Up A Mighty River Without A Paddle?

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 are continuing to be attacked and stigmatised. One of the more recent measures for example, being the drug testing of beneficiaries.⁴ 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 demand⁵), 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.⁷ 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 NZ⁸. 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 (ie. 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 Thatcher¹⁰ and Ilse Aigner a cabinet member in the ruling conservative government of Angela Merkel in Germany¹¹. The Labour and Greens here are also promoting it as a better way to manage elements of the system. The Greens argue that ?elling 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 ?ew 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 spectrum¹⁵. 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.