Friday, February 29, 2008

Roger returns (part II): From Dancing to Douglas - circuit-breaker or poisoned chalice?

What are the implications of Sir Roger Douglas's return to ACT? Today, I look at the pros and cons of him returning to the party he co-founded in 1993/4. While I'm sure many ACT supporters were pleased to hear that he's coming back to the fold, the strategy is certainly not without risk.

The main advantage of Douglas coming back is his galvanising effect with core ACT supporters. In my dissertation, I examined how Douglas possessed an extraordinary capability to unify supporters of the neo-liberal economic reforms he introduced, but did not complete, during the Fourth Labour Government of 1984-1990. In the set-up phase of ACT, the reputation of Douglas quickly drew together loyal supporters: a journalist even called ACT a “Roger Douglas fan club”. Indeed, high profile advocates of economic reform soon flocked to ACT, including former Labour ministers like Prebble and Trevor de Cleene, businessmen Craig Heatley and Alan Gibbs, and thousands of other rank and file members. It is unlikely that anyone but Douglas could have won a similar level of even semireligious devotion (one supporter called Douglas “our Dalai Lama, our spiritual leader”.

It's difficult to say how many of these supporters drifted away from ACT as Douglas's formal involvement with the party disintegrated. Even today, ACT still seems to manage a "bedrock support" of about 1% in opinion polls (0.9% in the latest One News-Colmar Brunton poll; 1% in the Fairfax Media poll from last weekend). This was about the same amount as ACT was polling in 1995, when Douglas was party leader (Richard Prebble took over in March 1996). Douglas's return should help to keep the core supporters of economic reform with ACT. His involvement might allay fears that ACT is becoming a "personality party" driven by Rodney Hide's own personality.

Moreover, Douglas's economic focus (the label invisibly attached to him being "sacked Finance Minister") dovetails perfectly with ACT's renewed committment to promoting economic policies such as the Taxpayer Rights Bill and Regulatory Responsibility Bill. Douglas was not only a fan of the party concentrating on raw economics, he hated it when ACT diverted to "populist" issues such as perkbusting. As I understand it, Douglas was not so keen on the saleable, but non-core social issues of race ("One Law for All") and law and order ("Zero Tolerance for Crime"), as he saw them as peripheral to the party's main message of economic reform. In 2008, Douglas will act as a visible cue to voters (and particularly ACT-thinking voters) that ACT is a party of economics, not dancing, fitness or anything else.

Lastly, Sir Roger Douglas gets headlines. On July 7, 2007, 3 News carried a report on the ACT Wellington Regional Conference. The regional conference of any political party, let alone a minor one, does not normally warrant a network's political staff giving up their weekend. The reason last July's conference warranted a report was that Douglas had criticised ACT the previous day for entertaining the prospect of a "co-operation agreement" with Labour over the Therapeutic Medicines Bill (later sunk for lack of support). Following July 2007, the next TV news report devoted to ACT that I can recall was....the item on Tuesday night on Douglas's return. ACT has a major problem with visibility right now and the use of Douglas as a "news hook" should help the party with getting coverage from media which show little interest in covering parties other than Labour or National.

But there are also several drawbacks of having Douglas on board. Firstly, while he was able to draw together absolute core supporters, the likes of Hide, Heatley and Gibbs, Douglas was also responsible in no small part for ACT's "image problem". Since 2005, Rodney Hide and ACT in general have gone to tremendous lengths to try to erase the negative perceptions carried by the party because of its links with the generally unpopular neoliberal reforms of the 1980s. As past ACT candidate Willie Martin put it in an interview with me last year for my dissertation:
The 1980s people are gone, we're a party of Rodney Hide and supporters now, I think people probably generally associate Rodney Hide with ACT now, or ACT with Rodney and that Rodney is just sort of this quite fun guy who goes on Dancing with the Stars. I think we are going to see quite a change of some elements of the population as to how ACT's perceived
Well, now the "1980s people" appear to be coming back, with Douglas's return a crucial component in this. Furthermore, after relinquishing the ACT leadership in 2004, Richard Prebble did not desert the party in the way Douglas did, but stayed loyal to Hide, giving a speech to the Wellington Regional Conference in July 2007. ACT on Campus treasurer Peter McCaffrey's blog recently published a photo of Roger Douglas, Richard Prebble and Rodney Hide together, looking the best of friends. At a personal level, this is fine, of course - but Hide should be wary of letting Douglas become the face of the party again. Here, the experience of the party when Douglas was leader (from 1994-1995) is instructive. For every voter who admired Douglas, there were many others who did not. The chief contributor for the dislike was Douglas's role in introducing the economic reforms in the 1980s, forever linked to him under the moniker “Rogernomics”. A 1996 North and South magazine article claimed that Douglas “carried the stale odour of a different decade's politics. People often associated him with the pain but not the gain of economic reforms”. Recognising his own dislike, Douglas conceded in 1996 that for many people he was the “devil reincarnated”. Quantitatively, a December 1995 poll found that Douglas was the least-liked leader of any party. Furthermore, with Douglas at the helm, support for ACT in opinion polls declined from 3.3 per cent to 1.2 per cent during 1995, its first year as a registered political party.

