Bill Sutch has been dead nearly as long as CAFCA has been alive. Dr William Ball Sutch, formidable economic nationalist, writer, intellectual, public figure and top civil servant, died in early 1975 just months after he underwent the unique ordeal of being the only person ever to stand trial under the espionage provisions of the former Official Secrets Act. He was accused of passing unspecified information to a Russian spy operating out of the Embassy of the former Soviet Union, in the course of a series of allegedly clandestine meetings in Wellington. Sutch was acquitted but was dead within months, from cancer.

The Sutch case marks the only time that the Security Intelligence Service (SIS) has ever brought a prosecution against anyone (as the SIS has no powers of arrest, it was the Police who actually arrested Sutch at the scene of one such nocturnal and urinal meeting with a Soviet diplomat at a public toilet). Needless to say, his whole arrest and trial was one of the most sensational events in New Zealand’s history of the second half of the 20 th Century.

And suddenly it’s all being regurgitated again, nearly 32 years after Sutch’s death. One of the SIS agents who had tailed him and was present at his arrest has written a book, unauthorised by the SIS, called simply “Spy”, baldly accusing Sutch of having been just that, for the Soviet Union. Christopher Horton* Bennetts was “Agent S” at the trial. The names of all the SIS witnesses were suppressed and several people were subsequently convicted for naming them or for allowing them to be named on his show, in the case of radio star Brian Edwards. Bennetts has left the SIS and now works as a cop in Australia, hence they couldn’t stop him writing the book (which incurred the displeasure of Helen Clark, Minister in Charge of the SIS). * No relation of mine, I hasten to add. MH.

I should make it clear that I haven’t read the book, don’t intend to and won’t be getting it reviewed in Watchdog. So, what I know about it is solely from the media coverage – but that has been extensive, with extracts published in the New Zealand Herald, a major portion of one of TVNZ’s Sunday programme devoted to it, several lengthy newspaper articles, and editorials (for example, in both the Herald and Press) praising it. The editorials matter of factly accept Bennetts’ conclusions and brand Sutch a spy and a traitor (apparently, a logical progression from the “Communist sympathies” of his youth, which included a long journey through Stalin’s Soviet Union). Bennetts himself makes no pretence of evenhandedness, calling Sutch a “liar”, “traitor” and, just for good measure, “turd” ( Press, 30/9/06; ‘Sutch labelled liar”, Dan Eaton). The most charitable thing that Bennetts can say is: “He was also a loving father, a good husband and he did many things that many New Zealanders would think far outweighed whatever he might have done…I’m making the point that he was a paradoxical patriot. I’m sure he never believed he was doing anything wrong but he was such an arrogant son of a bitch” ( Press, ibid.). On the other hand, Maurice Shadbolt, who covered the trial for the Listener, described “Agent S” (Bennetts) as “looking like a car salesman with a patter that was a little too efficient. ‘A slight, neat young man, moustached, fashionably garbed with wide lapels, wide tie, curved collar; I can imagine him selling shiny new Holdens off the floor of a large city showroom’” ( Press, ibid.).

Trying To Provoke The Acquitted Sutch To Sue Truth

Let’s re-state the central fact in all of this. Bill Sutch stood trial and was acquitted by a jury. Not on some technicality but because the jury found him to be innocent after they had heard all of the evidence. He exercised his right not to give evidence and the defence witnesses were all (high profile) character witnesses only. The SIS’s political and media mouthpieces had trumpeted that New Zealand had caught its own Cold War traitor and, following the prosecution’s humiliating courtroom defeat, those mouthpieces set about viciously libelling Sutch for the remaining few months of his life.

