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If the Communists take over would we change the flag? (Getty Images)
If the Communists take over would we change the flag? (Getty Images)

PoliticsOctober 4, 2018

Socialism is back, baby, and it doesn’t want your vote

If the Communists take over would we change the flag? (Getty Images)
If the Communists take over would we change the flag? (Getty Images)

A new radical left group has formed with the goal of making socialism a reality in New Zealand. But what would that even look like? And will they have any chance of success by rejecting parliamentary politics? 

You’ve probably seen them on the news. If there’s an event on that has a militant looking protest taking place at it in the last few years, it’s likely at least some of those protesters are among a new generation of self-described communists, anarchists and socialists who have coalesced into a new group called Organise Aotearoa. They intend to build a movement “for liberation and socialism”, but have no intention of ever standing for election to make that happen.

Organise Aotearoa officially launched this week after about two years of less formal meetings. They’re currently building a political programme – in a manner not unlike a working group – which will be unfurled next year. The membership so far comes largely from a base of other like-minded organisations, such as People Against Prisons Aotearoa, the Peace Action networks, and Auckland Action Against Poverty, describing themselves as a collection of “ordinary people – teachers, workers, students, unionists, parents.” According to one source in the organisation the membership numbered about 80 when it launched on Monday. Since then, they’ve tweeted about their signup page crashing from being overloaded.

Emilie Rākete, the Organise Aotearoa press spokesperson, is one such person who has been actively involved in street protest and organising with People Against Prisons Aotearoa. Rākete says the history of the activists involved means the organisation can start with a base of people who have learnt what has and hasn’t worked. “We’re working directly with oppressed, exploited and dispossessed communities to directly build political power for the working class.”

“Traditional political structures haven’t worked, and can’t address the crisis of capitalism in the 21st century,” she says, as to why they’re not bothering with standing for parliament. The rhetoric is of rich and poor having diametrically opposed interests, and the state’s failure to mediate between those interests. Looking at stats around widening economic inequality that periodically come out, it’s hard to argue with the diagnosis of the problem. But as for solutions, why not run for office just in case?

“There are a lot of really important and good and progressive movements that do try and use parliamentary politics, to alleviate the suffering that working class people endure every day. And those are good things. But what those experiments in parliamentary politics have shown is that the state as a tool is incapable of resolving the conflicts between rich and poor,” says Rākete. And while some in existing political parties might share some of the same views – for example, the explicitly anti-capitalist kaupapa of the GreenLeft network within the Green Party – they still have to operate within the framework of parliament.

So what does political success look like, if parliament isn’t the goal? Rākate says in New Zealand it would require meaningful tino rangatiratanga, and the fulfilment of the promises in the Treaty of Waitangi. But over and above that, she says there needs to be a “qualitatively new kind of government, by and for working people, not capitalists”. Asked, at the risk of ending up on a watch-list of some sort, if that means overthrowing the state, Rākete jokes about a GCSB agent listening in, saying she’s probably already on a watch-list. It’s not as paranoid a suggestion as it might seem, given the surveillance that has taken place of radical activists in New Zealand in the past.

“I can’t predict what the future contingencies of class struggle are going to be in this country,” she says, talking around the question. “All I know is that right now, at least 15 children a year are going to die from rotten lungs, because their landlords are making thousands of dollars a year by renting out a slum. Organise Aotearoa is committed to building the kind of power for working class people that can completely abolish this situation, and build a new kind of society.”

While it’s not a direct link, it is possible to see the influence of the groups feeding into Organise Aotearoa in the kinds of ideas being pursued by the current government’s many Working Groups. But often other, more moderate groups have been more prominent in that. Pressure from AAAP – along with other groups like the Salvation Army and the Child Poverty Action Group – managed to get welfare system reform on the table, at least in the form of a review. And the current Justice system reforms move ever so slightly on a continuum towards prison abolitionist ideas pushed by People Against Prisons Aotearoa. But the government’s reforms just address symptoms, says OA, and while the government remains “shackled by the capitalist economic system,” it will never actually solve those problems.

