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Government with a plan

Written By: - Date published: 8:00 am, July 22nd, 2018 - 46 comments
Categories: benefits, capitalism, class war, Deep stuff, democracy under attack, economy, Economy, election 2017, Financial markets, grant robertson, infrastructure, jacinda ardern, jobs, Keynes, labour, Politics, poverty, socialism, welfare - Tags: ,

Labour and New Zealand First Ministers under the first term of the sixth Labour government sitting in the Cabinet office.

The polls are great. Top work. But I’m getting worried about the entropy of this government already. Matthew Hooten and Karl Marx agree with me.

Governments usually start with a whiz and a bang and gradually subside from there. We forgot to start.

Even Prime Minister Helen Clark, while democratizing New Public Management with bunches of partially-elected Boards, still launched the huge Growth and Innovation Framework, and other initiatives expanding the reach of public policy into investment capital through Kiwisaver and NZSuperfund.

But with this Ardern-led government, we started with lots of tax transfers, unguided and incoherent engagement with major capital, and yet even with major expansive engagements with real estate capitalism they are running out of steam.

Back in the day I could roll out my Adorno and my Habermas pretty easily. Now it’s getting a bit rusty, but in this moment we need to step back and get the big mental machinery rolling again.

In 2008 or ’98 or ’78, after every good crisis-scale economic throat-clearing, Marx gets rolled out to explain how the system will fuck itself up. Today our national pathologies are more chronic than thanatic.

Since the late 1970s, median household income in New Zealand, adjusted for inflation, has stagnated for the bottom 60 percent of the population, even as income for the richest New Zealanders has soared. Corporate profits are at their highest levels since the 1960s, yet corporations of any note are taking those profits offshore rather than reinvesting them locally. We remain one of the very, very few states left in which democracy is active and hasn’t been massively hollowed out and replaced with technocratic elites who plane across the globe unbounded much by time or border. We still vote.

Thanks for voting, but in New Zealand you can fill the Temuka Memorial Hall with the people who own 75% of the country and still have the back four rows of seats empty.

Karl Marx, of course, would not be surprised. He predicted that capitalism’s internal logic would over time lead to rising inequality, chronic unemployment and underemployment, stagnant wages, the dominance of large powerful firms, and the creation of an entrenched elite whose power would act as a barrier to social progress. Eventually, the combined weight of these problems would spark a general crisis. Yet somewhere between crisis and revolution, Karl Marx and Matthew Hooten diverge; revolution just ain’t happening.

Marx believed the revolution would come in the most advanced capitalist economies. Instead, it came right out of the energised proletariat in Russia and China. There, communism ushered in authoritarian government and economic stagnation. Social democrats like myself from developed economies treated our regular crises as a kind of necessary perpetual binge-purge cycle. But today, as developed economy incomes get skinnier and more malnourished, the winners instead are distended versions of militarized states freed from previous Marxist capture, namely: Russia and China.

Despite the genocidal disasters of the Soviet Union and the countries that followed its model, Marx’s theory remains one of the most perceptive critiques of capitalism ever offered. Better than most, Marx understood the mechanisms that produce capitalism’s downsides and the problems that develop when governments do not actively combat them, as they have not for the past 40 years. Marxism is still useful in part for making sense of New Zealand today.

What makes Marx acutely relevant today is his economic theory, which he intended, as he wrote in Capital, “to lay bare the economic law of motion of modern society.” And although Marx, like the economist David Ricardo, relied on the flawed labor theory of value for some of his economic thinking, his remarkable insights remain.

Marx believed that under capitalism the pressure on entrepreneurs to accumulate capital under conditions of market competition would lead to outcomes that are palpably familiar today. First, he argued that improvements in labour productivity created by technological innovation would largely be captured by the owners of capital. “Even when the real wages are rising,” he wrote, they “never rise proportionally to the productive power of labor.” Put simply, workers would always receive less than what they added to output, leading to inequality and relative immiseration.

Second, Marx predicted that competition among capitalists to reduce wages would compel them to introduce labor-saving technology. Over time, this technology would eliminate jobs, creating a permanently unemployed and underemployed portion of the population.

Third, Marx thought that competition would lead to greater concentration in and among industries, as larger, more profitable
firms drove smaller ones out of business. Since these larger firms would, by definition, be more competitive and technologically advanced, they would enjoy ever-increasing surpluses. Yet these surpluses would also be unequally distributed, compounding the first two dynamics.

