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New Zealand goes to polls at time of global economic turmoil – Part I

Chris Ford - 11/3/2008

New Zealand will go to the polls almost four days after the US elects a new leader on November 8. This is at a time when global economic turmoil could impact on the outcome.

Until the beginning of the campaign, opinion polls predicted a significant centre-right National Party victory with some even forecasting an outright win under the country’s German-style proportional representation electoral system. The prospect still remains of a significant swing to the right resulting in the National Party gaining the most number of seats in Parliament.

However, the dynamic of the race is shifting as the campaign proceeds. The historical trend in New Zealand is for governments to serve no more than two or three triennial (three year) terms in government. When compared with other Western democracies such as Australia and Canada, fourth-term governments are rare in New Zealand with the last having been elected in 1969.

The electoral outcome could be ultimately influenced by the presence or absence of smaller political parties within the new Parliament and the ongoing turmoil within international capitalism. As this article is being written, the National Party under its new, youthful leader, former financial market trader, John Key, is beginning to stumble through a series of media gaffes and poor receptions for policy releases.

What is working in Key’s favour, though, is the perception of freshness as he is only in his early forties and is a relative newcomer to the parliamentary scene having only served six years. In many ways, Key’s ascension resembles that of both Democratic Party presidential nominee Barack Obama in the US and Conservative Party leader David Cameron in the UK. As is the case in both Britain and the US, Key is opposed by an older, more experienced leader in Helen Clark who has held the Prime Minister’s office for nearly nine years.

Conversely, the factors that could favour Clark are that despite Labour’s (so far) lengthy period in office, the combined centre-left bloc vote (comprised of Labour, the Progressive Party and the Greens) is almost equal to that of the centre-right bloc (comprised of National, the free-market Act Party and United Future)according to recent polls. This is the case as the Greens have pledged their support for retaining Labour in government while the Progressive Party of Jim Anderton has done the same (given it is almost now indistinguishable from Labour itself). The Act Party, founded by former finance minister Roger Douglas, and now led by economist Rodney Hide, has hitched its wagon firmly to the National Party and has appealed to centre-right voters to make it the influential partner in a new centre-right government. United Future, led by Peter Dunne, has signed an agreement with National to enter a centre-right governing arrangement after the election, despite Dunne remaining Revenue (Taxation) Minister in the outgoing administration due to his party having been in a supply and confidence arrangement with Labour in the outgoing Parliament.


Labour’s downward slide

The Clark Labour Government has been on a downward slide ever since its re-election for a third term in late 2005. In early 2006, the first signs of trouble came when the government decided to support legislation proposed by Green Party Member of Parliament (MP) Sue Bradford to outlaw the defence for adults to discipline children via physical or corporal methods. The so-called ‘anti-smacking’ law was attacked by conservative right-wing groups as representing the intrusion of ‘Nanny State’ into the private family lives of New Zealanders. This call resonated with many thousands of New Zealanders with opinion polls showing approximately 80 per cent of voters opposed to the proposed law.

This did not deter the Clark administration from pressing ahead with passing the law, which was a long overdue measure to help end legitimised assault against children and young people. The main problem in securing the law’s passage was that while Labour had whipped its MPs to vote for the measure, other parties allowed their members to cast conscience (free votes) on the law. An unlikely ‘hero to the rescue’ was John Key’s National Party which brought up a compromise amendment after fears that the police and other authorities would seek to prosecute ‘innocent’ parents for reasonably disciplining their children. The amendment, proposing that the police overlook any ‘insignificant’ breaches of the new law, meant it was able to pass nearly unanimously.

Other factors contributed to Labour’s gradual post-2005 decline, the most important of these being the perception of growing ‘sleaze’. Around the time of the 2005 election, allegations were made that an MP of Pacific Island origin, Taito Philip Field, had not paid an immigrant Thai labourer for work done on both his Samoan and New Zealand properties in return for Field advancing the labourer’s permanent entry into New Zealand. The allegations continued being made into early 2006 and his behaviour saw him removed as a junior minister in Clark’s outer cabinet and, after he was charged with criminal offences (for which he is to stand trial in early 2009), Field was expelled from the Labour Party caucus. The aura of sleaze permeated another member of Clark’s cabinet, Corrections (Prisons) Minister Damien O’Connor who toured with a parliamentary rugby team which contained a prison guard against whom corruption allegations had been made and O’Connor lost two of his ministerial portfolios due to his poor judgement.

Shortly afterwards, another minister, Trevor Mallard, was involved in a physical altercation with a conservative opposition MP and, as with O’Connor, was demoted in cabinet rank for his poor behaviour as well. Another minister to have fallen foul of Clark was David Benson-Pope who had been at the centre of charges made in 2005 that he had assaulted pupils at a high school where he had been a teacher. In mid-2007, Benson-Pope became the centre of new allegations that he had effectively connived in the dismissal of a communications official at the country’s Environment Ministry where he was minister. He initially denied that he or his office had anything to do with ordering the dismissal of the official but, after further inquiries and an accidental slip of the tongue by the minister in Parliament, the truth surfaced in that ministerial interference had occurred and Benson-Pope was forced to resign.

These controversies served as continual distractions for the Labour-led government. In late 2007 and into 2008, the economy became a significant issue as firstly, rising international oil and food prices began eating into household budgets and, secondly, the global credit crunch worsened into the ‘Great Crash of 2008’ in mid-October. The Labour-led government in response to the economic tumult caved into the pressure from right-wing opposition parties and started delivering tax cuts from October 2008. Otherwise Labour, still willing to largely follow the post-1984 free-market policy settings, was like an opossum looking into the headlights of an oncoming vehicle in that it was startled when the crash came. Along with the crash has come any hope of Labour rolling out big-spending, election-saving promises.

With all this carnage spread out on the road behind it, Labour could have been heading into the electoral abyss, at least that is, until recently.