GUEST BLOG: Tadhg Stopford – History’s Lesson, Betrayed by Politicians
In 1981, the Reserve Bank of New Zealand was clear-eyed. The economy was unbalanced: too much consumption, too much speculation in housing and land, too little productive investment. Private credit was exploding. Exports were fragile. Inflation and external deficits were the twin dangers. Unemployment was structural.
And the RBNZ warned: unless there was an integrated medium-term approach, the nation would drift deeper into imbalance.
That warning was ignored.
Instead of stewardship, politicians chose betrayal.
They sold our patrimony to related parties, cheaply. Foolishly at best.
They invited in Fay Richwhite and their winebox crew ilk – financial engineers who carved up national wealth and sold it cheap to foreign investors (and themselves) while clipping the ticket on every side.
They imported the Chicago School catechism: deregulate, privatise, “let markets decide.” They handed control of credit to banksters and their minions in the Treasury.
This was not capitalism as Adam Smith or John Stuart Mill understood it; where markets served the nation, monopoly rents were restrained (to lower the costs of living and business), and the wealth of nations was built on improving productivity (through sovereign investment).
This was its perversion: financial capitalism, parasitic and extractive, where profit came not from creating wealth but from stripping it. Where costs of living and business were released from the protection of SOES and set onto the rocket ship of private monopoly cartels; with their attendant underinvestment for the future.
Its incredible really. How did we let them do it?
Rogernomics and Ruthenasia were either gross incompetence or a scam. Never recanted by ‘labour’ not ‘national’, NACT appears the shameless perfection of entitled criminality hidden behind lies. Remember, the divine right of kingship to rule was based on a commitment to Justice, not just law. But in our greed driven age
The result has been forty years of economic decline dressed up as reform:
- Housing inflated into a casino, wages siphoned into mortgages.
- Banks gorged on easy profits while industry withered.
- Current account deficits entrenched, foreign creditors enthroned.
- Public finance costs soared while vital commons – rail, energy, hospitals – were gutted.
- Politicians still mouthing Chicago slogans while their people sink.
This is more than bad economics. It is the corrosion of civilisation.
It is misrule by the wealth addicted few, whose entitlement blinds them to their responsibilities.
Civilisation rests on responsibility: leaders as stewards, citizens as sovereign, the commonwealth as sacred trust.
Conservatism once meant conserving the land, the community, the inheritance of civilisation.
Capitalism, in its classical form, meant harnessing enterprise to serve the nation, restraining rentiers, and building shared prosperity.
All three have been betrayed.
What we have instead is bankster capitalism: financial parasitism dressed as progress. Conservatism without conservation. Civilisation without stewardship. Politicians without shame.
The right calls this freedom.
It is not.
It is parasitic dependency that is killing the host, our nation.
They call it reform.
It is not.
“Reform” is what was done to defeat the private monoplies.
What our politicians sell us as ‘“reform” is plunder. It is the return of private monopolies that raise the costs of living and of business.
It is profound theft from our past, our present, and our future.
It is plunder.
The true conservative, the true patriot, the true guardian of Western civilisation, is the one who stands against this betrayal: who demands that credit be guided to productive purpose, that land and resources serve the people, that public wealth be invested for generations, not auctioned for donors.
History has already judged the last forty years as treason against civilisation itself. The question is whether we will let it continue; or whether we will reclaim capitalism in its classical sense, conservatism in its true sense, and civilisation in its only sense: the stewardship of a people’s future.
Our future, our nation, our children, our legacy, depends on it.
RBNZ Bulletin November 1981 – Critical Annotations & Strategic Lessons
Original (1981):
Recovery based on private consumption and residential construction. Impetus from disposable income increases.
Critical Annotation (2025 lens):
Shallow, consumption-led upturn. Shows early bias toward housing and consumption. Seeds of NZ’s long-term imbalance.
Original (1981):
Agricultural operating surplus lagged inflation; export volume growth expected to weaken.
