• Second and Final Term?

    As a former politician, I have often lamented the journalistic tendency to treat politics as a matter of personalities rather than policies. But there are times when political personalities – and their interaction – can provide an insight into what is really happening.

    Just four months into his second term, it is already apparent that the Prime Minister is a very different John Key from the one we learned to know and (at least for some) love in his first term. The relaxed and amiable friend to everyone has – as John Armstrong has pointed out – somehow transmogrified into a tougher and much less accommodating political leader. The whole tone of the government’s approach is now very different.

    The John Key of the first term showed a remarkably accurate sensitivity to popular opinion. He avoided controversy wherever possible and built an enviable popularity by unerringly identifying where the political centre of gravity on any given issue could be located.

    Today, however, we see a different attitude from the Prime Minister. He is obviously now committed to an agenda that is increasingly likely to encounter opposition and controversy. He seems determined to pursue that agenda – for example, on asset sales – whatever public opinion may have to say.

    If the Prime Ministerial smile was the defining image of his first term, the second seems destined to be characterised by the Prime Ministerial shrug – a shrug that seems to say that he is determined to do what he wants, whether popular or not. What explains this sudden and apparently inexplicable change?

    What is now clear is that the goal of the first term was simply to win the 2011 election. The key to achieving that goal was to be the Prime Minister’s personal popularity – particularly with the politically uncommitted.

    That goal having been achieved, a quite different goal has now been identified. A Prime Minister who was criticised in his first term for being lightweight and not making a difference seems now to have set himself the task of making his mark and leaving a political legacy.

    The second term, it seems, will be used to push through an agenda of change which may commend itself less – or not at all – to the uncommitted, but which will deliver to the Prime Minister’s own closest supporters much of what they elected him to do.

    It is, in its own way, quite refreshing to see a politician who sees the exercise of power, not as an end in itself, but as the means by which real change is to be brought about. But the Prime Minister’s change of focus warrants scrutiny on other grounds as well.

    If his goal is to use power now rather than merely prolong it,that inevitably suggests that he does not see his premiership extending beyond the next election. He has given hints in the past that he does not see himself devoting the rest of his life to politics; his apparent determination to go for broke now is the best evidence we have that he sees two terms as Prime Minister as being quite enough.

    That in turn means that picking up the pieces after the next election – whatever the outcome – is likely to be the responsibility of someone else. And that brings into focus the second major piece of evidence to support the proposition that we might be looking, in 2014, at a post-Key era – the likelihood that a similar thought seems to have occurred to some of those who might see themselves as being in with a chance of succeeding John Key, when the time comes, as party leader.

    The most obvious contender might seem to be Bill English – the Deputy Leader, and of course supported by a significant group of MPs who have already had success in projecting him into the leadership on a previous occasion.

    But there are growing signs of tension in the relationship between John Key and Bill English. There have been several recent instances when the two men have said – it seems quite deliberately – quite different things, to the point of embarrassing or directly contradicting the other.

    Take, for instance, Bill English’s startling admission that the estimate of the proceeds from asset sales was “just a guess” – something that no politician of his experience would have allowed himself to say by accident, and certainly not what John Key would have expected from a loyal deputy committed to this central element in government policy. And look at the direct disagreement this week between Key and English on the issue of whether a renewed boom in house prices is getting under way.

    These tensions do not arise by accident. The signs are that Bill English may know, or think he knows, about John Key’s plans for 2014, and may be distancing himself from his leader so as to offer a fresh start when the time comes.

    Or, he may sense that there are other plans afoot. He will have noticed with apprehension the rise of Steven Joyce, and the new Minister for Everything’s closeness to the leader. There is nothing more guaranteed to engender a sense of angst than the sight of a rival being promoted. Watch this space!

    Bryan Gould

    19 March 2012

    This article was published in the NZ Herald on 22 March.

  • Will He, Won’t He?