Marx made plenty of mistakes. He had little idea how well the state would refine itself to enable politics to tame markets after crises, putting officials in power who pursued a range of social democratic policies without damaging the economy. He really had no idea how war-accelerated mechanization would expand the entire purpose of the state or enable multi-state mechanisms. The postwar rise of the social compact made it seem as if that Marx was wrong about the ability of capitalist economies to satisfy human needs, at least material ones.

Our postwar boom was uneven to start with, and lingers still in diminished form. It declined with the stagflationary crisis of the 1970s, when the preferred economic policy of Western social democracies — Keynesian state management of demand — seemed incapable of restoring full employment and profitability without provoking high levels of inflation. Sure, Muldoon comes to mind, but so does Holyoake and Holland, Clark and Key, the Todds and the Fletchers and the Goodmans; restoring profitability by curbing inflation, accepting state to large corporation codependence, not particularly strenghtening organized labor, and accommodating unemployment. Brian Easton has written several good tomes on this relationship.

While the rich made bank from the late 1980s, our little country has proved incapable of replicating the broad-based prosperity of the mid-twentieth century. It marked instead in New Zealand a long recovery since the late 1980s characterised by uneven real estate booms, sluggish commodity dependence, and inequality. This sharp divergence in fortunes has been driven by, among other things, the fact that increases in productivity no longer lead to increases in wages in most advanced economies. (What has saved us as we went through these ideological full-waxings was Australia simply absorbing our excess labour during the tough times, providing us with capital to accelerate our boom times, and providing us with customers and markets throughout. Australia is still our actual government).

If the postwar boom made Marx seem obsolete, recent decades have confirmed his prescience. Marx argued that the long-run (remember the long run?) tendency of capitalism was to form a system in which real wages did not keep up with increases in productivity. This insight mirrors the economist Thomas Piketty’s observation that the rate of return on capital is higher than the rate of economic growth, ensuring that the gap between those whose incomes derive from capital assets and those whose incomes derive from labor will grow over time.

What Marx failed to get is the purpose of the modern state; to stabilize society by forming policy around capitalism, to make it more comprehensible, more rational, providing new languages and legislative and frameworks and redistributive structures making it more generous in its ends than just reifying capitalism self. It is a constant task.

Competition and lawlessness has driven down labour’s share of compensation by creating segments of the labour force with an increasingly weak relationship to the productive parts of the economy—segments that Marx called “the reserve army of labour,” referring to the unemployed and underemployed. Here Marxian analysis stumbles in our current state, where headline unemployment is staying low and reduced to pockets among the completely disorganized and the young. Our system is calm because state redistributions are increasing again, and there are no threats or agitators of any note, anywhere.

Wages haven’t risen. Unionism hasn’t increased. The state has not increased the sophistication of its engagement with capital. With the Ardern government, nothing structural has changed at all. Other than through the willfully incoherent Shane Jones, its will to do so is palpably declining by the day.

Business was supposed to be working on the obsolescence of labour. On the high end, the consulting company McKinsey estimates that 30 percent of the hours worked globally could be automated. These losses are still expected to be concentrated among unskilled segments of the labor force. Prior to the election Grant Robertson worried about the same thing, but the economy remains fully ready to absorb them. Here, business worries that the state doesn’t want to engage and doesn’t have a plan for them.

Research by the economist David Autor and his colleagues suggests that the rise of superstar firms may help explain labour’s declining share of national income across advanced economies (do check him up). Through a New Zealand lens, that means a group of massive companies dominated prices and supply chains both to labour, and to their consumers, to near-oligopolistic scale, in nearly every industry. As our own (relative) superstar firms have become more important to our economy, workers have suffered across the board.

Marx’s overall worldview left little room for politics to mitigate the downsides of capitalism. As he and his collaborator Friedrich Engels famously stated in The Communist Manifesto, “The executive of the modern state is but a committee for managing the common affairs of the whole bourgeoisie.” He’s only right because our state appears nearly unwilling anymore to do so.

In the late 1990s, good thinkers like David Porter and David Skilling toiled hard on how to get New Zealand government to re-engage usefully with clusters of industry and with labour, and good hard-headed Ministers like Jim Anderton were up for it. Their legacy here is surprisingly small and uneven (Skilling moved to Singapore, where his thinking is fully simpatico with a really active and empowered state engaging with industry), but that’s mostly because the second term of the Clark government just starved it to death.

Today, the question of whether politics can re-engage local capitalism remains open. Especially in New Zealand, the Labour-led government is doing as little as possible to upset the New Public Management school of Board-dominated governance, with only occasional and limited reforms of existing Ministerial structures. Few boards have been refreshed. Few judges have been renewed. Almost no departments or structures are in train to be altered in any legislative sense (The only new Ministry formed under this government is a very, very small one designed to get the state to dig out men who died in a coal mine – a pretty dark Marxian joke by itself). Measured by the will to engage or tame it, capitalism appears to have overwhelmed our politics, democratic or otherwise. Perhaps the postwar decades of a near-perfect balance for the majority will be seen as fleeting.