Critical Annotation (2025 lens):
Early warning: external constraint (terms of trade). Needed diversification and sovereign credit for higher-value (strategic) industries. A missed opportunity.
Original (1981):
Unemployment remains historically high despite higher sales/output. Structural problem identified.
Critical Annotation (2025 lens):
Correct diagnosis=structural unemployment. Missed remedy: strategic investment + skills policy. Instead NZ pursued labour market deregulation.
Original (1981):
Credit aggregates accelerating: M1 +15% y/y; private credit +26% y/y; finance companies +30%+.
Critical Annotation (2025 lens):
Embryo of credit-fuelled asset cycle. No credit guidance, no allocative discipline. Led to financialisation and housing dominance. Parasitic growth. Deadweight sugar rush/theft.
Original (1981):
House prices +20.6% y/y; farmland +30.5%; building costs +20%.
Critical Annotation (2025 lens):
Clear evidence of land/asset inflation problem. RBNZ saw it, but reforms amplified rather than restrained speculation.
Original (1981):
Government deficit at 7.4% GDP, expansionary budget. Warning of risk to BoP and inflation in 1982.
Critical Annotation (2025 lens):
Framed correctly: fiscal expansion + weak tradables = external deficit risk. Remedy chosen later was austerity, not productive public investment.
Original (1981):
Conclusion: growth will continue but constrained by current account deficit and inflation. Calls for an “integrated medium-term approach.”
Critical Annotation (2025 lens):
The critical line. NZ never implemented it. Forty years later, the same twin problems persist, magnified by neoliberal rentier policy.
If we want things to improve, we should stop making the same “mistakes”.
Tadhg Stopford is a Teacher and Historian. Support change by purchasing your Rare & Holy Hemp Oils and Balms from www.tigerdrops.co.nz, join the movement at www.thehempfoundation.org.nz
This is an excellent description of the faults in the economy, although the saying about turkeys not voting for an early Christmas illustrates the difficulty of getting people to support a plan that is best for all if they feel that it might disadvantage them. I say that it would be best for all because the advantage of living in a safer, more prosperous economy with less inequality would make up for the few who will have a bit less net worth.
History is too often forgotten – as if there is no connection to the present. It doesn’t look good for the current global system if history is considered. Civilisations have come and gone. It’s well documented. Various causes I suspect but likely some commonalities that might help connect the demise of the local with the global. Back in the day Oswald Spengler had a bit to say on this. TBH havent read his work but have read somewhere his thesis is outdated. Perhaps he ended up a Fascist and is now discredited.
But a good few since have raised much the same. Like numerous civilizations before us we are living on borrowed time. If anything is to be learned it is change is constant and that over time – centuries infact- things go pear shaped. Might be sooner than later for the current global system. Notwithsatnding the impacts of climate change. But here’s the rub: very few notice or fully understand – and certainly not politicians – until the rot has set in.
Excellent, the tragedy is why Labour remain wedded to a watered down version of this. You’d think they would have realised the lesson by now. I guess we can keep living in hope.
Labour are marching to another tune. Somewhere in the thesis? is the way our minds work; cling together when poor and you might get ahead somehow, When you do better you cast off and sail your own boat in the fleet then you move up go solo, and don’t need to support the group who haven’t moved up.
Then you keep on getting more and more and update all your wants and desires. Meaner and meaner goes your thinking.. Labour is no longer full of working class fiery chaps who haven’t t brought their connected beliefs with them as they moved up financially.. Then their children become lawyers who want to lock their wealth in and are about holding onto wealth as much as possible.
It is supposed to be spent on investment that produces jobs. For a while; the people at the bottom get less and less, and lose their jobs and have nothing. Work isn’t even recognised as a good, and necessary, and jobs are lost to mechanisation. If you can afford something you and your children can have it, or borrow to get it. You are sorted. Labour has transmogrified.
Well written, and undeniable as our peoples’ future gushes out to Australia, where politicians, though by no means saints, are much less deserving of a meeting with Jack Ketch.