Tuesday, 26 May 2015

Tricky Customer: Why Is Matthew Hooton Accusing John Key’s Government Of Lurching To The Left?

Trickster-in-Chief? Right-wing PR maven, Matthew Hooton, pushes the line that National is lurching leftwards, because he wants Labour to "trump National to the right".
 
MATTHEW HOOTON is a very tricky customer. To hear him tell it, Bill English’s seventh Budget represents a decisive break with the policies of Roger and Ruth. Effectively, the end of the neoliberal settlement. It’s nonsense, of course. But that only makes me wonder why he’s saying it.
 
There are only two probable explanations for Matthew’s latest foray into the realms of make-believe. The first is that he actually believes what he is saying. The second is that he is saying it for effect.
 
To hear for himself just how silly he sounds, he has only to answer the following questions about Bill English’s Budget.
 
1. Did the Budget foreshadow the repeal of the Reserve Bank Act?
2. Did Bill English signal his government’s intention to resuscitate organised labour?
3. Did he announce New Zealand’s imminent return to trade protectionism?
4. Did he raise the top marginal rates of income tax?
5. Did he abandon his goal of returning the Government’s accounts to surplus?
 
The answer to every one of these questions is, of course, a resounding “No.” There is absolutely no question of this National Government abandoning the neoliberal settlement of the past 30 years. For Matthew’s benefit, however, let us briefly enumerate the key features of that “broad policy consensus”:
 
1. Price Stability.
2. Labour Market Flexibility.
3. An Open Competitive Economy.
4. Broad-based, Low-Tax Structure.
5. Government Surpluses and Debt Repayment.
 
To strengthen those key features, successive neoliberal governments (both National and Labour) have pursued at least one – sometimes all – of the following policy goals:
 
1. The legislative curtailment of trade union rights - especially the right to strike.
2. The steady elimination of progressive taxation – to the advantage of the wealthy.
3. Permanent downward pressure on both the size and scope of the public sector.
4. Continued privatisation of state assets.
5. Creating incentives for beneficiaries to move off benefits and into training and/or work.
 
The very most that Matthew could say, in terms of Bill English’s Budget moving away from the Neoliberal Settlement, is that his decision to increase some benefits by up to $25.00 per week (after 1 April 2016) represented a marginal reduction in the incentive to transit from welfare into work. That said, however, and given the fact that even that bastion of neoliberal rectitude, The Treasury, was prepared to acknowledge that the gap between benefits and wages had grown so wide that tens-of-thousands of children were suffering actual hardship, one can only wonder what Matthew would rather Bill English had done.
 
Should the Finance Minister simply have ignored all those children careless enough to have been born into poor families? Should the cumulative long-term effects of childhood poverty have been similarly disregarded by this present generation of politicians – leaving the butcher’s bill for all its entirely predictable social pathologies to be paid by the taxpayers of the future? Matthew doesn’t say.
 
Let us, then, turn to the second probable explanation for Matthew’s curious obituary for the Neoliberal Settlement: that he is saying it for effect. What effect could that be?
 
The most likely effect which Matthew is striving to produce is the general public acceptance of his proposition that the National Party, under John Key and Bill English, has moved sharply to the left. So dramatic has this shift been, Matthew told Radio New Zealand–National’s Kathryn Ryan, that National “is well to the left of the Clark Government, and well to the left of the Greens.”
 
Now, why on earth would a radical conservative like Matthew want to persuade ordinary centrist voters that John Key was slowly-but-surely turning the National Party into a socialist outfit more radical than either Labour or the Greens? Let’s allow the man, himself, to answer the question. This is what he said to Kathryn Ryan on Monday, 25 May 2015:
 
“I think that [Labour is] in the most terrible trouble – perhaps in their history ….. Look, [these] are their choices: John Key is chasing them to the left, there is no doubt about that. As I said, Helen Clark didn’t do anything this radical. They have to accept what’s happening here. If they think that moving left is going to help them, then John Key is just going to chase them. So, I think they’re going to have to – and I don’t know how they’ll manage this – but they’re going to have to trump National to the right, somehow.”
 
