The Shift To A More Socially Responsible Economic Policy Is Also Supported by Public Opnion – With Real Political Implications.

Listener Cover Story: 25 March 2000

Keywords: Political Economy & History; Social Policy

The success of Rogernomics depended on New Zealanders changing their beliefs. Reforming economic and political institutions would not have been enough. People also had to think about governing the economy in quite different ways. The rhetoric of the reformers was that New Zealand had been a “nanny state” that did everything for its people. New circumstances and a poor economic performance (So they claimed) required a greater reliance on private enterprise and a major reduction in the range of activities of the state. New Zealanders had to reject their dependence on nanny and take greater responsibility for themselves.

There are some elements of truth here. From its beginning, the New Zealand state had been deeply involved in national development. Over the years, the involvement had been extended to numerous other activities encompassing private lives as well -health, education and retirement. Before 1984, many thoughtful people believed that it was necessary to reduce state involvement in some areas. (It seemed to me, as my Listener columns at the time tell, that the state was far too involved in the detailed regulation of business activities.) But, although some change may have been necessary, few envisaged such radical reforms as were to be implemented, and most expected that the traditional values of New Zealanders would set the limits for change. Instead. the Rogernomes used the peculiarities of the pre-MMP winner-takes-all political system to impose their extreme policies.

It is a matter of record that the reformers failed to attain their economic promises (the one exception has been inflation). But did they change our beliefs? Are New Zealanders now committed to the Rogernomes’ vision of a low-involved state? For more than a decade the New Zealand Study of Values (NZVS), based at Massey University, has been monitoring political and economic values, as well as spiritual and ethical ones. Its recent book, New Zealand Politics at the Turn of the Millennium; Attitudes and Values about Politics and Government*, shows that we have hardly changed the values that the reformers wanted to subvert. The study includes a host of tables – the 1998 survey of over 1200 people had more than 300 questions. A key table illustrates responses to the question: “What should be the responsibility of government?” The percentages supporting different responsibilities are shown in Table 1.

Percentages Who Think That The Government Should

The vast majority of the public responded “yes’. to central government’s responsibilities, and a majority also saw major tasks for local government (except for income redistribution), even where it has no means of pursuing them.

On the question of redistribution of wealth, 45% of respondents in 1998 were in favour or strongly in favour, against 29% who were not. Nine years earlier, the figures were 42% and 34%, so the public had shifted towards favouring greater redistribution. Nor is there evidence that the younger generations markedly oppose redistribution more than their elders do. The Rogernomes have failed to capture the hearts and minds of the young, just as they failed to persuade the rest to change their views.

A similar commitment to government involvement is seen in the questions about whether the government should increase spending. (See Table 2.)

Proportions That Think Government Spending Should Be Increased For

* While there was no majority for increased spending, there was no majority for reduced spending either.

No one who followed the 1999 election will be surprised at the demand for increased spending on the core activities of the welfare state. What is intriguing is that demands rose over a nine year period. Although this might be explained by the savage expenditure reductions of the early 1990s and the squeeze that followed, the conclusion has to be that the weaning (“cold turkey” might be more apt) has done nothing to reduce our demand for the “nanny state”.

Moderate reformers can take heart from the responses to questions about the role of business. Some 60% thought that, “owners should run their businesses or appoint managers” (albeit the 1998 percentage was down a little from the 63% of 1989), although 34% of 1998 respondents wanted some employee involvement in the management of firms (up from 28%). Just half (50%) wanted to increase private ownership of business and industry, but only 31% favoured government owning more business. Lest business gets complacent, however. 53% of the 1998 survey favoured tighter government regulation of big business (a fraction down on the 55% of 1989), although 70% thought that, “this country was run by a few big interests looking out for themselves” (compared to an earlier 54%). Moreover, a key element of recent economic policy, the opening up of the economy to foreign competition, is opposed by a majority of the public: 61% said that, “there should be stricter limits on selling foreign goods to protect jobs”.