    While much of the country is focused on the Rugby World Cup, there is at least one group of people with a quite different contest at the top of their minds.

    With less than six weeks till the general election, the campaign managers for the major parties will be scanning the horizon for opportunities to advance their cause. While much that will be thrown up by the news stories over that period is unpredictable, other events are already well established in the calendar. Plans will be already well advanced to squeeze every last drop of political advantage from each of them.

    That work – as I know from my own experience of election campaign management – will have been going on throughout the World Cup tournament. The Prime Minister’s campaign team, during what John Key laughingly described as an election-free zone, has most reason to feel pleased with what they have achieved over this period.

    The rugby has provided not only a feel-good factor, but also a number of photo opportunities for the Prime Minister to confirm his role as the nation’s cheerleader. Not everything, though, has gone his way.

    The NRL Grand Final did not quite deliver the triumphant climax that the Prime Minister’s trip to Sydney demanded. And there have been difficult moments; the bungled attempt to put words in the mouths of Standard and Poor’s on the credit downgrade did not play well, and the public concern about the apparently ineffectual response to the Rena disaster must be placed on the debit side.

    The government has, not without reason, argued that the Rena is an operational matter, and is the responsibility of the appropriate authorities. The problem is, however, that a Prime Minister who succeeds in basking in the reflected glory of things that go well will sometimes find it difficult to skip away from those things that go badly.

    The campaign team will have been pleased, though, at their success in shifting the blame for the World Cup opening night transport fiasco on to Auckland local government; and they will now without doubt be eyeing up the possibilities presented by what we all hope will be a triumph on Sunday night.

    The stakes here for the campaign team will be high, and warrant a big play. But so will the risks if they get it wrong.

    They will be encouraged by an earlier success in the World Cup scenario. The match against Japan at Waikato Stadium presented an entirely appropriate occasion to recognise – through a minute’s silence – the terrible natural disasters suffered by both countries this year.

    It also allowed the Prime Minister, accompanied by the Japanese Deputy Prime Minister who may or may not have been aware of his supporting role in the drama, to walk on to the field and – having been unable to resist a cheery wave to the crowd as he did so – then be televised standing next to Richie McCaw and the All Blacks as the national anthems were sung. Of such moments are successful election campaigns made.

    But Sunday night is a different proposition altogether. There is, after all, a precedent, and one which will tempt the Prime Minister’s team greatly.

    Many people will remember the 1995 World Cup final in South Africa. The most enduring memory of that occasion is not necessarily Joel Stransky’s drop goal that won the match in extra time, but the appearance of Nelson Mandela, wearing a Springbok shirt, to greet the South African players and wish them well.

    The moment was full of symbolism. Here was the father of the nation, the newly elected President of the whole of South Africa, the man who had represented through a lifetime of sacrifice the ultimately successful struggle against apartheid, wearing a uniform that symbolised for most South Africans the hated minority that had oppressed them for so long.

    It was confirmation of the great generosity of spirit of the man that Nelson Mandela should choose to signal to his supporters in this way that South Africa was now one country – the rainbow nation. Here was one of the greatest men of the century showing huge magnanimity to his former oppressors and leading his new-born country to a new future.

    Does John Key dare to emulate this example? Would the NZRU and the All Black management play ball? Would the television companies cooperate? Is a politician seeking votes quite the same thing as a Head of State celebrating and confirming the birth of a new nation which he had brought into being? Nelson Mandela was after all giving something of himself to the Springboks and his country, not expecting to get some benefit for himself.

    These are the questions the campaign team will be agonising over. There will of course be thousands of supporters wearing the All Black jersey to signify their support on Sunday night. Why shouldn’t the Prime Minister do likewise? But how far can he push it? There will be more than one issue to be decided on Sunday night.

    Bryan Gould

    18 October 2011

  • Is The Mad Butcher Mad?

