The Political Outlook in 2008: A speech given in
Waiuku, 22 February 2008

Michael Bassett


Predicting politics in the Chinese Year of the Rat used to be easier. In previous Years of the Rat, 1960, 1972 and 1984 the government in New Zealand changed. The last Year of the Rat, 1996, it nearly did until Jim Bolger pulled out of his hat not a rat, but a rabbit with Winston Peters' face on it. That year, of course, was the first election under MMP, or as it has become in practice, MER - Manipulating Election Returns. MMP is the big unknown factor that can always mean that the voters are kept away from the ultimate allocation of victory - a sort of Duckworth-Lewis system for throwing the game to the team that hasn't necessarily been the star performer. Elections this last twelve years have become giant lotteries where the voters only play a part in who eventually governs. How many parties will make it over the magical 5% this year? Almost certainly many would vote differently if they only knew. Will we finally be rid of New Zealand First? Or will Labour throw Winston a lifeline as Jim Bolger did to Richard Prebble and ACT in 1996 to keep them there for the after-match function? After muffing the first set of post-election manoeuvrings in 1996, Helen Clark has shown mastery of the smoke-filled back room deals. For a non-smoker she does it brilliantly. Mistaking length of time in office for effective use of it, she is desperate to pass Peter Fraser's record of nine and a half years as Labour's Prime Minister. To do that, she has to stay in office until July 2009. Everything is being bent towards that goal.

Because Labour is further behind in the polls than at any similar stage in recent three-year parliamentary cycles it's an odds-on bet that this will be a particularly nasty campaign. Already we can see that the Electoral Finance Act has screwed down everyone else's election spending, while doing nary a jot to impede Labour's incumbent capacity to spend taxpayers' money as lavishly as it likes on advertising policies. This doesn't surprise me. In 1990 at the very last Labour caucus that I attended, when everyone was moping over our well-deserved trouncing, Helen Clark, then Deputy Leader, told the assembled Labour MPs something that I wrote down carefully at the time. She said she would be - and I quote from my caucus notes - "as vicious, nasty and opportunist as anyone" in the fight to return Labour to the Treasury benches. Those remarks were a forewarning. The only religious belief most modern Labourites seem to hold is their divine right to govern, to impose their views on others. It's a sort of messianic quality shared, oddly enough, by the Exclusive Brethren, whom Helen Clark loves to hate. Over-the-top politics was much in evidence in 2005 when Labour adopted a "whatever it takes" attitude to winning, spending more on its campaign than was legal, and daring the Police to prosecute, which in their usual pusillanimous way, they didn't. The Electoral Finance Act 2007 is the most recent manifestation of the "Whatever it takes" attitude which will again be in evidence in 2008. So crystal ball gazing has become extremely difficult. A word of warning: National's lead in the current polls is no guarantee they'll get Beehive offices, or their bums in the new BMW 730s.

Adding a further complication to the guessing game is the impact that any downturn in the world economy might have on New Zealand. The economic good times in New Zealand have lasted long. Today a voter aged 30 has little or no memory of the hard times that this country passed through as the essentials of good economic management were put in place in the 1980s and early 1990s. Consequently, younger voters have no understanding of the significance of the incremental changes that have been slowly eroding those fundamentals. While the share market is down, and the property market is slowing, it isn't yet clear that we are into a full scale recession. Political Science has little to tell us about how voters might react to a sudden jolt in the current, complex climate. The former conventional wisdom about voters turning on whoever is in power at a time of bad news isn't, I suggest, necessarily a guide. Last time, Labour made inroads in the last few days of the campaign with a slogan "Don't put it all at Risk". How MUCH will seem at risk come election time? TV ONE's polling last Sunday suggested that pessimism about the economy is rising sharply, but the gap between the parties since December hasn't widened to the point where a change can be said to be inevitable. More recent polls are tending in that direction, however.

