The emergence of Bill English as National party leader and therefore as Prime Minister was in some ways almost a non-event – it did of course produce an important and clear-cut outcome, but the contest was over before it began.

From the moment that Bill English was endorsed by John Key, it would have been a major surprise if he had not prevailed, and the absence of any real sense of contest was compounded by the surprising thinness of the field that he had to overcome.

Challenges from Judith Collins and Jonathan Coleman were never going to have him quaking in his shoes – and hardly spoke volumes for the talent allegedly to be found on National’s front bench.  Judith Collins had really no claim to be considered, having surely disqualified herself from high office by her unsavoury connections with dirty politics and Cameron Slater, and her inability to separate her ministerial responsibilities from her husband’s business interests in China.

Jonathan Coleman has proved himself a decently competent Minister, but his problem in pitching himself as the party leader can be seen from the fact that the only time he has hit the headlines concerned a fight he got into at a function hosted by British-American Tobacco, when he blew cigar smoke into the face of another guest, and refused to desist.

So, the hot favourite won going away.  That, however, was the easy bit.  Bill English now has to jump higher hurdles, including winning a general election – and that is a hurdle he has fallen at in the past.

He can fairly claim to be the architect of much of National’s policy platform, but selling it to the public is now his responsibility and can no longer be contracted out to his predecessor, who – unlike him – had the advantage of being a born salesman.  There is an eerily close parallel between his predicament and that of the former UK politician, Gordon Brown.

Brown was handed the premiership, after a long wait, when Tony Blair – who is variously reckoned to have been either a brilliantly persuasive communicator or a ham actor and con man – was persuaded to remove himself from the scene.

Brown was a dour Scot, not given to levity and small talk.  The contrast with Blair was all too apparent.  His advisers told him that he must smile more – with the result that often, in the middle of a television interview on some humourless topic, he would suddenly remember to smile and, at the most inopportune moment, break into a kind of rictus, baring his teeth in an alarming way and appearing almost manic.

Bill English is not, of course, similarly afflicted, but he does not have John Key’s easy manner, and – when he remembers to smile – he can often look as though he is enjoying a private joke at the expense of his interlocutors, perhaps because he knows he is cleverer than they are and knows things they don’t.

But his problems are not just presentational.  He, more than anyone else, has been associated with, and has claimed the credit for, giving priority to “the deficit’ – not the country’s deficit (the one that really matters) but the government’s.

Cutting the deficit matters, especially to policy wonks, but a price has been paid for the cuts – particularly by ordinary people who have found that their housing, health, education and living standards have suffered while the government has pocketed money that could have been spent on them.

And he is still at it.  As we speak, he has authorised a further sale of state houses in Christchurch to absentee landlords in Australia – more money for the government’s coffers, but a further loss of government-provided housing for the badly housed and homeless.

It was one thing to be hard-nosed as Minister of Finance, but quite another to be a hard-nosed Prime Minister.  The combination of a smiling front man and a tough number two served the last government well, but English and Joyce – two hard-nosed money men who focus more on figures than people – may not work as well.

That leaves the Deputy’s position.  The call from the rival candidates, Paula Bennett and Simon Bridges, was for change and refreshment – a call that could be echoed to advantage by Andrew Little come election time.

Bryan Gould

10 December 2016

The Opposition, and the Labour Party in particular, always under-estimated John Key.  What they saw was no more than a genial glad-hander and a seat-of-the-pants chancer – at best, a populist adept at winning the centre ground.  It was only a matter of time, they thought, before he came unstuck.

What they missed was a sharp political intelligence and a clear ideological commitment.  The result – they were always fighting the wrong battle.

John Key certainly had important political gifts, in terms of likeability and the ability to communicate and relate to people.  Much of the opposition’s effort was devoted to trying to negate those advantages, in the hope that the feet of clay they were sure were there would be exposed to the public gaze.

They failed to understand that the battle was not one of personality politics, but real politics. The personality was merely the means by which a deadly serious re-making of New Zealand – along ideological lines – was being undertaken.

If we review the Key years, the trends are unmistakable.  Business interests have been given top priority; social and environmental issues have been increasingly relegated to the second or third rank.  Public assets have been privatised and the public sector and public spending have been subject to constant cuts; the law has been changed when required to suit the interests of overseas corporations.

