The Rich. A New Zealand History
Penguin Books, $34.95,
ISBN 0 140 25740 3
If the poor are always with us, it logically follows that the rich are their constant counterparts. Relative poverty is a companion to relative privilege. Far more, however, has been written about the impoverished than the prosperous in New Zealand and we know rather less about the size of lakes of wealth than the depth of income streams that flow into them. Social scientists, moreover, have frequently been criticised, often from within their own ranks, for failing to study the powerful. The powerless, rather patronisingly, being considered easier research targets.
Given this company Stevan Eldred-Grigg can stake as much claim as anyone for exploring the relationship between the “haves” and “have nots”, although, like other writers, he has often dwelt on particular sections of the hierarchy. The author has already explored the Canterbury and Christchurch pecking order and his novels are complemented by nonfiction accounts of working people and the southern gentry.
The Rich fits neither genre exactly. Thesis findings, historical accounts and sociological studies are whipped together and laced with journalese and a touch of narrative. Add a garnish of acid against the bourgeoisie and we are left with a kind of literary docu-drama; a colourful pastiche of drier academic sound bites and excited social commentary. As entertainment the book succeeds, as history it disappoints. Admittedly, the author adds a late disclaimer that the book is not meant to be a scholarly work but histories should have analytic pretensions so criticisms of a lack of interpretation are not so easily brushed aside. Does analysis have to be dry? Well, no, but a few more islands of sober reflection in a sea of rhetoric would not have gone amiss.
Statistics, the author rightly suggests, cannot fully capture “the swell”. He’s not keen on social analysts who “want to count heads and yard landowners into different classes of paddock” (p25) but he’s quite content to draw on this evidence if it is available. Unfortunately, he does not do this systematically so you have to hunt for trends amidst words that often disguise as much as they illuminate.
What we do know, thanks to Margaret Galt’s thesis (Victoria PhD, 1985), is that inequalities of wealth were particularly noteworthy in the late nineteenth century. Galt estimates that the top 1% owned between 55% and 60% of national assets in the early 1890s. The very rich’s share drops to 21% in 1915 after the Liberal era, and rises to around 25% to 30% by the end of the 1930s. This pattern remains constant until the mid-1950s when a Planning Council study, For Richer for Poorer, takes up the story. In 1956 the “top end” still control about a quarter of the nation’s assets, by 1966 this has fallen to 18% and by 1985 a further couple of percentage points have been trimmed away.
How wealthy are the rich now? We don’t know. As Eldred-Grigg confirms, the tax office has closed off access to probate data and the tentacles of wealth holdings are even more difficult to disentangle in today’s paperless environment than they were in the past. We do know that income levels have widened substantially over the past two decades, that the topmost quartile has been doing a great deal better than the bottom. Those who occupy very specific niches in administrative and professional areas of government and quasi-government agencies and major commercial and financial enterprises, particularly those with international connections, have been doing very nicely in the current tax and labour market climate while those in relative poverty have, at best, stood still, with meagre fare from benefits and underemployment.
What do these long term trends tell us? That our society became steadily more equal in wealth terms from the 1880s to the 1980s and then the The Rich, perhaps in new guise, took a firmer hold of the purse strings once again? Eldred-Grigg is rather coy about such matters, but he seems to think that the gap between floor and ceiling has often been understated. He wants, indeed, to argue that “the rich of New Zealand in fact have almost always commanded much the same share of national wealth and income as the rich in other advanced capitalist states’”.
This assertion is debatable. Studies of wealth in the United Kingdom, for example, reveal the same longterm trends as New Zealand but the gap between the very rich and those below them are consistently greater than Eldred-Grigg suggests. Wedgewood’s cross-national studies of several countries around the World War I period (The Economics of Inheritance, 1929) show that the holdings of the top 1% in England (and France and Prussia) were much higher than in Australia. And our trans-Tasman wealthy cousins were almost twice as rich as us. More recent work by Atkinson (The Economics of Inequality, 1983) and Townsend (Poverty in the United Kingdom, 1975) shows that, although the British elite’s fortunes also fell during the welfare state era immediately after World War II, they were always much larger than their New Zealand equivalents.
The longevity of inheritance is the key factor that separates the relatively greater levels of equality in “new societies” compared with the “old”. Paradoxically, therefore, Eldred-Grigg’s argument for stressing the power of “old” money against “new” within New Zealand is his Achilles heel when it comes to his cross-national assertions. Perhaps one shouldn’t really see this book in terms of trends. It’s about modes and manners and how Bourdieu’s habitus becomes habit as the dynastic chains of privilege wind and unwind. Treated as a lively excursion into the Lives of the Rich and Infamous, The Rich is far more rewarding and if you read between the lines there are lots of tips about what one should do if you want to make and retain a pile. The informed reader will be able to tie some threads of argument together — the thoughts below attempt this — others should tread warily.
As a rule, choose your parents wisely. Try and make sure you’re male and a member of the right ethnic group. It helps to be high in the birth order. Money and status are not co-requisites but the former can often buy the latter in many quarters. Capital and credit are obligatory and good connections can ensure their continuance. The right education, marriage partner, address and recreational pursuits are further reflections and sustainers of wealth and privilege. Also desirable is a modicum of luck and foresight, especially in being in the right spot when a new technological change and/or a shift in polity or policy proffers new opportunities for money making.
