Josiah Banbury: Labour won the election battle, but National won the ideological war

Josiah Banbury: Labour won the election battle, but National won the ideological war

Are Jacinda Ardern and her colleagues a roadblock to transformation? Josiah Banbury takes a look at why the new Labour Government is going to retain the status quo rather than fix the problems in society.


The Labour Party cruised to a comfortable win in the 2020 election, Jacinda Ardern is extremely popular and the National Party is in tatters. On the surface, everything looks fine for Labour, but scratch a little deeper and you will find a party that is unsure of its own identity and unable to articulate a path forward. Their election slogan was ‘Let’s Keep Moving’, but they failed to explain where they plan to move to. Labour has a clear mandate, but they have no idea what that mandate entails. Tim Watkin was right to question “who really won the 2020 election.” That is because Labour won the election battle, but once again they have lost the ideological war. And unfortunately for Labour, the latter is more important. They will only be able to implement transformational change after they win the ideological war.

After an election occurs, the party that leads the government is deemed to be the winner, while the opposition party is considered to be the loser. Such an assumption is understandable because it is much easier for the party that leads the government to implement its policies than it is for the party in opposition. However, this understanding ignores how ideology shapes and constrains power and thereby, the implementation of policy, regardless of which party leads the government. As we have seen over the past 20 years in New Zealand it is common for the ruling party to hold power and not create change. Policies are implemented, but the material reality for most people remains the same. Often political leaders want to create change, but they are unable to due to ideological constraints that either exists throughout society or are self-imposed. Labour’s policy-free election campaign is an example of a self-imposed ideological constraint. They could have won easily while campaigning for a wealth tax, a capital gains tax, and transformative environmental policies, but chose not to because they are constrained by their Third Way ideological approach.

Jacinda Ardern’s election night promise to “govern for every New Zealander” differs markedly from her statement in 2017 that “this will be a government of transformation.” Back then, as the new leader of Labour, Ardern projected an image of an alternative. Now, as she embarks on her second term, Ardern has dialled down her rhetoric and talks about building a consensus. Many people assume her statements are contradictory. They argue Ardern has shifted towards the centre over the past three years and no longer wants to be the change-maker she claimed to be when she first became Prime Minister. However, if we look at the ideological beliefs that underpin Ardern and Labour it becomes clear there is not a contradiction between Ardern in 2017 and Ardern in 2020.

The ideology that underpins Labour is called the Third Way. It aims to humanise neoliberalism with elements of post-WWII social democracy. Socially progressive rhetoric is foregrounded while maintaining a pro-market environment that privileges the interests of capital. Proponents of the Third Way assume there is no alternative to the free market, but they will try to minimise the social ills of capitalism through incremental reforms. When a politician positions themselves as a centrist, they can employ discourse from both social democracy and neoliberalism without contradiction. This, of course, can leave people confused, but ideologically it is coherent. Ardern often speaks like a social democrat. She will talk about addressing New Zealand’s wealth inequality, poverty rates and housing crisis. Meanwhile, her righthand man and finance minister presents the Labour Party as fiscally conservative and focused on reducing, or at least controlling government debt. Ardern, Robertson and Labour do not present a threat to the power of capital, but they do want to deliver economic change. However, delivering meaningful economic change without threatening capital is impossible.

On 9 September 2020, the day Robertson ruled out a wealth tax, Stuff’s chief political reporter Henry Cooke tweeted “Grant Robertson is Bill English’s greatest achievement.” Cooke’s point was not simply that Robertson shares similarities with his predecessor English. Instead, he highlighted how Labour continues to subscribe to the neoliberal paradigm that has dominated politics in New Zealand since the 1980s. The words “greatest achievement” referred to the claim that in 1992 Margaret Thatcher said her greatest achievement was “Tony Blair and New Labour. We forced our opponents to change their minds”. Before becoming an MP Ardern worked as a researcher for Phil Goff and Helen Clark, as well as a policy advisor for Tony Blair’s government in the UK. Similarly, Robertson’s background is that of an advisor to Helen Clark. Ardern and Robertson are both products of the Third Way mould created by Blair and normalised in New Zealand by Clark’s government from 1999 to 2007.

Labour has not changed under the leadership of Ardern and Robertson, nor is it likely to. They have been conditioned to ignore economic alternatives to their left and instead seek to build a consensus with centre-right voters. During their apprenticeship in the Labour Party, the prevailing belief was that social issues could be addressed by market-based solutions – even when the problems they were trying to address is the result of the failure of the market. If Margaret Thatcher was alive today, she would be comfortable with Ardern’s leadership and happy to see her legacy continuing to shape a new generation of political leaders. Like the capitalists in the Mood of the Boardroom Survey, she would probably even endorse Robertson as a competent finance minister. On the other hand, Michael Joseph Savage, whose portrait sits in the Prime Minister’s office, would be less impressed with the current Labour leadership team and frustrated by their incremental approach. Ardern, Robertson and the Labour Party represent a continuation of the existing order, not an alternative. Their aim is not to fight an ideological war and usher in transformative change, instead, they are content with winning election battles and implementing incremental change.

