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Will Jacinda Ardern meet her promise to transform?

Written By: - Date published: 6:53 am, September 4th, 2020 - 62 comments
Categories: election 2017, election 2020, greens, jacinda ardern, john key, labour, nz first, political parties, Politics, poverty, tax, winston peters - Tags: , , , ,

Jacinda Ardern’s second term in office will be more challenging than her first, even accounting for such crises as the Christchurch massacre and Covid 19.

In 2017, when Labour was languishing in the points and her taking on Labour’s leadership just weeks before the election, she had nothing to lose.

As we know, the miracle happened, but Labour was profoundly unready to govern. In its first 100 days it rolled out the Families Package but policy to address the underlying cause of inequality was lacking.

It also had the handbrake of coalition partners, mainly NZ First, which was instrumental in blocking or diluting any radical change, most importantly, the Tax Working Group’s main recommendation of a capital gains tax to make our tax system fairer.

This election will be far different. Polls consistently show Labour has very chance of governing with just the Greens, or outright. No handbrake, no excuses for being unready.

This has to be a scary moment.

Covid and Christchurch have proved Ardern is made of stern stuff, but having the freedom of total parliamentary control is another challenge altogether.

In her rhetoric, Ardern consistently claims her government will be two things – it will deal with climate change as her generation’s “nuclear-free moment” and it will be “transformation”.

On climate change, she and the Green Party have successfully set up a structure via the Zero Carbon Act and the Climate Commission to tackle this issue, even getting partial buy-in from National. But three years have elapsed and the goal of zero net emissions by 2050 is not much closer. So this coming term the hard yards of implementation need to be done.

This challenge will be eased by not having NZ First dragging the chain, but it remains continental in size, made more difficult in an economy beaten down by Covid and now debt-ridden.

Transformation will be equally scary and challenging.

What Ardern means by transformational is open to interpretation but in the context in which she has said it, it is hard to interpret it as meaning anything other than reducing inequality and poverty. In 2017 she set a prime goal of bringing all children out of poverty within six years. Half that time to reach the target has expired.

It is hard to see how, from the progressive side of the political spectrum, you can address inequality without tackling, if not unwinding the underlying structures of neoliberalism that have produced such inequality.

Nine years of Labour governance under Helen Clark did not attempt this. She mitigated neoliberalism by making the tax system slightly more progressive, repealing the hated Contracts Act and introducing the redistributive Working for Families package. But she left the underlying blocks of neoliberalism largely intact – an unfair, regressive tax system, capital gains left untaxed, deregulated labour, electricity and finance markets largely intact, a central bank based on monetarism, government finances restricted by debt ceilings and largely open slather foreign investment.

During his nine years in office John Key undid many of Clark’s mitigations and added his own neoliberal touches.

In 2017, when Winston Peters chose which party to side with, he cited the extremes to which capitalism had reached under the influence of neoliberals as his reason for choosing Labour.

“That experiment – of unbridled, irrational neoliberalism – has transformed what was once one of the most egalitarian societies in the world, into a case-study of acute inequity,” Peters said in a speech shortly after.

Even one of neoliberalism’s prime exponents, former Prime Minister Jim Bolger, whose first Finance Minister, Ruth Richardson, unwound much of the welfare state with her 1990 Mother of All Budgets, has freely admitted neoliberalism has “absolutely failed”.

“They have failed to produce economic growth and what growth there has been has gone to the few at the top,” Bolger noted.

Equality researcher and writer Max Rashbrooke documented this in a recent Guardian article. He cited Statistics NZ’s 2017/18 Household Economic Survey showing the 1 percent hold $140 billion of assets in trusts with a median value of $6.2 million per trust, while another $127 billion is held by the next 5 percent.

In all, the top 10 percent of Kiwis own 59 percent of all assets and the poorest half own just 2 percent. And a major point he makes is that most of the gains from those assets are legally untaxed because they derive from capital appreciation.

He cites IRD research showing half of the Rich List of Kiwis owning over $50 million declare income of less than $70,000. The bulk of their income comes from selling off assets, such as shares, that have appreciated hugely in value, but legally attract no tax.

This well documented and astounding wealth disparity is a major challenge to Aotearoa’s identity as a fair and equal society, Rashbrooke says.

Labour’s Tax Working Group’s main recommendation for redressing what it called an unbalanced and unfair tax system which underpins our newfound inequality, was for a capital gains tax. But Ardern boxed herself into a corner when she succumbed to Peters’ blackmail and not only rejected the recommendation, but ruled out a CGT while she remains leader.

CGT has been her Achilles heel. In 2017 she initially got into trouble via her “captain’s call” not to rule it out pre-election, then she u-turned and ruled it out until the TWG had deliberated. Her decision to permanently rule it out was due to fear of National using tax to spook the electorate in this election.

But something must be done if Ardern is to successfully address poverty. A fairer tax system is today even more pressing, having spent our way through the thick end of $60 billion to address the Covid crisis. That means little or no discretionary spending in many budgets to come.

“As a nation, New Zealand simply will not get through this crisis in one piece if it fails to answer the urgent need for an immediate and massive redistribution of wealth from those whose financial position is reasonably secure to those whose position is not,” says left wing commentator Chris Trotter.

The Green Party has come up with a well-thought, comprehensive poverty policy that would be funded by a wealth tax of 1 percent on individuals with net assets over $1 million, and 2 percent for those with assets over $2 million. It is neat, in that it would also operate as a de facto inheritance tax for asset-rich-cash-poor individuals who want to defer payment, and it also captures most trusts by treating them as individuals.

However, Rashbrooke says Ardern is “distinctly lukewarm” on the wealth tax and he reckons she has little appetite for redistribution, by which I assume he means higher income tax brackets.

Labour, still shy of spooking the electorate over tax, has been very quiet on tax policy and is likely to remain so ahead of the vote.

