Monday, May 14, 2012

Public/Private/Foreign


Interviewed by The Dominion Post after signing a referendum petition last Friday, Wellington commuter David Lamborn had no difficulty explaining his opposition to asset sales:
There doesn't seem to be any good logical explanation for why they want to do it, it's just based on ideology. I would rather retain them for future benefit for all New Zealanders rather than just a few who can afford to buy shares.
That is what privatisation means: removing assets from public ownership, where they can benefit the whole of society, and placing them in the hands of those who can afford to buy shares. However this is not what privatisation means to the principal political forces that are opposing the proposed sale of a 49% share of Meridian Energy, Mighty River Power, Genesis Power, Solid Energy and Air New Zealand. To these parties, the evil of privatisation lies in the risk of foreign ownership. Thus in his opening statament for the launch of the referendum petition, Labour leader David Shearer is quoted as pledging that
Labour will stand up for New Zealanders and make sure that we keep our assets and our future in Kiwi hands
while the Green party has filed its opposition to asset sales under the ‘foreign ownership’ section of its website, along with the logo of its campaign against land purchases by overseas investors.


‘Own our Future’. ‘Keep it Kiwi’. The crude approach to economics and sovereignty encapsulated by these slogans is clearly seen by the two main centre-left parties as an election winner and the best strategic response to the Tories’ privatisation agenda. However the glaring problem with this strategy is that it buys wholesale into a right-wing analysis of the problem. Witness for example Labour’s attack line against National in the lead-up to the last election based on its doubtful assurances that ‘Mum and Dad investors’ would be the main beneficiaries of the sales, which saw the party both conceding the existence and virtuous nature of that ghastly political subject – the mumanddadinvestor – and implying that a privatisation mechanism that actually ensured the outcome touted by National may be acceptable to progressives.

Of the two parties, Labour was always going to find it more difficult to articulate a stronger opposition to asset sales, seeing as it is responsible for introducing the State-owned enterprise model and has never reneged on that policy. All of the companies currently slated for partial sale are SOEs, meaning that they are already run like private companies mandated to return the maximum profit to its shareholders – which just happen to be us. But this is already a form of privatisation: for the profits in question are extracted from the public in regressive fashion, and the resulting revenue allows the government to moderate the taxation of income, which is progressive. Thus SOEs serve the interest of the wealthiest among us, whilst never being required to produce a social dividend. The case of Folole Muliaga remains sadly very emblematic in this respect.


Asset sales are simply a further round of privatisation, increasing the transfer of wealth towards the ruling classes and allowing for some of this wealth to flow out of the country altogether – either in the hands of foreign entities or in the bank accounts of New Zealanders who should opt to take their money overseas. This capital outflow would have material consequences for our economy, but by focussing on this single aspect to the exclusion of everything else, Labour and the Greens are passing up on the opportunity to mount a broader class-based critique of the sales, as well as placing themselves in the curious position – for ostensibly progressive forces – of having to pander to anti-foreign sentiment to garner the requisite level of support and keep the issue alive and at the centre of the political debate.

For those who think that the charge of xenophobia against these campaigns is misplaced or disproportionate, I defer to Dougal McNeill’s brilliant dissection (and compelling historicisation) of the rhetoric around the Crafar farms. For my part what I’m mainly concerned with today is reconciling the debate around assets sales with the response to the most recent measures against beneficiaries announced by the government.

Firstly, the offer of free long-term contraception to female beneficiaries and their daughters: a move that can pass as fair and reasonable as opposed to grotesquely coercive only in a country that has lost all capacity to understand and debate the power dynamics between the State and the citizens who most depend on welfare for their survival. On this issue Labour was simultaneously chastised for responding and praised for not responding to what was portrayed by more than one political commentator as an artful distraction ahead of the budget. As a point of fact Labour did respond, and through no less than its leader, who argued that women in the scheme might feel intimidated by case workers into accepting the procedure and questioned why men weren’t targeted – which is more or less what Metiria Turei of the Greens said, if somewhat more forcefully. Turei also responded at the earliest opportunity to suggestions by Social Development and Employment Minister Paula Bennett that beneficiaries may be required to vaccinate their children or risk having their payments discontinued, a measure every bit as provocative as the previous one in its manifest aim to constrain the rights of some citizens in exchange for the State support that they receive.

Whether or not the likes of Vernon Small are correct in their claim that public opinion strongly sides with the government on these kinds of issues (eight out of ten Sunday Star Times readers do just that, a statistic tempered by the fact that ten out of ten of them consider the Sunday Star Times a legitimate source of news), liberals can in fact generally be depended upon to muster a response, as was the case here. However they’re also liable to vastly underplay the crass class war character of the measures, which is what enables the Tories to set the terms of the debate. Outside of the unions, much of the institutional Left in New Zealand has lost the vocabulary, let alone the willingness, to describe phenomena in terms of their class dimension. But discrimination and exploitation aren’t the same thing, and the true test for a Left worth its salt lies in its capacity to mobilise against both.

Image by Simon Oosterman

Take Ports of Auckland Limited, a council-owned entity that operates like an SOE at the local level, and Labour’s comprehensive failure to deal with the issue, from the conduct of its Mayor, Len Brown, down to the fence-sitting of party leader David Shearer and his timid and belated support for the locked out workers when the Left took to the streets. Throughout the dispute the bourgeois commentariat insisted of course that the Labour party should run away from labour issues, and that any suggestion to the contrary would smack of ideology and run afoul of the public. But aside from the customary inability on the part of said commentators to see the beam of free-market ideology in their own eye, the problem with this viewpoint – and with Labour’s conduct – is that it woefully misunderstood the political moment. To have come out strongly on the side of workers in the Ports dispute would have helped Labour articulate a far more coherent stance in the fight against asset sales, and be more incisive in its attacks on the government’s failure to stem the exodus of workers to Australia. There was a lesson to be drawn and questions to be asked on the nature of the public good and on the virtues of a system that produces the imbalances of globalisation within a single country, pitting Auckland wharfies not against those of foreign ports and lower-wage economies, but against their counterparts in Tauranga, two hundred kilometres down the M2. Welfare reform, too, would have come into sharper focus, since the attacks on workers and unions and the attacks on beneficiaries and women belong to the same political agenda, and are never mere distractions standing in the way of something more important, not even the government’s core economic document.

I am of course speaking hypothetically. It would be unaccountably naïve to expect Labour to be that opposition party and to seize upon such a narrative. Even if that living, breathing counterfactual – the opportunistic David Cunliffe, former paladin of public-private partnerships – were somehow to be magicked into the leadership, he would be faced with the task of marshalling a caucus that wants nothing to do with any of that. The Greens, for their part, keep alternating a stronger and broader commitment to progressive politics on a number of issues to what appears like a steady rightward drift. We are stuck therefore with owning our future and keeping it Kiwi, and a politics painfully out of step with the radicalisation of left-wing oppositions elsewhere in the West and with the magnitude of the economic and social problems facing the country.