Moreover, Douglas is a major risk simply because he is his own man. He does not ask permission to speak. Although it has been glossed over, the revelation this week that Douglas was to speak at the ACT conference in March was a mistake. He was meant to be the "mystery speaker". So how did the word get out two weeks in advance? Of course, I don't know the exact sequence, but I suspect TV3's Duncan Garner received a tip-off from inside ACT (or put two and two together from the conference information mailout) and contacted Douglas for confirmation. At this point, Douglas should have simply said "no comment" and left it at that. I doubt the story would have gone to air just based on a rumour. But instead, Douglas confirmed it and Rodney Hide hastily had to himself confirm (and sound pleased about) the news - on the fly at Wellington Airport. This was pretty shambolic: Douglas refused to give an on-camera interview, yet was happy to be quoted about coming back. Then there were the musings about whether he was going to be on the ACT list. This is the sort of thing which should be sorted out behind the scenes, not debated via the media. Then a press conference is arranged, Douglas and Hide appear as best mates together and it's neatly all stage-managed.

Of course, no great harm was done by the pre-emptive announcement of Douglas's return. In fact, it may have actually helped ACT, giving it some extra, much-needed publicity in time for the conference next month. You can be sure that the conference will be covered by the news media, simply because of the "Douglas effect". But the danger is that during the year a open disagreement will break out over a more substantive issue, like a matter of policy between Hide and Douglas. Douglas hasn't hesitated before to voice his disapproval about what ACT is doing. He won't again. But internal division has never helped ACT. And if a party can't govern itself, how can it expect to successfully contribute to governing the country?

Wednesday, February 27, 2008

Roger returns (part I): how the story unfolded

He's back.

If you're reading this blog you have probably already read that Sir Roger Douglas, co-founder of ACT New Zealand (with Derek Quigley), is returning to the party fold by giving a speech to the Annual Conference on March 15. In this post, I look at how the story unfolded, while in subsequent posts I will discuss the implications and the conference itself.

First, I want to acknowledge the several messages I've received wondering where my analysis of the story is. I'm a little annoyed with myself, as I had already my suspicions that Douglas would turn out to be the "mystery speaker" at the conference, but lack of time meant I didn't get around to doing a blog post. Indeed, there were a few clues. On Friday, the ACTion party member newsletter about several low-key party events at which Douglas would be present. First, an ACT Waikato fundraiser at the house of party stalwart Vince Ashworth:
Join the Ashworth’s for Lamb-on-the-spit, BYO salads, cash refreshment bar, auction, quickfire raffles. Rodney, Heather & Garry will be present. Sir Roger and Catherine Judd are hoping to attend. [Emphasis added].
Even more blatant was the news of a "Roger Douglas Dinner" to raise funds for ACT in the Bay of Plenty:
Dinner with Sir Roger Douglas

Where: Tauranga Club
When: 18 March 2008
Time: 7 pm Cash bar available

Sir Roger Douglas is coming to Tauranga to launch the election campaigns of the candidates standing for ACT in Tauranga and the Bay of Plenty.
He will be speaking after dinner at the Tauranga Club on 18 March.
While a speech might seem fairly innocuous, given the bad blood between Douglas and the party since at least 2004 (and with enough troubles before that), it seemed surprising. Moreover, the fact that Douglas was to launch the bids of ACT candidates suggested that Douglas was going to take a hands-on role in the election campaign.