But their group may come in for criticism not only from natural enemies, but from those you might think would be friends. Academic Tyler West, who wrote his Master’s Thesis on the extra-parliamentary left between 1999-2008, says there is still a constellation of other small leftist groups in New Zealand. He also says the radical left really does often become bogged down and split over questions of positions on various bouts of historical fratricide, in keeping with the Monty Pythonesque ‘People’s Front of Judea’ stereotype. In an announcement episode put out by the Shit Hot People’s Politburo, a podcast that shares members with with Organise Aotearoa, the panelists pre-emptively responded to some of the criticisms they expected, including from other far left groups. The episode opened with a support group skit. “Hi everyone, my name’s Emmy, and I’m a Tankie.” By the end of the skit, they’re lining each other up against the wall.

What the hell is a Tankie? It basically means someone who supports Stalinism, to varying degrees of totality and totalitarianism. Allegedly, it originally referred to British communists who backed the Soviet Union using tanks on Hungarian protesters, crushing what some would argue was an attempt at a revolution. That’s one historical line leftists split down. There’s also the Spanish Civil War, or the current war in Syria, or Venezuela, or the Occupy movements, or Tibet, or even the moment of most profound ruptures in Communism, the Russian revolution and eventual triumph of Stalin over Trotsky. Just for context Leon Trotsky was murdered in 1940, a mere 78 years ago.

West said these sorts of questions still had the potential to cause division, partly because of personal baggage and infighting between individuals, but also partly because “there are a lot of genuine ideological differences, which if you weren’t familiar with the radical left, might not seem important.” But if different strands of thought exist within the same organisation, from anarchists to Maoists, “you can dismiss the historical things, but what they’re drawing from that are lessons that give a fundamentally different direction, that will start pulling Organise Aotearoa in different ways.”

James Roberts, the OA National Secretary, spoke directly about this on the podcast, saying they weren’t debates worth derailing the wider project for. When it came to dealing with other groups, he said the aim would not be “colonising space that they’re trying to organise within, but rather working alongside to build socialism together.” He says the “plans will probably be as diverse as the membership,” but also with unifying points that everyone will agree on.

But is there actually any point to all of this? You may have noticed that socialism and communism comes with quite a lot of historical baggage. It’s a safe bet that if you polled the country at large as to whether they wanted a socialist revolution, they’d say no. New Zealand didn’t even end up supporting a flag change, let alone the wholesale replacement of the state. And besides, the history of New Zealand’s radical left is littered with small groups who have briefly flared and burnt out, ground away in obscurity, or won literally dozens of votes in elections.

That in and of itself is one perhaps reason to not want to stand for parliament every three years. A lot of very small parties across the spectrum only stand once or twice before deregistering, the exercise having given them nothing but worn out shoes. If a group of activists outside the political mainstream actually want to have any effect on the world, they’re better of simply going and doing some mahi.

It’s a point also picked up in the interview with Rākete, who says that “socialism isn’t going to come because someone sat behind a desk and signed a proclamation. Socialism is going to come to Aotearoa because it’s the answer to a question that millions of people are asking themselves.”

And there is a deep-seated sense of malaise that can be seen in many parts of New Zealand – a sense that housing issues will never really get sorted out, that any victories in the workplace are just gaining back what has been lost, that the country is becoming fundamentally less fair. Ironically for OA, it was articulated quite well by the arch-parliamentarian Winston Peters, when he said “far too many New Zealanders have come to view today’s capitalism, not as their friend, but as their foe.”