Workers’ rights have been reduced; employers have been given more power.  Child poverty – and poverty more generally – has increased and life on benefits is tougher; the rich have enjoyed tax cuts.  Homelessness has re-appeared in our midst and owning their own home is now beyond many young Kiwis; those already owning their own homes and property speculators in particular have made fortunes from soaring house prices.

It is John Key’s politics, not his personality, that have produced these intended outcomes.  They have been produced, not by a relaxed middle–of-the-roader, but by a dedicated ideologue.  They are the result of a particular kind of neo-liberal politics, of a consistent and deliberate push from our Prime Minister to turn New Zealand into a “trickle down” economy (and society), one that clearly differentiates between winners and losers, one where the top priority is to ensure that the winners do even better and the losers have to get by as best they can.

Who can doubt that he has succeeded in changing our country as he intended?

John Key was no doubt perfectly genuine in his belief that this was a New Zealand that would be acceptable to most, but he was nevertheless adept at concealing his intentions in case they were not supported.  He was on occasion quite open about this.

A few years ago, the then Premier of Queensland, Campbell Newman, was contemplating asset sales to raise cash.  He sought advice from John Key as to how he could get away politically with what he knew would be an unpopular measure.  Key’s advice, as reported in the New Zealand media?  “Do it in small stages,” he said, “and people won’t notice.”

He was also pragmatic and cautious when it suited.  A new policy would usually be “floated” in advance, and then referred to “focus groups”, so that the public response could be judged.  Depending on that response, the policy would be implemented or tweaked as necessary or simply abandoned.

Here, in other words, was a political operator who knew exactly what he was doing.  It is no accident that he was highly regarded by his right-wing colleagues in other countries, to the extent that he has for some time been chair of the International Democratic Union, the global association of right-wing political parties.

He had, after all, achieved what so many of them had struggled with – he had sold a neo-liberal agenda to voters who would normally have rejected it as extreme and contrary to their values.

His easy manner and “nice guy” image meant, of course, that he was able to conceal the ideological mainspring of his politics not only from the voters but from his opponents as well.  They were reluctant to accept that they were being confronted by a serious political operator and were so bemused by his image that their attention was distracted from the serious political purpose that was being served.  They were fighting the image – “a cheeky chappie” – when it was the politics that should have engaged their efforts.

Key’s departure and the arrival of Bill English in his place should make things simpler for the slow-witted.  There will, one imagines, be less dissembling and a more clear-cut, no-frills, political direction.  It will in many ways be a relief to get back to clear political choices and a better chance of deciding the kind of New Zealand we want.

Bryan Gould

11 December 2016.

What are we to make of John Key’s bombshell?  Reactions will obviously vary according to the political views of those making them, but his statement should be taken – initially at least – at face value.  We should all understand the pressures that public life imposes, particularly on the major players.  Living in the limelight is not by any means as much fun as it seems.

The Prime Minister may have been feeling the effects of a strenuous by-election campaign in Mount Roskill, and defeat there may have offered a glimpse of what a general election defeat might feel like.  He may also have been at a low ebb, perhaps disheartened by the election of Donald Trump and what that has meant for the TPPA; he may have felt very keenly the loss of what was very much his own pet project.

It may simply be that he felt that he had done all that he could and that, as he himself says, he had “nothing left in the tank”.  And perhaps he sees the advantage, in terms of his legacy, of retiring while still on top and undefeated, rather than running the risk that the voters will tell him next year that it is time to go.

The British politician, Enoch Powell, once famously said, with pardonable and only slight exaggeration, that “all political careers end in failure”.  John Key may not have been familiar with that well-known quotation but he may still have been tempted to disprove the wisdom it claims to represent.

Whatever the truth of such speculations, there will certainly be many well-earned tributes paid to him and his record of success as a vote-gathering political leader.  He has undoubtedly been one of the most successful and popular of our prime ministers – though, it must be remembered, that, despite the impression often peddled by National party acolytes, only one in three of eligible voters actually voted for him and his government in 2014.

His “nice guy” image certainly struck a chord with many voters, even if others deplored his glibness and, on occasion, apparent slipperiness.  He was faced with serious challenges – the Global Financial Crisis and the Canterbury earthquake – and on the whole dealt with them calmly and competently.

His handling of the Pike River disaster, however, was less compelling and his record has been threatened by the crisis in housing affordability and homelessness, by the growing sense of a society where significant numbers are left behind, and by the excessive attention he seems to have paid to business interests at the expense of working people.