    The love-in between the Mad Butcher and the Prime Minister, dutifully reported in every detail by complaisant media, is perhaps best described as reciprocal back-scratching – a term that is at least more polite than alternative anatomical allusions that might come to mind.

    But while Sir Peter Leitch might have every reason, in view of favours received, to respond with a typically high-octane endorsement of the Prime Minister, the rest of us might be a little cautious. We might take the view that John Key and his government should be judged by other and more demanding criteria.

    Like, for example, their success or otherwise in managing the economy. We all know, don’t we, that while the rest of the world is struggling, New Zealand is doing pretty well? At least, that is what we are constantly told.

    And it is certainly true that we have good reason to suppose that the deep and intractable problems that afflict others have passed us by. Our main export markets happen to be, after all, two of the most buoyant economies in the world. Our commodity prices have reached record levels. The government’s debt, though constantly offered as the reason for public spending cuts, is – thanks largely to the prudence of the previous government – amongst the lowest in the developed world. Our often-maligned Australian-owned banks are a bastion of stability in a world facing renewed financial meltdown.

    By contrast, other (and major) parts of the world economy are facing really tough times. The Americans are paralysed by political conflict. The eurozone is engaged in a losing battle with debt – a contagion that seems to be spreading like wildfire. And the British are determined to inflict on themselves a home-grown version of austerity that ensures that there is to be no early recovery from recession.

    So, we surely have every reason to expect that our good fortune will be recognised by the credit-rating agencies and that we will show up as one of the bright spots in the OECD.

    So, why have we suffered a credit downgrade? And why do Standard and Poor’s and Fitch seem not to have taken much notice of the government’s feel-good message? They are more concerned with our high external debt, which they say is on track to get worse, not better.

    And if we really are bucking the trend, that should surely show up in the most recent quarterly GDP tables? Yet sadly, the OECD’s second-quarter GDP figures also tell a rather different story. New Zealand recorded a 0.1% growth rate in that quarter – a figure that means that we are out of recession by just about the smallest statistical margin possible.

    But wait, as the TV ads say, there’s more. The figures show that while there are a few OECD members who have done worse than us (and one or two have actually gone backwards), the majority have done significantly better than us.

    The paralysed Americans? They scored double our rate at 0.2%, as did the British, and the eurozone as a whole. European members of the OECD did better still at an average 0.4%. The debt-ridden Italians managed 0.3% and the equally debt-ridden Irish a whopping 1.6%. Our neighbours across the Tasman, on whom we are supposed to be gaining, did 12 times better at 1.2%.

    We are told that we must expect tougher conditions to come. The Prime Minister, using a metaphor that typically places him in a sporting context, assures us that we can expect him to “roll with the punches”; but it is difficult to do that when you are flat on the canvas.

    The story we are told is not, in other words, borne out by the facts. And those facts are most brutally apparent to all those who suffer directly from our failure to make the most of our relative good fortune, but who don’t make it into the media that often.

    Foremost among them are those who go to make up our obstinately high unemployment total – a statistic that not only means a constant drag on our economy and a diminution in our national wealth, but that also represents tens of thousands of wrecked individual lives.

    And sadly, the fastest growing element in the shameful jobless total is young people. Their rising numbers mean that young people now constitute a higher proportion of our unemployed – at 45% – than in any other OECD member country.

    That statistic, coupled with the equally shameful and rising level of child poverty, shows that our failures are not just for here and now; we are building a divided and broken society for a generation and more to come.

    Too many of our younger generation are condemned to a poor start, denied through public service cuts the early childhood education that would give them a chance, suffering poor health through the illnesses and diseases of poverty, unable to afford or qualify for skill training, vainly looking for paid employment in an economy that has already thrown thousands on the scrapheap, taking tragic refuge in drugs, prostitution and crime.

    A constant diet of feel-good stories is all very well; but those who care about our country will want to dig deeper and make their judgments accordingly.

