Time for more radical state intervention

20:47, Oct 15 2012

They came together in an atmosphere of near panic. Factories were closing their gates and thousands of laid-off workers were joining the ranks of the unemployed.

In the face of global financial catastrophe the political party ostensibly devoted to protecting the interests of working people was in the grip of a peculiar immobilism - unable or unwilling to take resolute action.

A special "Crisis Congress" was convened by the largest of the country's trade unions to debate a recovery plan devised by three of the labour movement's leading economists.

Entitled "Restructuring the Economy" it called for direct and massive government intervention to mobilise idle resources and get the nation back to work.

To the utter dismay of the trade unions the leading economic spokesperson of the largest left- wing party refused to back the plan.

A few months later that same party suffered a crushing electoral defeat.


This could be a description of recent political developments in just about any country of the developed world.

But the story isn't recent.

It happened over 80 years ago in Weimar Germany.

The metalworkers' union's "Crisis Congress", at which its radical restructuring plan was presented, took place in April 1931.

Two years later Adolf Hitler's National Socialists were in power.

By 1935 the Nazis' own (very similar) programme of "massive government intervention" had practically eliminated unemployment and confirmed Hitler as Germany's saviour.

Last Friday, Trevor Bolderson, a coal-miner from the West Coast, rose to his feet and asked: "What are you going to do for my little town of Greymouth?"

His question was directed at Winston Peters from NZ First, Russel Norman from The Greens and Labour's finance spokesperson, David Parker.

The venue was the "Jobs Crisis Summit" organised by Bolderson's trade union, the Engineering Printing and Manufacturing Union (EPMU). Like the German workers of 80 years ago he, too, was looking for salvation.

All he got were evasions and promises.

The assembled politicians would only tell him what he and his workmates already knew.

That the lay-offs of Solid Energy's administrative and mining employees must be understood in the context of the Government's plans to partially privatise the state-owned energy sector.

No one was willing to give Bolderson an unequivocal commitment to re-opening the Spring Creek Mine.

No one spoke of state ownership offering employees and their unions a greater role in managing New Zealand's energy resources.

No one denounced the madness of mothballing a highly productive coal mine and laying-off its highly skilled workers when international demand for its top- grade product is certain to recover as China's stockpiles dwindle.

That the Greens might be wary of promoting coal mining is understandable (although someone should ask them if they're also happy to do without the high-grade steel Spring Creek's coal makes possible).

NZ First could also be forgiven for not being the loudest promoter of state-ownership.

But Labour, the party to which Bolderson's EPMU is affiliated, should have been able to offer something more hopeful than Parker's declaration that he "could not promise that every mine could be kept open".

Returning to the West Coast, Bolderson will be able to tell his EPMU brothers and sisters that the three parties represented at the Jobs Crisis Summit have undertaken to conduct a parliamentary inquiry into the manufacturing sector's problems.

"The crisis in manufacturing is hammering communities from South Auckland to Bluff, from Kawerau to Greymouth", Labour's leader, David Shearer, stated in a media release distributed after the Summit. "The future of our country depends on a modern manufacturing sector that creates better jobs and higher wages to keep Kiwis in New Zealand."

This could only be achieved, he suggested, if political parties worked together.

Certainly, the sight of the leaders of the three major Opposition parties all lined up behind the same table is a hopeful sign for New Zealand's beleaguered working and middle- class voters.

Bolderson, along with the men and women who used to do the 40,000 jobs that the manufacturing sector has shed since 2008, can only benefit from more political co- operation among the National-led Government's opponents.

Not so hopeful, however, are the extraordinarily modest demands being advanced by the EPMU.

The union's national secretary, Bill Newson, listed these as: action to bring down the high New Zealand dollar; a government procurement policy which favours domestic producers; and direct Government support for manufacturing enterprises facing imminent down-sizing or closure.

As an experienced union negotiator, Newson must know that modest demands elicit modest responses.

If New Zealand's labour movement is to fare better than its German counterpart of eighty years ago, then not only must it formulate an equally radical plan for "massive state intervention" and democratic restructuring of our economy, but also ensure that Labour, the people's party, commits itself, body and soul, to making it happen.

The Press