Nor can it be said that his government has succeeded in the overdue task of re-balancing the New Zealand economy.  Our current supposed “success” is still far too dependent on excessive borrowing, consumption and imports, while productivity, investment and exports languish.  And “the deficit” on which so much attention has been focused is not the one that really matters, the deficit we have with the rest of the world – the one that means we constantly have to borrow to balance the books.

The real question about his resignation, however, is its timing.  Why now?  It is not as though he has another big job – perhaps on the international stage – lined up.  Nor does he need time, for financial reasons, to build another career in order to provide for his family.

It could be argued, with some justice, that he took a principled decision to take the NZ public into his confidence so that he cannot be accused, after the 2017 election, of misleading them as to his intentions.  But the mystery deepens when we recall that it was only a few hours earlier that he was relishing the challenge that he was to face in his own electorate from Hayley Holt.

For a Prime Minister to resign in this unexpected way must suggest that he is acting under some pressing imperative.  The one he identifies is that his wife has asked him to take this step and that his children have suffered – though he must know that Max Key’s foibles will still attract attention, even if his father is out of office.

If that is the reason, he is to be commended.  But imperatives come in many different forms.  Time will tell whether that is the full explanation.

Bryan Gould

5 December 2016

As we read yet again of the huge gains by property speculators, are we not obliged to ask a serious question?  Are they – or even more pertinently, are we – happy to live in a society where fortunes are made in the course of a single day from dealing in property while hundreds of thousands of Kiwi children do not have a safe, dry, or even any, roof over their heads?

We live at a time and in a place where to be rich and famous is regarded as the pinnacle of achievement.  The rich – (the fame usually comes along as a corollary) – are admired and envied, not just for the lifestyle their wealth makes possible but also because it is seen as a mark of particular moral worth and social value.

These attitudes are sedulously fostered by the media, who enjoy a complex symbiotic relationship with the rich – largely because the media find it prudent to serve the interests of their owners and because the activities of the rich provide an endless source of copy.  Even more significantly, the same attitudes are translated into political analysis; we have for some decades now been persuaded that the success of those who have made their fortunes is the key to a successful economy.

Even economic analysis has at times succumbed to the worship of the wealthy.  The infamous “trickle down” theory – now largely discredited – postulated that if the rich did well, their wealth would, by stimulating economic activity, “trickle down” to lesser mortals.  Our own government has stopped short of specifically endorsing this “crumbs from the rich man’s table” approach, but has been very clear that the rich are the prime movers in the economy and that their interests must come first.

None of this – which has been so important in shaping changed social attitudes over recent decades – takes much account of distinctions in the way that the rich make their money.  They are usually all lumped together as economic and social leaders, all meriting the same thanks and congratulations from the less successful.

Yet there is now ample evidence that there are major distinctions to be made – at least in terms of the debt of gratitude that the rest of us should feel to our supposed benefactors.  Joseph Stiglitz, the Nobel prize-winning economist, in particular, has shown that the best way to become rich is to be born into a wealthy family.  Even more importantly, he establishes that great majority of “the rich” are “rentiers” – that is, they do not create new wealth (as popular wisdom encourages us to believe) but simply manipulate their existing wealth in order to derive a return from it.

So much, in other words, for the moral virtue we are told we should attribute to the wealthy and the gratitude we should feel to them for the economic benefits they bestow upon us.  Even more particularly, how should we feel about those who quite clearly do not contribute in any sense to the creation of new wealth, but who gouge their fortunes from the rest of us by extracting a disproportionate reward for speculative activities?

We (or at least some of us) might still feel admiration for those who are clever enough to spot profitable opportunities and then walk away with the booty – but at least spare the rest of us from any sense that we should award them medals for benefaction and social responsibility.

These thoughts are prompted by the increasingly frequent recent reports of the fortunes being made by those who speculate in the Auckland property market.  We have ample precedents for the social and economic damage that such activities can produce.  The Global Financial Crisis, for example, was the direct consequence of institutional involvement in highly speculative sub-prime mortgages, which created a dangerously unstable pyramid of debt and grossly over-valued assets.

And who could doubt that speculative activities of this kind now constitute the major risk faced by our economy, to say nothing of the housing crisis that has now placed a family home beyond the reach of many families and reduced others to sleeping in cars, tents and garages?