    Bryan Gould

    28 September 2011

    This article was published in the NZ Herald on 3 October.

  • On Being Prime Minister

    Very few of us get within touching distance of becoming Prime Minister. For those who do get to the top of the greasy pole, though, it must be a heady experience.

    Suddenly – overnight – you are feted wherever you go. People hang on your every word. Former rivals become your acolytes, dependent on you for preferment. Armies of public servants do your bidding. The whole government of the country waits for your instructions.

    Little wonder that many Prime Ministers fall victim to what I call “Prime Minister’s syndrome” – the temptation, after a year or two of being treated as infallible, to believe it. Susceptibility to the syndrome, of course, varies from one Prime Minister to another; it is less evident in the case of those who are stop-gap Prime Ministers (say, a Mike Moore) or who succeed mid-term by virtue of a coup (like Jenny Shipley or Gordon Brown).

    The most susceptible are those who become Prime Minister off the back of a general election triumph. They start as heroes of their party, with the excitement of victory and the expectation of great deeds to be performed. But hero-worship can be a dangerous launching–pad for a Prime Minister.

    Perhaps the most extreme example of Prime Minister’s syndrome was Tony Blair. I recall Tony, as a young member of my Shadow Cabinet team, confessing to me that, if he were elected to the Shadow Cabinet in a forthcoming election, he was frightened that he would be “found out”. Yet, if the memoirs of his PR guru Alastair Campbell are to be believed, within a day or two of his general election victory in 1997 he was lamenting that Britain did not provide him with a bigger and more important stage on which to deploy his talents.

    Tony Blair was of course a brilliant communicator – a facility that led him to fall victim to another aspect of the syndrome. He began to believe that he could convince the country of anything – that he need only assert something to convince people that it must be so.

    He reached the point of ceasing to concern himself with the truth or otherwise of what he said; the mere fact that he had said it was enough – in his mind – to establish its credibility beyond all challenge. This, coupled with an almost messianic conviction that he should play an important role on the world stage, led amongst other things to the ill-fated adventure of the Iraq invasion.

    Being Prime Minister, in other words, carries with it dangers as well as opportunities. Some of those dangers are personal as well as political. The more successful a Prime Minister is in promoting his or her public persona, the greater the risk that the public persona will devour whatever remains of the private person. Margaret Thatcher was another instance of Prime Minister’s syndrome – and a prime example of someone whose public image became so powerful that there was nothing left of the private person.

    The political risks of the syndrome are equally serious. A Prime Minister who believes his or her own myth, who is constantly told that the fortunes of his government and his party and the welfare of the country depend entirely on him, is in danger of becoming dismissive of those who do not tell him what he wants to hear.

    It is then just a short step to showing less than proper respect for colleagues (who begin to feel resentful in private, whatever they may say in public), for Parliament, and ultimately for the voters themselves – and voters are very good at detecting whether or not they are being treated in a cavalier fashion. Once they sense that they are being led by someone who is detached from their lives and who believes that they can be fobbed off with less than the truth, it is a hard road back.

    If that point is reached, then even the most telegenic performers can find that their media skills can become a two-edged sword. Tony Blair is again a case in point. The boyish charm and open manner that served him so well in his early years eventually became – when he lost the trust of many people – a count against him. There are some in Britain today who cannot today watch Tony on television, so great is their revulsion at what they see as the contrast between the smiling appearance and the harsher reality.

    The later symptoms of the syndrome develop when – inevitably – the initial excitement of Prime Ministerial office begins to wane. Some Prime Ministers lose patience with what they see as the endless nit-picking from ungrateful voters at home; they seek refuge at international gatherings where they feel that their true merits as world leaders can be properly recognised – though only a few actually have the ability, as Helen Clark did, to land a proper job in the international arena.

    Perhaps the most pernicious aspect of the syndrome is that those who suffer from it do not recognise it until it is too late. In such cases, we can only hope that the victims of the syndrome do not include us.