OA also don’t have anyone involved who would be widely recognised outside of their activism, which would probably be necessary for electoral politics. One person who might have been that, former Green MP and long-time welfare reform campaigner Sue Bradford, was involved in the early stages of the group, but left in 2017. She had also been involved with the Mana Movement, which was represented in parliament through Hone Harawira. Bradford says she’s made political progress inside parliament, which showed that it was always useful to be represented there. She also said groups completely outside of that mattered as influencers, especially in the current context within which she didn’t see much from the current coalition government. But she wished Organise Aotearoa well, saying the outcomes they were working towards were more important than the methods.

There is also potentially a space for them to work in the same way that groups like the Democratic Socialists of America, or Momentum in the United Kingdom. Those groups have become politically influential, partly through entryist tactics into existing political parties, and partly by acting as pressure groups to put issues on the agenda.

But in the short term, it’s direct action and protest where there presence will be felt most. OA have committed themselves to protests that are going to take place at the Defence Industry Forum – colloquially known as the Weapons Expo – in Palmerston North at the end of the month. Given the tensions already developing around that event between organisers and opponents, it’s likely that confrontations will kick off. So even if Organise Aotearoa eventually comes to nothing, like so many other leftist groups before them, you’ll probably be seeing them on the news soon.


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Jesse Mulligan on The Project
Jesse Mulligan on The Project

PoliticsOctober 4, 2018

At war with angry #nzpol Twitter on the need for a capital gains tax

Jesse Mulligan on The Project
Jesse Mulligan on The Project

Jesse Mulligan walks us through some of the spittle-flecked feedback he received for making the case that a capital gains tax is obviously a good and necessary idea.

What is it like to be a woman? I don’t know, but they tell me it involves a lot of being corrected, patronised and explained to by men who don’t necessarily know what they’re talking about. I endured a bit of that recently and I have to tell you, ladies, that I did not care for it.

Yes, when I spoke in favour of taxing capital on Twitter and The Project I heard from some of the dumbest people in the country. Addressing their objections on social media is a bit like yelling underwater so I decided to surface for a week then go back through them in a calm and orderly fashion. Here are the most common and loudest complaints I heard:

We already have a capital gains tax!

This nonsense was easily dispensed with.

https://twitter.com/JesseMulligan/status/1042955574915194880

But in fairness to Hamish he was probably talking about the fact that you already have to pay tax on the money you make on an investment property, if you intended to resell it when you purchased it. Of course it’s almost impossible to prove what somebody’s intention was, so government revenue in this area is … low. That’s why they introduced the “Bright Line test” which says that if you flip a property quickly you are assumed to be in it for the cash and you have to pay tax on the profit.

https://twitter.com/Kiwiflyer/status/1042988611950395393

Unlike someone who earns their money through a wage or salary, you are still free of tax obligations in New Zealand if your money comes from the sale of shares, or a business, or intellectual property, or property you hold onto for longer than one Olympiad.

(Extra for experts: our rules do allow for taxation of capital gains in some other circumstances but in practice that rule is difficult to enforce and so rarely enforced, leading us to the situation we are now in, which is that we don’t tax capital gains in many circumstances when a good argument could be made that they are taxable. This needs fixing.)

Think of the mums and dads!

Mums and dads came up a LOT. Given that the family home is not under consideration by the Tax Working Group (though Danyl Mclauchlan makes a great case for why it should be), I guess the mums and dads we’re talking about are the ones who’ve made tax free profits on their own house but also don’t want the profit taxed on their one or more investment houses.

Boohoo. It’s worth reminding you at this stage that we’re not talking about taking their profits, just taxing them in the same way we tax other forms of income. It’s also worth adding that most of the people making this argument did not look like mums and dads, they looked like the sort of people mums and dads would leave in the woods and hope for the best.

We don’t need a capital gains tax!

Allan on Twitter was the best on this:

This argument says that a tax on capital (I use this phrase because it covers the working group’s two alternative suggestions, only one of which is a CGT) will not achieve whatever I think it will achieve, or that it will be net bad for the world because it will discourage brave risk takers from investing in the things society needs. But my only claim was that a capital gains tax would make things fairer. Sure the economist for Westpac recently decided it would cut house prices by 10% but, look, I just want everyone to be playing by the same rules.

