During the last election the centre-right National Party lead by multi-millionaire John
Key, said it would partly privatise certain state assets if re-elected. Its main losing
rival was the Labour Party, at the time lead by the uncharismatic Phil Goff, who had been
one of the architects of the privitisation push in the 1980s. National has now decided to
press ahead with its threat. The power company Mighty River Power is the current focus of
attention, with other goodies up for grabs in the future. What will the effects of greater
privatisation be? What options exist for workers in Aotearoa/New Zealand?
Aotearoa was one of the first countries where the neo-liberal brand of capitalism gained
momentum during the 1980's and 90's. The Fourth Labour government began the process in 1984.
In terms of finance, foreign exchange controls were removed, the dollar was floated, new
banks allowed and keeping inflation low became an obsession. Regarding trade, import
tariffs were severely reduced or eliminated and subsidies to farmers ended. The labour
market was weighted increasingly in favour of employers, with legislation such as the
Employment Contracts Act (1991),which enabled strong attacks on unions, in the name of
'flexibility'. A regressive Goods And Services Tax (GST) was introduced, with a
corresponding reduction in income and company tax. The State-Owned Enterprises Act in 1986
required remaining government run assets such as Telecom and Air NZ to operate on a 'for
profit' basis. All this so the market could be free to work its magic of bringing greater
efficiency and prosperity to the country. (1)
Subsequent Labour and National administrations have sped up, slowed down or modified
elements of this process, but none have reversed it. After three decades of these
measures, there can be little doubt as to the effects of privatisation. Most workers have
no union coverage and are left to bargain alone against employers. Many work long hours,
subject to irregular shifts and job sharing in precarious positions on short-term
contracts. Earlier attacks by previous governments have been extended by the present one,
in the form of the 90 Day Act. This permits workers to be fired within that period without
explanation and limits union access to worksites (2). Wages have not matched the higher
levels of productivity squeezed out of workers (3). Welfare beneficiaries (4) are
continuing to be attacked and stigmatised. One of the more recent measures for example,
being the drug testing of beneficiaries. The individual beneficiary is being blamed for
his/her situation rather than the failure of the system to provide meaningful jobs. GST
has increased to 15% with no exemptions and basic food items are becoming hard for some
working families to buy regularly. This has caused dependence on food banks (which have
sometimes actually run out of stock due to high demand), private charities and extended
whanau. Rents are high, especially in the main centres and many families have given up on
the dream of ever owning their own homes. In short, there is very little prosperity to be
seen out there, though a minority have of course benefited. A lot of people are getting by
bill-to-bill, rather than living in the financial paradise held out by the neo-liberal
theorists.
Asset sales also interrelate to the deeper history of this country in terms of colonialism
and its consequences. The NZ nation state is intrinsically based on the confiscation of
indigenous land and destruction of indigenous communities. From at least 1860 onwards, the
crown broke its guarantees set out in the Treaty of Waitangi and even overrode the fact
that many iwi had not signed it. The crown simply invaded and stole (6). Having the land,
culture, people and knowledge decimated, has impacted tangata whenua for generations
since. As in other countries with similar histories, the indigenous people continue to be
over-represented in crucial social indicators such as poor health, gambling, homelessness
and high conviction statistics. Most hapu have essentially lost all rangatiratanga - the
ability to determine what happens to your land. Asset sales are just another way of
transferring assets from one owner to another without Maori being able to even participate
in the discussion of how that happens, let alone making any decisions.
As for the question of efficiency, recent governments have had to implicitly admit the
failure of privatisation and SOEs' by either buying back assets, selling off some or
putting tax payers' money into others. In 2001 the Labour-lead government bought an 80%
stake in a nearly bankrupt Air NZ (8). Rail services were taken back into state control
and renamed Kiwirail in 2008 after being run down for years. Telecom made multi-billion
dollar profits but did very little to develop its infrastructure. Consequently it is now
being hugely subsidised to upgrade its network. The Solid Energy coal company became
nearly $400 million in debt due to a combination of bad investments and poor management
and is now on the list of assets to be sold by this government (9). Mighty River Power is
about to be 49% privatised, supposedly in order to reduce government debt, and others will
follow.
The neo-liberal privatisation approach has failed in Aotearoa, even on its own terms. This
country is far from unique in this regard. Socio-economic damage has consistently been the
case globally wherever it was applied, from Chile to Britain. Opponents of neo-liberalism
have searched for alternative approaches to asset sales and privatisation, with
nationalisation (i.e. state ownership) being put on the agenda. Traditionally in the
English-speaking world, nationalisation has been promoted by sections of the ruling class
as a means of building infrastructure in sectors of the economy that are natural
monopolies and therefore less open to easy profit making.