But, with a huge chunk of discretionary spending, not just for this term, but for the next generation at least, already allocated, the question is, how will Ardern fund her poverty-alleviation program?

Reports are in for working groups on welfare, education and health and, assuming those reports will not be rejected as the TWG report has been, they will result in substantive changes to our society.

But such measures and others such as decolonising the justice system, fall well short of societal transformation in the way that Micky Savage or even David Lange, with the introduction of neoliberalism, revolutionised our society.

Ardern looks poised to have the same opportunity they had and history will judge how well she seizes it.

(Simon Louisson worked as a journalist for Reuters, the New Zealand Press Association, and The Wall Street Journal among media organisations. He also worked two stints for the Green Party as a media and political adviser).

62 comments on “Will Jacinda Ardern meet her promise to transform? ”

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  1. PsyclingLeft.Always 1
    4 September 2020 at 7:35 am

    Of course the nat Fear Mongers will be absolutely on this. Remember sir Key "communism by stealth" ?

    https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=3571934

    And of course the rich are…

    https://www.rnz.co.nz/news/national/380550/the-rich-are-getting-richer-the-poor-are-getting-poorer-new-research

    There is always this….all the flow on effects…lead to a Cost. Why arent these Costs factored in? A country still has to pay for the collateral damage the Inequality brings…

    https://rationalwiki.org/wiki/Economic_inequality#Effects_of_economic_inequality

  2. Stuart Munro 2
    4 September 2020 at 7:47 am

    Although NZ's wealthy have made out like bandits from the want of a CGT, it may not be the best immediate political solution.

    A Tobin tax of some description is more difficult to sledge in the press.

    • dv 2.1
      4 September 2020 at 7:58 am

      Yes and a financial transaction tax on all bank transfers (Like credit card charges at 2%)

      Zero tax up to 20k, say 50% over 200k

      And a UBI

    • mikesh 2.2
      4 September 2020 at 10:26 pm

      Yes. Getting rid of the regressive GST and substituting a transaction tax would be a move in the right direction. Such a tax would catch large financial transactions, which GST misses.

      Mind you, I'm not sure how the average man in the street would regard, say, a 1% tax being added to his mortgage payments.

  3. Tony Veitch (not etc.) 3
    4 September 2020 at 7:48 am

    Frankly, anything less than 'transformational' is selling out our grandchildren.

    If Labour gains a majority or goes into coalition with the Greens, then I for one hope they take this country by the collar and gives it a good shake. With a mandate for change, they could re-direct this country in even more profound ways than Michael Joseph did after 1935.

    Here's hoping.

  4. Pat 4
    4 September 2020 at 8:19 am

    The degree to which Labour feel the need to be transformational will be determined by the level of electoral support for the likes of the Greens…..and as weve seen 6% is not very transformational at all.

  5. Wayne 5
    4 September 2020 at 8:20 am

    Presumably Labour will have some sort of manifesto, or at least a list of election promises.

    I would be surprised if they were very specific, more in the nature of goals and objectives.

    However, they won't be allowed to get away with that completely. On some things Labour will have to be specific. For instance taxes.

    Being elected into government doesn't give a political party an unfettered mandate to do as it pleases, to only satisfy its own activists. They will have been elected (or in this case, re-elected) based on what they have done in the past, and on what they have promised to do.

    Both Labour (1999 to 2008) and National (2008 to 2017) essentially governed on the mandate they had been given in successive elections. They did not go, in any significant way, beyond the election commitments they had made. And on that basis, both were elected into government for three terms, and in National's case was the largest party on the fourth election.

    I appreciate Covid is an event bigger than the GFC, but we have now had it for 7 months and have a general understanding of its economic and social impact. Political parties are able to factor Covid into their 2020 election commitments.

    There seems to be a desire on The Standard, that political parties (or at least Labour) should no longer be bound by electoral commitments, that Labour, if re-elected, will simply have carte blanche. Perhaps even going further, that they could do radical things, even if it was against their specific election promises.

    Governments doing this in the 1980's and early 1990's is how we got MMP. New Zealanders wanted to reign in such unfettered exercises of power. Now The Standard (or at least some of the authors) seems to be advocating going back to that style of government.

    All I can say, is I hope senior politicians, irrespective of which party they are in, resist that siren call. That they will in fact govern according to the mandate given to them by electors. That mandate is best measured by the campaign commitments that parties make during the election.

    • PsyclingLeft.Always 5.1
      4 September 2020 at 8:28 am

      I was going to TLDR, but persevered. Was this Boomspeak? Neolib justify? or Nat-ification? : )

      I'm just going by…

      "There seems to be a desire on The Standard, that political parties (or at least Labour) should no longer be bound by electoral commitments, that Labour, if re-elected, will simply have carte blanche. Perhaps even going further, that they could do radical things, even if it was against their specific election promises."

      • Wayne 5.1.1
        4 September 2020 at 8:46 am

        Basically it is a view that political parties should essentially govern according to their mandate. That is, they govern according to what they promised to do during the election campaign, at least to the best extent they can.

        If that is Boomspeak, Neolib justify, Or Natification, so be it.

        To me it is the essence of democratic accountability.

        • PsyclingLeft.Always 5.1.1.1
          4 September 2020 at 9:05 am

          Yea but SPECIFICALLY…you stated

          "There seems to be a desire on The Standard, that political parties (or at least Labour) should no longer be bound by electoral commitments, that Labour, if re-elected, will simply have carte blanche. Perhaps even going further, that they could do radical things, even if it was against their specific election promises."

          Must be your blue tinted specs?

        • Stuart Munro 5.1.1.2
          4 September 2020 at 10:00 am

          Better than 80% of NZers opposed asset sales, and you knew that perfectly well, but still pursued the policy, because your party is, above all else, the party of corruption.

        • McFlock 5.1.1.3
          4 September 2020 at 2:03 pm

          There is that view, and I support it.