The final signal arrived in my letterbox on Tuesday, when I received information about the ACT conference on March 15/16. The accompanying letter was signed by both Hide and Douglas. One of the points in the letter sounded like a compromise with Douglas. Since 2005, Hide had suggested that ACT could coalesce with Labour as well as National. But talk of a "co-operation agreement" with Labour last July was savaged by Douglas, who called the idea of ACT supporting Labour to support the (now moribund) Therapeutic Medicines Bill a joke:

Sir Roger said Act could talk to anybody it liked.

"But this is a Government of control freaks and there's not much point in talking to control freaks. I can't see that there's any common ground."

In the conference letter sent to members, Hide and Douglas suggested that ACT should promote policies "unable to be ruled out ahead of the election by National and, ideally, Labour, but not something they would do without ACT" [emphasis added]. This would appear to be a shift from Hide's aim of being the balance of power, equally willing to coalesce with centre-left Labour as with the traditional coalition partner National. This sounded to me as if Hide had agreed with Douglas to adopt a more indifferent, rather than accommodating, stance towards Labour. "If Labour likes what we say, fine, but we're not going to go out of our way".

Finally, 3 News ran the story first last night, with a report giving more details also in the New Zealand Herald today (it looks like they were working on the story at the same time). Hide noted the reports on his recently rejuvenated blog, while a post on Kiwiblog also appeared this morning. I don't monitor all the blogs, but I also found Peter McCaffrey of ACT on Campus also had a post about the story. I'd appreciate it if readers would let me know of any other coverage of the story I might have missed.

Friday, February 22, 2008

Douglas to Demolition

This from today's ACTion! e-mail newsletter:

Office Space Required in Newmarket - URGENTLY

Can anyone help us find a new home in Newmarket as our current premises are due for demolition very soon. If you know of any office space for rental contact Margaret on margaret@...

Thursday, February 21, 2008

Alan Greenspan and Roger Douglas

I've noted before that ACT has many international connections - perhaps more than any other New Zealand party. Much of this stems from the work of Roger Douglas as Minister of Finance during the 1980s, after which Douglas was recruited as an international consultant on economic reform. Moreover, ACT has often been keen to look abroad for policy proposals, such as when it became keen on the "Wisconsin Works" work-for-the-dole scheme during the late 1990s. More recently, in 2006 Rodney Hide and Heather Roy travelled to Germany and Ireland to look at how the German Free Democrats (FDP) and Irish Progressive Democrats (PD), which they saw as being similar to their own party, managed to be so much more successful.

Other New Zealand parties do have international connections, but they tend to be more rigid. The Green Party, for instance, works with the Australian Greens, despite the Australian party enjoying little electoral success (mostly due to majoritarian voting - a better role model would be the pioneering and very successful German Greens); Labour looks to its namesake in Britain and to the Australian Labor Party for clues to boosting its own fortunes. Some proposals the Labour Party comes up with here, notably the infamous "pledge card", were taken holus-bolus from Tony Blair's NewLabour.

Given the international connections of Roger Douglas, it did not come as a great surprise to find mention of him in former US Federal Reserve chairman Alan Greenspan's recently published autobiography The Age of Turbulence: Adventures in a New World. But alas for Douglas, he is not credited as a pioneer of economic reform, even for this part of the world. Rather, Greenspan enthuses about the actions of Australian Labor Prime Minister Bob Hawke and now former PM John Howard and Treasurer Peter Costello. Referring to Hawke, Greenspan says his reduction of tariffs and loosening of the employment market resulted in an "amazing economic turnaround...increasing real per capita income by more than 40 percent [from 1991-2006]". Amidst a double page of praise for Australia, Douglas is reduced to just one sentence which implies he was just a copycat: "New Zealand, goaded by Finance Minister Roger Douglas, engaged in similar reforms in the mid-1980s with the same impressive results".

Greenspan's comments cut to the core of the ACT story. Firstly, the NZ reforms did not grant us the "same" results; otherwise our incomes would not have dropped relative to Australia over the same time. Secondly, Greenspan's overlooking of Douglas as a pioneer of economic reform mirrors ACT's own complaints that it never gets the credit for its own ideas. Thirdly, Greenspan's ensuing praise for the actions of Howard, Costello and others since the 1980s is a reminder that despite some further reform directed by Ruth Richardson from 1990-1993, the trinity of Douglas, ACT and ACT-like policies of lower tax and regulation have been largely out of the cold since Douglas was dismissed as Finance Minister in 1988.