Kathryn Ryan asks Matthew if he’s suggesting that Labour do what it did in the 1980s.
 
“Well, exactly! That was forced upon Labour, wasn’t it? When you had Muldoon going so far to the left, in that third term, in particular, the incoming Labour government had no alternative – because there was no position or place in the political spectrum for it.”
 
Stripped of all its fanciful historical analogies and preposterous ideological comparisons, Hooton’s analysis reduces down to this bleak electoral proposition.
 
National can only hope to continue in office by conceding more and more ideological ground to the Left. In terms of internal National Party politics, the scope for many more such concessions is rapidly narrowing. The only hope of holding the neoliberal line, therefore, is to persuade the Labour Party to embrace the very principles that National has already identified as electoral poison.
 
Why would Labour do that? – As opposed to endorsing, and then extending, the left-wing political gestures upon which National has pinned its hopes of re-election? What could possibly persuade Labour to refrain from forcing an electorally fatal split in National’s ranks, in order to adopt a suite of policies guaranteed to re-open the bitterest divisions within its own?
 
Sadly these are not rhetorical questions. Labour’s caucus already contains within its ranks a number of MPs to whom neoliberalism still presents itself as the solution – not the problem. Strengthen the hand of these individuals by orchestrating the same sort of media about-face that sank the National Government of Rob Muldoon. Heap praise upon Andrew Little for having the courage to “think the unthinkable” (and let him know that he can expect strong media backing for silencing the Labour Left) and History could very easily be persuaded to repeat herself.
 
And if/when she does, you can bet that Matthew Hooton’s PR firm will be writing her media releases.
 
This essay was originally posted on The Daily Blog of Monday, 25 May 2015.

31 comments:

Anonymous said...

If one looks at the last 40 years of NZ political history it is hard to see a clear distinction in government's left and right with respect to their implementation of policy and across the board governance. In the context of the Douglas/Lange then Richardson years everything since seems profoundly centrist. Hooton hates Key and co - for personal reasons and because they are not right enough for him. Key, and Clark before him were pragmatists and they pitch to the centre and govern to stay in power. Within National here's not much stomach at the moment for right lurching, even though your Willamson/Collins faction (is there one?) are teetering in that direction. On the left the seemingly disparate ideological power struggle is discomforting to the public and the longer this happens the more the centre ground shores up.

Charles E said...

Hooton has become rather odd and volatile of late. He has it in for Key & Joyce for some reason, possibly personal.
I first noticed it in the NBR when he took up the position that they had completely blown it with the Sky City/Govt Convention deal & dispute. He slammed them as suckers at the mercy of a cunning Sky City boss who had them cornered and predicted an embarrassing back down would be inevitable. He got it 100% wrong and the Sky City boss backed down and apologised. This annoyed Hooton greatly I expect and he continued to attack Key in the NBR over other things including petty stuff like the hair thing.
So it is no surprise he is going even more silly and saying Key is now a socialist. What crap Hooton spouts when it comes to the Key regime.
As you point out, there is no evidence for his rant at all. It is batty.
Increasing welfare is actually proof of Key & Co being true blue old fashioned conservatives like me, better known sometimes as Tories. We are not remotely socialists, nor neoliberals either. We believe in basic State charity, (called Welfare) for the truly needy when communities fail to look after the poor as they should. Private charity is better but we accept the State must provide a bottom line upon which communities and charities can build.
Secondarily it is excellent politics from an astonishingly clever & popular government. That clearly infuriates Hooton for some reason. Perhaps he wanted to stand for them and was told to bugger off? Or did Key unfriend him on social media or fail to give him scoops for his blog? Something little perhaps like that has set his brain on fire.

Wayne Mapp said...