          But I think imprecise goals (as long as they're not weasel words) are a better indicator than numbers. Numbers change according to circumstance, honest effort towards the goals is what counts.

          But then there are also outright lies – the one shortly before I went to university was Lockwood smith's signed pledge to end the student loan scheme in 1990. Outright fraud on the electorate.

    • mauī 5.2
      4 September 2020 at 9:04 am

      Being elected into government doesn't give a political party an unfettered mandate to do as it pleases, …

      That didn't stop the last National Government… State Asset Sales, Sky City Convention centre, TPPA, and plenty more…

      • Wayne 5.2.1
        4 September 2020 at 9:40 am

        Maui

        All of which were the subject of specific campaign commitments

        • mauī 5.2.1.1
          4 September 2020 at 11:18 am

          Ok, I will admit they may have campaigned on these issues. However, they did soldier on with these divisive policies while ignoring increasing public opposition.

          They were a Government that did as it pleases, the current Gov on the other hand would at least seek some sort of compromise in the same situation.

    • lprent 5.3
      4 September 2020 at 9:21 am

      Both Labour (1999 to 2008) and National (2008 to 2017) essentially governed on the mandate they had been given in successive elections. They did not go, in any significant way, beyond the election commitments they had made.

      But isn't that exactly what Jacinda did? If you actually read the post you'll have noted the link to a RNZ interview on the 12th September 2017 (the election was on the 23rd)

      Labour leader Jacinda Ardern says neoliberalism has failed and New Zealand has always been served well by interventionist government.

      The opposition leader, outlining her economic ideology to RNZ in a lengthy interview, was asked if she agreed with former Prime Minister Jim Bolger's assessment of neoliberalism in New Zealand: that it had failed.

      As I recall, this was largely reflected in the Labour election policy statements for the 2017 election. I haven't seen an actual manifesto since the 1980s except from the minor parties.

      Presumably Labour will have some sort of manifesto, or at least a list of election promises.

      I would be surprised if they were very specific, more in the nature of goals and objectives.

      And presumably National will get around to producing their comprehensive manifesto and list of election promises any month now – the ones that are costed.

      Unlike this pile of fantasy crap about a second harbour crossing in Auckland. It somehow fails to mention that in the last decade, while Auckland's population went up by 25% or more and cars be even more, that the traffic volumes on the bridge actually declined relative to population. The number of people transported over the bridge increased – on mass transit. Via the Northern Busway.

      So this bit of idiotic bullshit justifying the massive car spend is fatuous and irrelevant.

      Population and travel demand growth is forecast to increase by around 22% (an additional 40,000 vehicles per day) by 2041.

      There is one reason to replace the Harbour Bridge – maintenance issues of age. For anything else mass transit would be a more effective solution. And I haven't seen any engineering report to show that there is a maintenance problem. The big problem with a second harbour crossing is simply about how to put the approaches in. There simply isn't room and it will be a nightmare to do it now anywhere close to the city centre.

      So as far as I can see a 20 year replacement process for the Harbour bridge still hasn't started. We just need to kick more cars off and let more mass transit on.

      But I'd agree that there is a reason to put in the commuter rail to the North Shore. But so far I haven't seen any costing or feasibility study on a pure rail tunnel under the harbour. And I suspect that option will be really bad economically compared to just taking it over a bridge and approach on the upper harbour.

      But I believe that November is the target date for costed policies for National – right? Because when you look at National's current policies they are all of this ilk – useless slogans with no intelligence or understanding of the issues.

      Political parties should please give me intents and a rationale behind them. Or policies that have been costed. Just making up unfeasible waffle like National does really doesn't count for much.

    • Tony Veitch (not etc.) 5.4
      4 September 2020 at 9:50 am

      The trouble is, Wayne, that BAU is just not acceptable any more.

      You may not have noticed but there is

      * a pandemic raging worldwide

      * an economic crisis engulfing the world

      * a climate crisis threatening to make the world uninhabitable for humans.

      BAU just doesn't cut the mustard these days.

      • Wayne 5.4.1
        5 September 2020 at 7:53 am

        Tony,

        If Labour campaigns on a specific transformational platform, and they win, then they have a mandate to implement it.

    • Gabby 5.5
      4 September 2020 at 2:29 pm

      Didn't the gnatsies ignore a referendum and sell a bunch of stuff?

    • Draco T Bastard 5.6
      4 September 2020 at 8:37 pm

      Governments doing this in the 1980's and early 1990's is how we got MMP. New Zealanders wanted to reign in such unfettered exercises of power. Now The Standard (or at least some of the authors) seems to be advocating going back to that style of government.

      And I'm pretty sure that National's and their funders support for Supplementary Member voting systems in their attempt to get rid of MMP was showing just how much they wanted to go back to that system.

      All I can say, is I hope senior politicians, irrespective of which party they are in, resist that siren call.

      That siren call is the electorate calling out for change from the failed system that government have put in place over the last four decades against the electorates will.

  6. Ad 6
    4 September 2020 at 8:27 am

    Jesus Simon. Holding Ardern to "transformation" in 2020 is as dumb as holding Gordon Coates to 1928 campaign promises in 1930, or Parker to Mayoral promises he made in 2008.

    Cataclysms got in the way, and what is left is operating the machine of government with all you have.

    We are going into a new Depression.

    Robertson is holding this ship together in the highest seas since 1930.

    Transformation? This is survival government.

    • PsyclingLeft.Always 6.1
      4 September 2020 at 8:30 am

      "Jesus Simon" ? Well he did raise some good Points : )

      • Ad 6.1.1
        4 September 2020 at 9:10 am

        How's our unemployment rate?

        Our mortgagee sale rate?

        Our bankruptcy rate?

        Homeless people piling onto the streets?

        Riots breaking out?

        Insurers going to the wall?

        Any of the features that we saw after either the 1929 crash or the Christchurch earthquakes?

        No.

        And the answer is no because this government is throwing everything at it. Successfully.

