Entitled “The View
From The Seventh Floor”, this article was published on 26 January 2000, sixty
days after the election of the Labour-Alliance coalition government on 27
November 1999. The circumstances and challenges confronting Helen Clark’s new
government, when set alongside those facing Jacinda Ardern and her colleagues,
are at once strikingly similar but also jarringly different. By reproducing my seventeen-year-old article today, I hope to provide the
readers of Bowalley Road with an opportunity to compare
and contrast these two historical moments of significant political departure. - Chris Trotter
WHAT HAPPENS on the Seventh Floor of the Beehive affects
everyone. From a handful of cramped offices thirty metres above Lambton Quay,
issue forth the media releases, speech notes, bills and regulations intended to
shape - and re-shape - the New Zealand economy. For the next three years, the
speed and direction of economic policy will be determined by the two
politicians currently occupying the Seventh Floor – Labour’s Treasurer and
Finance Minister, Michael Cullen, and Jim Anderton, the Alliance’s Minister for
Economic Development. The success or failure of these two ministers will have
an enormous bearing on the fate of the Labour-Alliance Coalition. Voters
respond most vociferously to Government decisions which have a direct impact on
their material standard of living. If they wish to remain on the Seventh Floor,
Cullen and Anderton will have to get it right much more often than they get it
wrong.
Five years ago, the idea that Michael Cullen and Jim
Anderton might one day be working alongside one another would have been greeted
with derision. As Labour and the Alliance staked out their respective economic
positions, the responsibility for articulating the issues which divided the two
parties fell to the two men who must now – somehow – unite them. It must be
said, that both Cullen and Anderton embraced the former task with all the
fervour and vitriol for which the Left is famous. Cullen christened the
Alliance Leader “Jim Il Sung” – equating Anderton’s protectionist predilections
with the North Korean command economy. Anderton, not to be outdone, never tired
of reminding Alliance audiences that Cullen’s air-fare to an exclusive seminar
in Aspen, Colorado, had been paid for by a member of the Business Roundtable so
that Labour’s finance spokesperson could be further indoctrinated with New
Right economic theory.
These were blunt rhetorical instruments, however, when
compared to the razor-sharp analysis of Laila Harré, who, in her maiden speech
to Parliament, provided by far the best summary of the policy issues separating
Labour and the Alliance:
“A government cannot both embrace the full force of
globalisation and retain sovereignty over key economic decisions. A government
cannot deliver a first class health and education service accessible to all
regardless of wealth without a substantially more progressive income tax
system. A government cannot deal with fundamental issues of biosecurity and
ecological diversity by adopting a market model which will by definition subsume
these needs to the perceived interests of foreign investors. These fundamental
issues of difference between the Alliance and Labour must be resolved, and not
simply disguised by clever packaging.”
It is now clear that Harré’s words were directed as much
towards her own party’s leadership as they were to Labour. The 1996 election
débacle brought about a decisive shift in Jim Anderton’s
long-term political strategy, the first sign of which was
his June 1997 speech to the NewLabour Party conference in Hamilton, where he
proposed a substantial revision of the Alliance’s taxation policies. This
rightward shift brought the smouldering civil war within the Alliance’s ranks
to flash-point - precipitating a battle in which the Marxist Left of the NLP
was pitted against an opportunistic coalition made up of Anderton supporters,
Mana Motuhake and the Democrats. The Greens, rather than become involved in
another three years of fratricidal bloodletting, opted to withdraw from the
Alliance altogether.
Anderton’s faction – as so often in the past – emerged
triumphant from the repositioning argument, thereby clearing the way for the
formal rapprochement with Labour
which took place at the Alliance Annual Conference held on Massey University’s Albany
campus in August 1998. The decision of the latter to opt for a “loose”
coalition with Labour – rather than a detailed National/NZ First-style
agreement – signalled a further defeat for the NLP Left. Harré and her allies
had argued strongly for a much less accommodating approach.
From Helen Clark and Michael Cullen’s perspective,
Anderton’s demonstrated capacity to master the Left of the Alliance was a
necessary precondition to any reciprocal shift of position on the part of the
Labour Party. The Labour Caucus’s decision to confirm a six cent tax hike for
those earning more than $60,000 per annum was Clark and Cullen’s answering
gesture to Albany’s warm fuzziness – and proof positive that the process of
“policy convergence” was now an accomplished fact.
Astute readers will recognise in this brief historical
narrative a political motif strikingly similar to the one imposed on NZ First
by Michael Laws in 1996. Before either party could “coalesce” with a mainstream
political force, it first had to be shorn of its more radical elements. That
this process necessarily entailed the shedding of large chunks of its electoral
support, and the steady disillusionment of its most active supporters, was
considered by both the Alliance and the NZ First leadership to be the
unavoidable price of power.
All attempts by the Left of the NLP to arrest this process
of de-radicalisation proved fruitless. In spite of Alliance Director Matt
McCarten’s best Machiavellian efforts to supplant Mana Motuhake and Democrat
candidates with NLP Leftists on the Alliance List, the tax issue once again
provided Anderton with the means to demote and exclude the radicals from
serious contention. By aligning the Alliance’s initial tax rate with Labour’s,
Anderton not only eliminated the progressive elements of Alliance fiscal
policy, but also undermined its capacity to offer a truly radical alternative
to Labour’s economic direction. The NLP Left’s last ditch defence of
Progressive Taxation did little more than reveal the true extent of its isolation
and weakness within the wider Alliance coalition.
Walking around the Seventh Floor of the Beehive today, one
gets the feeling that Jim Anderton has “come home”. Surrounding the Minister of
Economic Development is exactly the same group of individuals who supplied him
with advice and support back in the late 1980s. Just across the circular
stairwell is the office of Peter Harris - the former CTU economist who,
alongside the redoubtable Pat Kelly, was one of the key driving forces of the
Labour Party’s “Economic Policy Network” – a group set up by Anderton in the
mid-1980s to contest the Douglas/Prebble assertion that “There is No
Alternative”. Interestingly, Peter Harris is now advising Michael Cullen.
Advising Anderton, as they have done since 1988, are Integrated Economic
Services’ John Lepper, Petrus Simons, and Len Bayliss. The other long-term
advisor from the 80s with easy access to Anderton’s office is constitutional
lawyer, Andrew Ladley. It was Ladley who successfully argued the case for Anderton’s
readmission to the Labour Caucus following his suspension for refusing to
support the privatisation of the BNZ in 1988.
Matt McCarten’s request to keep the Alliance’s Parliamentary
and Organisational staff in close physical proximity – i.e. on the same floor
of the Executive Building - was over-ruled by both Anderton and Clark. If you
want to chat with the radicals nowadays you have to move out of the Beehive
altogether and make your way through a maze of corridors to their new offices
in the old parliamentary complex. Nothing could better illustrate the changes
that have swept over the Alliance as it has moved steadily towards the
political mainstream.
It was a series of tactical – not ideological – differences
which separated Cullen, and Anderton back in the late-1980s. Ten years on, even
those have disappeared.
This essay was
originally published in The Independent Business Weekly of Wednesday, 26 January 2000.