Yet this is not the only narrative. An alternative one would start with the recognition that the politics of capitalism’s golden age, which combined strong unions, Keynesian demand management, loose monetary policy, and capital controls, delivered a lot for a long time but could not deliver an egalitarian form of capitalism forever.

Other narratives are possible. The normal state of capitalism is one in which, as Marx and Engels wrote in The Communist Manifesto, “all that is solid melts into air.” This dynamism means that achieving egalitarian goals will require new institutional configurations backed by new forms of politics.

Like all social democratic governments, that is the task this government has yet to set itself, taking all sectors of New Zealand society with it. There’s a strong sense that this government is neglecting capitals’ leaders, displacing the social sectors’ leaders with delayed ‘reviews’, leaving any environmental engagement solely to the leader of a very small support party, and otherwise using budget surpluses to keep the crowds happy by chucking the political equivalent of hot meat pies to the crowd.

National’s solution has been to buttress the welfare state’s redistribution of income with a redistribution of capital assets, so that capital worked for everyone. The Bolger and Key governments selloff of shares of key public assets into the local share market sought to help achieve that. The ‘stakeholder capitalism’ vision was not state ownership but a broad property-owning democracy in which wealth was more equally distributed because the distribution of productive capacity was more equal. The outcome of that set of sales did not achieve this. Nor had it achieved it under Prime Ministers David Lange or Jim Bolger. You can ask them at the Temuka Memorial Hall.

The one massive intervention this government has a chance to really tame is real estate capitalism inherited from Brownlee in Christchurch to Twyford in Auckland. Not the same as engaging across government no sirree, but a pretty damn big sector of our kind of capitalism. HLC is turning into a suburban juggernaut rolling over the bourgeoise niceties enshrined in the Unitary Plan. And yes, it will deliver at scale.

But if a Bernie Sanders or Jeremy Corbyn-type programme were ever to see the light of day in taming markets and revitalizing social democracy for the twenty-first century, it will not be with the politics of the past. As Marx recognized, under capitalism there is no going back.

Here instead under Prime Minister Ardern is a small managerial state with little inclination to become any stronger, no intellectual or ideological framework to decide how to shape and redirect our kinds of capitalism, and – housing excepted – a residual sense that its ambitions are slow and can only get slower.

Sure, we don’t need a vision. Maybe even a plan’s too much to ask. Just clear, hard engagement across government would be a start.

46 comments on “Government with a plan”

  1. tc 1

    It’s under whelming for sure. Seems to be no plan in many areas aside from let the existing BS of self regulation and ticket clipping carry on.

    Not even a decent critique of the damage they inherited being banged on about ad nauseum to fill the void.

    I wonder how aware they are of the totality in terms of crumbling infrastructure around NZ that national and it’s local govt cronies perpetrated over 3 terms of kicking many cans down potholed shoulderless roads.

    That in itself is a massive issue for the short-medium term but I don’t see any rethink of that broken model of local/central govt.

    • Herodotus 1.1

      Whist I agree with the sentiments of your comment, I would like to promote an alt view to “hat national and it’s local govt cronies perpetrated over 3 terms of kicking many cans down potholed shoulderless roads.”
      Both the 99 and 08 govts. were similar in a few major aspects :
      They had a highly competent, stable senior leadership (in that the direction they followed)
      For 2 terms, both had laid the foundations to do something special, but both decided to continue in their 3rd term of “steady as she goes”, and in doing so missed the opportunity to place NZ in a position for the future. Be that future proofing our infrastructure, protect the environment, solve the then emerging housing issue (and the flow on effects that this has caused) and to use your phrase kicking cans …
      NZ was worse off, due to both 3rd terms of the Labour 05-07 and Nats 14-17 govts. And the weakness resulting of what was left of both defeated parties following the election loss, and their inability to hold the govt to account.

      • tc 1.1.1

        Doing something special by your definition was flooding NZ with offshore tax haven and other funds which hoovering up the property it was causing to escalate and assets they were stripping.

        Banking 101 playbook stuff which is what shonky and his cabal did in 08 all the while ignoring the infrastructure impacts and knock on effects of the ‘have money, come on down’ approach.

        99 inherited the Shipley/Richardson beating NZ had taken whereas key/blinglish in 08 had net zero crown debt after Cullen/Clark laid foundations, righted the ship which they duly went about gutting, underfunding and selling off.