    • solkta 6.2
      4 September 2020 at 8:32 am

      but weren't the biggest transformational changes that we have seen done during a depression?

    • Andre 6.3
      4 September 2020 at 8:42 am

      Never waste a good crisis.

  7. Jum 7
    4 September 2020 at 8:47 am

    In a time of great need, Ardern can make new and reformed decisions.

  8. Sabine 8
    4 September 2020 at 8:52 am

    nope they will not.

    And that is the crux of the matter. And yeah, we have a pandemic that started 5 month ago and already in March we knew that the kinder gentler bullshit was just that bullshit.

    The increase in benefits of 25NZD and the double heating payment had nothing to do with the need of people to have more money and the heating allowance had nothing to do with the energy costs of people, but came about because Covid. That alone should tell us alot. Without Covid non of it would have happened.

    the unemployment benefits were to little three years ago, and are still to little. regular benefits still have people decide weather to eat to their hunger or weather to pay a bill because both don't work. Rent increases add to stress, cause now its back to the kinder gentler Winz Drone who can't be bothered (after all he/she gets paid no matter how much their 'clients' suffer, maybe even get a bonus if they make them suffer ) to ask for an increase in the Accomodation benefit.

    Here maybe have a read on that and ask yourself really if hope is the right tool to deal with the inaction of the government.

    https://www.stuff.co.nz/national/politics/300097143/winter-energy-payment-to-end-their-income-is-going-to-fall-off-a-cliff

    The chair of the government's own Welfare Expert Advisory Group, Cindy Kiro, said the welfare system simply wasn't working.

    "I don't think there can be any doubt that when people are willing to sacrifice their dignity by waiting in a queue for hours and hours, there's something wrong."

    She said while boosting the winter energy payment was not the complete answer, it was a start.

    "Whatever justification you want to use people to pay people who desperately need more money, more money is fine by me – you can call it a Covid wage extension, you can call it a Covid hardship extension – you can call it a 'summer' winter payment – I don't care what you call it."

    Social Development Minister Carmel Sepuloni said there were no plans to keep the money going – but it wasn't the only boost beneficiaries had received as part of the government's $5 billion families package.

    in bold the line of the government who tried a little, decided it was good enough and now can't be bothered doing more – unless the moment they realize that they are gonna loose their coveted spots as biggest beige suits on top.

    The best the poor in this country can hope for are a few morsels that fall of Grant Robertsons (current holder of the purse – but the same would happen under a National holder of the purse cause they all don’t care) dinner table, and they have to say thanks sir, may i have another to give satisfaction.

    • garibaldi 8.1
      4 September 2020 at 11:31 am

      I believe you are correct Sabine.

      Labour is so wedded to neoliberalism that it is incapable of being progressive. Jacinda may/may not have tendencies that way in her nature, but the Party ……hopeless. They are just a bunch of third wayers. Their only good point is that they are preferable to National.

      • greywarshark 8.1.1
        5 September 2020 at 12:22 pm

        This from Sabine unfortunately hits the nail (I fear).

        in bold the line of the government who tried a little, decided it was good enough and now can't be bothered doing more – unless the moment they realize that they are gonna loose their coveted spots as biggest beige suits on top.

        And garibaldi fears they are still wedded to The Third Way. I am sure that there are some separations pending, even divorces. There are signs, keep up positives to those providing good governance. I think perhaps emails to all the others with simple why questions about what they aren't doing, with one practical step they could take which would show that they are actually alive! Don't tell them you are disappointed but set them a task that meets one need in their portfolio. Just saying.

        This is a summary of the 'Third Way ' in Wikipedia for your eddification:
        The Third Way is a political philosophy and political position akin to centrism that attempts to reconcile right-wing and left-wing politics by advocating a varying synthesis of centre-right and centrist economic platforms with some centre-left social policies.

        I'll see if I can find it explained in common language!… Can't but this is interesting and to me, contradictory.

        https://www.tutor2u.net/politics/reference/third-way-socialism
        The "third way" is a middle-ground alternative route to socialism and free-market capitalism.

        The third way is a political and theoretical perspective that seeks to modify left-wing ideas towards the economic and political realities of globalisation. This centre-left way of thinking advocates a balance between rights and responsibilities and a combination of social justice alongside market-oriented economics.
        As a practical illustration of this mindset, the welfare state should provide a ‘hand up not a hand out.’ There is also a strong emphasis upon stakeholding (where businesses have a responsibility to various groups rather than just ‘fat-cats’ at the very top).

        In ideological terms, the third way is closely related to the concept of communitarianism which emphasises the interest of communities and societies over those of the individual and seeks to reinvigorate social democracy.

        However I did find this sardonic view in this BBC information piece.
        http://news.bbc.co.uk/2/hi/458626.stm
        One supporter writing to The Independent claimed it was a form of benevolent pragmatism – a philosophy that asked of each policy – is it good, does it work? For this reason he argued it was hated by the old left and the new right – the new right because they never did anything that was good and the old left because they never did anything that worked.

  9. KJT 9
    4 September 2020 at 9:03 am

    @Wayne.

    Labour went into the last election promising "Transformational" change. Is that not a mandate?

    Even more so are polls showing 80% support for change rather than going back to where we were.

    Not that National ever paid much attention to democracy. After being elected in the 90's on the admittedly vague promise to reverse Labours "reforms" they doubled down on them. Not to mention continued asset thefts, sorry, sales, after a clear majority opposed it.

    • Morepork 9.1
      5 September 2020 at 9:44 am

      " Labour went into the last election promising "Transformational" change. Is that not a mandate? "

      Not when they received only 37% of the vote and the incumbents received 45%.

      • lprent 9.1.1
        5 September 2020 at 11:57 am

        Hello ignorant idiotic fool.

        The votes that count are those that allow the formation of a voting majority in Parliament on confidence and supply.

        The ‘incumbents’ received less than 50% of the seats in parliament. The Maori party and Peter Dunne departed parliament because of insufficient public support or old age.