That was 20 years ago.

Friday, February 15, 2008

Populism on the rise again - an opportunity for ACT?

Populism seems to be on the rise again in New Zealand politics. Today we had Helen Clark declaring a virtual war on tagging with draconian, yet ineffective policies to deal with spray-paint vandalism. The chances of this sort of policy, which includes banning the sale of spray-paint to youths under 18, actually working hover slightly above nil. But it's a popular policy to push to the electorate:

1. Tagging is a bane of the (mostly white) middle class. It gets people riled in a way that banging on about "sustainability" never will. Tagging is emotional, as it gets to the heart of "my home, my castle" principle.

2. It makes Labour look "tough".

3. It's easy for the TV people to cover and easy for the TV viewers to digest. Kill the taggers (no not literally), nice and simple.

Of course, despite the rhetoric it's simply another property crime. But it's a very visible one for the population at large (unless you're burgled, you never see the mess caused). Hence the decision by Labour to "run with it" as an issue in election year.

The other populist issue to surface over the last week or so, albeit in a less prominent manner, is the politics of race. This week's cover story in the Listener ("Why Brits see NZ as a 'philistine hellhole'") discussed how New Zealand officialdom prefers to accentuate Polynesian culture over its European heritage, with a case in point being Te Papa museum which reportedly holds it European art collection in a non-public basement.

And last week, we saw John Key "hongi" Tame Iti and link hands with Mrs. Harawira. As Chris Trotter wrote in his column in this week's Independent Financial Review (not online), this does not go down well with National voters. They are centrist, but only to a point. It was Don Brash who regained their votes from other right-wing parties. And foremost among these was ACT.

As I discussed in Chapter Two of my dissertation, I am somewhat sceptical of the case made that National is wholly to blame for the decline in support for ACT at the 2005 election. But what I did note was that ACT's vote caved in immediately after Brash's Orewa Speech on what he called "the dangerous drift towards racial separatism".

This strongly suggests that ACT supporters were mostly avid fans of the call for "One Law for All". As we know, Don Brash took over this cause - but since his departure this topic has disappeared from the political agenda. Now Key is eager to embrace the likes of Iti at Waitangi, all in the name of centrism (although as has been pointed out, Iti's Tuhoe tribe was never even a signatory to the Treaty of Waitangi). And ACT leader Rodney Hide does not want to touch the issue of race. When I quizzed him on this, he said "I want to paint a picture that's more positive for the country than grumpy and I think the “One Law for All” and such things are quite a grumpy side of New Zealand politics", although he did add that there is a "requirement that people be treated equally" buried in his Regulatory Responsibility Bill. But for all intents and purposes, Hide wants to be a centrist as well, at least on race.

But there is an opportunity to capture votes with race. Like tagging, it is a populist issue. It's an emotive issue. It's primed by people's everyday "experiences" of powhiri, karakia and taniwha. I've no doubt that "One Law for All" is dead. But here's a suggestion. If Hide wants to be positive, ACT could launch a campaign for New Zealanders to be proud of its international links, including European ancestry. A campaign that would be a practical application of the Listener story. A catchy slogan or two (try "we've got nothing to be ashamed of"), a few full page newspaper ads and ACT could strike the proverbial chord.

This would not be something that out of the blue: ACT has in the past stressed its roots in the Enlightenment and has often looked abroad for policy advice and tactics, such as in the visit by Rodney Hide and Heather Roy to the Free Democrats (FDP) in Germany and the Progressive Democrats in Ireland in October 2006. In a campaign, ACT could also point out New Zealand's slide down the OECD league tables, particularly compared with Australia. The message could be that New Zealand should look to these other countries for clues to its own success.

The following was included in Murray McCully's first e-mail newsletter for the year. McCully couches his criticism in Key-approved "timewasting" language, but the dog-whistling to race is clear:
Our Productive Public Service

Wondering why the size and cost of the public service is blowing through the roof? Well, a small indication may be discerned from emails, thoughtfully leaked to the worldwide headquarters of mccully.co by frustrated public servants in recent weeks, outlining the lengthy process by which Land Information New Zealand (LINZ) chief executive Brendan Boyle was to be farewelled by that department and welcomed into the same role at Internal Affairs.