        • Herodotus

          Not at all, read the comment !!!
          THEY LAID THE FOUNDATIONS TO DO SOMETHING SPECIAL, is not the same as what you said I said !!!!!

    • cleangreen 1.2

      TC 100% correct.

      This Governmenrt need bold policies not setting up the ‘avisory group crap’ yet again as National did; – by using ‘private ‘consultant advisors’ through MBIE; – as that agency has inbreed idiots running it.

  2. Pat 2

    A couple of fundamental flaws with your precis.

    Both Marx and Keynes imagined a world of limitless growth and even without that restriction Kalecki foretold of the reaction of capital to a reducing share of the output.

    The abnormal growth enjoyed post WW2 until the mid seventies can be truly seen as the result of the exploitation of cheap mobile energy (oil) and production processes developed for industrialised warfare to enable an unprecedented manufacturing and consumption boom…that was the source of massive increases in productivity.
    It ended when the price of that cheap energy doubled overnight. Manufacturing lends itself to productivity growth, services not so much…and advanced economies are largely service economies.

    Interestingly NZs “stagflation” in that period under Muldoon occurred with a debt to GDP ratio akin to todays….and we havnt improved our balance of trade since.

    Autors argument that we have and will create demand for unknown goods and services ignores the limitation of resources (much as Marx and Keynes) and in such a world we will have to choose where those resources (and their externalities) are best used, removing the luxury of creating demand for demands sake.

    This NZ Government (and all governments) face a near impossible task….how do we design an economy (thats part of a whole) that provides for all demands, with diminishing resources and growing expectations?

    We are going to have to choose carefully what are needs and what are wants……and that is going to cause one hell of a shit fight.

    • Incognito 2.1

      I thought the OP was excellent overall.

      You wrote:

      This NZ Government (and all governments) face a near impossible task….how do we design an economy (thats part of a whole) that provides for all demands, with diminishing resources and growing expectations?

      In the OP:

      … no intellectual or ideological framework to decide how to shape and redirect our kinds of capitalism …

      I disagree with the OP that there is no framework to ‘design’ an economy as you describe. The (our) current system wasn’t ‘designed’ either and it kind of grew ‘organically’ and has delivered many things.

      Rather than tinkering with the current system, e.g. a little more focus on socio-economic outcomes such as inequality and a little more focus on the environment and so-called sustainability, we need to try something new, something that has not been done before.

      This will require taking risks, trying out new things (prototypes), testing, failing & rejecting (!), and stepwise improvements. Nothing gets designed from scratch in one go and certainly not life in human society; it is an ongoing process of change & evolution that will take (many?) generations. It most definitely is not an academic, rational & logical, or intellectual exercise!

      There are plenty of new and exciting progressive ideas to try out. Agreed, as such there is no cohesive framework and structured targeted approach. Such “intellectual and ideological framework” will be formulated later, when things are becoming clearer, by ‘prescient visionaries’ who are finely attuned to what’s going on and subsequently by intellectuals/academics and pundits in no particular order 😉

      The current system (AKA the Devil we know, BAU, or status quo) cannot and will not last even though it has delivered much and is still functional, by and large, although its obvious flaws have also become evident. The time scale by which change will occur may be a lot longer/slower than some of us would like though but change is inevitable and happening as we speak …

      • Pat 2.1.1

        our current system was by and large designed, and any move away from it will require design and goals. unless you subscribe to chaos….and as noted if we (NZ) decide such a step change we also need to consider compatibility with the rest of our trading partners, unless we intend isolationism, and unless it is to be imposed by an authoritarian regime it needs to be supportable by mandate….and that is likely the most difficult aspect. not so much the mechanism but the politics.

        There are alternative paths but I wouldnt be advocating for them nor do I believe would the bulk of the electorate, and waiting for some ethereal organic solution at some indeterminate future date is as appealing as BAU..and neither will we be provided the time.

        And isnt that the role of political parties in a democracy?

  3. R.P Mcmurphy 3

    well habermass became a christian and marx said I am not a marxist so beware of words masquerading as reality. there is more at stake now as the world plunges head on into mass extinctions and global warming caused by political pandering to the gross desires of consumers. lets have new theories about that!

  4. greywarshark 4

    Meanwhile the National Party has used and NZ media is willing and inviting, to Australian right wing commenters to put their oar in to help in influencing voters against Labour. I think the Australian government has just enacted something intended to keep foreigners out of their politics.