The wolf pack was led by the misnamed weekly paper Truth, which was then a force to be reckoned with in the land, a strange mishmash of rabid Rightwing politics, populism and good old smut. It ran a concerted post-acquittal campaign against Sutch, having access to information that had obviously been gathered by the SIS and Police investigation. One of its scurrilous headlines “Why Did Sutch Lie?” is reproduced on the cover of Bennetts’ book. The aim was obvious – to goad Sutch into suing, so that the whole case could be re-heard, with the advantage (to Truth, the SIS and co) that civil cases don’t have to meet the same high standard of proof “beyond reasonable doubt” as criminal cases have to. The tactic failed, as Sutch never rose to the bait. But he was dead within months, which may very well have been the aim of the whole exercise.

Sutch was certainly naive to be meeting a Soviet diplomat under such circumstances, he was asking for trouble. The only explanation he ever offered was that the Russian approached him, in his capacity as a stalwart of the NZ Friends of Israel, for information about who were the Zionists in New Zealand. There is a whole other explanation for what happened to Sutch that is never mentioned by Bennetts or in the media coverage of his book – namely that Sutch was set up, which would back up Sutch’s story that the Russian approached him first. This was the conclusion of a fascinating post-acquittal 1970s’ TV current affairs documentary. Specifically, that the Russian diplomat/spy wanted to defect to the West, and the Americans asked him to prove himself by doing them and their SIS junior partners a favour by setting up Sutch to be busted. Both the US Central Intelligence Agency (CIA) and the SIS had long suspected Sutch of being a “Communist fellow traveller” (in the peculiar jargon of the Cold War era) and an outright Soviet spy. Here was a chance for a cooperative Russian patsy to deliver him on a plate. What a pity for them that they couldn’t make it stick.

Bennetts states over and over that the reason the prosecution failed to prove its case was that the cops and SIS could not find the package that he said Sutch was seen to hand to the Soviet diplomat at the meeting at which Sutch was arrested (hence the curious charge that he faced, under the Official Secrets Act, of passing unspecified information to the Soviet Union). But it would be most unwise to accept Bennetts’ word as gospel. Well known former Wellington lawyer, Hector MacNeill, wrote to the Listener (14/10/06): “…anyone thinking of buying his book had at the very least a right to expect that Bennetts had read the transcript of evidence given at the Supreme Court trial in 1975. If he has read it, it is plain he did not do so with sufficient care… In the transcript of evidence from the Supreme Court proceedings, no evidence was given by anyone saying that they saw Sutch meet Razgovorov (the Soviet diplomat. Ed.). Additionally, although under observation by a Police officer when Razgovorov spoke to his driver, Sutch was not seen to have handed over a package. Both of these incidents were vital aspects tending to discredit the prosecution case”. So Bennetts can’t even be relied on to get the actual “criminal” facts of the case right.

“A Greater Patriot Than His Detractors”

The real political reason why the powers that be, both in NZ and the US, hated Sutch’s guts and wanted him discredited and imprisoned as a traitor and spy, were most succinctly stated by renowned Christchurch historian, Harry Evison, in a letter to the Press (12/10/06): “The Press omits to mention the most serious offences Dr William Sutch committed against the free market principles that have captivated New Zealand since his death. Besides visiting Russia and reading Marxism, he outrageously questioned whether selling New Zealand’s economic assets to transnational corporations was good for the country. Worse still, he was a Leftwing historian. Right-thinking journalists ignore his writings, and knighted historians like Keith Sinclair very properly exclude him from their bibliographies. Yet two of Sutch’s books, “Colony Or Nation” (1966) and “Takeover New Zealand” (1972) actually deplore the loss of New Zealand’s economic independence through the foreign acquisition of our assets. Sutch even claims that New Zealand would be better off standing on its own feet economically. What would Feltex workers think? The SIS should be warned that there are still people who regard Dr Sutch as a greater patriot than his detractors”.

Harry hits the nail on the head. I never met Bill Sutch or had any contact with him but his books and the political and economic views that he articulated were inspirations to those of us who founded CAFCINZ (as it was then) at the same time as his arrest. The 1975 South Island Resistance Ride, the activity that gave birth to CAFCINZ, was held just weeks before his trial and acquittal. His warnings of what would happen to New Zealand if it allowed itself to be conquered by transnational corporate recolonisation remain as valid today as when he wrote them in the 1960s and 70s.