Having prudently covered my tail feathers with disclaimers, let's look more closely at the issues. There are several really significant ones, but no guarantee they'll be debated during the campaign. The first and obvious one is economic management. Michael Cullen was correct when he said recently that New Zealand has enjoyed its longest period of expansion for many years. Indeed, for the first few years of this Labour Government our growth rate continued at above the OECD average. There was excited talk of rising up the OECD rankings. But the discipline required was a bit like when David Lange needed to cut down on food after his stomach stapling: he didn't and soon put on weight again. Our advantage disappeared, and instead we dropped behind the OECD average, despite record commodity prices. As that occurred, leading Labour politicians did what an uninformed public usually expects of governments - they stepped up their level of economic intervention and centralized decision making that should always be left nearer the people. This increased the cost of doing business. Predictably economic growth slowed further. Productivity growth now stands at one third of what it was in the decade before this Labour Government came to office. Cullen recently said that he was in politics "to make sure that working people get their fair share of New Zealand's success". The cake if you like - doesn't appear to me to be growing as fast as it was or should be, thanks in large measure to the policies he and his colleagues have adopted. Whether working people are getting a larger slice of that relatively diminishing cake isn't clear. But Cullen's recent statement that employers ought to push wages higher despite falling productivity doesn't sit well with his homilies about inflation. John Key will probably concentrate some fire on the need to improve growth and productivity, but in a world where the great mass of voters is blind to economic realities, he won't dwell over much on the issue, even although growth is vital to lifting everyone's wages and living standards. Don Brash, as a former Governor of the Reserve Bank, could always sound authoritative as an economic manager, but to be fair, John Key isn't too far behind.

Closely aligned with the creeping regulatory framework is the steady implementation of ancient Labour ideologies such as was apparent in the instant lifting of the top marginal tax rate to 39% in 1999, the Employment Relations Act 2000, and a ratcheting up of the size of the bureaucracy. New nostrums flowing from the Local Government Act 2002, the Resource Management Act, the Kyoto Protocol; more rigid takeover legislation; the urge to break apart Telecom that willing private sector buyers paid big money for in 1990 in its unbundled state; and now the pre-conditions that Cullen keeps repeating for tax-cuts; all of them affect perceptions of New Zealand as a place to invest.

The problem business has is this: to an economically illiterate voter each one of the measures that contributes to the economic slowdown appears reasonable in itself. Measures that sound like they might produce higher wages NOW; firm regulation to punish rapacious telcos NOW; putting more checks and balances in the way of development through the resource consent process NOW; all have knee-jerk appeal. We haven't quite reached the level of ignorance that applies in Germany and France where recent surveys revealed that only 36% of people actually support private enterprise, while many more claim to believe in a woolly form of socialism. But this government has done nothing to increase the public's level of understanding of what is likely to lift growth, because to do so would open their own conduct to greater scrutiny. Economic ignorance hobbles every politician who might present policies to accelerate growth. The problems may be clear to us, but it will be extremely difficult to get them across to the public. Let me suggest a reason. A recent CIS study caught my eye. It dealt with the electoral repercussions from John Howard's Work Choices legislation. It suggested that no matter what arguments were mounted in favour of Work Choices, a majority of Australian voters opposed drastic labour market reform at a time when unemployment was low and there was apparent prosperity. In other words, apparent prosperity can politically lock in the conditions that restrain a higher growth trajectory and better wages. What I am saying is that some reforms might never move until voter torpor is shaken by a serious economic downturn. Relative comfort keeps serious economic debate at bay, which is just where Labour wants it to be. They can waft away conventional economic thinking as irrelevant New Right ideology. Maybe an emergency that could frighten the public will emerge before election day, but don't count on it. Besides, Helen Clark is cunning enough to trump up an excuse to go to the country early.

Controlling the parameters of political debate is something that this government excels at. Helen Clark spends a prodigious amount of time managing public opinion. Her principal acolytes are young, mostly female journalists. Deep down, they regard her as a kindly aunt or big sister, and they happily cooperate, especially when any government critic can be dismissed as politically incorrect. Ministers get away with turning the discourse into playing the man, not the ball. A recent example: when Murray McCully embarked on a footling line against Kordia's involvement with cell-phone towers in Myanmar, Helen Clark dismissed it by abusing McCully. Another issue: the emigration of skills that has reached serious proportions, is often dismissed as the exit of anti-Labour voters, and therefore a matter of no consequence, or even cause for celebration. Jim Anderton's early promise to entice them all home has been long forgotten.