    Bryan Gould

    21 April 2011

    This article was published in the NZ Herald on 26 April.

  • Open Letter to Our New Prime Minister

    Dear John,

    As you form your new government, there will be many who, for the sake of the country, will wish you well and who will hope that you have the wit and will to overcome the economic crisis that now afflicts us. This may be the moment to put to one side your experience as a merchant banker and to concentrate instead on the needs of the real economy in which most people live and work.

    Your challenge is in fact twofold. You will first have to confront, with other world leaders, the global crisis that now threatens us, but at the same time you will have to look forward to the steps that will be needed if we are to improve our own endemically disappointing economic performance. The world’s big economies have been, after all, like great ocean liners which have done very well while sailing the global ocean, until they suddenly sprang a leak and started to sink. We, on the other hand, from the moment we launched our own tiny and vulnerable craft on global waters in 1984, have been waterlogged for 25 years.

    The decisions you will have to take in response to the global crisis are, in a curious sense, relatively straightforward. There is a wide-ranging consensus as to what needs to be done, embracing right (George Bush) and left (Gordon Brown and Kevin Rudd), which you should have no difficulty in joining.

    The steps taken so far in New Zealand are in line with that consensus. The cut in the OCR, the Bank Deposit Guarantee Scheme, the measures to improve bank liquidity, will all help to avert disaster. Even so, it is almost certainly the case that we have not yet seen the full dimensions of the crisis. As our export markets close down and our tourist numbers decline, we will feel – in addition to our own home-grown recession – the full brunt of the international recession. And, while our banks look reasonably well placed for the time being, the higher cost and greater difficulty of borrowing overseas will have their impact sooner or later.

    The difficult issues, however, will arise in tackling our own deep-seated and endemic national problems. It is here that your real test will come. If your government is to slow down, or even stop or reverse, the migration across the Tasman (which has attracted so much attention from politicians over recent years), it will have to deal with the fact that if we had matched the Australian performance over the past 25 years, every New Zealand family would be $80,000 per year better off. It beggars belief that this disparity is unrelated to the policy prescriptions we have chosen to put in place over that time.

    Just as the global crisis has compelled a freeing up of the debate about international economic and financial arrangements, so it should be seen as an equally strong reason for undertaking a re-appraisal of our own national policy stance. Both the global crisis and our own shortfall in economic performance, after all, have a common origin – the belief that there is no alternative to the current orthodoxy of unregulated markets and of economic decisions being the preserve of bankers rather than elected governments.

    It is that simple-minded belief that must now be subjected to review. Your actions and statements so far suggest that you understand this (though you may have your work cut out to persuade your deputy and Minister of Finance that it is not “too hard” to make a change).

    In case you need to buttress your resolve in this respect, you should take courage from the increasing chorus of influential voices – from Joseph Stiglitz at the United Nations, to Robert Skidelsky and Vijay Joshi in the pages of The Guardian – who are now calling for new thinking and new measures.

    Nor is there any shortage of reputable New Zealand economists – Brian Easton, Ganesh Nana, Kel Sanderson, Anthony Byett – who believe that the time is long overdue for reconsidering the wisdom of relying on a single policy instrument – interest rates – to control inflation. There are many others who will concede in private that new thinking is needed. Even your predecessor as National Party leader, Don Brash, has recognised the need for additional instruments in his advocacy of a variable rate of excise duty on petrol. And the new Labour finance spokesperson, David Cunliffe, seems ready to break the shackles of current orthodoxy.

    The country will hope that you might go further, and put your weight behind the growing international demand for a “new Bretton Woods”, which would put a new international framework in place – as Henry Paulson puts it – to redress imbalances and restrain excessive capital movements. No country has more to gain than we have from such a development. If we are to improve our economic performance, both at home and internationally, we must be ready to apply the lessons that both our own and the global experience should teach us.

    Bryan Gould

    13 November 2008