Near tears, Brian Easton

New Territory: the Transformation of New Zealand 1984-1992  
Colin James,
Bridget Williams Books, $29.95

The cognoscente will first turn to chapter 15’s footnote 25, one of the longest in the book, where the author claims that Bruce Jesson misrepresents his role in the political changes of the last decade. There is no bibliographical reference to Jesson’s claims so it is not possible to assess that part of the argument. But James describes his own role as a journalist … bound to examine currents and enquire where they may lead. It is the account of the simple observer reporting the truth, unaffected by any point of view except that which is there.

Alas, such naivité is as impractical in journalism as it is in art. As in every other book, the author has a viewpoint which informs the account. Consider the cautious: the theory [of the economic reforms generally called ‘rogernomics’] is that in time there will be an economic and social payoff. And there are some facts to support the theory.

One might then expect a balanced account in which the ‘facts’ are listed and evaluated. Instead the following five pages list uncritically ‘the facts’ and then the we are told there are three main criticisms, which are dealt with in just two pages. No attempt is made to consider whether there are any contradictory facts.

Even James’ choices of criticisms are odd. One is that for the likes of Roger Douglas ‘the process was too slow’. The second is related to the sequencing issue (a technical issue which James does not explain well) that the concept of the reforms were well founded, but they were done in the wrong order – mismanaged. The third, says James, is related to the second. That is, that far more damage was done than necessary to the ‘real’ economy.

At this point your reviewer was near tears. James accepts unquestioningly that the economic reforms were necessary and all that is to be debated is their speed, sequence, and intensity. There is no mention of critics who denied the reforms were necessary  – that one mentions them does not mean one agrees with them. And there is also a denial of those who think the reforms were misconceived, rather like the curate’s egg, and the related criticism is that the reforms were dominated by an extremist ideology. Admittedly some of the issues are touched upon in a confused paragraph which elaborates James’ third criticism. But in the end there is no clear account of what the real debate in New Zealand was about, as distinct from James’ account of the argument the reformers would prefer to deal with because it ignores the salient weaknesses of their case.

For despite the disclaimer in the footnote, James is as partisan as the next writer (your tearful reviewer included). Once this is recognised, a book which appears to be a mishmash of anecdote and half thought-through analysis, sprinkled with some most extraordinary economic and statistical gaffs, becomes fascinating. (One illustration of the gaffs will do: Labour productivity has risen dramatically … a rough estimate [no source is given] puts the improvement around 30%. Since output has been stagnant, this alleged increase in productivity would push the unemployment rate to above 30 per cent of the labour force. The sad statistical truth is that there is little evidence of any substantial productivity increase even 1 per cent p.a. – above the long-term trend.)

To understand where James comes from, this book has to be seen as a second volume, following on from his The Quiet Revolution, which covers what happened before 1984. It is unfortunate that New Territory does not attend more to the earlier period. James contends, in the earlier book, and repeats in this one, there has been a revolution in New Zealand. He is not quite sure what constitutes one, and even includes an appendix trying to sort his ideas out (which would bring tears to any political scientist). Ralph Darendorf, whom James does not mention, makes the useful distinction of two quite different versions of dramatic change. One is deep change, the transformation of core structures of a society which in the nature of the case takes time; the other is quick change, notably the circulation of those at the top within days or months by highly visible, often violent action. The first might be called social revolution, the second political revolution. The Industrial Revolution was in this sense social, the French Revolution was political (The Modern Social Conflict.. An Essay on the Politics of Liberty).

What has happened in New Zealand is that both revolutions have occurred. The change in the economic and social structure occurred in the 1970s, especially in the external sector, as the New Zealand economy diversified its exports products and destinations in response to the major fall of the terms of trade in late 1966. John Gould’s The Muldoon Years suggests this transformation was greater than for any other OECD country, and it was also probably faster than any previous restructuring of the New Zealand economy. Inevitably the change in the economy caused stress which erupted into the political and social upheaval of the second sort of revolution: the rapid change of the governing elite with which we associate the regime of the fourth Labour government although, instructively, the élite remains in power after the Labour was deposed by the electorate.

In effect the old political economy had its Old Establishment, and the new political economy, a different New Establishment. But because of the speed of the structural change, and perhaps the obstinacy of Muldoon, the last prime minister of the Old Establishment, there was no orderly transformation of power.

This is not the conceptual framework James offers. Rather, he is a traveller in the turbulent times trying to make sense of it from a position associated with the Establishment. It is a particularly interesting one because James would appear to have his heart with the Old Establishment, and his head with the new one. The resulting tension provides drama and insights, as via this Establishment vision he tries to make sense of the turmoil.

Consider James’ (in)famous characterisation in The Quiet Revolution of the New Establishment as the Vietnam generation…

That optimism marked out the Vietnam protests as different from the previous outbursts of street violence – the industrial clashes of 1913 and 1951 and the rampages of the unemployed in the 1930s. Those clashes were negative and hard, centred on individual need and greed. The underlying characteristic of the 1960s was a big optimism concerned often with the self in the sense of individual salvation but allied to the broader quest for the salvation of humankind, a belief in human perfectibility.

