‘Free trade’ or protectionism – it’s business as usual

Philip Ferguson

September in Auckland sees the second United States New Zealand Partnership Forum. The Forum is organised by the NZ US Council (in the US it's called the US NZ Council). The Council was established in 1986 to foster communication between US and NZ imperialism, ironically at a point when US-NZ relations appeared to be at an all- time low. Appearances, however, can be deceptive.

While the New Zealand ruling class banned US warships from entering port here, the Labour government of David Lange, like the National Party governments which preceded and followed it, was completely committed to a close economic and political relationship with the US. This is not because New Zealand's ruling class is subordinate to the US, but because it has common interests with the United States' rulers as part of the Western imperialist bloc.

However, New Zealand's rulers, as imperialists in their own right, also have specific interests of their own. Thus, as the Cold War approached its end, they were able to assert their own power in the Pacific in a more independent manner. Indeed, the anti-nuclear ban showed that New Zealand was not some underling of the US but an independent imperialist player, albeit a junior one. Behind the no-nukes ban, Labour stepped up New Zealand's conventional force military activity in the Pacific to levels not seen since WW2, and waved the big stick at any Pacific country, like Vanuatu, which dared assert any degree of sovereignty.

(Indeed, NZ's ruling elite has a long history of economic plunder and political interference and repression in the Pacific.) Free trade a key focus of the NZ US Council at present is assisting New Zealand in convincing a reluctant US government to agree to a free trade agreement. Again, since New Zealand is not some kind of neo-colony or semi-colony, New Zealand business would be the chief recipient of such a deal. The New Zealand market, for instance, is not especially important to American firms, but the US market has massive possibilities for New Zealand exporters.

New Zealand meat and dairy exporters, for instance, produce more efficiently than their heavily government-subsidised and government-protected equivalents in the United States. They want a free trade deal in order to boost their profits in the lucrative US market.

This is a very different reality from that being presented by many who are protesting the Forum in Auckland. The protests have an essentially New Zealand nationalist flavour and present this country as some kind of colony, or near-colony, of the US. Such politics serve to obscure the real interests of New Zealand’s own ruling exploiters, the very people with the most to gain from a free trade deal with the United States.

For anyone interested in promoting the interests of NZ workers, it is immaterial whether the New Zealand ruling class, or any section of it, favours free trade or protectionism. These are simply ways in which the exploiting class does business and each form of trade is designed to benefit business – or, at least, the sections of it which are dominant at any point in time. In the US, those capitalist sectors unable to compete with imports favour protectionism and the US government dutifully protects them just as successive NZ governments protected business here for decades. Protectionism in the US inhibits NZ business opportunities there, so exporters and the NZ government want a free trade deal with the United States.

That's why Phil Goff, addressing the US Chamber of Commerce in Washington DC in May this year, talked about an "open international economy" being "part of the liberty that was hard won by the democracies in World War two and the Cold War." Goff went on to extol the virtues of neo-liberal reform and an open economy in New Zealand in order to convert US business to the same view. In fact, in his May speech Goff regaled his American listeners with how subsidies and protection had been removed from the agricultural sector in NZ in the 1980s with, according to him, splendid results.

Goff went on to state that "the next logical step" in the "strong mature relationship" between NZ and the US is for Washington to agree to a free trade deal.

In other words, it is not a bullying US which is trying to force a free trade deal on New Zealand, it is a cajoling NZ government and business sector which is trying to win American business and government around to embracing neo-liberalism and an open economy with the same zeal that Goff and his colleagues in government in New Zealand did in the 1980s.

Labour and National twins

The NZ US Council and its Partnership Forums also reveal the degree of unanimity between Labour and National and their commitment to the interests of NZ business above all else.

The 2006 Forum, for instance, involved former Labour and National prime ministers (Mike Moore and Jim Bolger respectively), Goff and David Cunliffe from Labour, Don Brash, Tim Groser and Murray McCully from National, and the presidents of both NZ Business (Stephen

Collins) and the CTU (Ross Wilson), as well as important figures from various NZ businesses and government departments, including the secretary of defence (Graham Fortune).

NZ imperialism

The focus of the Forum and the NZ US Council is interesting in another way. Both sets of imperialists desire stability – ie the peaceful maintenance of inequality and exploitation – in the Pacific. NZ, along with Australia, has hegemony in most of the south Pacific, outside France's direct colonies, and the US rules over the northern Pacific. This is a division of labour which benefits the NZ ruling class and allows it to intervene at will in places such as the Solomons and Tonga and to threaten places such as Fiji. The south Pacific has long been regarded as some kind of colonial extension of New Zealand. Indeed, as early as the 1860s, NZ businessmen and politicians were talking of a great south Pacific empire centred on NZ and they set about trying to grab as many of the islands as possible.

Unfortunately for the NZ ruling class, the French, British, Americans and Germans were bigger and got there first. However, NZ was able to grab the Cooks and Nuie and, during WW1, invade and take over Samoa. Under NZ rule, at least a quarter of the population of Samoa died of influenza thanks to the callousness of the NZ colonial administration. When Samoans protested peacefully for independence, their movement was suppressed and shot off the streets.

After WW2, NZ shifted into a close alliance with the US as the best way to enhance NZ interests in the Pacific. Indeed, most of the western imperialists accepted US leadership during the Cold War.

With the demise of the Soviet Union, inter-imperialist tensions and contradictions have become more pronounced. In the Middle East, for instance, NZ has different interests to the US. NZ business requires lucrative markets there for meat and other agricultural exports and so has no desire to antagonise the peoples of the region. The NZ government, following the interests of NZ business, therefore decided not to send combat troops to Iraq – although they did send armed engineers just in time to allow NZ business to bid for "reconstruction" contracts. In the case of the Middle East, NZ capital's interests have more in common with French, German and Russian capital – and the NZ government took the according political stand.

Finding the right target

The simple fact is that the NZ government operates both at home and abroad in accord with the interests of NZ capital. This means more exploitation of NZ workers through the intensification of work, insecure jobs, falling real wages since 1984, and growing social inequality. And it means more NZ interference in other people's countries, especially in the Pacific.

The people who plan to protest at the September United States New Zealand Partnership Forum about imaginary US "domination" of NZ would be better to use this occasion to protest against the very real NZ domination and interference in island nations in the south Pacific, and to draw attention to the role of New Zealand's ruling class.

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Worth thinking about, no?