Staff of LINZ received a memo advising that on 4 February “LINZ manuhiri” would “gather at 9.15 am at DIA for welcome at 9.30 am. The Internal Affairs Office is across Lambton Quay from LINZ,” the memo helpfully informed.

The programme then provided for:

“Department of Internal Affairs Tangata whenua (staff) welcome Brendan and LINZ staff. Speeches (Whaikoreo) and waiata (songs) in Te Reo.

“LINZ response – speeches and songs in Te Reo

“Transfer of Brendan from LINZ to Department of Internal Affairs at 10.05ish. Speeches.

“At 10.30ish the formal part of the process will close, and the proceedings will open for English to be spoken. Speeches to follow from Kevin Kelly the GM Policy LINZ, Annette Offenberger the Acting CE DIA and Brendan Chief Executive DIA.

“Conclusion with morning tea (Kapu ti/Kai) at 10.45ish, followed by farewell (Poroporoaki), Informal mixing of LINZ/DIA staff.”

So that’s the whole morning cut (and probably the early part of the afternoon) for a bundle of senior public servants (all of whom are no doubt drawing salaries in excess of those paid to our elected representatives, but let’s not be churlish). But wait, there’s more:

“In preparation for this,” the memo advises, “you have already been advised of a number of waiata practice sessions.” These are listed as being from 12.30 to 1.30 on the 18th, 23rd and 25th of January. Then there’s the “rehearsal for the Powhirischeduled from noon to 2.00pm on Tuesday 29th”.

“If you intend going to the welcome, attendance at these is recommended,” staff are advised.

But, dear taxpayers, never fear. The nation’s public servants are ever sensitive to the prospect that large numbers of highly paid public servants might be diverted from their important duties. The note advises:

“Due to a limit of 60 LINZ people that can be accommodated at Internal Affairs, would you please register attendance..”

Isn’t that reassuring?

Thursday, February 7, 2008

Summer speeches 2008: Hide delivers up usual fare but gives some election year hints

Rodney Hide gave his Waitangi Day speech to supporters in Epsom yesterday. There's not a lot new in the speech itself, unfortunately. It begins with the usual weight loss advice which is getting a bit tired now:
I had the great fortune to meet the President of Remuera Rackets Nigel Nathan who made it his job to get me fit to be MP for Epsom. That has been my Everest. It was a big challenge. The Club here has been fantastic in providing me with facilities and support, advice and encouragement. Two years on and I am 40kgs lighter and fitter than I have ever been in my life. Nigel and Remuera Rackets have given me a whole new life.
Hide said much the same in some speeches last year, such as his July 2007 conference speech. I've no doubt that he's fitter and stronger, but we're in election year now, not the heady days of Autumn 2006 and Dancing with the Stars. We do get a few nuggets of information in the speech: Hide signals that education and health are going to be priorities for ACT. On education, we get a tantalizing hint:
ACT is working on exciting policy in education that will improve vastly the opportunities for young New Zealanders and their families. We can make a big difference in education. And by making a big difference in Education, we can make a big difference to our country's future success.
I'm looking forward to hearing what the policy is, but couldn't we have had something unveiled in the speech itself?! The tradition - established by Brash, Key and now Clark - with start of year speeches is to give a little policy away. Nothing big, but something to get Leighton Smith et al. talking about. It's going to be hard for ACT to "own" an education policy (an area traditionally dominated by Labour) but the 2005 election proved it was hard for ACT to own a tax policy (its stomping ground) because it was so closely associated with the National Party.

In fact, more interesting than the speech itself is a list of talking points posted by Hide on his blog which seems to have sprung to life again. For one thing, there's a new slogan:
ACT's small size and MMP allows us to be the only party to have a consistent and principled political philosophy, best summarised with the phrase, "Free to Choose".
As well, there's some more distancing from National -
John Key to win power is understandably adopting Labour Party policy to minimise policy difference's between National and Labour. Their promise is not to change Labour Party policy, only to tweak and tinker with it.
So rather than a rapprochement with National, which is what I had suspected Hide was looking for, it seems ACT would contemplate a coalition with Labour or National, as he was intimating in late 2006-mid 2007. ACT will have to tread very carefully on this to avoid alienating its supporters, the majority of which I am convinced wants to "get rid of this Labour government".

N.B. updates are more limited at the moment as I am out of town for a few days.