Should we not say that if the time has now come when excessive speculation fuelled by foreign investors must be restrained, the same is true of speculative investment from domestic sources as well?  Not only are those who grow rich by such means – home-grown or otherwise – not entitled to plaudits as economic leaders and benefactors; they should be identified as those whose gains are literally ill-gotten and which come at the expense of the rest of us.

Every speculative dollar transferred into the pockets of speculators as the consequence of the million-dollar price of the average Auckland property has to come from somewhere – and the answer is that it comes from the rest of us.  It is a transfer of wealth from the poor to the rich and a major driver of inequality.

It may be difficult to convince our Prime Minister of this – as someone who made his fortune by trading on the foreign exchange market, he is unlikely to criticise those who make money by manipulating existing assets – but the rest of us might feel entitled to ask, are those who prosper by creating misery for others really scaling the moral heights and entitled to our respect and admiration or are they plumbing the moral depths?

Bryan Gould

12 September 2016

The Herald made a valiant attempt to explain last Friday how Air New Zealand had managed to produce a record $663 million profit.  They quoted the Chief Executive, Christopher Luxon, as attributing the result to the tourist boom, the fall in fuel costs, improved cost control in general and the efforts of a dedicated staff – all of which no doubt had a part to play.

He was not reported, however, as mentioning another significant factor – the pressure exerted by the government to maximise profits (and therefore the dividend the government is paid), even at the expense of neglecting Air New Zealand’s responsibilities as the national carrier.

This latter factor is of particular significance to a large number of hitherto loyal Air New Zealand customers, who would willingly remain loyal given half a chance, but who have been left high and dry by the withdrawal of services from various less populated parts of the country.  Those erstwhile customers include me and my friends, neighbours and family, whose service from Whakatane was arbitrarily withdrawn a year or so ago.

It is not only individual travellers who suffer the consequences of this decision.  The local economy takes a hit as well, since the inability to fly to other parts of the country and back will deter many others from living in a spot which suddenly seems to have become so inaccessible.

We are, on the whole, well served by the providers of national services, most of whom recognise and discharge their responsibilities to the further-flung parts of our country.  Power and telecom companies do their best to disregard and overcome the problems of remoteness.  The Post Office continues to maintain their excellent rural delivery service.  But Air New Zealand pulled the plug in the interests of maximising profits; they seem to operate on a rather restricted definition of what it means to be the “national” carrier.

It was not that there was insufficient demand.  The direct flight to Wellington once a day had already been cancelled but the three or four daily flights to and from Auckland in a small 20-seater plane were usually pretty full.  The problem seems to have been that a small plane is less economical to operate than, say, a 50-seater – and there wasn’t enough demand to justify that larger plane.  Rather than settle for less than optimal profits and run the risk of disappointing its government shareholder, Air New Zealand was prepared to abandon its Whakatane customers – though no doubt expecting a non-reciprocal loyalty from them when it came to choosing an airline in which to travel overseas.

That would be bad enough.  But when the small airline, Air Chathams, stepped into the breach and provided a very welcome substitute service, Air New Zealand again showed how little the interests of the customers they had deserted actually mattered to them.  They showed no interest in co-ordinating schedules and ticketing arrangements with Air Chathams, with the result that passengers arriving at or departing from Auckland on their way to or from Whakatane are treated as though the trip between Whakatane and Auckland has nothing to do with Air New Zealand.  The fact that passengers fly Air New Zealand from Wellington to Auckland only as part of a journey to Whakatane is of no concern to our national carrier; when we step off the Air New Zealand flight, they wash their hands of us all over again.

It is not possible, for example, to get a single ticket for the journey from Whakatane to Wellington or vice versa.  Nor is it possible for those whose membership pf the Koru Club has been paid for or earned as frequent flyers to use the Koru Lounge In Auckland if they fly Air New Zealand to Auckland then and have a long wait for the onward Air Chathams flight to Whakatane.  They are refused access to the Lounge because they do not have an onward Air New Zealand ticket.  It is not only, in other words, the Whakatane flight that has been withdrawn but also any consideration as an Air New Zealand customer.

Air New Zealand may care little about their customers but they do have the comfort of pleasing not only their own Minister but also the Minister of Finance.  The half billion dollars they have contributed to the government’s coffers may have been earned at the expense of hitherto loyal customers but will have earned golden opinions from Air New Zealand’s ministerial owners who seem equally unconcerned about those living in less populated areas of the country.  Perhaps Christopher Luxon has a little more explaining to do about that $663 million.

Bryan Gould

29 August 2016