    We have seen an inter-country thing of interns working for the left or right in Australia, and I suppose vice versa as if they are the same breed. This can lead to a lot of supposedly informed antipathy and sour comment for years as they mature into their narrow area of self-satisfaction. We don’t want Oz jtypes joining in the haranguing of NZ with their hostile banshee caterwauling. This behaviour must have some negative affect on our polls when it is mischievous or damaging comment whether from NZ or Oz tyros.

    Brigitte Morten is a Senior Consultant for Silvereye. Prior to that she was a senior ministerial adviser for the previous National-led government, and an adviser and campaign director for Australia’s Liberal Party.
    RNZ 8:08 am on 13 July 2018
    TOP demise shows fate of vanity parties
    …People generally join political parties because they want to be heard, want to have a say on policy and want to have a sense of ownership of making it better. A party built around a dominant central figure – like Gareth Morgan – fail to provide people in the long term with that ability.

    You might be willing to be the one that sets out the morning tea for a while – but in the long term if you don’t have a sense of ownership over the clubrooms as ‘your club’ you are unlikely to continue to do so.t

    Some of her points might be salient. But we don’t need cynical comment from Australia to tell us these. And calling TOPS a vanity party dismisses the earnest effort that Gareth Morgan made to introduce fresh practical workable ideas into the morass of failed policy dragging us down. Ultimately he messed his own nest and the left didn’t take to his ideas which seemed too narrow. But they were ideas and they put some mental fuel into some seized-up brains. It was a very useful exercise for NZ citizens which he primarily funded himself. So Australian commenter talk about your own Pauline Hanson ever present over the Ditch? Now there is Vanity!
    Vanity working on a weak head, produces every sort of mischief.
    Jane Austen

    Read more at: https://www.brainyquote.com/quotes/jane_austen_399068?src=t_vanity

    • cleangreen 4.1


      yesyou are right, Labour need to take bback the public media now as National have ‘hijacked TVNZ and RNZ to spout National Party policy,

      Then we need labour to do this instead; – and fire “clueless Clare Curran”who allowed this to happen, as minister of broadcasting she must be a national party plant..

  5. CHCOff 5

    A Govt. not based heavily on rorting ( in somewhat opposition to the prevailing neo-lib ruling class & it’s conventional wisdom) is something to be thankful for these days. There’s not much else to be said for otherwise it’s a rather big can of worms eh ? !


  6. RedLogix 6

    One of the most thoughtful OP’s here for sometime Ad. I’d recommend everyone read it a second time and address the points.

    Karl Marx, of course, would not be surprised. He predicted that capitalism’s internal logic would over time lead to rising inequality, chronic unemployment and underemployment, stagnant wages, the dominance of large powerful firms, and the creation of an entrenched elite whose power would act as a barrier to social progress.

    Marx’s observations were nothing new; inequality has been a feature of all developed human societies for all of recorded, probably deeper, history. Capitalism merely amplified the problem, while playing a large role in solving the poverty problem, it exacerbated the inequality issue. In that Marx was right; but his cure has fallen catastrophically short. Or as the well known quote goes “right solution, wrong species”.

    There are three broad ways we can address inequality, one is to address the obvious symptoms using tools such as legislation and education to maximise equal opportunities; progressive taxation and redistribution to flatten out the income gaps, and investing in social and physical infrastructure to widen access to the wealth and benefits of the economy. All these are classic left-wing responses at a state level.

    Another approach is to counter the natural tendency for the power elites to corruptly entrench themselves, with broad-scale labour and social movements such as Unions. Again a classic left-wing response at a social level, but not immune to it’s own concentrations of power and corruption.

    The idea that is percolating around in my head is that the element missing here is the idea of a left-wing response to inequality at an individual level. Now we cannot nor should not attempt to make all people equal in terms of outcome. We are all different for good reasons. Some people will always have more wealth, status and power than others. The crucial question is … what do they do with it?

    Historically this response was mediated by a religious ethic, the core idea that indeed “I am my brother’s keeper”. It manifest as both philanthropy and charity, both of which have and still do contribute a great deal. In lefty-liberal circles both of these are typically sneered upon because both were associated with wealthy donors controlling and imposing an agenda on their generosity. The mere association with wealth tends to taint all charitable acts as self-serving in some form.

    But we can look past this. There is the biblical ‘Parable of the Talents” telling how a master who gave three of his servants a sum of money before leaving on a journey. On his return he asked each what had been done with it. One had buried it safely and returned the sum intact to his master; the second had invested some cautiously and showed a modest return, while the third showed a handsome return.