Forms of “getting on” and “staying on top” vary over time and region. At the turn of the eighteenth century booty capitalists engaged in whaling and suchlike often came and went as often as their profits but networks of reward and rulership emerged very early after British settlement. These were seldom tightly drawn and took time to become nationally based. Landed and mercantile capitalists figured highly among the wealthy elite in nineteenth century New Zealand and a goodly number of them arrived as cabin passengers with capital.
Historians are still debating whether we had a gentry in and beyond the colonial period. Much of the discussion hinges on comparisons with Britain and whether colonial mores and class structure differed greatly from that pertaining in the metropolis. Eldred-Grigg’s money seems to be on closer parallels than many would like but with the arrival of capitalism it logically follows that class came too. And even if our gentry was often untitled and less lordly than their British counterparts, we did seem to get enough representatives from the “higher orders” to sustain a mix of myth and modes of genteel existence.
Country manners were reproduced or adapted to suit new conditions. The possession of town and country houses with servants (if you could get them), a “public”, possibly university, education (at least for sons), suitably ascribed friendship and marriage ties, ensuring entree into the “right” social, business and political circles, and a “social life” designed to wrap these networks together were the hallmarks of privilege.
Boundaries between “the gentry” and the respectable middle class, between leisured and working (rather than labouring) classes were often more permeable in the colonies. Merchants, bankers and manufacturers came from more modest backgrounds than genteel folk but very few were from the “rough” working class. Rags to riches stories abounded, but “workmen seldom turned themselves into rich men simply by hard work”. (p54) This rather depends what you mean by “rich” and it may not take too many truths to sustain myths of wider opportunity. What little we know about social mobility — the turn of the century decades are best researched — suggests movement between adjacent strata, up and down, wasn’t too difficult but the climb or fall between apex and base was unlikely.
By the 1890s a pattern of “old” and “new” money and town and country elites had become established. The riche, the author contends, were more concerned with honour and manners than money, the nouveau merely aspired to coinage. The Liberals dealt the landed “gentry” a few blows but none of them were fatal. “Mister Fat” (and no doubt Mistress as well) shifted into “paper” wealth creation and dirtied their hands in industry and commerce. Assets were sought in other parts of the Empire or the Americas. Many wool lords offered land to the state. Settlers did noticeably better in the land stakes than tribal landowners, although some Maori did amass considerable wealth. Nevertheless, the genteel rural dynasties were declining and outward display of “high society” had all but ceased by the end of the 1920s.
The established trappings of opulence and the occasional glimpse of philanthropy were still markers of “old money” among the very rich. A greater longevity was an added bonus. But the rise of the middle classes is the most conspicuous phenomenon now. The sons of shopkeepers or cow cockies rose into the ranks of the moderately rich. Tradesmen become manufacturers and enter the lists. An assembly of 165 merchants, financiers and industrialists drawn from 1900 to 1940 (quite how is not precisely defined) mainly had fathers with middle class occupations. Most of them were local born. By 1940 the top 10% are far more prominent in the probate stakes, although it is always tricky teasing out whether this was due to arrivistes taking some of the spoils, or “old money” being gifted and trusted around. This pattern, Eldred-Grigg argues, continued after World War II, when mass consumption and new technologies, fuelled by local as much as foreign capital, offered new opportunities for money making. Getting import licences, franchises for local assembly or even possessing the ingenuity to make or market an original product were keys to financial success. Retail trade became a very lucrative possibility.
The welfare state era offered protection. Business was solid. And money was safe, even if tax regimes and populist values were an annoyance. Regimes of multiple directorships and/or share holdings paralleled rather than replaced the old landed dynasties, where interlocking was as much to do with a good marriage than the right blend of stock holdings. Urban wealth was becoming more conspicuous than rural opulence or at least it was displayed to more eyes. As the cities grew larger, a class ecology, always less distinct than in most overseas exemplars, became more evident. This trend of more conspicuous display of urban wealth set against the continuance of more discrete rural privilege is traversed in a few breathless pages that covers the 1930s to 1970s. The last two decades are treated just as sketchily.
We race through the years of share market boom and bust and hopeful boom again. The bourgeoisie become even beastlier, especially in Auckland, although Felicity, the Metro ferret, is always snapping at their jugulars. Her gossip provides some delicious tidbits and the photos are suitably malicious. National Business Review lists and Who’s Who compilations (the times are again hazy) are said to show that most recent capitalists are the children of privilege but Eldred-Grigg’s own figures reveal that over a quarter of the very rich had fathers with lower middle or even lower origins. Maybe this explains why the brashness of the northern elites at play supposedly offends the quieter pursuits of southern comfort. Golf, fishing and gardening are listed as the three favourite pursuits of our glitterati — not a trace of admitted sin. Dull stuff. The “roughs” have gatecrashed the members stand but they try to ape their betters.
There is a splendid, sprawling historical novel to be written here — a tale of lust and lucre that marries, possibly quite literally, the mid-south with the far north. An alternative text wouldn’t sell as well but we’d learn more about the privileged in relation to the poor and the sources would be easier to follow up for the uninformed. The Rich is a good yarn. Occasionally it is more than that. On both counts the book adds something to our knowledge and enjoyment. Is it worth your money? That’s your risk. After all, isn’t that what capitalism is really about?
David Pearson is reader in sociology and social policy at Victoria University.