New Zealand has an election on the 23rd September. Currently it’s fair to say, I have nobody particularly inspiring to vote for. Economically it would appear whichever way it goes; a right coalition or a left coalition, neoliberal policies will still persist the following morning. That’s not to say there are no differences, but they are to be found in funding certain programmes or the nuances of the said programmes rather than a re-structuring of a failed economic system. So far during the run up to the election, the ‘NZ left’ have had an interesting time of it. Firstly Labour unveiled Jacinda Adhern as their new leader, which initially caused euphoria among progressives. This was known unimaginatively by the press as ‘Jacindamania’, which has only slightly started to wane over the last few weeks, primarily because her mention of the dreaded ‘T’ word, that is taxes. Then Metiria Turei, the joint leader of the Greens fell on her sword, after admitting she lied to authorities, therefore, claiming more benefits than she was entitled to. Ms Turei in her defence stated her actions were nothing more than trying to “survive as a solo mum”. The point of this was to initiate a debate regarding the most vulnerable sections of society and the major problems regarding welfare. Instead Turei’s admission became a starting pistol for intense abuse by right wing factions, both National and ACT desperately portrayed Ms Turei as nothing more than cheat and a criminal. This would be laughable, if it wasn’t so tragic. This very National government has consistently allowed corporations to dodge tax and create an environment that provides socialism for the rich and capitalism for the poor. The tactic of using the poor as an object of aggression, for having the temerity to survive, while the rich get ever richer, is seen all over the neoliberal world and is used to perfection in an effort to keep societies divided.
I came to live in New Zealand from England in 2011, having visited here on our honeymoon in 2010. The longer I spent here, the more I realised that the people are essentially egalitarian, however, this communal spirit stops with a government that is ideologically neoliberal. The differences in NZ from life in most parts of the UK are palpable and hugely welcome. Fruit from your trees gets shared out at work, fish is handed over the fence if somebody has had a good day on the water and people are generally happy to give you hand if you get stuck. Quite often your labour can be used instead of money, for something you may need. For example my last batch of fire-wood was paid for by helping my friends to chop and split wood for the day. Although to most people in the UK this may seem odd as products are bought with that stuff they call money, here it’s pretty normal to exchange goods for your labour. At first I thought maybe this was because I live in provincial New Zealand, therefore as the saying goes ‘if we all get along, we go along’. However, after living in Auckland which is bigger, more frantic and less personal it is still my opinion that even Auckland is a much friendlier place than the average English city. After a few years here I have concluded that this friendly Kiwi attitude permeates pretty much all over the country. So imagine my surprise whilst getting to grips with NZ politics, when I noticed there were no prominent left leaning parties, a problem that still persists today. This blind devotion to neoliberalism hasn’t always been the case, but it’s a doctrine that was borrowed off the US and the UK in the 80’s. The effect of this was to push all acceptable politics to the right and to marginalise the left.
Like most countries in the Anglo-American world Social Democratic parties swung wildly to the right following free-market capitalism being the adopted orthodoxy. It’s not difficult to find examples of this lurch to the right from supposed peoples parties; Bill Clinton took the Democrats to victory in 1993, likewise Tony Blair swept to the top job with Labour in 1997. Both leaders were similar with their liberal rhetoric and easy charm. At the heart of their success, however, was an adherence to a market economy, which managed to sway the support of the corporations and the media. Both Clinton and Blair accomplished the task of achieving relative longevity by balancing neoliberal economic policies, while offering social justice concessions. With this heady cocktail of ideas, often known as the 3rd way, both were able to successfully lure the electorate. Clinton brought in the Family and Medical Leave Act of 1993 while Blair was instrumental in introducing a minimum wage in the UK. These types of policies softened the blow of deregulation of the financial sector and masked the damage that would occur in years to come. One of Bill Clinton’s most destructive actions was to repeal the Glass-Steagall Act which was initially designed to separate commercial and investment banking, this act had been in place since 1933 following the depression in the US. It’s fair to acknowledge that a lack of these types of safety mechanisms among others were a reason the global financial crisis was allowed to reach the devastating conclusion it did. Meanwhile under Blair’s watch university tuition fees were ushered in and privatisation by stealth for the health service increased. The UK and US are not alone regarding their acceptance of a neoliberal doctrine. New Zealand has it’s own tale to tell, which could very well shed some light on the original question “where’s the left”.