Chris,
You clearly set out what you believe to be the neo-liberal settlement. You must also know that there is not the remotest chance that Labour will overthrow it, at least as you have defined the "settlement."
On your analysis, the platform put forward by Labour in the last election sat squarely within the neo-liberal project.
To step outside the neo-liberal project, Labour would have to agree to withdrew from the WTO, probably withdraw from CER, re-nationalise large chunks of the economy and bring back compulsory unionism. None of these are going to happen.
But Labour could have a modern appealing programme by looking forward, not back.
For instance a major green initiative built around innovation, a major green initiative around agriculture that meant boosting production as apposed closing down the diary industry (which is the Greens answer), a different transport and infrastructure programme, a dramatic regions initiative and of course housing (for purchase, not rent).
None of this reverses the neo-liberal project, but it is quite different to National.
And I think being relentlessly positive, and less carping on about John Key would be an essential ingredient.

Guerilla Surgeon said...

Hooton is about as far right as it is possible to get isn't he? Or am I missing something? In which case he probably does believe John Key is a socialist :-). If you're looking at him from the extreme right, I guess he is.

Davo Stevens said...

Batty Matty is somewhere in orbit around Mars. He's almost impossible to understand where his head's at.

Don't pay him any attention and you will save your own sanity.

Tiger Mountain said...

even marxist blog Redline claims the Key govt is not neo liberal! the fact is the Nats cruise on the hard wired ultra market structure of the ’84 Labour neo lib experiment–SOEs, Reserve Bank and State Sector Acts, Treasury settings, asset sales, degrading of the public sector etc

and for immediate consumption (pun intended) they also cruise on various social democratic policies such as the obvious WFF, Kiwibank and Kiwisaver while they oversee the transfer of wealth ‘upstairs’ and offshore, NBR recently reported via Oxfam criteria* that some 3% (over 100,000) NZers are 1%ers

so it is Hooton playing silly, and dangerous buggers with political terminology

* as I recall that involves having $900,000 in “readies” after debt has been retired on all other assets and holdings

Victor said...

I think that Ockham's Razor may need an outing.

GS is right. Hooten is very much on the economic Right, closer to ACT and the Business Round Table types than to National's mainstream. And for the last six and a bit years, he's been telling us, with varying degrees of conviction, that Key's a leftie.

That's what Hooten and many others amongst the right-wing lumpen-intelligentsia (and their paymasters) actually believe. And they tell you just that, whenever the opportunity arises. Moreover, they've been doing so for yonks. No mystery!

And Charles E is also right. Mainstream, traditional conservatism in this country is a different beast to outright neo-liberalism. It has solid provincial roots and, in its way, cares about the country's future.

The neo-liberals thought that, when they hired a globe-trotting money man, they'd hired one of their own. But they hadn't. All they'd got was a more street-wise and less intellectual version of Bill English, with a (to me at least) inexplicable ability to charm birds off trees.

So Key's safe as long as he remains 'Mr Popularity' with Middle NZ. Meanwhile, Andrew Little's doing his best to make the PM look statesmanlike.

pat said...

although Matthew Hooton has a problem with Key and some senior Nats at a personal level (or so the story goes)...most of what he publicly espouses is business.....follow the money.

Kumara Republic said...

Key's National is less neo-liberal and more crony capitalist.

Davo Stevens said...

Yes Victor. With MMP the two major parties dance around the centre. They continually move in one direction then the other and leave the more extreme views to the smaller parties. The Nats did the deal with ACT not just to get an extra seat, knowing that they could possibly not win Epsom, but to make it look like they were neo-lib of a Kiwi kind. Michelle Boag head-hunted John Key probably thinking that he was a better operator than English. He has a fascination with photos and pony-tails.

The almost non-existent Maori Party is also a centre dancer with a righthand twist. The Greens have also moved to the centre as well. That leaves no party that one could honestly call Left wing and it is what we need here. It is needed to give people a real choice of Left or Right. Some regard Andrew Little as being left wing but I, for one, am not holding my breath. Time will tell if he is or not.

Charles E said...