Current calls for selective nationalisation overseas, have come from some
business-friendly members of the elite. Examples include Nigel Lawson ex-Chancellor of the
Exchequer under Thatcher (10) and Ilse Aigner a cabinet member in the ruling conservative
government of Angela Merkel in Germany (11). The Labour and Greens here are also promoting
it as a better way to manage elements of the system. The Greens argue that "Selling off
our publicly owned companies would mean more foreign ownership and less accountability to
whats best for New Zealanders" (12). Their perspective is one mired in a petty nationalism
that sees opposition to asset sales as helping 'us', meaning the nation of fellow kiwis,
regardless of social class. It is no accident that these parties find themselves alongside
the right-populists of NZ First, headed by the zombie egotist Winston Peters and his
racist MP Richard Prosser and Co. The latter spout very much the same rhetoric, arguing
"New Zealand First firmly believes that any profits should stay at home" (13). Strangely,
even some of those claiming the label 'socialist' see nationalisation as a useful tool.
This is because to them it is a transitional mechanism on the road to eliminating the
entire current economic system, rather than merely a defensive measure to maintain it (14).
The fact that nationalisation can be adopted by various wings of the contemporary
establishment and has been used historically by all manner of regimes from the Nazis, to
Stalinists and petty dictators in Africa, South America and the Middle East, should give
people pause for thought. It cannot be viewed as an inherently progressive move that will
secure resources for the majority of the population. Instead it simply entails the
transfer of resources from control by private business to that by politicians and
unelected bureaucrats. The Fourth Labour Government's actions showed that this process can
be reversed too. The state has not played the role of kaitiaki and can't be relied on to
do so in the future either.
Under state ownership workers can more easily be bullied into compliance with government
policies. This can be done by a combination of laws and cops at the 'tough' end of the
spectrum (15). At the opposite end there are top-down union structures with 'friendly'
union bosses who act as soft cops. They warn members not to rock the boat and to put their
faith in the idea that 'consultation' with government will win a few scraps from the
table. Its hardly surprising they would do this, given the number of union bosses who get
rewarded with safe Labour Party seats in parliament and other perks once they retire. (16)
Under neither privatisation nor nationalisation do those who actually produce goods and
services have control or ownership over them. In addition, the myopia of 'kiwi first'
nationalism that nationalisation would be based on, is a dead end. It fails to deal with
the reality that this country is part of an interlocking international economic system.
Therefore any solution to economic failure has to extend outwards to deal with it. In this
regard John Key at least acknowledges that asset sales are tied to the need for the
government to react to the global economic crisis. The attempt by the Labour
Party/Greens/NZ First et al to mobilize workers against 'foreign investors' and overseas
companies is a cheap trick. Workers in this country are experiencing the effects of the
global crisis in the same way as workers everywhere else. It isn't foreign speculators,
foreign banks or foreign companies that are the problem. It is a global capitalism which
knows no boundaries and the global ruling class with material interests in common (despite
internal squabbles) that is responsible for the mess the world is in.
Anarchists don't accept the false dichotomy of private ownership or state ownership. We
see our goal as a transnational economy where those who produce things, collectively and
directly own and control those resources. We envisage a world where we actually determine
the social and economic ways of organising ourselves in our workplaces and communities.
Decisions would be made in a truly democratic way, with direct participation by all and
accountability to the collective for those decisions. Given the complexity of operating
any economy in the modern world, this would require co-ordination between the various
organisations the communities establish. This can be achieved by federations that span
wider and wider geographical areas. No doubt, there would be teething problems, especially
if a democratic economy arose after a protracted revolutionary upheaval. However, given
that the workers of the world currently produce everything anyway, efficiently controlling
resources on our own behalf is not an impossible task if the opportunity arises. In
addition, with the full possession of the factors of production, the material basis would
exist for the whole of society to live comfortably, rather than the minority that do at
present.
Collective and federative ways of organising are not new. Many aspects of our lives - from
bands to community groups or marae - already include truly democratic and collective ways
of operating. Plus, history is full of examples of people doing things together for the
community as a whole and not for the betterment of a few individuals.
Moving from the political options available, to modes of struggle, what can be said about
the latter in the present environment? Opposition to asset sales has taken a reformist and
legalistic shape. For example the Maori Council appealed to the Supreme Court, arguing
that the government's actions interfered with the Treaty of Waitangi process. This
temporarily held up the prospective partial-privatisation of Mighty River Power but
ultimately failed when they lost the case. The Greens and Labour along with the Mana Party
(17), some unions and Marxist-inspired grouplets have formed an anti-assets-sales
campaign. One tactic being applied is signature collecting for a petition to be submitted
to parliament. This is intended to initiate a referendum on asset sales. The petition has
nearly reached the minimum 300,000 names needed to produce a referendum. However, with a
glossy government advertising blitz in favour of selling Mighty River Power shares, you
would almost not know any petition existed at all! The very fact it does exist shows that
there is a significant level of disagreement with the government's plans. It also adds
credence to the idea that even during times of increased capitalist pressure, the
population is rarely entirely passive (18).