        The Labour and NZ First were able to form a government with the confidence and supply agreement with the Greens because NZ First and the Greens disagreed with less with Labours programme than they disagreed with Nationals incumbent actions – which all three parties and the majority of voters disagreed with.

        Perhaps you should educate yourself about our parliament rather than self-pleasing your genitals to invent spurious, irrelevant, and mistaken lies..

        • Morepork 9.1.1.1
          5 September 2020 at 5:05 pm

          I quoted the the specific comment I was replying to, which referred to a mandate, not about the formation of the government. Labour did NOT get a mandate from the last election. They formed a government with the suport of NZF, who have infact acted as a self styled 'handbrake' on labour's reforming policies.

  10. RedLogix 10
    4 September 2020 at 9:17 am

    Our entire political spectrum has repeatedly fallen short of dealing with the problem of gross relative poverty (or inequality as it's often also called). We have made huge progress in solving the absolute poverty problem in that starvation, famine and absolute deprivation do not by and large stalk our streets, and for this we should be very thankful,

    One trivial solution to the inequality problem is of course to render everyone absolutely poor and arrive at relative equality this way. Which is more or less where we started from 10,000 years ago, so I think we can set this one aside. No-one is for poverty.

    Every other attempt at solving the problem grapples with the problem that in the material domain, all people are innately different, and that differences in outcome inevitably accrue over time. As soon as you add actual prosperity to the human economy, some people will get more of it than others, and the more prosperous the system the large the inequality tends to become. This isn't necessarily due to greed or avarice; it's largely a property of the system.

    The conservative answer to this problem is to point to the individuals piled up at the bottom of the system and with some justification say that many have made poor choices and their unfortunate condition is something they could change if they made the effort to do so.

    The liberal answer to the problem is to point to the system and with some justification say that it tends to have too many constraints and restrictions on the individual by it's collective nature and that we could change everything if we freed people up from these in order they might fully express their true capacity.

    The socialist answer to the problem is to point to the system and with some justification say that the gross differences in outcomes is due to unfair structural oppression and privilege that condemns entire classes of people to perpetually inhabit the bottom rung of the ladder.

    And each political class has proposed various solutions aligning with their pre-suppositions, some more workable than others. (The more extreme versions usually turning out to be dismal failures but that's a tangent to my argument here.)

    Stepping back from this brief, and necessarily low resolution overview, it's fair to argue that neither the conservative, the liberal nor the socialist approach to inequality has fully embraced the true nature of the problem. At best we have muddled along toward compromise arrangements; progressive taxation, aggressively maximising equality of opportunity and the provision of collective physical and social infrastructure services that are equally accessible to all (health, education, security etc). These certainly ameliorate the inequality problem, but no-one pretends they represent a final satisfactory answer.

    And therein lies the question few people stop to ask. What exactly is the nature of the problem we are trying to solve here? And what would success like like? Not knowing our destination means we will almost certainly lose our way.

    Another part of the inequality paradox is that our very conception of a just solution to it, is rooted in the spiritual idea of all humans being of equal worth and dignity, while the material fact on the ground is that we are not all equivalent. This observation suggests that all attempts to solve a problem that has an essential moral root is probably not going to be well served by attempted solutions that ignore this. We tend to measure inequality by material numeric measure like wealth distribution, but this may mislead us into thinking that if we just change wealth distributions (the material outcomes) then all will be good, when in truth the root cause has remained untouched.

    The socialist left has always felt that conservatives and liberals don't care about inequality, when in truth they do, but not in ways we easily recognise. Certainly it can be held that the socialist value system places the problem at the centre of our political mores. And it's the broad failure of the left to convincingly grapple with this issue that has led to tragic missteps over time, like the workhouse culture of the Victorians, the marxist catastrophies of the 20th century and the failed neo-liberal dream of the 80's.

    Paradoxically as our societies have escaped poverty and become wealthy beyond the wildest dreams of our ancestors, the question of how best to distribute this largess has stepped urgently into the foreground. And it turns out I suggest, to be a far more difficult challenge than any of us have suspected.

    • RedLogix 10.1
      4 September 2020 at 11:52 am

      And for KJT's benefit this comment, that fully embraces and expands on the legitimate role of socialism, was posted before his "Reds under the Bed" post.

      As Ad says, no-one here is complaining about socialism. Except when it goes too far into marxism.

    • Descendant Of Smith 10.2
      4 September 2020 at 1:18 pm

      I have to disagree – capitalism and capitalists in general do not desire to have wealth distributed. This was evident in NZ in the 1800's where Maori were deliberately and consciously paid 1/10th of the wage of an English worker for cutting down timber. This was well known and documented at the time. It was evident in New Zealand when increased profits gained by lowering workers wages were redistributed to themselves through ever increasing salaries – the easiest way to transfer the increase in capital value of a business to your own pocket. It was evident in New Zealand when the winebox enquiry occurred. It was evident in New Zealand when the papers were released around tax havens. It was evident in New Zealand when changes were made to remove the tax on selling properties and to offset interest against personal income to reduce the personal tax you could pay.

      These are all conscious decisions made to increase capitalists personal wealth and capitalists have been very successful in doing so. The fact that some capitalists might might like it to be more fair/liberal simply reflects the inability of their own to mitigate the negative aspects of these changes. Even in my first example there were capitalists who were concerned about the exploitation. They were ineffective in preventing it though.

      • RedLogix 10.2.1
        4 September 2020 at 3:07 pm

        You really have completely and utterly missed my point. I'm not arguing that liberal capitalist are at heart secret socialists with a re-distributionist's conscience … not at all. Holding to them to that standard will always be a disappointment.

        This was evident in NZ in the 1800's where Maori were deliberately and consciously paid 1/10th of the wage of an English worker for cutting down timber.