TM, you can't have 3% of 1%er now can you?
Real 1%ers are hard men bikies in any case and they will be most upset if you tell them they are getting 300% more common.

Anonymous said...

Well said Wayne Mapp, according to Chris any government which wont implement a radical strategy of renationalisation, compulsory unionization and withdrawal from various trade agreements is Neoliberal.

Any government which accepts the status quo and implements cautious incremental changes is neoliberal (Clarke, and Key come to mind). Basically 95% of the population is neoliberal since most of us hate the idea of radical change either Rogernomics or Trotterskyism.

Brian Easton describes Key much more accurately as a neo muldoonist (in the non pejorative sense) See: http://pundit.co.nz/content/how-shallow-is-intellectual-life-in-new-zealand it really puts this latest post to shame

He writes:
I don’t think we have a ‘neoliberal’ government. Recall the short shift Key gave to Don Brash (who is definitely a neoliberal). In fact this government is, as Catton’s subsequent adjectives say, a business-oriented one. Business took on a neoliberal stance in the Rogernomic unwinding of the economic regime which Muldoon represented. But they don’t any longer.

Later he goes on to say:
About a decade ago the business community began saying to me, perhaps earlier to others, that rogernomics/neoliberalism was something of the past and they had moved on. But to where?

They would talk about ‘NZ Inc’ which involves a close association between business and the state. I have yet to write up the chapter of the history, but my tentative thinking is to call it ‘business capitalism’ (it is certainly not 'finance capitalism' – our finance sector is not big enough).

My current thinking is that in many ways it is a continuation of Muldoonism. I do not say this pejoratively (and I've never seen anyone say Muldoon was a neoliberal).

Muldoon ruled New Zealand when the economy faced extreme adjustment difficulties from the structural collapse of the wool price in 1966. But if you look behind this, and his personality, you see similarities with the way the current government operates. If that is correct – this is a tentative hypothesis – then we can trace the economic style back to National’s traditions – embodied in the Holyoake years and earlier. The big difference is that New-National has much less input from farmers than its earlier versions.

Muldoon ruled New Zealand when the economy faced extreme adjustment difficulties from the structural collapse of the wool price in 1966. But if you look behind this, and his personality, you see similarities with the way the current government operates. If that is correct – this is a tentative hypothesis – then we can trace the economic style back to National’s traditions – embodied in the Holyoake years and earlier. The big difference is that New-National has much less input from farmers than its earlier versions.

Easton is a thoughtful and economically erudite progressive and its hard to argue with his analysis, the current government are pragmatic and highly responsive to the desires of the vote rich median voter, far from being neoliberal they are solid centrists who accept the status quo and improve on it with many small incremental changes - just like Helen Clarke.

Trotter and Hooton are very similar in they're craving for the implementation of a radical economic agenda, which would almost certainly involve a great deal of uncertainty and economic hardship for a great deal of voting citizens as such they should and will be ignored unless there are extreme economic circumstances which create the kind of acceptance of radical change among centrist kiwi's (like the post muldoon stagflation and econmic malaise created fertile political soil for the 1980's neoliberals).

In short Chris like Hooton is an extremist and like all extremists he detests the cautiously conservative pragmatists who hold power, best he is ignored and we stick with the status quo and build on it - if that makes the remaining 95% of us neoliberal then so be it.

Chris Trotter said...

To: Wayne Mapp and Anonymous@11:00

The simple historical truth, which both of you seem incapable of taking on board, is that the Neoliberal Settlement, which began, in earnest, in 1984, was all about eliminating the Social-Democratic (or, if you prefer, the Keynesian) settlement of the 1930s and 40s.

If all of the important elements of the latter had not been decisively eliminated (e.g. The Employment Contracts Act 1991) we simply would not be able to talk about a Neoliberal Settlement - would we?

It is facile, to say the least, to construe National's purely tactical electoral manoeuvres (e.g. the $25.00 p/wk "increase" for beneficiaries) with some sort of wholesale strategic reversal away from core Neoliberal policies.