The flattering comparison of the Vietnam generation, of which I was a member, with those who went before is a little distasteful. The records of these earlier upwellings suggest that they made greater sacrifices from a much lower material base than we ever thought of.

James offers an alternative view in the first book, which he assigned to critics who said that it was the ‘Spock generation’ (after a 1950s American authority on child upbringing) lacking discipline and order, demanding immediate gratification, ‘gimme’ on a world scale: the right world. Everywhere. Now to make me feel right. And it contained elements British journalist Auberon Waugh has recently called ‘babyish libertarian romanticism’. Whether Dr Spock actually encouraged these virtues belongs to another discourse, but in New Territory James now aligns himself with the critics, describing the rogernomics as the ‘gimme’ generation, without any reference to his earlier claim of their commitment to salvation and human perfectibility.

Part of James’ problem is that he is confused between a generational cohort, which in the case of the ‘Vietnam generation’ were a very mixed bunch, and the ruling élite which comes from the cohort, which may be more homogeneous. It may well be true that the New Establishment has a common ideology of gimme. At the very least their philosophy for public policy celebrates selfishness. But that is not true for the whole of the generation, nor for the whole of the nation.

This lack of self-awareness of position leads to the rather odd story that James is implicitly telling. Once upon a time when Colin and I were young, it was the golden weather every day. Even when it rained, we stayed inside and Mother read us fairy stories, and in any case the rain grew the grass which was processed and exported for the national prosperity. True, the world outside was turbulent, but New Zealand was a place of peace and security. The Establishment of the day had hegemony, and there was no turbulence inside which threatened it. For the nostalgia forgets industrial disputes on the waterfront, the lack of equal pay (for women knew their place then), the All Whites toured South Africa while the Maori quietly stayed at home, and it was only communists who spoke of nuclear disarmament and the withdrawal from ANZUS (for even if the main dissenters were Christians they were really crypto-communists).

Alas in adulthood we find the weather is permanently stormy. Even the hegemony of the New Establishment is not as accepted as natural. There are still members of the Old Establishment, themselves anti-Muldoonists, who have been cut out from power after the revolution, and don’t understand why. And those inside the power élite face the problem that they still lack legitimacy. The turmoil which existed in New Zealand in even the 1950s now exists within the Establishment.

The trouble with revolutionaries is they invite – even legitimise – further revolution. In this case the holding of power is even more tenuous, because its seizure was justified by economic policies which have proved far from successful (despite James’ five page attempt to argue otherwise), and underpinned by an ideology which even many members of the New Establishment find uncomfortable. If I understand their role correctly, James’ appendices on Consensus or Social Contract? (which would have philosophers in tears), and on the welfare state (which would have social policy theorists also), are reporting a dialogue within the Establishment as to what could be the replacing ideology.

That is why the centrality of the reforms may not be challenged. One is allowed to worry about their speed, sequence, and intensity, but not their conception, and certainly not their ideological underpinning. Without the unchallenged reforms the New Establishment has not even a fig leaf to hide the naked lust for power its coup entailed.

As James reports the desperate attempt within the Establishment’s emperors to find some clothing, he plays down the role of the great unwashed. (It cannot be accidental that as in the case of the previous book, the cover illustration is of a land deserted of people.) This is no more evident than his strange silence on the electoral reform referendum. There is no date on the book to indicate when the text finally went to the printer, most unfortunate in a book of contemporary commentary. But there is a footnote reference to 26 October 1992. (The publisher must be commended by the speed of production. My copy arrived before Christmas.)

Where then is the discussion on perhaps the most central contemporary issue of the new territory? Especially given the outcome of the September referendum, it would appear the people have doubts about the nation’s leadership, in a far more fundamental sense than just the election of a few politicians. The Establishment is beside itself with anxiety over the possibility that there will be a new way of selecting our politicians, disrupting the old arrangements which safely protected their positions of power. Apparently even James’ computer spreadsheet blew a circuit for a column in The Sunday Times in a desperate attempt to show that there may really be a majority for first-past-the-post. Observing the impact of proportional representation on an Establishment which is not united, which lacks legitimacy, and which is uncertain of direction, is an excellent reason for voting for electoral change.

Concluding the footnote replying to Jesson, James writes: In passing, it bears noting that no one has ever produced any evidence that anything I have written or said on radio and television has influenced anyone to take or not to take action in relation to some government policy. He need not be so modest about his ineffectiveness. New Territory, and the earlier Quiet Revolution, provide the power élite with an account of where they are and what they are doing – ideas which can be powerful in a revolution and the consolidation which follows. If the impression is of a successful coup which has been unable to deliver on its promises of prosperity, with a resulting insecurity and even muddlement, then James has captured a truth.


Brian Easton is a consultant economist living in Wellington.


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