Opinion & Commentary
The Don reignites the war of ideas
Margaret Thatcher is famously said to have banged a copy of F.A. Hayek’s seminal work The Constitution of Liberty on a table at a meeting of the Conservative Party and said, ‘this is what we believe!’ As Prime Minister, she turned around the basket case that was Britain.
In New Zealand, where this same sort of principled attitude is required, septuagenarian Dr Donald T. Brash, intellectual standard bearer of the conservative (classical liberal) tradition, has just begun a remarkable political comeback.
Brash, son of a former moderator of the Presbyterian Church, retired after 14 years as Governor of Reserve Bank of New Zealand (RBNZ) in 2002. As befitting a Presbyterian public service ethos, he famously used to wash his own socks while away on overseas trips so as not to unduly burden the taxpayer.
He left the RBNZ to join the centre-right National Party. One year later, he became the party leader and returned it to its original principles. He rallied to pull the party’s vote from its lowest ever 21% to 39%, and nearly defeated Helen Clark in the 2003 election. Brash ended his political career three years later amidst controversy over leaked (read stolen) emails between him and his advisors/supporters in the year leading up to the 2005 election. The emails were published in a book of conspiracy theories and confected outrage called The Hollowmen, portraying Brash as duplicitously having a secret, ‘extreme right wing’ agenda. A documentary based on the book portrayed him as dishonest, implying that he was tricking a gullible electorate into voting for him.
In reality, Brash is simply a John Howard-like figure of hate for the Left in New Zealand: he is an economic liberal (which is apparently extreme in New Zealand), and his view of race relations and the Treaty of Waitangi – continued redress of past injustice and one law for all – undermined two decades of cosy liberal consensus in New Zealand. He is well known as a man of principle with unbending views on economics, welfare and the role of the state.
Recently, Brash has chaired the 2025 Taskforce, which was formed by the National-led Key government, to recommend policies to close the income gap with Australia by 2025. When the government ignored or ridiculed its recommendations, it turns out he has had enough.
Frustrated at the government’s performance, Brash has essentially mounted a hostile takeover of the free-market ACT Party – a party that until last week appeared consigned to electoral oblivion.
In a public letter to leader Rodney Hide two weeks ago, he offered his services to the ACT Party to improve its chances of winning. A week later, in a week a joint press conference with Mr Hide, Brash announced that he was joining ACT and would take over as leader. Brash claimed he has the donors, the polling, and most importantly, the economic policy to rebrand and resurrect ACT. He aims to increase the number of ACT seats in the next Parliament and form a coalition with National, who are in need of a bit of backbone.
Politics aside, Brash is one of the great policy wonks and classical liberal intellectuals in New Zealand and built a fearsome reputation while in charge of the RBNZ. He is already talking policy – interest-free student loans, universal doctor’s subsidies, middle-class welfare – it’s all on the table. He rightly points out that government spending is higher now than it ever was under Labour. He is sceptical of New Zealand’s all sectors, all gases ETS in the absence of global agreement. As a modest starting point, he wants to reduce state spending to 2005 levels.
But why did he come back? Basically, the National-led government has been profoundly disappointing to many New Zealanders, particularly in the business community and who wished to see economic reform. Not only has National not managed to improve the economic outlook of New Zealand but it has squibbed doing anything unpopular. The country has drifted into a situation where the government is borrowing $300 million a week just to pay its bills. That works out at approximately $300 per family per week, or $1.2 billion per month – around $14.4 billion of a $70 billion budget this year. And this was before the devastating Christchurch earthquake. Since then Treasury has forecast New Zealand highest ever deficit of close to $17 billion.
To the chagrin and worry of many, the Key government has ruled out any substantive policy changes to remedy this situation. Indeed, there is a fear of change, a void of principle and lack of an intellectual framework to drive any such changes. As political commentator Matthew Hooton has repeatedly noted, “We have a National government that is running an economic policy agenda to the left of Julia Gillard’s Labor Party in Australia.”
In this stagnant political climate, Brash’s announcement is welcome. Indeed, real policy issues are being discussed at a political level for the first time in two years. Up to now, reporting superficially focussed on the alleged political wizardry of John Key rather than analysing the policy problems that skilful politicians are supposed to address!
Brash’s re-entry into public life is also extraordinarily healthy for New Zealand democracy more generally. It will reignite ideological discussion and debate to a level unseen since the 1980s – a welcome departure from the grey ideological drabness and fuzzy Blairism of the Clark years. He is red meat for the Right, so they will rally behind him; the Left hates him, so some vociferous opposition will be emerge.
Indeed, the political Left has never forgiven Brash for his strident championing of free markets and ‘one law for all’ stance on race relations. He was rubbished by the media as a racist and extremist, before recording the biggest poll jump in the history of New Zealand (17 points) – not unlike John Howard with asylum seekers.
Brash also has earned enormous respect for being a non-politician: he operates with conviction and says what he thinks. No one in New Zealand will be in doubt about what he believes.
These recent exciting developments are still playing out, but it is testament to Brash’s chutzpah that he is being applauded across the political spectrum – for his conviction, if not his policies. Everyone knows that New Zealand has serious problems (vis-à-vis total debt levels, NZ is next cab off the rank behind Greece). Dr Brash has started the debate based on first principles about the future of the nation through an ideological lens. In short, the contest of ideas is on.
Already Brash is being disparagingly described as a ‘Thatcherite!’ in socialist New Zealand. If this means limited government, property rights, lower taxes, more markets, no ETS, and a New Zealand based on individual freedom, he should wear the title with pride. One thing is for sure, the Don will not be for turning.
Luke Malpass is a Policy Analyst with the New Zealand unit of The Centre for Independent Studies.