        A liberal might look at this example and argue that employing Maori, even at the very low levels of pay they were willing to work for (because otherwise in the conditions that prevailed in the 1800's they might have zero income), was better than not employing them at all. And that over time the pay levels would equalise as the two labour groups competed freely in the market, and eventually their inequality would reduce. Which, whether you like this argument or not, you have to accept was more or less what happened.

        It's not that liberals don't care about inequality, but they perceive it and the solutions to it quite differently to socialists.

        And of course my comment above really has a much wider point than this.

    • mikesh 10.3
      4 September 2020 at 11:05 pm

      While we can never eliminate the lack of "equivalence" with regard to human beings, we can endeavour to eliminate unfairness in the tax system.

  11. Tiger Mountain 11
    4 September 2020 at 9:25 am

    Good points raised by Simon, though he rather beats around the bush like other gentle critics of Labour’s non transformational ways. The structural and legislative underpinnings of Neo Liberalism need to be retired for good. No politics follower deserves the left tag if they do not acknowledge the evidence that leads to that conclusion.

    If Labour does not make any monumental errors in the next six weeks, and Covid does not go wild, then they are on track to be in Govt with no NZ First involved to drop floaters in the pool. So major change will indeed be possible, and, essential given the collapse of international tourism and migration associated education.

    One practical example; WINZ/MSD needs radical reform so that sanctions/stand downs/abatements are removed and benefits individualised as per the “Tier 2 Covid newbies” payments, where partners can keep working. The effect will be to create a seamless movement from say seasonal, intermittent, and gig work to welfare payments, and back again, without sadism and moral judgement. Ultimately a Basic Income administered by IRD would sort it for most. With a new Social Security Agency created to cater for special needs citizens i.e. home carers, disabled, sickness, ACC recipients etc.–basically just to bloody well pay these people liveable amounts without submitting them to inquisitions.

    It will take wide community organisation and direct action of various forms to shake the Labour Caucus on this. And a good Green vote would help too! Get Labour re-elected and then hold them to account and demand change is the way forward. A National/ACT/Conspiracy rats and mice Govt. would just create such negative political space that it must be avoided at all costs. Labour needs to toughen up right now with the public service Nat Toadies and leakers, sackings are required to set the example.

    • Kay 11.1
      4 September 2020 at 9:50 am

      One practical example; WINZ/MSD needs radical reform so that sanctions/stand downs/abatements are removed and benefits individualised as per the “Tier 2 Covid newbies” payments, where partners can keep working. The effect will be to create a seamless movement from say seasonal, intermittent, and gig work to welfare payments, and back again, without sadism and moral judgement. Ultimately a Basic Income administered by IRD would sort it for most. With a new Social Security Agency created to cater for special needs citizens i.e. home carers, disabled, sickness, ACC recipients etc.–basically just to bloody well pay these people liveable amounts without submitting them to inquisitions.

      This. Except it's TOO sensible and reasonable, and more importantly, fair. It also involves giving home carers, the sick and disabled more money and you have to remember there is still a large group of the public (and politicians of course, Labour included) ideologically opposed to increasing benefits for ANYONE, even those they tokenly consider 'deserving'. It would involve forcing a major mind switch which just isn't likely, so well ingrained is the indoctrination.

      • PsyclingLeft.Always 11.1.1
        4 September 2020 at 10:01 am

        Not forgetting having Bene's to Bash is always eminently useful for the neolibs. A (mostly) subdued grouping that just "exists". ….

        For all their railing…the nats would never rock this boat too much….might stir them up enough. for action…

        Biggest thing I observed during the Covid Lockdown…was how a ReSet NZ could be possible. People just seemed to be different. Friendlier…What could be. An actual Sustainable NZ.

        • greywarshark 11.1.1.1
          4 September 2020 at 11:35 am

          What needs to happen as far as tax is concerned is to remove the discouragement to work hard so you can improve your life. The lying of neolib system manipulators ensure that people not involved at the survival/lower income end of society's ladder don't understand its malevolent plan of using poverty as a spur to the precariat. Neolib culture holds out the goal of working hard, being self-sufficient so that needing welfare is a sign of degeneracy, laziness etc etc.

          Then wages are held to an artificial inflation level specially designed for the working class without housing security, the jobs and skills are demolished by new machinery and methods as in the Industrial Revolution, the newly unemployed broken-hearted and confused are objects of derision by those with certainty of employment at the office level; it is a disgrace to have this situation in the 21st century after all the education and economic experience of the past.

          So let's face up; neolib is nasty and false and acts to downgrade the human condition. Get it out of our heads and lives.

          Let people follow their natural bent to work and better themselves – if they want to work harder and longer, set good health limits but let them retain their rewards of wages or advantage for that work. Remove the fucking secondary tax, and reduce the GST to 10% on everything except food and water. Then 5% to the government general fund and 5% to fund infrastructure, provide services for the the area, the businesses where the money is spent, so they can invest it usefully.

          No GST on any food, cooked food, restaurant food, no worries; just stop trying to divide food into categories and whether it is tourists or locals – just let restaurants, takeaways, cafes, alone. Keep taxing booze though, and sugar, they are too tempting for us and we tend to excess on them, unhealthily.

          • roblogic 11.1.1.1.1
            4 September 2020 at 7:27 pm

            when housing stops inflating faster than the median wage we might be getting somewhere. every government since 84 has allowed the disgraceful behaviour of the FIRE sector to rampage unchecked, and the real economy to be colonised by banskters and their thieving ways

          • Draco T Bastard 11.1.1.1.2
            4 September 2020 at 8:21 pm

            Remove the fucking secondary tax,

            Repeat after me:

            There is no secondary tax.

            There is no secondary tax.

            There is no secondary tax.

            The secondary tax is a left over from when we didn't have computers. It achieved two things:

            1. It caught the higher tax rate that people ought to have been paying due to the higher income
            2. It encouraged people to actually fill in their damn tax return

            Once people did the latter the secondary tax would disappear in a puff of maths and the people who paid it would get a tax refund.