New Zealand had always been considered a social democratic state prior to the mid 80’s. From the 1930’s onwards the state owned many assets including Post, Railways, Inter-Island ferries, electricity generation, major public construction works, public housing, hospitals, mining and broadcasting to name a few. The government looked after their citizens and unemployment was quite often below 1%. By the early 80’s people were becoming tired of the National Prime Minister Rob Muldoon from a personal perspective. While many businesses in Auckland were becoming frustrated by a tightly controlled economy. To the surprise of many, Muldoon called a snap election in June 1984, this proved to be his undoing as his opponent David Lange was victorious by a landslide, leading the 4th Labour government. On the night of the election results and following celebrations, David Lange was saddled with the news that the previous government had accrued huge amounts of debts and NZ dollar was massively over-valued. The newly crowned Finance Minister Roger Douglas who was heavily influenced by the neoliberal ideology of Milton Friedman seized on this New Zealand financial crisis. Douglas had already written a book outlining a radical change to the NZ economy, which was considered ridiculous by most people in the political world. But what Douglas and the rest of the Troika (Richard Prebble and David Caygill) would do next, however, was classic ‘shock doctrine’ as described in Naomi Klein’s wonderful book. This ‘shock therapy’ as used in Chile, Russia, Argentina, US and UK, was to utilise a disaster such as a coup (Chile) or a financial crisis (US and UK) to usher in ideologically driven capitalism. This method, still used today, is consistently in the form of massive deregulation and the privatisation of state assets. These proposed economic changes were heavily supported by the NZ Treasury and the Business Round Table, an exceptionally right-wing think-tank. Within a short period of time New Zealand was transformed from one of the most regulated countries economically to one of the least.
The Labour government proceeded to sell off national assets worth $2.5 billion at bargain basement prices, while slashing top tier tax from 66% to a paltry 33%. Company taxes were reduced in a similar fashion, at the same time a new regressive Good and Services Tax (similar to UK VAT) was introduced. The Labour regime limited the right to strike, as real wages declined by 10%. Furthermore unemployment climbed from 8.5% to 16.2%. To counter any excessive payments regarding high unemployment the government reduced benefits and abolished payments for under 18’s. As neoliberalism took a hold in NZ, it was common practice to reduce unemployment payments if the gap between declining average wages and the dole became too close. In classic ‘disaster capitalism’ style, Roger Douglas declared that reforms had to be done as quickly as possible, to avoid any form of resistance to them. He even tried towards the end of his tenure to introduce a flat tax, which was a bridge too far for Lange. Following Labour’s resounding defeat in 1990, the country was now in the hands of National, where there would be no let up on the neoliberal doctrine. While in the 80’s NZ had Rogernomics, the 90’s resulted in Ruthanasia. Ruth Richardson was now the Finance Minister and was prepared to put free-market capitalism on steroids. It was their goal to privatise anything that wasn’t nailed down, including health, education, while reducing unemployment, sickness and welfare benefits. Active campaigns using adverts and TV programmes were used to demonise welfare recipients such as benefit cheats, unfortunately the same amount of effort was not expended on tax evaders/avoiders. Like their traditional opponents the National government were happy to maintain high levels of unemployment purposely to keep wages low and therefore, inflation low. Any collective in the form of unions which opposed these draconian reforms were systematically dismantled, with the Employments Contract Act. This intentionally individualised the employment relationship and pitted employee versus employee, this also had the dramatic effect of lowering wages. Although Ruth Richardson was gone by 1993, the National government continued until 1999. By then the die was cast, most people didn’t know any better than capitalism and consumption. The incoming Labour government led by Helen Clark managed to put the breaks on runaway capitalism, but by then individualism and consumerism were ingrained on a national psyche that once stood for egalitarian values.
So I guess the question is, why socialism, why go left? The answer is simple, unbridled capitalism does not have the answers to our very serious problems, both nationally and globally. If you are uncomfortable with socialism. then fine call it something else. The important thing is we need to move away from a massively individualistic society to a collective one. Jeremy Bentham stated “it is the greatest happiness of the greatest number that is the measure of right and wrong”. Not only is that a moral statement, but a practical one when we think that we live in a finite world and what we do has direct consequences on someone or something else. To live a life as if we are in isolation is foolish and irresponsible. To emphasise this point, the worlds 8 richest people have more wealth than the poorest 50%, while 1 in 9 people will go to bed hungry. How does this make sense? Gandhi famously said;
“The world has enough for everyone’s need, but not enough for everyone’s greed.”