I can’t understand how anybody could in clear conscience object to one tax law for all, but perhaps that’s why the people arguing hardest against it have no profile picture, no real name and no biographical information. If I was defending a status quo where, according to the Working Group, “the wealthiest members of society benefit the most from the inconsistent taxation of capital income”, I’d be too embarrassed to use my real name on Twitter too.

You’re taxing people twice!

“Once,” so the argument goes “when you pay income tax and a second time when you invest it in a rental property and make a profit.”

A guy I don’t know on Twitter called Chris was doing God’s work dealing with stuff like this; here he is in the thick of it:

And he could have added, to quote my smart friend Geoff Simmons (who likes the Group’s second recommendation, by the way), that “it’s the same with bank savings, and shares, and Kiwisaver. We tax when you earn the income you use to invest and tax again when you get benefit from the investment. The problem is inconsistent treatment of investments because we don’t tax the benefit of owning housing. If we can cut all tax on bank accounts, shares and Kiwisaver then all good! Except for inequality …”

Yeah, inequality is so annoying. Here’s a chart which shows how well we do at using the tax system to address inequality.

Of the 36 countries in the OECD, 27 are ahead of us. Even if you blame inequality on the poor you should still admit that choosing not to tax capital is a policy that benefits rich people most. See Max Rashbrooke for more on this.

There are two extra considerations: that every year our aging population is relying more on income earned from capital investments, and that 21st century business too is moving away from labour and towards capital – if we don’t start taxing it then income tax is going to increasingly be bearing the revenue strain.

It’s a left wing conspiracy!

“Jesse’s a leftie” … “he’s sticking up for his mate Jacinda” … “it’s communism by stealth!”

I’ve seen the worst of #NZpol twitter these last couple of weeks and the most depressing stuff comes from the people who think this is an ideological battle. But if you’re approaching questions like tax from an evidence-based perspective then left or right are meaningless terms.

We should remember that the recommendations we’re debating come from a Tax Working Group chaired, yes, by an ex-Labour Minister but comprised of people from across the political spectrum – you would presume the head of Business NZ is not a socialist, and pinkos don’t tend to do too well as senior partners in law and accountancy firms either.

We need to resist the loud voices in these debates who try to score points by herding people who disagree under a convenient banner then encouraging their own tribe to attack. The right and left disagree on the way to achieve certain goals, but if you think that “fairness” is a left wing concept then you’re not on the right wing, you’re just an arsehole.

You’re saying everyone who disagrees with you is acting out of self interest!

This is an accurate analysis of my position

Stick to comedy! You’re abusing your platform!

This is a related objection, that only people from a certain club are allowed to talk about the way tax is collected from the rest of us.

Look, here’s blogger John Drinnan

https://twitter.com/Zagzigger2/status/1042996231637614594

and some other person

https://twitter.com/Michael_Law87/status/1042873179566309376

 who got increasingly upset the more I didn’t reply to him

https://twitter.com/Michael_Law87/status/1042873756253732864

I got a long, angry text in the middle of the night from a good friend of mine in the money business similarly dismayed that I was spruiking for a tax he thought was wrong. The thing is, I’m not exactly going out on a limb. For the record I do have good qualifications in this area and my opinion piece was (as this one has been) fact checked by an economist. But in the end I’m only endorsing the view of an apolitical expert group who had (unsurprisingly) come to the same conclusions every other comparable country has come to before us: that if you’re going to tax anyone you should tax everyone. That if you’re going to tax income, you should tax all income.

If you don’t, then you should expect inequality, expect unfairness and expect people to load all their money in the lowest risk, least taxed alternative. So feel free to argue that a tax on capital won’t change the housing market. But while New Zealand’s investment options continue to look like this…

… you shouldn’t act surprised that Kiwis can’t stop themselves bidding high at auction.

Politics