            Now, if we used our computers efficiently the amount that some one needed to pay could be accurately calculated on a week by week basis and that includes companies as well and thus could remove the need for Provisional Tax. Unfortunately, we have far too many people absolutely terrified of the government using computers efficiently and will come back with the bollocks of the government watching their every move.

            Its really amazing how much people have believed the crooks over the last few decades.

            Oh, and get rid of GST – another tool put in place by the crooks.

            • greywarshark 11.1.1.1.2.1
              4 September 2020 at 8:46 pm

              Oh thanks DTB. You seem heated about the secondary tax reference – it is not real then. Glad to have got you warmed up on a cold winters day.

              But perhaps people don't want government looking over their shoulder and noting every week whether they have made a bob or two. I'm simple-minded I know. I think you are one who wants to drop cash and go plastic.

              And about secondary tax rate. If working longer so you could earn more money is a good thing – why should someone on a low wage go up to higher wage bracket for working longer. The differential in incomes worked out on an hourly rate, can be so high that it is daylight robbery to tax someone on the hours worked over 40.

              • Draco T Bastard …
                4 September 2020 at 10:27 pm

                You seem heated about the secondary tax reference – it is not real then.

                Its a misunderstanding that's been pissing me off for decades.

                But perhaps people don't want government looking over their shoulder and noting every week whether they have made a bob or two.

                The government does that every week for taxes. The only way to avoid it is by becoming a criminal.

                If working longer so you could earn more money is a good thing – why should someone on a low wage go up to higher wage bracket for working longer.

                Then don't work so long that you'll be taking work off of others.

                Yes, a large part of the reason for high unemployment is because we have so many working 50+ hours.

                Perhaps what we really need, instead of whinging about taxes, is better pay rates and less theft by the rich.

                • mikesh …
                  4 September 2020 at 11:28 pm

                  "If working longer so you could earn more money is a good thing – why should someone on a low wage go up to higher wage bracket for working longer."

                  So you are, in effect, advocating a flat tax rate.

  12. Dennis Frank 12
    4 September 2020 at 10:27 am

    Now that she's been voted runner-up top global thinker, she may think twice. Let's hope she rethinks her support of the neoliberal doctrine.

    Jacinda Ardern voted second on list of world’s top thinkers

    https://thespinoff.co.nz/politics/03-09-2020/jacinda-ardern-voted-second-on-list-of-worlds-top-thinkers/

    Ad makes a good point re necessity of crisis management, yet the crisis can only be solved if Labour transitions from talking progressive to actually being progressive. They may not realise it, but even Labour folk can walk & chew gum simultaneously.

    Since the crisis is global, someone must spell out the solution and start providing it. This is an opportunity for crowd-sourcing wisdom and co-design. The solution will be a package deal, so the task initially requires identification of all the essential components of the package.

    We can expect the smarter politicians to have a few clues, while other clues will come from experts. However, those two groups are afflicted by a mindset of adherence to the status quo. That leaves lateral thinkers as the group most likely to be the leading edge of the solution-finding process.

  13. Tricledrown 13
    4 September 2020 at 10:35 am

    Wayne your little fairy stories are pure BS.

    No govt meets its its promises no tax increases .

    GST increased a tax on the poor.

    Key said he was going to wipe out the P addiction its boomed exponentially.

    Key was going to grow the economy it barely grew wages and buying power.Immigration was the only policy that created a paltry growth at the cost of lower wages and worse housing situation.

    Housing was a complete disaster National now regretting selling off 6,000 state houses .

    When Judith Collins was housing spokesperson she promised cheap houses in the hobsonville development none were built developers didn't want to sell them below market value.

    Policing National cut police numbers by 800.

    Road policing was cut by even more while the road toll went up to as the number of miles driven on roads doubled.

    Education and Health spending were cut by the sinking lid policy.

    All to give a few dollars in tax cuts cynically 6 months out from elections ,bribes for the swing voter.

  14. greywarshark 14
    4 September 2020 at 11:08 am

    From Simon's great post. Picking out some concerns to think about and I have added links so we can be more informed by the wise opinions, facts and thoughts of writers who know what they are talking about, and reflect, update their information and shift in their opinions accordingly.

    In her rhetoric, Ardern consistently claims her government will be two things – it will deal with climate change as her generation’s “nuclear-free moment” and it will be “transformation”.

    These words are open to interpretation. Roger Douglas and hoods and Treasury set out to be transformational. They bloody well succeeded in just about every area of NZ life, the s…ts. So be careful fellow citizens, that we are all singing from the same hymnbook.

    What Ardern means by transformational is open to interpretation but in the context in which she has said it, it is hard to interpret it as meaning anything other than reducing inequality and poverty. In 2017 she set a prime goal of bringing all children out of poverty within six years. Half that time to reach the target has expired.

    It is hard to see how, from the progressive side of the political spectrum, you can address inequality without tackling, if not unwinding the underlying structures of neoliberalism that have produced such inequality.

    Nine years of Labour governance under Helen Clark did not attempt this….

    I heard yesterday a ringing slogan from PM Jacinda about wanting NZ to be the best country in the world to bring up children, or similar. I cringed, dear God I cried, people who keep the figures and note our decline have been begging for some stable positive change for decades. The known condition of NZs low standards for a large needy proportion of people is such that sentiments like that bring on reactions of cynicism, not hope.

    “As a nation, New Zealand simply will not get through this crisis in one piece if it fails to answer the urgent need for an immediate and massive redistribution of wealth from those whose financial position is reasonably secure to those whose position is not,” says left wing commentator Chris Trotter.

    The Green Party has come up with a well-thought, comprehensive poverty policy that would be funded by a wealth tax of 1 percent on individuals with net assets over $1 million, and 2 percent for those with assets over $2 million. It is neat, in that it would also operate as a de facto inheritance tax for asset-rich-cash-poor individuals who want to defer payment, and it also captures most trusts by treating them as individuals.

