In our third-generation sheep and beef farming family, the fear of a Labour Government being elected in 1984 was palpable.
We were in Ashhurst, a small farming community in the Manawatu for election night. As the triumphant red tide of Labour under the young, hugely popular David Lange swept through traditional National seats, the party turned into a wake.
- Liam Dann: Congratulations Labour, now for the really hard bit
- Duncan Bridgeman: Can Labour mend its bridge with business?
My brother and I sat silent in the back of the Commodore during the three-hour drive home to Taumarunui.
Mum and dad, like most Kiwi farmers, were sick with worry about what Labour’s policies would do to them. We didn’t stop for an ice-cream in Taihape. Us kids didn’t even ask.
But the 1984 Labour Government proved transformative.
It made tough, fast decisions in its first term which inflicted short-term pain, for long-term gain.
They delivered. They had to: the country was broke. Under the economic leadership of Sir Roger Douglas with Richard Prebble the enforcer at his side, Labour had transformational ideas to fix the structural issues that had bankrupted the economy. It was a Labour Government, Roger Douglas in particular, who is the most economically important and transformative in modern politics.
In contrast, the Labour Party elected in historic numbers last night is centrist. Labour’s campaign has been more about reassuring business that they won’t do stuff, than that they will. Unlike ’84, business and the markets had factored in a Labour win and already moved on.
Jacinda Ardern has shown she is cautious about burning her political capital on hard, unpopular change. Her biggest challenge is to manage the expectation on the left for change based on the huge mandate won. But this will be an incremental, not a transformative government.
Labour’s plan seems light on detail and modest. I don’t think there will be any major surprises foisted on business.
What we know from last night is that the language of Labour has turned to the ‘recovery’ from Covid-19. It’s about jobs, infrastructure, skills and trade training, with no detail on where those jobs will come from. The meaningful things that Labour would normally look to change, like the tax system Jacinda Ardern has already ruled out.
It was a great night for the Greens on the face of it, but they have no leverage because of the way the numbers have fallen. James Shaw has worked hard to work constructively with business. His ministerial capability and experience are needed in Cabinet.
For those worried about another three years of Labour, the Government’s record of non-delivery on major policy, is, ironically, very comforting. Labour’s biggest risk is a crisis free second term where their slogan, “let’s keep moving” will actually be put to the test.
And here’s the reality check. When it comes to keeping the country moving – business, not Government will drive the recovery. Sure, Government can set a clear direction of travel for the economy, clear any slips blocking the road and leave a bit more gas in the tank by cutting red tape, but then it needs to get out of the way. What’s needed is a government for business, not in business.
There are lessons for all sides after last night’s historic Labour victory. Importantly (especially for National), that there is no ‘natural’ party of government, or for business. Both business and Labour need to get over their traditionally tribal views of each other.
Jacinda Ardern said last night that Labour’s mandate means “We want to accelerate and crack on with the recovery”.
With jobs at the heart of Labour’s plan, but no detail on where those jobs will come from, business is in the driver seat.
Trish Sherson is a Director of Corporate Affairs firm, Sherson Willis.
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