What Labour has to learn from the budget

The Left must learn from the political techniques deployed so successfully in this budget.  Unless we ask ourselves the hard questions the right ask themselves, and are prepared to prioritise and make some tough decisions, we will maintain poll ratings bleakly far behind the Government's. 

Having chucked red meat to its base and changed the Employment Relations Act at the expense of working people, the National government used this budget to show it isn’t hostage to its far right factions. Turns out the problem with the economy isn’t that we’re all taking too many tea breaks ('quelle surprise') and - the real surprise - National is now prepared to do something about child poverty.

When the Budget increased child benefits, my first reaction was that National was just being cynical and  responding to focus groups showing rising concern about child poverty. I commented at the time in the NZ Herald, that the benefit increases would help some people in poverty but not help anyone out of poverty. 

But this is more than tactical politics. In giving more cash to beneficiaries, the Government has been prepared to confront its own ideological blindness. 

Most righties I know either deny child poverty really exists in New Zealand ("you should see Africa"), or they offer a version of Not My Problem: "It's just bad parenting"; "They spend it all on smokes and booze". Or they say voodoo will fix poverty: "We just need to cut benefits to widen the gap between wages and benefits, and the layabouts will see the error of their ways and respond rationally to the market incentives."  

Boosting benefits, National has ignored all this conservative dogma and left the Opposition in the awkward position  of trying to argue that the benefit increase was too miserly, prompting Matthew Hooton to ask for examples where either Labour or the Greens have called for higher increases in benefits. My frequent sparring partner's point is clever and excruciating. His aim is to depict the government as "socialist" (direct quote) , so that any further help for kids in poverty would seem extreme. 

But he has made a strong point that the Opposition has been  loud in its references to child poverty and simultaneously timid about the fiscal consequences of reducing poverty through transfers.  

Confronted with the same question, Bill English did something he has preached for a long time: He looked for a way to fund a benefit increase from spending that, for him, was a lower priority: The $1000 incentive to join KiwiSaver, and a reduction in the time a parent is eligible for DPB before being required to seek work. 

Politics is about choices and priorities. You don't have to accept the substance of the choices National made to recognise that it made hard decisions that meant some desirable policy was rejected in favour of a more desirable one. 

The reason the Government gets much better poll ratings on economic credibility than the Opposition is not because voters recognise hard choices need to be made. Even when voters are uncertain the government's priorities are right, they get credit because they are prepared to make decisions. 

In contrast, it's too easy for us to argue as if hard decisions were not required.  When we argue that the government has a responsibility to reduce child poverty, we are certainly right - and conservatives who try to dodge their responsibility to their fellow citizens are wrong. But we have to make priorities too, just as much as anyone else. If we want to reduce child poverty, we have to be prepared to be explicit about what we would cut to pay for our relief. 

Saying we’ll raise taxes doesn’t get away from the fact that spending has to be prioritised. Saying ‘create more jobs’ doesn’t mean you can avoid making hard decisions about where best to spend a limited welfare budget.

And, to be frank, no future Labour government is going to say, 'we will cut benefits for families with children to fund a KiwiSaver kickstart', which is prima facie evidence that any future government agrees with English's priority ranking. The policy consequences are unmissable: If we want to say in the future that KiwiSaver kickstart should be restored, and that benefits should be increased to alleviate child poverty, then we need to be explicit about what lower priority spending will be cut.

The public need to see Labour making those tough decisions. There are many causes that may be worthy of our support, from child obesity to campaigning to help kids get access to books at the National Library. But the Labour party can’t be a different NGO every week. It has to get on with the job that no-one else can do - being the Labour party.

That means creating an environment where we have strong communities and strong civil society groups who can campaign for these issues and be heard.

But Labour’s priorities have to be different. A series of micro-policies strung together don’t make a compelling story about why people should support Labour. 

Labour has always had a divine discontent with the status quo, and a drive to make people better off  and reward merit over the luck of birth or postcodes. Now it needs to own the next generation of ideas and policies, just as it did in the 1940s when it built the dams and the roads and came up with the welfare system, and build thousands of state houses.  That will mean making tough choices. 

I wrote a NZ Herald column after the 2011 election where I argued that if Labour wanted to increase benefits, then we also had to be prepared to reform welfare because, if you get more people in work who can work, then you can be more generous to those who can't work.   At the time, this was seen as a Labour heresy. Yet what has now happened is that the National Party has been able to achieve a benefit increase by cutting a policy priority the left would not have chosen. Winning is important not because we get to not make tough decisions, but because we get to make the ones we want.

But in order to win, we first have to make some tough calls, and we need to do it now in opposition to earn back the trust of the public.

What we have seen from Bill English's policy combo are two profoundly important political tactics: A willingness to confront National's own ideological blind spots, and a willingness to make hard choices. No one can hope to govern unless they are also prepared to do the same.