The Rocky Road To Populism

- by Liz Gordon

Liz Gordon contemplates the political year and thinks change is in the air.

We have seen many different kinds of populism in our governments over the years. There was the school bully approach taken by Robert Muldoon, egged on for nine years by a voting public that seemed to delight in a leader that eschewed accountability in favour of talking down anyone who got in his way. David Lange initially became known for standing up to Muldoon (the new boy on the block approach), then for standing up to the world with humour (albeit little substance), then for being a stand-up comic, and ultimately he was the tragic clown, whom opportunity passed by.

Fast forward through Palmer, Moore, Bolger and Shipley, we come to the anti-populist populism of Helen Clark, pragmatist extraordinaire. Clark was never popular with the masses, although she was and is respected. So what do we make of John Key and the National-led government? Popular, yes. And populist, I think, mainly in the negative sense of trying not to scare anyone, and showing a generally good humoured and smiley approach to the world.

Recognising that the main barrier to the election of a National-led government was fear of change back to the 1990s, Key promised that a number of core policies would not be touched in National’s first term. This has made the current Government look very much like the last Government over the past year. The term “Labour lite” has been aptly applied. But there are signs now that the Government is prepared to move on some of these policies before the first term is over. It appears that, having weighed up its populist “pledge” of no change against the opportunity to steam ahead with some desired changes, the “lite” approach may be on the wane.

National will have done the political arithmetic on this. On one side of the equation is the need for the Government to be seen to keep its promises in order to continue to attract votes from non-traditional National voters. These are the “horses” that must not be scared. On the other hand is the need to give something back to their constituency, in order to ensure the loyalty of National voters at the next election. Although it seems incredible, a resurgent ACT Party is a real possibility at the next election. ACT is, surprisingly, doing well in this term out of its “confidence and supply” agreement with National – much better than the Māori Party, I think.

The issue that tested the water was that of raising the goods and services tax (GST). This is one of those things that were specifically ruled out by John Key prior to the election, but there has been talk this year of increasing GST in the budget to 15% or even 17.5%, which he admitted the Government is considering. Whether or not it was intended, the GST episode acted as a test case for the Government on whether its pre-election pledges might be broken without causing too much political harm. At this stage the results are equivocal. Both the anti-GST groups and the pro lobby were highly visible in the media on this issue.

I suspect that, on balance, John Key will have decided that raising GST is too much of a political risk at this stage, as it will be highly unpopular. But the Right will be expecting some spoils to come to the rich in the budget, presumably by lowering the top tax rate rather than reducing company tax. In order to maintain the populist position of a Government for all the people, however, Key will have to offer some tax relief for low and middle income earners too. Without much spare money in the coffers, this will be difficult to achieve. I expect that the Budget will announce quite big cutbacks in State funding and an increase in user pays in some areas.

In terms of capital development, a proposed further liberalisation of the Overseas Investment Act has been discussed, although no details are yet available. The recent publicity over Shania Twain’s use of losses on her New Zealand land to reduce her USA tax liabilities should provoke a widespread debate around overseas investment. In the area of trade, with both main parties promoting a free trade agreement with the United States, either alone or through an expanded Trans Pacific Partnership, there seem to be no political barriers to a replacement of New Zealand products and people with those from other countries. This includes trade in services. ACT is even pushing for the private management of “failing” schools by an international company such as Edison, or even complete privatisation via a voucher scheme.

Good Old Union Bashing

The other area the Government is moving into to try and shore up traditional support is good old union bashing. There have been two lots so far this year. The first was attacking the Corrections staff over their opposition to the three strikes law (carrying on from last year’s attacks over double bunking in prison cells) and the recent announcement that two prisons are to be privately run, letting the private sector in, once again, to one of New Zealand’s main growth industries. A populist Government can, it appears, never go wrong in pushing through plans to increase the number of prisoners, even at a price tag of $90,000 per prisoner. The rising imprisonment rate is having dreadful effects on parts of our society, where young men, in particular, are disappearing at ever higher rates behind bars. Both major parties are responsible for turning New Zealand into the country with the second highest rate of imprisonment in the world. Where will it end?

When all else fails, a populist National government can always attack the teachers, trying to set up a “teachers versus parents” dynamic. The message is clear: the Government is on the side of the parents, not the selfish and ignorant teachers. But there is never a guarantee that attacking the teachers will work. In the 1990s, National became embroiled in the bulk funding saga which went on for literally years, and culminated in a political loss. The NZ Educational Institute, in response to Anne Tolley’s new national standards, has instituted nationwide action that appears to be quite effective. While Tolley may have “sold” standards to the print media, there are still plenty of alternate views around.

I think two things are happening. First, National is committed to becoming more active in implementing its own policies. Second, in doing so, it will begin to alienate some of those who like the “nice Mr Key”, but dislike Tory policies. I think cracks are appearing in the dam, and we will soon see the trickle of Rightist policies turn to a flood. To what extent we will see a return to the lunacy of the 1990s I do not know, but recent proposals such as a separate water agency for Christchurch, more competition in ACC, electricity and health care, do not augur well. What this will do for relationships in Government, and for a shift back to votes on the Centre Left (where there is in my view a shortage of attractive opportunities at present), I do not yet know. This is not all bad news, though, as it provides the opportunity to build opposition and show the Government in its true colours. So dust off the protest gear, folks, and I’ll see you on the streets.

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Foreign Control Watchdog, P O Box 2258, Christchurch, New Zealand/Aotearoa. May 2010.


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