Can Labour become the normal government?

Helen Clark has a couple of economically comfortable years ahead, forecasters say. That, some Nationalists are pondering ruefully, might usefully fund a Labour-Alliance re-election spendup in 2002.

But what happens in the economy this parliamentary term has been mostly determined by events in the term just ended. Underlying the boomlet ahead are deeper issues. What happens when United States consumers stop spending and we still haven’t got to the haven of the “knowledge economy” – and what is that anyway?

For election purposes Ms Clark placed very high on her action list the business development policy of help for start-ups, researchers and developers, would-be exporters and other generators of new or expanded economic activity. She is hoping for a strong multiplier off the $100-$200 million a year Jim Anderton will be spending.

But that will hardly nudge the structural skews in the economy: the huge block of sunk capital in pastoral agriculture which is producing a 1 per cent return but remains a vital source of export earnings cash flow; the difficulty for high-tech companies to grow beyond minnow size for lack of critical mass in their industries; the increasing tendency to shift company decision-making across the Tasman or up to Singapore and leave only line managers here.

The way out of these culs de sac is to construct a business environment that will encourage imaginative action by people in the businesses (including farms). That goal is a lot more subtle and elusive than mechanisms constructed in policy backrooms to put taxpayers� dollars into business operations.

The coalition’s short-term answer is to hope local entrepreneurs, thinkers, politicians and bureaucrats will produce ideas that can be turned into high-paying jobs. Its long-term answer is to make education more affordable, in the hope that will spawn more innovators.

What else can a government do? The electorate has just rejected – whether rightly or wrongly is debatable, but the fact of the rejection is not – the right’s formula, which was to create the least-cost business operating conditions and trust market forces to deliver investors in high-wage activities.

Ms Clark will reach for another formula: using her portfolio of arts and culture to free, value and enhance our native creativity to build national spirit. The rationale goes that a nation that feels good about itself is more likely to do well economically than one that is uncertain or divided.

Jim Anderton thought the very election result had started that process: he was clapped when he got on a plane on Sunday to go see his new boss and onetime close friend (Georgina Beyer did better with a standing ovation on the train to Wellington). Shades of the veneration of Micky Savage when the miasma of the 1930s Depression was lifted.

Maybe Mr Anderton is right, that the flushing out of a governing party which was in odium since it attacked beneficiaries, low-wage workers and pensioners in 1991 will free spirits sufficiently to lift economic performance and improve social cohesion.

More likely, the sourness evident in surveys and opinion polls and conversations in the street is much more deeply rooted than in the mere fact of which set of poorly regarded politicians is in power.

Rectifying this is often said to need only “leadership” and “vision”. Most politicians duly tried, with more or less skill, to supply this during the election campaign. Their pollsters were telling them that sprinkling round some “hope” would enhance their election prospects and for the more skilful it probably did.

The Greens did it well after voters started to take notice. ACT did it well at the start. Jim Anderton did it well in a leaders debate. Of the two big players, Ms Clark did it better than Jenny Shipley.

But election campaign “vision” is not much more than cosmetics. People will become less sour when they sense something is changing deep in their society. For a privileged 15 per cent or so, Rogernomics did just that; but it left the other 85 per cent unconvinced or insecure.

Helen Clark is a political scientist by training and a keen student still. She wants three terms. This is to establish Labour as a “normal” party of government after half a century of National dominance.

But three terms are also probably the minimum needed to effect the subterranean social change that will lighten the nation’s soul. If she can pull that off she will indeed embed Labour in a commanding position.