ÁREA MÍNIMA (M2)

The election of a Labour-led Government in 1999 signalled, according to the Labour Prime Minister, an end to fifteen years of neoliberalism. However the official death of neoliberalism does not come with a

resurrection of the ideas of the old Welfare State. In New Zealand, as in the UK and Germany, those ideas have been set-aside for the so-called Third Way or the “new social democracy” (Clark 2002; Maharey 2001, 2003; Chatterjee et al 1999).

A precise definition of the Third Way is probably more elusive than the first or second: it can be “everything found between those poles of economic and social organisation” (Chatterjee et al 1999:35). And New Zealand’s third way is probably bolder than its British or American versions.

Nevertheless, the New Zealand model demonstrates something which is central to the Third Way idea, that is, the belief that the fundamental values of these two previous models – social justice, economic growth, and more recently environmental sustainability – could be and probably somehow seamlessly combined, without the conflicts and the necessity to choose.

But a political vision without conflicts resonates better with an anti-political philosophy than the ideals of the left, which inevitably challenge rather than embrace inequality. Even if the Labour party has glossed over the conspicuousness of economic growth with new communitarian slogans such as innovation, inclusion, social cohesion, knowledge society,

sustainability and many others, economic growth emphatically remains the explicit priority, if only because maintaining the confidence of business is a necessary evil for the new social democrats. For instance, in her speech to Parliament, the Prime Minister argues:

Indeed for most of us the development of a stronger economy is a means to an end. That end is higher living standards and the ability to provide a better quality of life for all our people. An inclusive and cohesive society is an essential building block for a growing and innovative economy (Clark 2002).

Arguments such as this, however incoherent, help to highlight the

continuity in the changes. The quote above leaves an impression that, for Third Way champions, social justice itself is just a means to an end, secondary to the needs of the economy, which in turn serves some higher purpose. This is why it is necessary to reformulate the old left ideals into friendlier communitarian concepts such as social capital or human capital so that they can fit more easily into a framework of the knowledge

economy. “Higher living standards” and “better quality of life”, therefore, are to be understood as economic dividends rather than as the

achievement of ideals of social justice. The driving purpose appears to be to make it possible to distribute these gains in a fairer manner in order to ensure more growth and thus prosperity. It means taking more seriously the trickle-down theory of wealth creation and thus avoiding a direct confrontation with the neo-liberal values hierarchy of economic growth over social justice.

There is another similarity, related to the above, between the politics of the Third Way and neoliberalism in New Zealand. As Colin James (2001) argues, Third Way politics is also “technocratic”: “it is concerned with ‘what works’, not ‘what should be’”. In other words, it is concerned with the positive, rather than the normative. “What works” is the new mantra of legitimation, especially in social policy areas. Effectiveness, rather than economic efficiency, is now the imperative for policy makers. The problem, however, is that these two approaches have the same risk of “goal

displacement”, even if the things displaced may be quite different from each other. Effectiveness, just like efficiency, is likely to become an end in itself. The pursuit or rhetoric of things such as innovation or knowledge economy (read IT) often make them look suspiciously like a technological

fix for social and political problems. This will be discussed further in the discussion below in relation to the Managing for Outcome initiatives.

If the values of New Zealand’s Third Way politics are similar to those of neoliberalism in important aspects, one might expect that their conceptions of social relations might not be entirely dissimilar either. The civil society or the community is offered as an alternative to the market as a coordinating mechanism for society. As a corollary, “partnership”, with its emphasis on trust, norms and reciprocity, takes the place of contract and competition. An implication of these changes is a shift from the consumer model, based on market relationships, to the stakeholder model. The adoption of these communitarian notions can be traced to the previous National Government under Jim Bolger, and many have featured in neoliberal discourse.

However, they have undoubtedly gained momentum under an officially social democratic government.

Nevertheless the “real” meaning of these notions in practice remains a contested subject for New Zealand commentators. Take for example “partnership”. For some, it is an important means, or at least a promising starting point, to overcome the neoliberal legacy (Walker 2004; Larner and Craig 2005). Other observers are more sceptical (Curtis 2003; Fitzsimons 2000). Curtis (2003:7) claims that the Third Way “promised by Prime Minister Clark and increasingly operationalised by central government, local government and community groups” is best understood “in terms of continuity” with the neoliberalism begun by Labour in 1984.

The latter claim may be slightly unfair although it does pick up an

important point. The convergence of the two discourses is probably not an intentional result but an “unintended” consequence of reified notions of community, as discussed in chapter 2. To reiterate, just as the market discourse only captures a single dimension of social relations, the communitarian discourse transforms citizens into, in Fitzsimons (2000)’ words, “community subjects” under the mythical banner of community,

while community norms substitute for economic rationality as the basis of calculability and stability.

A further problem, related to the reification, is its neglect of inequality within or between communities, or partners, not only collectively but ultimately between people themselves individually. Nor do catchphrases such as “networking”, “relationship-building” and “coordinating”, derived from notions of networks and partnerships, always provide an accurate or meaningful description of what actually is going on. Labour’s

communitarian discourses feature “networks” and “partnership”, the “business community” and “public private” partnership, as well as trade unions and other social groups. But partnerships do not in themselves resolve the perennial conflicts between partners and are not necessarily in the interests of everyone. Vehement opposition from the business

community over major issues such as the Employment Relations Bill, or more recently electoral finance and climate change, shows just how fragile the harmonious image presented by the Third Way discourse can be.

A final point concerns politics itself. There is certainly a slow-down from the blitzkrieg approach in the previous Labour Government, partly thanks to the MMP environment. Moreover, there is an official acknowledgement of the need to put values back into politics (Maharey 2003). The

incremental approach has led to significant changes over the years, for example with the re-nationalisation of ACC, the reform of the Employment Contracts Act, and Working for Families. But the communitarian discourse has a certain anti-political bias of its own, albeit more benign. It poses difficulties because values such as community or social capital – like terms such as democracy and accountability – are almost impossible to object to and in a sense are devoid of political substance. There are thus inherent limitations for purposeful political action and debate. In this regard, notably, the key pieces of legislation, including those underpinning the NPM reforms, have not been fundamentally changed, despite significant changes in the social policy area.

Along with the new style of politics there is an increasing awareness of the importance of trust, now often dressed in the garb of social capital (Walker 2004). Third Way politics is certainly more “inclusive”, compared with the reform years. A shift has occurred away from particularised trust in

institutional elites during the 80s and 90s to allow more participation by the general public through increasing use of “consultation”. It is harder to see, however, what has been done to restore the trust in political institutions depleted by the reforms. The tendency to take for granted that the trust is “organic” and therefore will thrive in the absence of external forces – both markets and the government – is noticeable in the New Zealand

discourse, for instance, in Walker’s assertion that “trust is largely intuitive, and can only be engendered”. There is no conscious effort to make a distinction between “particularised” and “generalised” trust34. It precludes a more active attempt to overcome, rather than simply contain, the neo- liberal legacy. Moreover, there is a risk that the discourse of trust can obscure the demand for a broader basis of political legitimacy. Without addressing such fundamental problems as socio-economic inequality that generate distrust, the kind of centrism that now dominates New Zealand politics is likely to fall short of expectations, even by its own standards. “Consultation fatigue” can be seen as a result of this failure to actually deliver on its promises.