On a grand scale, nothing illustrates better this general tactic of playing the man, not the ball, than the brouhaha over the Exclusive Brethren. You will all recall their leaflets at the time of the 2005 election. I am more politically alert than most, but I missed them when delivered, and I had to painstakingly search through my waste-paper bin to find them. They would have had no impact on voters until Labour gave them legs. I analysed the one on the Greens, checking it against their manifesto. I concluded that all but one of the Brethren's comments were fair. Did any newspaper, radio or TV journalist dissect any of those pamphlets? Not on your Nelly. To their eternal shame, journalists meekly took their lead from the Prime Minister who attacked the pamphlets' authors, and their religion, never dealing with the issues they had raised. We now seem to inhabit a world where no one can debate things in a manner that Helen Clark doesn't approve of. I know of three cases recently where bona-fide Labour Party members who have written or said something publicly that the Beehive didn't like, have received phone calls or emails from ministers telling them to pull their heads in. When someone the government disapproves of appears on something as harmless as National Radio's Jim Mora Show, Beehive apparatchiks send emails protesting. I've seen the messages. Newspaper articles by critics of the government activate a Beehive letter-writing tree. In Auckland Jenny Kirk, her husband Owen, her brother-in-law Jeff Saunders, and at least half a dozen others rush into print with letters to the Herald, the contents of which have a common origin, the Beehive. I possess a Ruth Dyson email urging her supporters to protest about me to the Christchurch Press.

This is a very oppressive government. Peter Fraser fought for freedom of the press, believing always that the interests of workers would be best served by full and free debate. Modern Labour operates in another space. It uses sycophants to confine debate to areas where Labour is more comfortable. Everything else gets ridiculed. Imprisoning ideas is Labour's cardinal rule, and they have been extremely successful at it. The Electoral Finance Act is just the latest installment.

Nowhere is this oppressiveness more apparent than when someone tries to debate social policy. Sometimes I don't know whether to laugh or to cry at the huge state resources poured into avoiding the expanding elephant in our room. The collapse of the two-parent household, and of self-reliance, has become a Kiwi tragedy. Radio and TV perpetually carry stories that any sensible person can see indicates that a sizeable chunk of Maori and Polynesian society is collapsing. Labour's policies propel that collapse with a rocket in the tail. There are parts of Northland, South Auckland, Rotorua and Taupo that are now no-go areas at night. The Domestic Purposes Benefit didn't cause the breakdown of two parent households, but it gave it a permanent adrenalin rush. However, Labour resists debating the DPB like the devil shuns incense. Journalists like Simon Collins of the Herald produce barmy explanations for family collapse that refuse to get to grips with readily available social statistics.

We must remember that the DPB is an ancient article of feminist faith. But the depredations it has wrought are appalling. The perpetrators of child bashing, mothers driving with unrestrained children on their way home from the pub on benefit night, and the relentless over-production of fatherless children, can be traced directly to the DPB. It quickly became a state licence for tom-catting. Two-parent households have largely vanished from the underclass, ensuring that children stay in permanent poverty. They live desperate lives down there, yet politicians refuse to face one of the main causes of the continuing misery. For too many biological parents it's not the children they want, only the money that goes with them. We shouldn't be surprised that parents don't read to them, or even talk to them. A recent Herald interview with several young Maori women in Taupo had them complaining "there's nothing to do". Most parents in the underclass have never taken their children out for a treat to the zoo, the speedway, a concert, or even fishing or tramping, or to the public park. Kids who tag, who commit petty crime, and increasingly use knives, have no idea of the opportunities open to them in the wider world. The young Taupo women I mentioned sat there, thumbing their cell phones, and waiting for their inevitable dead-end careers on the DPB. Too many parents don't care about their kids - except on benefit day. Then it's off to the pub.