There is a widely asked question about the Sutch question – what possible secrets could he have given to the Russians, assuming that is what he was doing? What secrets does little old New Zealand have? Bennetts’ answer was that, as NZ is in the inner circle of Western Intelligence agencies (such as the top secret UKUSA Agreement, between the signals and electronic intelligence-gathering agencies of the US, UK, Canada, Australia and NZ – the Waihopai spybase is part of that) we are privy to the Big Boys’ secrets and that the Russians would have regarded NZ as the perfect soft target from which to glean the secrets of its major Western adversaries. This relies on the very shaky assumption that the US shares its secrets with its (very) junior partners. Not so – for example, vast quantities of US official and Intelligence documents (the sort that were bed time reading for the late, great Owen Wilkes) are routinely stamped “US Eyes Only – No Forn (foreign)”.

Moscow Talent Scout? Yeah, Right.

Bennetts has another explanation for Sutch’s alleged activities. He reckons the extremely well connected civil servant, intellectual and public figure was a talent spotter for Soviet Intelligence. In other words, that Sutch was either operating a ring of NZ spies and traitors or recruiting such people for the Russians. So Bennetts casts his smears over an unidentified wider group. He refuses to identify those he so accuses, with one exception. And, as with Sutch, his target is safely long dead and can neither defend himself nor sue Bennetts.

Bennetts accuses the late Jack Lewin, who died in 1990, of having been a possible traitor and Soviet spy. Lewin was a Wellington friend and colleague of Sutch, a long time Labour supporter, former President of the Public Service Association, and he retired a departmental head in the public service. Lewin is not so well known today as Sutch (he didn’t write books and, of course, he was never tried as a spy). But CAFCA remembers him very well. Watchdog 64, August 1990, devoted several pages to him, following his death that year. There was an obituary by Wolfgang Rosenberg and an article entitled “Jack Lewin And The CIA”, accompanied by a reproduced page from a 1959 declassified US State Department file* on him, marked for the attention of the CIA. Part of it reads: “Mr John P. Lewin has been appointed Assistant Secretary in the Department of Industries and Commerce. Reports reaching the Embassy indicate that Mr Lewin has a history of fellow traveller and Communist association. This is of special interest in connection with the history of the Secretary of the Department, Dr WB Sutch (see Embassy despatch No. 346, February 21, 1957)…”. So the Yanks had long had their eyes on both Sutch and Lewin. * CAFCA holds an extensive collection of now declassified US Embassy files, kindly gifted to us by a Wellington historian. See Watchdog 65, October 1990; “Spies Amongst Us. How The US Embassy Saw New Zealand, 1945-60”. Ed.

But the most fascinating material on Jack Lewin in our Watchdog 64 tribute was in an article entitled “Jack Lewin And Comalco: An Untold Story”, accompanied by a letter that he had written to us back in 1974. I never met Lewin and he was never a member of ours (nor was Sutch, for that matter). But when CAFCINZ was fund raising in 1974 for the 1975 South Island Resistance Ride he sent us a $5 donation, along with a letter of support (I should point out that in 1974, $5 represented more than half my weekly rent for a flat; my weekly wage, as editor of the University of Canterbury student paper, was $37). Lewin was then the permanent head of the Department of Trade and Industry, which made him an unusual person to be making a donation to a fledgling and unknown group in Christchurch. We asked his permission to publicise his support and what he said in his letter. He gave us permission only to say that he’d sent us $5, and to emphasise that he did so in his personal capacity. That in itself was newsworthy enough to make the media.