    It’s a story with many interpretations; but it has some key features. One is that the master gave the money with no conditions other than the expectation the servants would be wise stewards of it. It also makes it clear, we are all different and will respond differently to the same opportunity. But most crucially in my mind, it tells us we are expected to do something useful and responsible with the chances we are given. The two servants who took their opportunity and invested it with other people and in the community were rewarded. They were not just the recipients of the money, they in turn extended it to others and as a consequence not only improved total welfare but also reduced inequality.

    Of course the money is also a metaphor for the whole of our lives; it asks the question …. what are we living for? In pure evolutionary terms we tend to seek wealth, status and power for reproductive purposes; it’s a strategy deeply embedded in our genetic hard-wiring. But we are also the first post-Darwinian species, our software may be constrained by the biological CPU it must run on (at least for the time being) … but we do get to socially construct new purposes for our lives.

    And in my view at least, maybe for the first time in all of our deep evolution, we can realistically start to contemplate the idea that the purpose of our lives is to be responsible for ourselves and to be of service to those around us. This is how we can all attain to excellence as a legitimate expression of our own unique selves, and at the same time link to each other in a way that is both supportive, constructive and mitigates inequality across the whole of society.

    OK so it’s a Sunday …. bite me 🙂

    • Ad 6.1

      Having just come out of Mass a couple of hours ago, I still can’t always tell if the Parable of the Talents is from Supply Side Jesus or Demand Side Jesus.

      Cheers RedL it’s good the stretch the legs sometimes with a longer piece.

      • Poission 6.1.1

        Having just come out of Mass a couple of hours ago ..

        If religion is the opium of the Masses ,is OPM( other peoples money) the religion of the few?

      • RedLogix 6.1.2

        I hesitated on whether to use this parable or not. On one level it could be pointed to a justification for much despised idea of ‘trickle down economics’. In it’s defense you could argue the problem with that theory was that at each level people tended to hoard or ‘bury’ their wealth, rather than use it constructively.

        Al Franken of course rightly caricatures this. (Incidentally ‘camel’ was crappy translation of the Greek word for ‘thick rope’, but the critter with humps is more visually entertaining.)

        Still I’m unconvinced there is anything fundamentally wrong with the idea of ‘standing on your own two feet’. After all from a position of utter deprivation you really are of no use to yourself nor anyone else.

        • Incognito

          Still I’m unconvinced there is anything fundamentally wrong with the idea of ‘standing on your own two feet’. After all from a position of utter deprivation you really are of no use to yourself nor anyone else.

          Hmmm, the way I read this it is strangely at odds with your outstanding comment @ 6 and I agree with Ad (@ 6.2) that that is worthy of a post in its own right.

          We seem to forget that we haven’t and won’t always stand on ‘our own two feet’. Babies & infants, the sick, the elderly, the displaced (i.e. refugees or earthquake victims), for example, cannot stand on ‘their own two feet’.

          A paraplegic (e.g. Christopher Reeve) or a long-term coma patient (‘brain-dead’, e.g. Terri Schiavo) also have something useful to offer us and provide an opportunity to bring the best out in us, to help and support and to care for one another. During the reign of neoliberalism the individual-collective duality has moved away from integration and transcendence but this inevitably will swing around.

          In an economic-materialistic sense we, the 99%, can barely ‘stand on our own two feet’, most of the time. We try to keep our heads above water and try pulling others back up to surface; it’s an ongoing battle ‘for air’. Meanwhile, for the 1% the sun always shines bright and they make hay, lots of it.

          Psycho-spiritually almost all 100% of us are hovering under/near the waterline and still crawling in the mud. The few ‘enlightened’ ones that get cast higher up onto ‘dry land’, by accident of ‘sheer luck’, find themselves in absolute awe of their new experiences yet unable to formulate these to the wriggling biomass still stuck in the mud; they wouldn’t listen and trust/believe them anyway (if this reminds you of Plato’s Cave Allegory you are correct; /the-accidental-bodyguards-of-capitalism/).

          In other words, it’ll take time …

          • RedLogix

            I’ve no quibble with any of your excellent response above. Unquestionably the degree to which we can all take responsibility for our lives is a huge variable. You nail it here:

            In an economic-materialistic sense we, the 99%, can barely ‘stand on our own two feet’, most of the time. We try to keep our heads above water and try pulling others back up to surface; it’s an ongoing battle ‘for air’.

            Absolutely I get that; it’s why I keep returning to inequality as the core issue. And what you are saying here touches directly on why it is so very difficult to grapple with.

            Ultimately we have to use strategies that work in the worst case scenarios; the kind of god awful hell that people who’ve hit rock bottom face on a daily basis. And at a bare minimum that means ‘standiing on your own two feet’ to the extent that you can. And then reaching out to help those nearest to you.

