contribution to the coffers of the governing party. And when the obliging politician retired, a seat on the assisted company’s board-of-directors. No brown paper envelopes required – only patience.

A very Kiwi kind of corruption.

Winston Peters learned how to play this game from one of its grand masters, Rob Muldoon. The expectation that helping businesses to flourish was one of the most important responsibilities of a conservative New Zealand politician was deeply ingrained in Peters’ generation. They neither understood nor approved the sudden economic shift from the local to the global. If the distribution of resources was no longer the function of those in control of the nation state, but of transnational corporations and financiers, then what, exactly, was the point of politicians?

When viewed from this perspective, Peters political practice makes perfect sense. If his party was to rescue New Zealand business from the clutches of international financiers, then Kiwi businessmen would have to help him do it. Quid pro quo. But never, ever, where anybody not familiar with the rules of the game might witness the quids pro-quoing! NZ First’s obsessive secrecy is simply the organisational refection of its rock-solid commitment to rescuing New Zealand Inc: one contribution at a time.

If this is errant political behaviour, then there is something quaintly patriotic about it. Those tempted to climb upon their high moral horses should first ask themselves which is worse: taking thoroughbred-breeders’ money to rescue the racing industry; or, taking money from the People’s Republic of China to ensure that New Zealand remains open to its investors? Because it would be a huge mistake to think that political corruption is a thing of the past. All that’s happened is that, just like the rest of the economy, the locus of corruption has shifted from the local to the global. And, as the stakes have grown higher, so have the pay-offs.

Where does the news media fit into all this? Essentially the role of the news media in dealing with political corruption hasn’t changed at all. In the past, the job of the press was to ensure that, even when they were looking directly at it, New Zealanders would fail to recognise corrupt behaviour. In a country as dependent upon crony capitalism as New Zealand, scorching media exposés of political and business venality could only undermine people’s faith in the system - maybe to the point where it collapsed completely. Best to turn a blind eye.

The advent of globalisation, along with the neoliberal revolutions it necessitated, only reinforced the news media’s role as the justifier of capitalism’s mysterious ways to the ordinary man and woman. In the new order, however, there was an additional duty. The final and furious destruction of any politician or party foolhardy enough to defend the way things were done in the bad old days – back when the country was run, you know, like a Polish shipyard.

Unsurprising, then, that Winston Peters and NZ First, from the moment they acquired independent political form, were targeted by the news media for termination with extreme prejudice. That Peters cemented his status as the people’s tribune by exposing the massive financial corruption scandal known as “The Winebox Affair” only made his political termination all the more urgent. The 25 years of unrelenting media hostility to which Peters has, accordingly, been subjected by this country’s political and business journalists is nowhere near as surprising as the fact he has survived it.

Just as they did in 2008, the present attacks will go on and on. Politicians will collude with press gallery journalists, and press gallery journalists will collude with politicians, both groups making sure that the grubby process of leaking information and priming the public for ever-more shocking revelations continues right up until the general election. Completely ignoring the decades-long enfeeblement of our electoral watchdogs, Peters and NZ First will be condemned for the gaming of a system which no government has ever bothered to make un-game-able. This time, however, the assistance rendered by right-wing bloggers and tweeters will be even more decisive.

Twelve years ago, Winston Peters was still robust enough to come back from the political crucifixion which his political and media enemies had prepared for him. In his seventies now, the chances of a second resurrection are slim. We should, therefore, prepare for the last gasp of Old New Zealand’s very Kiwi corruption.

This essay was originally posted on The Daily Blog of Thursday, 21 November 2019.