THIS IS THE TIME of maximum danger for Jacinda Ardern. Caught off-guard by their stop-gap leader’s astonishing energy and confidence, the tired grey men of the Labour Party could only look on in wonder like the rest of us. As public expectations of Jacinda have soared, however, the men and women of Labour’s political apparatus are beginning to close in around her.
Their message was as simple as it is emphatic: Labour’s new leader must not allow the public’s expectations of an Ardern-led government – especially those of its younger members – to force the political agenda. Dampening down voter expectations has become a matter of urgency for Jacinda’s advisers.
The mantra du jour is: “Promise nothing that can’t be paid for!” Under no circumstances must Labour’s commitment to fiscal discipline – as codified in the Labour/Green “Budget Responsibility Rules” – be compromised. “If you can’t tell the voters how a promise is to be paid for, then don’t make it.”
What they fear most right now is the growing expectation that Jacinda is on the point of introducing a universal student allowance and announcing the abolition of tertiary fees. That such a promise, delivered to thousands of cheering university students, would set off a “youthquake” and, almost certainly, clinch the election for Labour, cuts no ice with Jacinda’s hyper-cautious counsellors.
And, if her comment to Duncan Garner: “universal may be going a bit far”; is any guide, then Jacinda is on the point of heeding the grey men’s advice. In her desire to appear fiscally responsible, she is on the point of needlessly blowing-off the “Jacinda-Train’s” election-winning head-of-steam.
What Jacinda needs to comprehend, urgently, is that there is always money to be found for things that are dear to a government’s heart. Remember the $1.5 billion that miraculously materialised to rescue the National Party-voting victims of South Canterbury Finance? As was the case with the contemporaneous bailouts of the banks and finance houses in the United States: when faced with the prospects of their friends going under, the Powers-That-Be will always find the money to socialise their losses.
The history of the Labour Party she leads is there to guide her on these critical matters. The First Labour Government’s state-housing programme could never have gone ahead had Mickey Savage and his colleagues not required the Reserve Bank to, in effect, grant their government a huge overdraft.
The same option is open to anyone who commands a state that issues its own currency – as Bill English confirmed when he authorised his billion-dollar South Canterbury bailout. Clearly, Jacinda heard her advisers when they told her that money doesn’t grow on trees. What she has yet to grasp, however, is that it can be made to materialise out of thin air! If she wants to call an end to tertiary fees and introduce a universal student allowance, then she should do so. If Grant Robertson objects, then ask David Parker to do it.
Nor should she be afraid to go for broke when it comes to spending-up large on health, education, welfare and infrastructure. As the late Sir Owen Woodhouse pointed out a few years ago, the ACC Fund contains tens-of-billions of dollars. At the moment, their purpose is to guarantee our “fully-funded” ACC Scheme. But that fully-funded requirement only exists because the Nats were planning to privatise ACC. Were Labour willing to pass a law reinstating ACC’s original “pay-as-you-go” funding formula, then Jacinda would have all the money she needs to end poverty, repair New Zealand’s broken social services, and future-proof its decaying infrastructure.
One of the reasons David Cunliffe failed to fire as Labour’s leader in 2014 is because one minute he was promising to deliver Labour’s Brave New World, and the next he was reassuring the astonished news media that his promised land would only be delivered “as finances permit”. If “Jacindamania” is robbed of its gathering momentum by a similar propensity to raise expectations with one hand, only to dampen them down with the other, then Labour will, once again, be seen to snatch defeat from the jaws of victory.
You said “Let’s do this!”, Jacinda. Now prove to us that you meant it.