    • Ad 6.2

      RedL your response is a post in itself – why not reframe it and offer it up?

      My quandary with the “left-wing response to inequality at an individual level” is that it needs exceedingly empowered and anointed individuals to break out. Jesus regrettably didn’t have a good theory of the state either – and not that great a theory on collective action.


      What gives me hope for New Zealand most of all is that we are a relentlessly entrepreneurial people, and we adapt fast, and many of us do have an unsatisfied hunger for excelling ourselves to the limit that pushes us out of here overseas.

      So far that’s not been knocked out of us by the enervating arms of our state.

      So on that note I prefer the parable of the mustard seed as a metaphor of relentless self realization amidst tough constraints.

  7. Stuart Munro 7

    I’m afraid that government, in its zeal to obtain the desirable features of capitalism, has been too quick to accommodate the wishes of various corporate entities without considering the impact on those a left party is supposedly impelled to serve.

    A recent example would be the Wellington bus drivers – the new government has been active in arranging to move people off the dole and into work – but this has been to some degree at the expense of existing drivers, and the overall effect is to at least temporarily depress wages in that sector. No wonder the corporates cooperated.

    Likewise, Phil Twyford’s flagship housing program is hollowed out by the use of substantial amounts of cheap migrant labour instead of training locals. Looks like a short term fix eh. But it’s not. There’s a crisis of skilled labour in construction because successive governments let the industry deskill. You can get away with it for a while, while you have a supply of experienced foremen to keep the newcomers to standard. But when they retire you’d better have new ones coming through, and you don’t get them by driving down wages and conditions with cheap foreign labour.

    Christchurch is a fucking mess from cowboy construction and the lies told at various levels to keep it in business. This is the future for NZ if the model continues, together with increasingly expensive inspection and permitting regimes that try to contain the damage. It’s about time NZ governments moved away from disastrous short term fixes and aimed at steady reliable systems. Like the ones they pissed away with Rogergnomics.

  8. Cynical jester 8

    The polls are great? We are in second place with simon f-ing bridges led nation in first (i know its mmp but still nothing to bloody celebrate) and our bffs the greens have been polling at 5% and everyone knows they always get 2% less than what they poll.

    I perform 4 times a week to crowds of over 100 and most of the crowd will be in their early to mid 20s. I also ask do we have any jacinda fans in the room i used to get massive cheers for her name now a couple unsure wooos.

    Jacindas not the rock star she was among the youth because people know this government is full of shit and so do i. A government of change? HA! A government of tweaks at best.

    The next election is an election based on tax reform and labour has never won a debate on tax. The only thing labour has going for it is nationals hopelessness.

    Noone believes we will do anything meaningful on poverty, homelessness,mental illness or housing and what we have done is mere tweaks, empty promises and pretty speeches about change that isn’t coming, dont go roynd the country promising systemic change and then deliver national party budgets and tweaks.

    I was so excited about this government and now i do t care if it gets reelected, like moat of my generation.

    • RedLogix 8.1

      I’m inclined to agree, it seems there are real limits to what left-wing govts can achieve by fiddling with the macro settings at a state level. Govt is an important element of positive change, but manifestly insufficient by itself.

      It’s like we have to do some work ourselves.

    • SaveNZ 8.2

      Agree with much of what you say, Cynical jester, but even a lost Labour are a hell of a lot better than an on task actively pillaging National party! It’s a bitter pill to swallow but after a decade of Natz, I’m still very relived they are finally gone for a bit.

      And it’s those aged in their 20’s who will get the most effects from bad government policy so they need to vote the best available option, which used to be Green.

      ‘Not caring’ for millennial’s is not a wise option.

    • Cynical Jester, Your audience has a 7 minute concentration span…. 6 weeks is too long!!

    • Philj 8.4

      You could be correct Jester. I wonder if Jacinda will be NZ’s Obama. A great communicator but no real change. As you say, mere tweaks. Keep NZ Inc happy. BAU.

  9. SaveNZ 9

    +1 all this under Rogernomics… trickle down never occurred.

    “Since the late 1970s, median household income in New Zealand, adjusted for inflation, has stagnated for the bottom 60 percent of the population, even as income for the richest New Zealanders has soared. Corporate profits are at their highest levels since the 1960s, yet corporations of any note are taking those profits offshore rather than reinvesting them locally.”

    Yet still no adjustment to help keep corporate profits in NZ and to ‘shock horror’ put in policy to increase the bottom 60% of population… it’s getting worse with new ways to pay below even minimum wages aka ‘dependant contractors’ ahhh that should be an employee. Or the bin rates of fruit picking to be stuck in the 1980’s… while business tells everyone they can’t find people? These jobs used to be good for the unemployed and students!