Pulling No Punches About Comalco & Foreign Investment

But what Jack Lewin said in his letter to CAFCINZ was dynamite and we never did get his permission to publish it. Very soon thereafter, Sutch was busted and we never heard from Lewin again. We did the decent thing and waited 16 years until after his death, before publishing it in full in Watchdog 64. I’ll quote a couple of paragraphs: “Speaking personally and not for the Department of Trade and Industry….you could not find a more perfervid opponent of foreign capitalist penetration of New Zealand than myself. In fact, in the matter of Comalco* I, first at the instance of Nash** and later at that of JR Marshall, fought the Comalco crowd in negotiations for ten years. My position was that I wanted at all costs to prevent their even starting up, but all that my obduracy and arguing power did was marginally to improve the position for New Zealand and enable the politicians to present the swindle more positively. * Comalco’s Bluff smelter was a focal point for the two week long Resistance Ride. More than 30 years later, CAFCA is still campaigning for its closure. Very recently Comalco New Zealand has been renamed Rio Tinto Aluminium New Zealand, reflecting its ownership by Rio Tinto of the UK, one of the world’s biggest mining transnationals. ** Walter Nash – veteran Labour politician and Minister from the 1930s onwards, Prime Minister 1957-60. Jack Marshall, veteran National politician and Minister from the 1950s onwards. Deputy Prime Minister during the 1960-72 Holyoake government, Prime Minister 1972. Ed.

“In fact when it comes to an outfit like Comalco, the operations of which I genuinely believe represent a net reduction in New Zealand GNP (Gross National Product) because of the tax concessions, cheap power, the Government funds committed, the price structure in which the amortisation of the borrowed capital is built, and most importantly, the opportunity costs involved in the foregone application of the pre-empted resources, I think that there should be published each year not only a financial accounting which shows the tax take to New Zealand but also an economic accounting which shows how we are bleeding for the multinationals. I would, of course, take this position for every foreign-owned company and would even go so far as to deny them access to New Zealand financial and other services and, in some circumstance, even labour. However, that is another subject…” (5/8/74, letter to CAFCINZ).

What an extraordinary letter! It would be strong stuff coming from any old person but from someone who was still the head of a Government department (he retired in October 1974), to a group such as CAFCINZ was very telling. How many heads of today’s public service do you think would be prepared to describe as a “swindle” the deal allowing Comalco to use 16% of NZ’s electricity at a guaranteed cheap and secret rate? Or to express the views on transnational corporations and foreign investment that Lewin did? And if any of them do hold those views, can you think of any of them who will be putting them in a letter to CAFCA anytime soon?

Their Memories Should Be Honoured, Not Libelled

We don’t make a habit of reprinting stuff that’s already been in Watchdog but when Jack Lewin’s name was dragged into this posthumous smear campaign against Bill Sutch, I hunted up number 64 and read out his 1974 letter at a CAFCA committee meeting. There was an audible intake of breath, people asked to read it for themselves, and I was unanimously instructed that I must republish it in the next issue. In the light of this vicious posthumous smearing of Lewin as a traitor and spy, it is entirely relevant, indeed it is newsworthy (as evidenced by the fact that the Press invited me to submit a drastically edited – it had to be pruned by two thirds - version of this article for its Perspective page, after I had circulated it to journalists in the hope that’s some of them might feel ashamed enough to put some balance into the onesided coverage. It was published on December 6 th, under the title of “’Spies’ ardent patriots” and attracted a lot of positive feedback). What Jack Lewin said to us about foreign investment in general and Comalco in particular still holds true today, 32 years after he wrote it.

So these are the dead men who are being posthumously tried and condemned as spies and traitors by an ex-spook who wants to relitigate a case that the SIS so famously lost, aided and abetted by a compliant and lazy media with its own ideological agenda. In fact, both Sutch and Lewin were New Zealand patriots and progressive nationalists. Obviously, that was their biggest crime. They can no longer defend themselves but we have no hesitation in standing up and saying: This is bullshit! Our advice to Bennetts is to crawl back under the rock from whence he came (actually, from my first hand experience of Aussie cops, he’ll be right at home among them). And we’re pleased to have the opportunity to remind New Zealanders once again of the debt that we owe to Bill Sutch and Jack Lewin. As the saying goes, we stand on the shoulders of giants.