Labour, buoyed by its historic outright victory under MMP, will interpret their win as a vindication of their centrist strategy. Such an assumption is a natural outcome of their ideological beliefs. As a result, they will ignore the fact that they could have easily won the election while campaigning on transformational policies that focus on the root causes of wealth inequality and the housing crisis. They will also ignore the fact that politics today is vastly different from the heyday of neoliberalism before the Global Financial Crisis when wealth inequality and the housing crisis were not key concerns for moderate swing voters. It therefore becomes difficult for Labour to entertain the thought of challenging the economic status quo.

A good example of this occurred on 15 October 2020, just two days before the election, when a Newshub-Reid Research poll asked voters if Labour should have gone further in taxing the wealthiest New Zealanders, 48.7 percent of voters said yes and 43 percent said no. Ardern was asked if she thought the public wants wealthy New Zealanders to pay more tax and she replied: “If I’m being honest, that’s not something that’s been fed back to me during the election campaign.” It might seem odd that Ardern would not know what voters think about taxing the wealthy, but that information is irrelevant to a leader who comes from the Third Way school of thought. Why would she want to know the public’s view on a policy that she considers politically unfavourable and unrealistic? An important aspect of this line of thinking is how power is understood. Power, according to politicians like Ardern, can only be held by someone who has the blessing of the economic establishment. It is a top-down understanding of how power operates. This is in stark contrast to how power is understood by politicians on the left such as Jeremy Corbyn and Bernie Sanders. They believe the only way transformational change can occur is through a groundswell of people power from below.

Can Ardern and Labour be transformed? The mistake many people make is they think politicians like Ardern can be pushed towards transformative change, when in fact the opposite is true; politicians like Ardern are the first line of defence against transformation taking place. Third Way leaders like Ardern are very skilled at drawing in support from their left without offering anything in return. This disempowers left-wing movements and shifts the centre of politics to the right. Moderates who are fighting against left-wing uprisings hold Ardern up as a beacon of hope. In 2018 Chuka Umunna, a former UK Labour Party MP who quit his party after it was transformed by Jeremy Corbyn’s leadership, claimed Ardern is part of a new wave of centrist leaders who can defend the political establishment from insurgent, grassroots political movements. So far, Umunna has been proved correct. In 2019 Ardern announced a capital gains tax would never happen under her leadership, during the election campaign a wealth tax was ruled out by her finance minister, and Labour’s environmental policies are tepid reforms that do not address the ecological crisis. Ardern has not been transformed by movements demanding change, and that is likely to continue. Unions have forced Labour to make some concessions, but unions would be the first to admit a transformation of the economy has not occurred. Those who want to transform Ardern and Labour must understand the limits of what can be achieved. Speaking two days after the election Robertson admitted Labour knew they were cruising to an easy victory: “You’re right, our own internal polling was showing us somewhere around where we landed.” However, despite knowing they had political capital to burn, Labour decided to run explicitly in opposition to a wealth tax, which is not a radical idea considering the alarming level of wealth inequality. When Labour was in an extremely powerful position, and while National was in complete disarray, Labour still felt the need to defend the interests of capital.

Therefore, attempting to constructively nudge Ardern, Robertson and Labour towards transformation is unlikely to be successful. The Green Party has taken this approach by signing up to a Cooperation Agreement with Labour. Green MPs are free to critique Labour, but such critiques will ring hollow since the public will interpret the agreement as support for Labour’s vision. During the short-term, transformation will not occur, and once the popularity of Labour dissipates, the Greens will be tainted with failure. A better approach for the Greens would have been to reject Labour’s offer. That would have shocked Ardern and dealt a blow to her image as a consensus builder. Then, the Greens could have pressured Ardern to respond to transformational demands with action, rather than empty rhetoric. By signing up to a formal agreement the Greens have disempowered themselves and created a situation where Ardern and Labour are able to move further to the right. Ardern now knows that any critiques that come from the Greens will be half-hearted and impotent. As a result, she is free to spend the next three years appeasing centre-right swing voters in the hope of holding on to their votes in 2023. The Cooperation Agreement is a tactical masterstroke by Ardern and it shows why centrists around the world hold her in such high esteem.

The real tragedy for Labour will be that as their popularity diminishes their hindsight will be just as ideological as their foresight. Since they view politics through a Third Way lens, they will assume they implemented change too swiftly, even if they have achieved nothing substantive. Before long their wide base of support will shrink to dyed-in-the-wool Labour supporters. Ardern will have burnt through her political capital, not by implementing radical changes, but through a centrist approach than dampens the passion of her base. Swing voters will be much more likely to consider National, especially if they have another easy-going and personable leader like John Key. Others will grow disillusioned, become disengaged from politics and some may even look to the far-right for answers.




Josiah Banbury has taught social policy and human services at the University of Canterbury. His research interests include disasters, housing and economic inequality.


This article can be republished under a Creative Commons CC BY-ND 4.0  license. Attributions should include a link to the Democracy Project.