My point in asking those five questions about Bill English's Budget was not to call for a return to the status-quo pre-1984, but to demonstrate the political absurdity of suggesting that such an event had occurred.

Nevertheless, to justify the claim that this is NOT a Neoliberal regime, you would have to provide concrete examples of its ministers moving beyond the assumptions - economic and social - that have underpinned New Zealand's policy environment for the past 30 years.

If you cannot do that, then your claims (along with Brian Easton's, Michael Cullen's and the Dim-Post's) that Key's is NOT a Neoliberal government must fail.

Victor said...

Kumara Republic

Absolutely. And there may come a time when crony capitalism becomes as unpopular with Middle New Zealand as is hard-line neo-liberalism. But (despite the Sky City Conference Centre)we're not there yet.

Anonymous said...

Your still saying that any government which dosn't engage in a radical counter revolutionary program to roll back the work of the rogernomics is neoliberal, this is clearly nonsense. The current government is a continuation of Holyoake/muldoon cautious pragmatism, building on the status quo and pushing ahead with incremental reforms.

We must remember before we join Chris in sneering that no progressive government since muldoon has increased welfare benefits and $25 per week will buy 10 litres of milk and 5 kg of porridge enough to ensure no child goes to school hungry.

Chris is well within his rights to join Roger Douglas, Matt Hooton and Martyn Bradbury as an outraged foam flecked bug eyed economic radical shrieking for revolution or counter revolution and labeling any who preach a moderate path as neoliberal or marxist backsliders - we just have to remind him that the remaining 95% of us are not neoliberal backsliders, we just dont want radical distruptive revolutions either neoliberal or neotrotterian the soft centrism of Clarke and Key is radical enough - long live neo muldoonism

Chris Trotter said...

This in no way answers the challenge put to you and Wayne, Anonymous@11:00. What's more, you have elected to descend into crude ad hominem attacks. If you can't foot it here at Bowalley Road - go play somewhere else. This is a blog for grown-ups.

Anonymous said...

mea culpa on the attack Chris it was unjustified, I have a live wire from my heart to my keyboard and the brain was not engaged.

I maintain unconvinced that key is a neoliberal, however I understand our views on what constitutes a neoliberal differ - which makes the description worthless as it describes anyone or anything and thus nothing.

For me neoliberal is an aggressive economic liberaliser, Im thinking Roger Douglas and Ruth Richardson in the NZ sphere, parties which engage in gradual liberalisations are not in my view neoliberal - its a timing and intensity thing (this is eastons view and cullens and danyl macl).

From what I can gather Chris believes we live in a neoliberal society - the end result of aggressive neoliberal reforms and any party which does not push to reverse that is guilty of being neoliberal. This means of course that most political parties and almost all voters are neoliberal as most of us hate radical and intensive economic reforms whether neoliberal or neo-lefterian.

Again I apologise for my previous rudeness, but I get annoyed at the insistence by of many on the hard left that moderates like Helen Clarke and John Key are somehow cut from the same timber as neoliberal policy aggressors like Douglas, Brash and Hooton. Chalk and Cheese or more accurately Rogergnomes and muldoonists.

David Stone said...

Hi Chris
To Wayne and Annon and yourself; To my mind the essential elements that distinguish neoliberal govt' are not so much on the expenditure side , whether they spend $25 on beneficiaries or $12.5M on a Soudi businessman , but on the overall control of the country's financial affairs . Neoliberal government has handed all that control over to the multinational banks and businesses and no longer has the means to determine whether we sink or swim.
Ultimately , if there is to be anything left to spend on social needs, Democracy must take back control of capitalism and the creation of money must be brought back under government control to serve capitalism . Under the globalised laissez faire regime we have now money is in control of capitalism and capitalism is in control of our democracy. This situation is not only unfair and unethical but it is ultimately unsustainable.
Cheers David J S

Anonymous said...

