Monday, 4 February 2013

New Zealand's stunted public sphere

New Zealand (above) used to be thought of as a social democratic paradise. A bit boring, perhaps. Maybe stultifyingly controlled. But even so, it seemed to be an example of how to combine economic controls with individual freedoms - a lesson that all Europeans wanted to learn between the 1950s and the 1970s. The British Liberal MP, David Goldblatt, rhapsodised about this place where 'the practice of neighbourliness is most strongly developed' in his 1955 book entitled Democracy at Ease. There are any number of good articles and PhDs on the subject, by the way, showing just how early, and just how prevalently, Europeans thought of New Zealand as a type of social paradise.

No longer. Or at least not since the radical liberalising 'Rogernomics' of the mid-1980s, launched on a rather unsuspecting public by a Labour government determined to shake the economy out of its perceived lethargy. Tariffs were lifted; spending reduced; taxes cut. All in the name of efficiency and global competitiveness. Ever since, despire some rises in public expenditure and especially in investment during Helen Clark's years as Prime Minister, the New Zealand state has been kept down, remaining below average within the OECD.

The results are everywhere for the modern visitor to see. A very small and rather slow rail service, that's gone through one failed privatisation, had to be bought back by the public sector, and which is still shrinking. A postal service that seems to be mulling over the end of daily deliveries.

The macro-economic and social results are also clear. There's no controversy about them. New Zealand has seen large and consistent rises in relative poverty, which have gone further and raced ahead faster than anywhere else in the OECD. It's a rather different picture from when the country was hailed as an example of how to make people more equal. Levels of inequality are now at an all-time high.

Now all this 'restructuring' probably has helped New Zealand retain its competitiveness in the region, signing the first free trade treaty with China and boosting its exports. It's a tiny country, floating on its own in the middle of the Pacific. It's a rural country, in which many services must be manned by volunteers. There simply aren't enough people, and there isn't enough cash, to do otherwise. But no-one should pretend - least of all 'Big Society' advocates in the UK - that you can make the state smaller without painful consequences. The destruction of New Zealand's image as a modern social nirvana is the least of those problems.

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