    However, Rashbrooke says Ardern is “distinctly lukewarm” on the wealth tax and he reckons she has little appetite for redistribution, by which I assume he means higher income tax brackets.

    It's time to bite the bullet; PM Jacinda has strong white teeth, and I believe that she has the intelligence, the political nous, and the mixture of hopeful youth and experienced maturity to take on the task. It is a tipping point in our history, and this one term of government is all she needs to make history. And for those Labour acolytes who want to manage through, BAU, they are not the men for this Gallipoli. They would be prepared to fight for some other country and lose their lives. But in the battle here and now they hope to survive personally unscathed at the expense of losing our country to the invasion of rentier capitalism, and "brutal, callous" and overbearing management of the vast majority of citizens.

    Those words were in stuff today uttered by a school principal who witnessed the execution of his school against all reason, figures, stats and despite its dedication and success with its low-income students. He said he was sorry for Hekia Parata, who he said did not understand what she was doing. That is almost Jesus-like, a resignation at the irretrievable loss of all that the people wanted, all that they had achieved together. That attitude will be echoed throughout the land if we are not active to prevent the attrition of NZ by the Right. https://www.stuff.co.nz/the-press/news/122485286/munted-it-was-quite-simple-it-was-good-versus-evil

    But another consideration is the fight to get the functionaries of government back on the side of the citizens. The attitude that neolib has embedded in them is that we are just a rabble and they are allotted the task of coping with us, and are regarded as successful if they can tick the boxes on their targets which are set by management which has likely come from the business class, with inflated egos that match their inflated salaries and perks. We are back to reference to 1st-2nd century Juvenal who posited the point "Who will guard the guards themselves?". We the citizens are either despised or indulged, we are losing/lost agency; is this democracy or an oligarchy or….? Sixteen different approaches to government are here, can we tweak ours? http://infographicfacts.com/16-government-types/

    Simon himself wrote about the problem of civil servants not being civil any more, and deciding who they serve. (I remember an old USA joke about a space rocket under development – 'They call it Civil Servant. It won't work and they can't fire it.)
    Sep./2017 Simon Louisson: An inside view of the politicisation of the public service https://www.stuff.co.nz/dominion-post/comment/96522159/simon-louisson-an-inside-view-of-the-politicisation-of-the-public-service

    And Chris Trotter has thought about this also, and I put the link again for those who didn't see it before. https://bowalleyroad.blogspot.com/2017/05/our-path-to-future-is-blocked-by-past.html
    …The simple answer is: The Past. A government elected on the strength of public misgivings about rampant homelessness and the lack of affordable housing; out-of-control immigration; and a despoiled natural environment; will be presented with thirty-year-old government machinery designed specifically to make effective state intervention as difficult as possible.

    Any attempt to deploy this machinery in pursuit of social and economic objectives for which it was not designed is highly likely to end in failure – and, quite possibly, disaster. Arrayed against a government in which only a handful of ministers possess Cabinet experience will be a bristling phalanx of public servants, National Party appointees, corporate and special interest lobbyists and public relations firms – all of whom have a vested interest in preserving the status quo.

    Other interesting and relevant posts Chris Trotter wrote in 2017. This one's caption for the image has a great quote by Dr Beaglehole:
    Dr J.C. Beaglehole, writing in 1961, recorded with considerable disdain: “The naïve, the almost childish brutality, with which the chiefs of the National Party fell upon power may seem quite surprising, until one remembers how famished for power they were, and with what an innocency of experience they faced the world about them ….. [Their] insensitiveness to administrative delicacies was quite appalling.” https://bowalleyroad.blogspot.com/2017/05/insensitiveness-to-administrative.html

    And the term 'cargo cult' was applied to simple Pacific Islanders who were descended on with all sorts of elaborate machinery in WW2. They were amazed and attracted by this stuff, they wanted more. Isn't that the NZ story, willing to do anything to get more, more goodies, more materialism. https://bowalleyroad.blogspot.com/2017/05/will-tpp-spell-nationals-doom.html

  15. McFlock 15
    4 September 2020 at 2:08 pm

    Losing winnie would be a two-edged sword. On the one hand, NZ1 has held the government back (cameras on fishing boats come to mind).

    On the other hand, it leaves nobody to blame for inaction. And as long as the Greens are at the table, happily it means the Greens can drag Labour forward.

  16. Corey Humm 16
    4 September 2020 at 2:19 pm

    The winter energy payment ends two weeks before the election. That's $40 and $60 being lost to the most vulnerable people in this country whose bills are up. Labour have created a two tier welfare system. Alot of people who voted labour in 2017 for the first time ,are going to be absolutely buggered. I reckon they'll stay home.

    Family packages don't help disabled people , people who are unwell , unemployed people on their own and the employment market isn't going to help the people on welfare prior to covid when so many who were working news jobs.

    Criminal negligence from Labour and its going to cost them at least a couple % of people who won't vote green they'll just stay home. Make that payment permanent

    • greywarshark 16.1
      4 September 2020 at 3:09 pm

      Yes too many stop gaps. But NZ likes to wait for people to fall over rather than fix a possibly risky situation. We only have x money left over for the mass of the population once we have looked after our new aristocrats and their heartfelt needs. They are wealth creators you know, they amass it, they build a big dwelling and they wallpaper their rooms with the wealth, to keep it close and safe.

    • Barfly 16.2
      4 September 2020 at 4:31 pm

      Yea I will be sad to see the $40.96 per week energy payment go 🙁

      But the 9 years of national government only gave fear ,harassment and panic attacks.

      I do not have the memory of a goldfish…and hopefully others do not as well

  17. mosa 17
    4 September 2020 at 11:12 pm

    " Will Jacinda Ardern meet her promise to transform "

    Politicians break promises !

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  • New Zealand to attend regional security meeting in Australia
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