David according to wikipedia neoliberalism is a set of ideas associated with laissez-faire economic liberalism beginning in the 1970s and 1980s, whose advocates support extensive economic liberalization policies such as privatization, fiscal austerity, deregulation, free trade, and reductions in government spending in order to enhance the role of the private sector in the economy.

There is no doubt according to this definition that Roger Douglas and Ruth Richardson were neoliberals, as is Matt Hooton and Don Brash. We can say for certainty that according to this definition that Jim Boldger (post 1993), Helen Clarke and John Key are NOT neoliberals they are gradualist, pragmatic centrists - neo muldoonist (in the non pejorative sense.

Chris on the other hand regards any politician who is happy to build on the status quo as neoliberal, this clearly is incorrect if you use the above definition.

The question which I would ask Matt Hooton is why should we engage in more aggressive neolibral reform, we have low inflation, our GDP growth is around its long term maximum sustainable level, we have falling unemployment and a government which has just given the first real increase in benefits to the most vulnerable without blowing the budget. What would we achieve with an aggressive program of economic liberalisation and is there anything to actually liberalise - Im thinking we need more comprehensive regulation of some industries - especially power (not the brain dead labour initiative either more like a pimped up commerce department etc).

I think the term neoliberal is now used and abused so often that practically every man his cat and dog can be described by some as neoliberal, in fact Chris is probably regarded as a neoliberal sellout by some on the far left, enough on this subject.

Chris Trotter said...

Yes, more than enough.

Your definition is entirely adequate - and WOULD, of course, include John Key, whose entire prime-ministership has been devoted to "enhanc[ing] the role of the private sector in the economy".

And, quite apart from Key's conduct, it is important to remember that this posting is about the Neoliberal SETTLEMENT. In other words, it's about mapping the accepted parameters of the politically possible.

There are moments in the establishment of a new political paradigm when policy aggression (a la Douglas and Richardson) is the order of the day, and there are other times, after the initial battles have been won, when consolidation and a more gradual pace of reform are required.

We are living through the latter - not the former. But this in no way suggests that the overall settlement is under threat.

Nor is it permissible to suggest that "we are all Neoliberals now". Fully a third of the population continues to vote for parties with policies that actively challenge the Neoliberal status-quo - yes, even Labour, over the last two elections.

The vital point to retain is that Neoliberalism was and remains a political, not an economic, project. Its protagonists, like the Chinese, have constructed an elaborate series of defences against those who would threaten their power - and like all such defences it requires constant maintenance.

That's all John Key is: a very effective maintenance man.

Guerilla Surgeon said...

You don't need to be "an aggressive economic liberaliser" to be considered a neoliberal if it's already been done for you. All you have to do is keep the laws on the books. That may be one of the points that Chris is making.

Anonymous said...

Thats exactly his point GS, in CHris's world maintaining the status quo is neoliberal, thus key and clark are neoliberal maintanance workers.

That means we have an awful lot of neoliberals in our country, most of them are unconscious or involuntrary neoliberals who either have no idea we are living in a neoliberal order which can and should be reversed immediately, or if they are aware of it they also know that to try to mount a counter revolution would be political suicide and instead work within the current framework with gradualist reforms which dont cause the upheavals of the neoliberal 1980's.

At the end of the day I reject this notion, I accept Brian Eastons view of neoliberals as the aggressive economic liberalisers of the 1980s, I also accept there is neither need for they're policies now and there is certainly no political appetite for them.

Chris and I agree to disagree - which is cool because this is Bowalley road where diversity and strong debate are allowed and encouraged.

David Stone said...

To Anonymous
What Chris said
Cheers David J S

Guerilla Surgeon said...

And when it's all done anonymous? When everything's been privatised and aggressively liberalised? Do we then have no neoliberals at all? It's sort of like science 'stopping' because we know everything. I'm not sure your answer makes sense to be honest.

Chris Trotter said...

To: David Stone.

Thank you. It's good to know that at least one person out there gets it.

