The Beneficiary Of Chaos: Television New Zealand’s current affairs flagship, Q+A, interviewed Stephen Jennings, the former Treasury official and New Zealand investment banker who took advantage of the collapse of the Soviet Union to make himself a billionaire.
IT WAS A LONG TIME AGO, the late-1970s, possibly, or the very early 1980s. My father and I were watching one of the many current affairs shows then broadcast by the state-owned television network. The guest was a very young Alan Gibbs – at least that’s the way I remember it. If it wasn’t him, then it was someone who looked and sounded very much like him.
It was an odd interview. Not in terms of the production itself, but because in those days people espousing the views of businessmen like Alan Gibbs were very few and far between. In New Zealand, at least, the post-war Keynesian settlement still reigned supreme. Lassiez-faire capitalism was something students read about in economic history textbooks. In the 1970s, most responsible intellectuals dismissed unregulated capitalism as a ruthless and highly exploitative form of economic management, long since discarded by civilised nations.
That’s what made the interview so memorable. The young businessman (Gibbs?) withstood the interviewer’s rather condescending line of questioning without flinching. Every aspect of the post-war settlement: the welfare state; public ownership; compulsory unionism; import-licencing; guaranteed prices; came under his withering critique. My father and I looked at each other in alarm. We’d never heard anything like it. At the conclusion of the interview, my father turned to me and said: “Men like that are dangerous, son. If they ever gain a serious following in this country they will cause tremendous harm.”
It was New Zealand’s first encounter with what we today call “neoliberalism”. Within five years of that interview, however, Keynesianism was on the defensive. Businessmen like Gibbs and his fellow asset strippers were being lionised in the business press. Defenders of the status quo, like Rob Muldoon, were being pilloried. The new economic order, guarded by Margaret Thatcher in the UK, and Ronald Reagan in the USA, had made the world safe of dangerous men. Here in New Zealand – just as my father had predicted – they were all getting ready to inflict tremendous harm.
What made me think of this prophetic television encounter from 40 years ago? Unsurprisingly, it was another current-affairs interview.
On Sunday’s Q+A (17/7/16) Corin Dann interviewed Stephen Jennings, the former Treasury official and New Zealand investment banker who took advantage of the collapse of the Soviet Union to make himself a billionaire.
Jennings’ firm, Renaissance Capital, made five billion dollars buying and selling the property of the Russian people. The new, laissez-faire economy Jennings and his fellow oligarchs constructed on the ruins of the USSR proved to be more than usually dangerous. Perhaps the most dramatic measure of the tremendous harm it inflicted was that, as the Oligarchs and their kleptocrat political allies imposed capitalism on their nation from above, the life expectancy of the Russians actually fell.
Today, Jennings oversees a continent-wide property development enterprise constructing massive suburbs on the outskirts of African largest cities. As low-wage economies cascade out of Asia and into the last, great, untapped pool of cheap labour on the planet, Jennings will be there to ensure that their new, middle-class overseers have somewhere suitable to live.
Whether Africans prove to be as biddable as Russians remains to be seen. All the signs point to the great wave of globalisation, out of which Jennings extracted his super-profits, as having already broken. As it recedes, the neoliberal doctrine, which for forty years has been used to justify the globalisers’ moral and environmental excesses, is beginning to sound increasingly hollow.
Not, of course, to the members of the NZ Initiative (successor organisation to the NZ Business Roundtable) who were happy to provide an audience for Jennings’ unreconstructed neoliberalism. Nor, indeed, to Act’s David Seymour, in whose “Free Press” newsletter Jennings is lauded like a rock-star. But to those of us who have heard enough neoliberal rhetoric over the past 40 years to last several lifetimes, Jennings performance came across as just one more iteration of a policy prescription that has succeeded only in making the world a less equal, less habitable, and less free place in which to live.
As Dann concluded his interview with Jennings, it occurred to me that I had been witness to both the beginning and the end of an era. Gibbs and Jennings are neoliberal proselytisers of formidable energy and unwavering certainty. That much, at least, remains unchanged. The difference, of course, is that in that first interview the ideas expressed had yet to be tested in a modern context. In Jennings’s case that is obviously no longer true. The world now knows what happens when capitalism is unbound. Its harm is all around us.
My father knew, instinctively, that business leaders like Gibbs and Jennings were dangerous men. Would that he had lived long enough to see the self-serving character of their ideology made obvious to everyone.
This essay was originally posted on The Daily Blog of Monday, 18 July 2016.