Since 1999 it has become clear that Labour doesn't believe in contracting out anything - except parental responsibility. This government funds an army of social workers while the problems get steadily worse. Now we are told that police will soon be attached to schools, acting of course in loco parentis. The notion that state-paid agencies can adequately substitute for parental responsibility must be one of the greatest fallacies of modern times. Yet Labour Party branches are full of representatives of the "caring industries". Their livelihoods depend on a willingness to keep contracting out parental responsibility. Labour has locked these people into its electoral coalition at the expense of the wider welfare of society. A social work army dominates Labour these days. Making up the rest of the voting coalition are many of the recipients of Working for Families. The government will try to frighten them all this year with an up-dated version of "Don't put it all at Risk". Meantime the underclass that Labour has helped to create will continue to inflict untold damage, at huge expense, on the rest of us.

The point of my rave? The centre right will have to win across, or neutralize, the expanding voting group of carers. It won't be easy. Phony statistics will continue to be produced by in-house researchers and friendly so-called academics, arguing for more resources to keep doing on an ever-wider scale, the sorts of things that have helped create the modern underclass. No one seems to care that it gets bigger at a time when jobs are plentiful. The underclass keeps Labour's hard-core activists busy.

How can we bring social issues into focus?

The National Party seems to understand the difficulties it faces in a world where their opponents set the parameters of debate. Of course there has always been a large part of National that believes in regulation so long as National does the regulating. Those of you who were inspired by Nigel Lawson's visit, and who have gone on to read his View from No. 11, will know that the so-called Conservatives in Britain have that same wet patch in the middle of their bed. Don Brash made a valiant effort to break out of Labour's intellectual prison. But too many National supporters happily let him be crucified.

There's a gender issue that must be confronted. The polls show that women are more likely to vote Labour. They are often the secondary earners in their household. Many work in the caring industries; the hours are congenial. They are wary of change. However, if you think carefully about the social collapse that is taking place, there will in the foreseeable future be jobs for them; they'll just be differently focused if work for a benefit becomes a requirement as it has in other parts of the world. Yet, despite Judith Collins' best efforts, there is a cautious note to National's social policy. Welfare reform was a Brash issue, some National people regard it therefore as tainted.

In other words, Labour has been so successful at confining the debate that crime and social dysfunctionality don't look like they will feature this election. Nor does education that is dear to every good parent's heart. Politically correct curricula abound, but on most things, including student loans, National has meekly fallen into the me-too school. It's another example of Labour's extraordinary capacity to determine the battlefield.

As an electoral strategy I suggest there are perils in me-tooism. Labour is now suggesting that National must possess secret agendas that they aren't declaring. That chorus could well become deafening by election time. There is a risk of clumsy off-the-cuff responses. Don't forget: the left are masters at scary plot theories and demonology.

All my instincts incline me to the feeling that election campaigns should produce meaningful debate, and that the centre right should fight to set the agenda. But am I right about this? Several considerations make me pause. "Me tooism" was a strategy that worked well for Kevin Rudd's opposition to Howard's agenda. Rudd neutralized many issues lest they frightened the centre. Referring back to that article about Work Choices, it may possibly be wiser to move cautiously. Many of you will counter that Don Brash's sudden injection of policy options into the 2005 election discourse doubled National's vote. But with women everywhere, especially here, in Australia and the US, reacting cautiously to talk of social reform, the centre right needs either to think very carefully about how to sell change, or avoid specifics.

And don't forget that uniquely New Zealand problem, MMP. It institutionalizes differences of opinion and it rewards minorities. To win office, the largest party must draw at least one other group to its side. Helen Clark has been skilful at keeping as many minor parties as possible on her side of an invisible, but nonetheless real, parliamentary dividing line. Perhaps caution is the wisest course, although I suspect there will be a huge din if National attempts to negotiate the rapids of an absolutely critical election for New Zealand's future with nothing better on offer than a slightly bluer version of Labour's failed policies. Will I be proved wrong?