To: Anonymous@13:37:

You are, indeed, correct, when you say Bowalley Road is a place where people can agree to disagree. But, it is also a place where those who participate in debate are expected to read and comprehend the arguments of those with whom they are debating.

This straw man of yours, that I am advocating a return to the status quo ante Rogernomics and Ruthanasia, while essential to your argument, is quite simply inadmissible.

A settlement of any kind is given the title precisely because it has settled issues previously in dispute.

The post-Civil War settlement in England, for example, restored the monarchy, but only on condition that the monarch was willing to rule with - and not in spite of - the guidance of Parliament. Charles II managed to do this (with a lot of help from Louis XIV) but his brother, James II, did not. Except that, when James tried to restore the absolutist principles of his father, Parliament and the army simply deposed him. Absolute monarchy was no longer politically feasible in England. That much, at least, was settled.

It is no more acceptable to imply that someone who talks about the Neoliberal Settlement must ipso facto be in favour of the restoration of what came before it, than it is to suggest that historians who talk about the post-Civil War Settlement favour the return of Charles I's absolutism.

Nor is it fair to say that just because all the English leaders who accepted and advanced the notion of Parliamentary Supremacy were not military dictators like Charles I's nemesis, Oliver Cromwell, it is quite alright to describe them as absolute monarchists. And yet, this is precisely what someone like Matthew Hooton is doing when he describes John Key as "left-wing".

John Key is the sort of Neoliberal you opt for after the Neoliberal Revolution has been won and the Neoliberal Settlement cemented into place.

It absolutely astounds me that so many otherwise intelligent people, on both the Left and the Right, cannot seem to grasp this.

peter petterson said...

Key's government is a fascist government and if reelected in 2017 it will become as Nazi as Germany's in the 1930's.

Anonymous said...

Im sorry Chris I still dont get your argument, all I see with the last 2 governments is a return to muldoon gradualism, the revolutions of the 1980s to me were just an intensification of the Holyoake and muldoon gradualist reforms. Holyoake spent 12 years undoing Nordmyers rather dated war type policies and muldoon in his first 6 years presided over CER and the ultra painful adjustment of the 1966 wool price collapse, Britain joining the EU and the oil shocks. I guess thats because I was not an adult during the tumult and read about it in the economic history books at Uni - Im a new NZer, not an old one.

One area of counter revolution Im picking up on is in the housing market where we could see massive government intervention in auckland to resolve the crisis - building houses for the young aspiring middle classes, big vote winner for national, not exactly progressive policy but certainly not neoliberal either.

I eagerly await your next post Chris, for now Im over the topic of who and what is a neoliberal.

Davo Stevens said...

I don't really care about the semantics of what people say, I read what they post and absorb it that's all.

I have been reading what a rather sensible member of another forum has been posting:

http://forums.aardvark.co.nz/viewtopic.php?f=4&t=429

He makes a lot of sense. His analogy of scum on a pond is quite accurate regarding politics here over the latter years. Another of his analogies is accurate too, namely, if you want your garden to flourish then there is no point in shooting the fertiliser into the sky. It needs to be put at ground level and the plants will grow. The same applies to money, shooting money upwards doesn't make an economy grow either, it must be put in at ground level too. Then the economy can grow strongly. John Maynard Keynes recognised that important point.

Whether John Key is Neolib or not is not the issue (he is but so was Helen Clark) as all of them are. He, like Helen, is a consummate MMP politician which makes it hard to define his real politics. Hone Harawera, love him or hate him, was the only politician in Parliament who was not a Neolib. All the others are in all differing degrees.

Making changes incrementally doesn't work either. To give Roger his due, he realised this and saw that the only way to change things is to do so quickly and suddenly. Slash and burn if you like. As I have said many times here, will Andrew Little make any real changes? I doubt it but I will give him a chance.

Why is it that fewer people are voting? Cuold it possibly be that they have no real choice? Tweedledee/Tweedledum politics with both parties joined at the hip (and the shoulder and the head). We need a real choice people!!

Victor said...