Unfortunately for the signatories and the rest of the country, Key will ignore the
petition. His argument being that the election, in which nearly a quarter of the
population refused to participate, gave him a mandate to push through whatever he wants.
The experience of the opposition movement so far proves once again that if a form of
protest is permitted by the powers-that-be, its probably because they know it offers no
more than a symbolic 'threat' to them (ie. no threat at all). An accompanying tactic has
been street demonstrations. These have managed to gain some attention and thereby raised
awareness of the issue. Though fluctuating attendance has been a feature of them too.
However, the nationalistic approach has also made neo-nazis and anti-semites comfortable
participating in 'Aotearoa is Not for Sale' marches (19). This demonstrates the slippery
slope that this really is. Unless we are explicit that our campaign is anti-racists and
racists are not welcome (from Rightwing Resistance's Kyle Chapman to NZ First leader
Winston Peters), we legitimise racist and anti-semitic rhetoric. Overall the
demonstrations and referendum hardly have the government quaking in its boots and are
likely to degenerate further in the direction of electioneering in favour of the Greens
and Labour in the next election.
While anarchists have participated in demonstrations and disseminated our message
regarding asset sales, we have done so with no illusion that this is sufficient. Real
change will require workers and communities across the country to take direct action for
themselves. This can come in many forms including strikes and occupations that put
resources under their immediate control and begin to threaten the stranglehold of the
state and capitalists. This will have to be undertaken in co-ordination with similar
actions in other places across the globe. On the face of it, this seems highly unlikely to
happen soon in Aotearoa. However, something being unlikely doesn't make it wrong, just
difficult and failure to act at all will guarantee defeat. The fightback though limited
here, has begun and will hopefully continue to gain momentum as this ideologically (and in
some cases literally) bankrupt system lurches from crisis to crisis.
Aotearoa Workers Solidarity Movement
Notes:
1. An accessible orthodox Left critique of neo-liberalism as applied in NZ in the '80s and
'90s can be found in J. Kelsey, The New Zealand Experiment, (Auckland, 1996).
2. See AWSM, "Solidarity", Issue 1:1 2009 for more on this legislation.
3. Bill Rosenberg,
http://www.stuff.co.nz/dominion-post/comment/5824465/New-Zealanders-get-low-wages.
4. See
http://www.stuff.co.nz/national/politics/7496309/High-cost-for-drug-testing-beneficiaries-Health-ministry.
5. Sophie Rishworth, NZ Herald, Nov 3 2011.
6. Of course there were variations in experience within the colonisation and confiscation
processes but the basic picture is clear. See R. Boast & R. S. Hill (eds), Raupatu
(Wellington, 2009).
7. For a wide-ranging view of the various social problems experienced by Maori today, see
T. McIntosh & M. Mullholland (eds), Maori and Social Issues (Wellington, 2011).
8. http://en.wikipedia.org/wiki/History_of_Air_New_Zealand#Rebirth_and_re-nationalisation.
9. For a summary of how this problem arose, see
http://www.stuff.co.nz/dominion-post/business/8489664/Why-Solid-Energy-has-ended-up-on-the-slagheap.
10.
http://www.investmentweek.co.uk/investment-week/news/2240785/exchancellor-lawson-calls-for-full-nationalisation-of-rbs.
11.
http://www.spiegel.de/international/business/member-of-merkel-cabinet-calls-for-nationalization-of-german-power-grid-a-877576.html.
12. http://www.greens.org.nz/koa.
13. http://nzfirst.org.nz/what-we-stand-for/no-asset-sales.
14. For example, Socialist Aotearoa which is the NZ affiliate of the International
Socialist Tendency.
15. Of course, it is the nature of the state to attempt to act this way, regardless of the
exact proportion of government or private control over the economy. Something even
right-wing libertarians appreciate. Nevertheless, it is easier when the state has more
direct control. The classic example of draconian intervention by the NZ state in
industrial warfare was the 1951 waterside dispute. See Dick Scott, 151 Days (1952).
16. For example, Andrew Little - a current Labour MP - spent his entire previous working
life as a union bureaucrat and obtained his seat via a prime position on the party list,
despite having been resoundingly rejected by voters in an electorate seat.
17. A small Left split from the Maori Party, which had chosen to enter into coalition with
National.
18. See Toby Boraman, "The Myth of Passivity",http://www.anarkismo.net/article/2277.
19. See https://notafraidofruins.wordpress.com/2013/04/30/stop-ignoring-anti-jewish-racism/
Related Link: http://awsm.noblogs.org/
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