Only 19% of New Zealanders agreed that, “the government should take responsibility to ensure everyone is provided for.’. This places us in the middle of the five rich countries in the inter-national study -Sweden (6%), the US (12%), Australia (21%) and West Germany (23%)-and well below Taiwan (27%), Mexico (32%), Poland (33%), Brazil (34%), China (36%), Lithuania (41%), Japan (42%). South Africa (43%), Russia (50’Yo). East Germany (50%) and South Korea (65%). We seem to be sturdy individualists. who nevertheless expect the government to support us in our pursuits and protect us when things outside our control go wrong.

One of the strongest responses of the survey is that people feel politically marginalised. In 1998, 67% thought that central government was generally unresponsive to the public. They were willing to take direct political action: 97% would sign a petition. 67% would join a boycott, 67% would attend a lawful demonstration, 34% would join an unofficial strike, and 17% would occupy buildings. In each case, they were more willing to do so than in the past, and more in 1998 said that they had engaged in direct political activity than in earlier surveys. But 81% rejected violence as a means of pursuing political goals.

The NZVS results are in the public domain. We can be sure that there are a host of private surveys, many in the hands of political parties, which give broadly similar conclusions. Such surveys present the parties and policymakers with a challenge. Under the past winner-takes-all political system, a handful of bolsheviks (of the right or left) could seize power and impose their policies, even if the public hated them. Under MMP, coups are less likely.

We see Act responding in the contesting of its presidency. Whatever the personalities and the party issues, underlying them is the fact that Act economic policies based on Roger Douglas’s Unfinished Business are favoured by less than 10% of New Zealanders. The party’s destiny under MMP, if it keeps to these policies, may be to help form a government of the right, but it will never have a decisive role in political power because its policies are an anathema to the majority of the public. It is no accident that Act played down its economic policies in the 1999 election, focusing on social security entitlements and Treaty settlements, where the NZVS survey shows that it was much closer to the public’s desires.

Many of the Greens ‘ policies are articulated by other parties, too, although not necessarily with the same enthusiasm. But there are hints in the NZVS study that many New Zealanders want to be governed differently. The survey shows that we are committed democrats, but it may be that the unorthodox Green politics -dual leadership, a parliamentary musterer rather than a whip, a high level of grassroots consultation -represent a yearning for a more collectivist governance. at least among a significant minority. The Greens will also take heart that 39% of respondents favoured traditional technology over high technology. with only 35% taking the opposite view. But, maybe surprisingly. New Zealand was below nine other countries in the survey (Australia, China. Mexico, Russia, South Korea, Spain, Sweden, Taiwan, Turkey and the US} at giving priority to the environment over the economy.

The Alliance is another party discovering that some of its policies resonate with the public while others clearly don’t. Labour probably best positioned itself, according to the NZVS, in the 1999 election. However, a fifth of its caucus is Maori, although the public is broadly opposed to giving Maori any special treatment. The survey reports the public’s reluctance to spend more on Maori. Some 66% are against giving them special land and fishing rights, and 34% think that the Treaty of Waitangi should be abolished, together with another 29% Who think that there should be greater limits on Maori claims under the Treaty. Maori have worked the old political system, just like the Rogernomes, so neither they nor the government have really tried to sell their case to the public. That will be necessary under MMP.

Probably the biggest immediate gainer from studying such polls is the National Party. The majority of the populace did not like much of what its government did in the 1990s. Realising this, its leader Jim Bolger tried to restrain the party’s Rogernomes, seeking a new policy direction with a social cohesion to balance the economics. Although known as “potato-head” by the elite, of our last five prime ministers, Bolger was the most in touch with the electorate, and the shrewdest. His redirection attempts were thwarted because the top of his caucus was recruited during the gung-ho years of Rogernomics, to which they were sympathetic. In opposition, National has the opportunity to create a caucus that aligns better with the public’s desires.

Moderate reformers will be pleased that they have got the public’s values roughly right, and note that a large majority of respondents also think that “society must be changed slowly by the reforms”. Even so, just because the public wants something, it cannot always be delivered. There remains a role for leadership identifying and articulating opportunities. restraints and evolving trends. Surveys such as the NZVS tell us where to begin.

*The authors. Paul Perry and Alan Webster, supplied The Listener with a supplementary report.