I take what I think is Chris's point, viz. that neoliberalism is now so firmly embedded in our institutions, policy settings and practices that pragmatists (even reforming pragmatists) automatically work within its confines and, consciously or otherwise, share the assumptions, if not the arid fanaticism, of the ideologues who foisted this creed upon us.

If he's correct and if I've interpreted him correctly, then he's right to insist on this formulation. How else do you persuade politicians and voters that there might be sensible and practical alternatives, including alternatives that are tried and tested but were abandoned for no very good reason a third of a century ago? Personally, I found it hard to watch the recent UK election without this thought occurring and re-occurring.

It might bear repeating that, if the great, primarily conservative and largely successful leaders of the 1950s (e.g. Eisenhower, Adenauer, Churchill, Macmillan, de Gaulle, Menzies, De Gaspari et al.) were to come back to life and seek to contribute their thoughts and experience, they'd immediately be dismissed as leftist dreamers. None of them, after all, shared the basic assumptions of neoliberalism.

On the other hand, there are greater and lesser degrees of devotion to neoliberalism amongst those who currently govern us. Moreover, events have the habit of causing even the most dominant of ideological settlements to morph into something else. Indeed, we seem to be experiencing such a shift at the moment..in the direction of 'crony capitalism'.

But, if so, it's a form of crony capitalism with neoliberal characteristics as opposed to the (far less toxic) pre-Rogernomics crony capitalism, which came with Keynesian and welfarist characteristics.

Wayne Mapp said...

Chris,

While I agree there was a neo-liberal settlement in the late 80's and 90's I think its elements are a bit different from what you would consider them to be. I would say the key elements were a substantial deregulation of financial markets, deregulation of labour markets, privatization of the competitive parts of the economy, and lower taxes (typically to be no higher than 50%).

To explain some of these. Probably the key element was the deregulation of financial and capital markets. This led to much greater internationalization of capital (how John Key made his money). Privitisation really meant getting the state out of those parts of the economy where the goods and services supplied did not have significant social component and where the consumer simply paid a fee for the service (telecoms, electricity, airlines, hotels, ports etc). In contrast those parts of the economy with a large social component (education, social services, health, low income housing, roading) the state has remain heavily engaged.

I have not included liberalization of trade. This dates back to GATT 1947 and has been a long held objective, mostly because the 1930's depression was seen to have been greatly worsened by trade restrictions. The EU, and CER are part of this broad trend.

While neither Helen Clark or John Key have sought to unwind the key elements of the settlement, they have both (in somewhat different ways) sought to ameliorate it. Helen more explicitly (read her speeches), John in a more pragmatic way (also read his).

Where I fundamentally differ from you is the efficacy of the neo-liberal settlement. To me, by and large it was a good thing since it gave both more freedom and choice, and it increased overall prosperity. New Zealand was a bit of an outlier by the 1970's (compulsory unionism, very high tariffs and import licensing), so the journey of reform was greater than say in Australia.

In my view the settlement will not be unwound, and neither should it be. Of course it can be moderated and that is where most political discourse in New Zealand exists.

As for your views on this issue Chris, well I simply can't work them out. I cannot tell whether you think the settlement should be unwound or not. I suspect you do not think it can be, hence why you appear to blow hot and cold on it.

Guerilla Surgeon said...

Wayne – if indeed he be Wayne – is making a certain amount of sense here. I wouldn't mind a little clarification on what should be done with the neoliberal experiment. I'm half of the mind that technological change has made it impossible to completely expunge it. But there must be surely, ideas short of this? Taken as a whole obviously it hasn't worked. Prosperity might have increased overall, but most of that has gone to the top 10% or less. We don't know exactly how much prosperity might have increased under a more Keynesian regime. Trickle-down has been shown to be utter nonsense. And we have had a number of substantial crashes due to the deregulation of financial markets, and irresponsibility if not illegality on the part of bankers, which on the whole I think are occurring at a greater frequency than they have in the past. Though I must admit it's probably a little early to say.