  10. Ad 10

    Liam Dann in the NZHerald has just posted on New Zealand falling in global rankings as an innovation leader.


    I’m not prepared to go down the full path of targeted v untargeted industry assistance as a debate. It’s a whole post in itself.

    But if ever there were a warning that good economic conditions and great polls are precisely the wrong time to not bother with a really strong set of country-wide engagement initiatives, the stats from Liam Dann are bracing.

    Fine blaming the previous government, so long as your own plan is far better and more effective.

    They better be.

  11. Nic the NZer 11

    We need to recognize the actual political seeds of our present day problems with income inequality and excessive housing costs, this is actually primarily caused by wages not keeping up with asset price inflation.

    A couple of articles on where the left (in France) took its neo-liberal turn, and which policies it needs to actually rehabilitate to leave this course.


    “That political reality was too stark for the public to accept and necessitated a smokescreen being erected to disassociate the rising unemployment from macroeconomic policy choices.

    The rising unemployment was reconstructed by the political and bureaucratic spin-doctors as a ‘structural’ problem reflecting a failure of individuals to be self-reliant and assiduous in job search and skill development.

    A bevy of securely employed and highly paid economists pumped out a massive number of ‘research’ papers, which served to give authority and legitimacy to this ideologically tainted and empirically bereft view.”


    This criticism could probably have been leveled at the outcomes of the governments “future of work” initiatives,

    “The major weakness of the White Paper is that it fails to recognise that the key problems at the present time are those of demand management and that the immediate questions in tackling unemployment are thus macroeconomic ones. Instead, the report concentrates on what it calls ‘rigidities in the labour market’, which seem to provide a pretext for attacking all forms of legislation or agreements to protect labour, combined with a general call to cut labour costs.”

    • Ad 11.1

      Any suggestions from those papers for the current government of New Zealand?

      • Nic the NZer 11.1.1

        When the author of those blog posts last spoke in NZ he suggested implementation of a fully state funded job guarantee scheme. This would probably require some changes in how the reserve bank operates as they presently target what they estimate to be an ideal unemployment rate (ideal was 4.5% unemployment at last report). A job guarantee is likely to cause the unemployment rate to fall substantially so the reserve bank should probably switch to targeting something else like the rate of job guarantee employment as a proportion of total employment.

        Then there are some other suggestions like, just stop issuing government debt (and make all the budgeted spending happen internally at the reserve bank). This is to deal with the propaganda and miss-information around government spending.

      • Gabby 11.1.2

        I’m guessing that it’s an issue that needs further study funded.

  12. Poission 12

    “The owner, the employees, and the buying public are all one and the same, and unless an industry can so manage itself as to keep wages high and prices low it destroys itself, for otherwise it limits the number of its customers. One’s own employees ought to be one’s own best customers.”

    Henry Ford 1926


  13. McFlock 13

    Marx never came up with a mechanism to predict the breaking strain of a capitalist society.

    My suspicion and hope is that the current government are actually a different beast to the last thirty years, which followed the line that the government did as much as conceptually possible in the first term and then ran out of steam.

    Whereas the current government seems to have set longer term goals and will be measured against their progression towards those goals.

    • RedLogix 13.1

      Marx never came up with a mechanism to predict the breaking strain of a capitalist society.

      Because it’s remarkably resilient; and brings some real benefits. If it was all bad we’d never tolerate it.

      What impresses me much more than Marx are the more modern researchers, such as Picketty, who are far more accurately measuring the impacts of inequality. It’s from this work we are more likely to make convincing arguments for exactly where the constraints and boundaries need to be placed on the capitalist model.

      • McFlock 13.1.1

        I sort of view them as doing the same thing as Marx but without the philosophical baggage.

        Much of Marx’s work was developing historical models and gathering contemporary data about the working people in society. The thesis/antithesis/synthesis prediction of communism was pretty dodgy, IMO. But his work on factory conditions and the inequalities of the time was almost the textbook for modern researchers. In that aspect Marx was the political equivalent of Snow, semmelweiss, or Takaki.

  14. cleangreen 14

    Good article,

    When is labour goping to spend money for our new TV channel to restore the “TV 7” with ‘real investigative journalism public affairs programing’ that they set up ast time around?

    • Philj 14.1

      A new quality TV public channel? This government has reneged on that. Minister(?) Clare Curran has been ‘educated’on the birds and bees, and has given up. It’s BAU folks. Labour is getting its instructions from business. Got to keep business happy, or else..

  15. Jackel 15

    Not really knowing why, they stubbornly and blindly blundered on anyway.

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