NZ Election: Money, Power and Kiwi Non-Exceptionalism

In an election year, leading NZ politicians are embroiled in donation scandals.

Submitted by LAMA on February 21, 2020

Just when it seemed the 2020 General Election (scheduled for September) was shaping up to be another yawnfest both National (traditionally one of the main parties of government, currently in opposition) and New Zealand First (a minor Right-Wing populist party now in the coalition government) have found themselves embroiled in a scandal that could upset the political landscape, or at least the outcome of the election itself.

The scandal that threatens to take down long-term political zombie Winston Peters and his New Zealand First vehicle does not directly involve the main government party, Labour. However, the latest polls mean that the parties Prime Minister Ardern needs to form a coalition government with, may not get back into Parliament. The Colmar Brunton Poll has the Greens at 5 percent and NZ First at 3 percent. Labour polled 41 percent. National polled at 46 percent. Unless New Zealand First, ACT [a very small purist free-market party] and the Maori Party win electorate seats, National will also have problems forming a coalition government. Under New Zealand’s Mixed Member Proportional representation system a party must win either 5 percent of the party votes or an electorate seat to gain representation in Parliament.

So what is this scandal?

Under the electoral laws any political party donations that are at least $15,000 must be made public so the everyone knows who is bankrolling them. To evade this legal requirement it has been alleged that in this case the two Directors of Conrad Properties and other entities owned by these Directors donated a total of $55,000 in four payments to the New Zealand First Foundation so they could avoid the public disclosure requirements of the Electoral Act. (Radio New Zealand, February 18th, 2020)

The Electoral Commission, which oversees all matters relating to elections and enforcing the Electoral Act, including political party donations, views the failure to disclose these donations as a breach of the public disclosure provisions of the Act. However, this is not the only reason why there is such a frenzy.

The problem stems from the claim many of the donors, including the two directors from Conrad Properties, were using their 2017 election campaign donations as leverage to press NZ First MPs’ to make changes to the Overseas Investments Amendment Act 2018 that would personally benefit these directors and other donors in the housing sector. No matter how much Deputy Prime Minister Winston Peters resorts to the standard Trump tactic of accusing journalists of fabricating news stories and smearing his reputation (Winston Peters’ message to his supporters dated February 18th) the reality is that many voters will see this as cronyism at best and corruption at worst.

Such donations also raised eyebrows among some former New Zealand First members who wondered how a political party that was supposed to be on the bones of its arse (according to Doug Woolerton, one of the two trustees who oversaw the running of the Foundation) was suddenly able to afford a campaign bus for Peter’s campaign in his (failed) electoral campaign for the Northland seat in 2017.

Even more intriguing was that David Carter, the National MP for Northland since 2017, had also been approached by these donors because he was on the select committee that was hearing submissions on the Overseas Investments Amendment Bill. This is nothing unusual in NZ politics: people personally approaching a Member of Parliament to discuss legislation is commonplace even in this day in age. However, in the context of their donations to the New Zealand First Foundation, this meeting has struck some people as highly suspect. Carter himself claimed that he was surprised to learn that the directors of Conrad Properties had donated money to the NZ First Foundation.

This problem of wealthy people donating large sums of money to a political party but avoiding the disclosure laws by donating it in smaller sums has also come to haunt the National Party. This came particularly after it was revealed that an unnamed wealthy Chinese businessman made two donations of $100,000 in 2017 and $100,050 in 2018 to National without this amount being disclosed. (Newshub, February 18th)

This case has resulted in four people being prosecuted by the Serious Fraud Office. Three of the four people being prosecuted are being charged over deceptive practices in trying to cover up these donations according to the Auckland District Court. The fourth is being charged with the same charges relating to the other three but is also being charged with misleading SFO investigators.

These people are expected to appear in court on February 25th. On February 19th, Newshub released their names. They are Zhang Yikun, the businessman who donated $100,00 to the National Party; Colin Zheng, Zhang’s business partner and perspective National Party candidate; Hengjia Zheng and JamiLee Ross, the already scandal-soaked MP for Botany. As expected Simon Bridges, the leader of the National Party, denied knowing anything about these donations in a media interview he gave on February 18th.

Despite these scandals Ardern has displayed what at first sight is a surprising lack of decisiveness. The same person who had no qualms about immediately banning military style weapons and generally plays on her own supposed dynamism, has taken a hands off approach to the scandals impacting her coalition partner. When she was interviewed by RadioNZ on February 17th, she said: “Indeed, I’m the Prime Minister, I run the government. I do not run three separate parties, so I don’t think it’s unfair or unreasonable to say that these are matters for New Zealand First, not for me.”