So lets get to our pressing problems and why New Zealand needs to turn left. First up homelessness, a report by Yale University concluded that New Zealand has the highest homeless rates in the OECD. More than 40,000 people live on the streets or in emergency housing or substandard shelters, this equates to almost 1% of the population. While there is one person living rough or in sub-standard accommodation, in my opinion we have failed as a society. This is clearly a difficult problem to solve; there is indeed the physical aspect of having enough accommodation, psychological problems, such as people feeling disenfranchised with society and many other complex contributing factors. But the answer is not how many houses to build, or how we increase mental health provision. The answer is the government needs to find the political will to actually complete these projects regardless of any barriers that may exist. Government’s seem to find money to fund war or bank bailouts, but somehow the cupboard is bare when it comes to the most vulnerable in society. This is quite simply an ideological decision to allow certain sections of society to suffer.
New Zealand has some highest suicide rates in the world. NZ youth suicide has twice the prevalence of Australia and five times that of the UK. Although the reasons are multi-faceted, economic inequality is a huge factor with regards to mental health problems. Feelings of worthlessness and status anxiety increases, while trust decreases. The very fabric of society disintegrates, at a time when many people would benefit from a supportive network. Inequality also has a huge effect on child poverty, in 1982 child poverty was 14%, now it sits around 28%. All the while the incomes of the top 10% compared to the lower 10% have increased from 5 times to 10 times greater. The examples I have mentioned highlighting where NZ falls down have one thing in common, ‘people’. If the wealth of the rich compared to the poor widens, yet many health and social indicators show NZ is severely lacking, this indicates to me that the system has failed and the government has no inclination or desire to change course. One last thought on this; New Zealand’s richest two men (Richard Chandler and Graeme Hart) have more wealth than 30% of the poorest people. That in itself is sickening.
On to my last reason for NZ to turn left. The most important issue we face on this planet is climate change. The National government have signed up to the Paris accord, however, this according to renowned climate scientist James Hansen doesn’t go far enough to avoid temperatures elevating by 2 degrees. Climate scientists warn that this rise would have dramatic affects; one in which seas will rise by more than 5 metres over the coming centuries, and one in which droughts, floods and extreme heatwaves will ravage many parts of the world. Currently National seem to be randomly tossing figures around without any concerted plan. For example the government have stated that it will aim for a 2030 target of 30% below 2005 emission levels, which actually is equivalent to cutting emissions to 11% below 1990 levels. Their rhetoric is meaningless as are their actions, but this shouldn’t be surprising as it’s a party wedded to big business, including the fossil fuel industry.
During this election cycle, National have ran an exceptionally negative campaign towards Labour and the Greens. This has been a two pronged attack; ridiculing Labour by stating their proposals are not affordable, while scaring the public into believing they’ll be paying masses of tax to pay for services. One of the stand-out moments was Steven Joyce the current Finance Minister, claiming there was a $11.7bn hole in Labour’s budget. This was of course total rubbish, but it didn’t matter, it had the desired effect. In the right-wing world there is no requirement to tell the truth only the result matters. These tactics were designed to make Labour seem indecisive regarding taxes, at the same time slowing the Jacinda effect. My thoughts are Jacinda Adhern should have been bold the moment she took office, stating; these are the problems, this is what we’ll do, this is why we’ll do it and here’s how we’ll pay. Obviously the only way they could pay is through taxes. Bizarrely, New Zealand, appears to be tax phobic, which would indicate that the people are heavily taxed. This couldn’t be further from the truth, tax is a little less than most OECD countries and is a lot less progressive than it once was (top tax rate was 66%). Tax is obviously spent on services such as health, education, police, prisons and welfare. Therefore, what we pay on tax is directly linked to what sort of services we want in New Zealand. Tax is no more than the pooling of our resources to make the nation better. Scandinavia is well known for their high taxes, but have an excellent standard of living, often topping rankings in; education, low crime, good health outcomes and excellent social cohesion. Tax isn’t the only solution to problems in New Zealand or anywhere else for that matter, but it does offer a means to improve services and reduce inequality.
So why do I keep harping on about inequality? It’s quite simple, inequality is directly connected with; increased crime rates, poorer health outcomes, less social mobility, substandard education, a decrease in social cohesion and a less stable economy. The ruling elite will continue to divide society, convincing the middle class to blame the poor, while the poor blame the immigrants. All the while the rich will get tax cuts or avoid tax completely. Rather than looking at the most marginalised and the vulnerable in society we should be looking towards the ruling elite to locate where the problem lies. As I stated at the top of this piece, the choices for the election are not particularly stark, but I still hope for a change of government and maybe a step in the right direction.