According to a RadioNZ website article dated the same day, she was quoted thus: “It is not conduct I’ve been engaged in. No, I don’t see these things as being explicit to the Cabinet manual, which is the conduct of how we run the government…”. “He [Peters] maintains the role he needs to maintain appropriately as Minister of Foreign Affairs. You’re asking questions of him as leader of a political party … these are matters for him…”. “It is ultimately an MMP environment, it will have separate political parties, they are in charge of their own conduct as party and party leaders. “These aren’t matters that I have any responsibility for. I’m the leader of the Labour Party, I had nothing to do with this and I’m not going to stand here and explain it or defend it because it’s not for me.” “I cannot run both a government and three political parties.”

Here is a Prime Minister stating that serious accusations being made against a key member of her Cabinet are nothing more than an internal NZ First matter that should be left to them to sort out! These accusations threaten to undermine the image of the system she supports and all she can say is that it’s not her concern?! The key to this is probably that once you cut through the smooth PR-generated rhetoric, media hype, advertising and spin, Labour exists as a vehicle that seeks power. That’s what it is for, plain and simple. NZ First is a populist party that specialises in the lowest common denominators of politics such as xenophobia. Since NZ First had sufficient support during the last election to be a serious junior partner, Labour could not alienate them. Though, given their shared nationalism and the anti-Chinese xenophobia Labour stoked up on the housing issue at the time, there isn’t a completely different outlook between them anyway. More importantly,they shared a pursuit for power that was ultimately more motivating than any technical, policy differences or supposed matters of principle. That being the case, it’s hardly surprising really that Ardern is soft pedalling the current scandal.

Ardern is caught between the proverbial rock and a hard place. Winston Peters is a spiteful man and there is no doubt that if she kicked him out of Cabinet she will have to call an early election as he is unlikely to support her on supply and confidence motions. The Labour-led government will be in serious trouble if the poll results prove to be accurate or, worse, the tendency of the Greens to perform worse in elections than the polls holds true, if an early election is called. If she condemns him and kicks him out of Cabinet she will face an election where the chances are she won’t be able to form a coalition government. If she washes her hands of the situation she shows herself to be a moral coward which will almost certainly cost the Labour Party dearly in the election. The only thing that could save her election chances is if Jami-Lee Ross (who is admittedly now an ex-National MP) and Colin Zheng are found guilty of the charges laid against them. This will seriously dent National’s credibility among many swing and undecided voters.

At least she bothered to say something. The Greens have been noteworthy for having nothing whatsoever to say on these scandals. Considering how vocal the Greens have been in the past about holding other political parties to account, this is interesting. Now they have seats at the big table, its not really in their interests to mess with things in a way that might jeopodise their cut of the pie. They would seem to prefer waiting it out, pointing to the puny policy successes they’ve squeezed out of Labour and hoping for the best. Politically they’ve got nowhere to go except to tail behind Labour as the bigger dog anyway.

There is often the lazy and smug assumption in this country that ‘we’ are somehow an exception to the way things work elsewhere. To Anarchists, the scandals that have rocked National and New Zealand First have merely confirmed that this country is not immune to the influence of business elites donating large amounts of money in exchange for favours or, dare I suggest it, buying their way into Parliament. It’s noteworthy that it’s not a crime for wealthy donors to pay out $15,000 or more to a political party, just a crime for political parties not to reveal who made such donations. Just like in failed states such as the U.S.A, wealthy people are buying influence here by offering large donations to political parties they think will be most receptive to their lobbying.
None of this comes as a surprise to us. State-based ‘democracy’ has always been founded upon a link between money and power. You simply can’t obtain power under the current system without raising a lot of money for advertising, meetings, social media promotions, lunches and all sorts of stuff. Wealthy elites influencing the politicians who pass laws that benefit them financially is really just an extreme manifestation of what passes for normal.

The politicians and, by extension, the state itself does not exist primarily to serve the people. It is set up to ensure that the elites within each country or region are able to keep their wealth, privileges and power. As the anarchist activist Lucy Parsons put it a long time ago “Never be deceived that the rich will allow you to vote away their wealth”. Even in the countries that historically some Marxists are fond of calling “deformed workers countries” or “Socialist” the brute reality has been that the state only serves to keep bureaucratic, rather than wealthy, elites entrenched in power.

There are many reasons why Anarchists seek to eradicate the state but the key reason is that without the state these elites would not exist. Without the state there are no laws, no police, no military and no bureaucracies to create, entrench and protect these elites from the workers and everybody else they have bribed, exploited, lied to and terrorised. Attention to the current scandals and this year’s election, should serve to prove that while the scale may differ from elsewhere, this country is no different from any other in that regard.