Labour’s worst week highlights its existential crisis - Bryce Edwards’ Political Roundup

OPINION

The Labour Party’s fortunes go from bad to worse. Ever since the party was turfed out of power in October, incurring its biggest-ever loss, Labour has shown no real sign of learning any lessons from its defeat, nor does it show any capacity to revive itself.

Last week is being labelled its “worst week yet” by commentators. One of them, Vernon Small, who until recently was the senior adviser to David Parker, wrote yesterday in the Sunday Star Times that Labour appears to have finally hit rock bottom last week, with another poor opinion poll result of 28 per cent support, Grant Robertson abandoning ship and a new report out showing that in government, Labour had failed on child poverty - see: Was that Labour’s worst week yet? (paywalled)

Not only is Robertson a major loss of talent for the party in Opposition, Small points out that most of the other stars have been departing: “As well as Robertson and Ardern, Kelvin Davis, Nanaia Mahuta, Andrew Little, Michael Wood and Kiritapu Allan have all jumped ship or been thrown overboard. Third-ranked Megan Woods is being equivocal about her long-term plans.” Meanwhile, Small points out that Chris Hipkins has demoted other solid talent, such as Damien O’Connor and David Parker, leaving Labour’s front bench “looking decidedly callow”.

Small suggests that Labour views tax reform as a “recurrent campaign nightmare” to avoid rather than “an opportunity to define itself and fund its policy platform”. And he says that in keeping Parker away from the revenue and economic portfolios, he’s signalling that a wealth tax is off the agenda. Instead, Hipkins has put the rather dry Deborah Russell in charge of tax and she says that wealth taxes are “largely unknown” and too complicated to explain.

Grant Robertson announced his retirement from politics last week. Photo / Mark Mitchell

And on the weekend another Labour insider wrote an analysis on the Labour-aligned blog The Standard about how Hipkins is more interested in preserving his leadership than giving MPs like Parker a chance to innovate on tax policy: “Hipkins is also using the elevation of Edmonds and Russell to shank David Parker. Parker is the only guy left with that combination of progressive chops, huge track record and the merest mote of charisma to be an alternative leader to Hipkins. Hipkins has sent yet another signal to Parker to retire. This leaves Hipkins free to turn the entire Labour effort into an even more ineffectual Wellington-circling wankathon taking two terms to recover from the smashing he got it in 2023″ - see: What’s Left?

Labour failed on poverty and inequality

It’s last week’s Statistics New Zealand report on child poverty that is truly eviscerating for Labour. As Small argues, Labour MPs and activists now need to acknowledge their Government “didn’t adequately protect the most vulnerable being hit hard by the cost-of-living crisis”. This is why many on the political left have been so disappointed by the last Government. Arguably things got much worse for the poor and working class, while the rich got richer under Hipkins, Dame Jacinda Ardern and Robertson.

Hence, some of the farewell commentaries for Robertson have been less than positive, with some of the most scathing coming from those on the political left. For example, activist Steven Cowan sums up what a lot of those on the left think: “The unvarnished truth is that, despite Prime Minister Jacinda Ardern promising to lead a Government focused on economic transformation, very little changed. The Labour Government, supported by the Greens, merely tinkered. Working people were, again, like Oliver Twist, left pleading for more. The new child poverty figures only serve to underline the fact that the Labour Government continued to deliver out thin gruel for the working class its so-called ‘socialist’ MPs claimed to represent. And presiding over it all was Finance Minister Robertson. While he wrote, in a nod to New Zealand’s myth of egalitarianism, that he wanted to give everyone ‘a fair suck of the sav’, in reality he was a resolute defender of the neoliberal status quo.” See: A loyal lieutenant of capital.

Robertson’s end of an error

The toughest column on Robertson’s time in power has been written by Newstalk’s Heather du Plessis-Allan, who says that his departure is not being accurately evaluated by the commentariat and press gallery because he’s the sort of politician that they like having a beer with. She rightly reckons that Robertson won’t be willing to have any more beers with her once he’s read her column: Grant Robertson is a great bloke, but he was a terrible Finance Minister.

Robertson is praised by du Plessis-Allan for many of his talents, but she says he should be ranked as New Zealand’s worst Finance Minister on record - even worse than Sir Robert Muldoon. This is mainly because he took the public’s debt from “$5 billion in 2019 to a projected $93b this year” without producing anything much to show for it. She says at least when Muldoon wasted money on building dams and energy infrastructure the country was left with some assets as a result – but in Robertson’s case, he seemed to blow all those billions without anyone really knowing where it went. She poses the question: “What can we point to and say ‘Grant paid for that’?”

Grant Robertson (right) with Dame Jacinda Ardern. Photo / Mark Mitchell

Here’s one good example she gives of Robertson’s propensity to spend very poorly: “He said yes to Michael Wood’s bike bridge, which is the perfect example of wasteful spending. It was a stupid idea. It cost us more than $51m in consultants and rented office space. Then it was canned. We spent money and we have nothing to show for it. The implications are serious. We now don’t have enough money to pay the nurses their back pay or the police the pay rise they’re due. Or the GPs.”

Robertson also failed to advance any real economic reform. And despite lots of talk about how unfair the tax system is, Robertson mostly retained the status quo: “If he really believed the tax system needed to be fairer, he had his chance. He had the ear of Jacinda Ardern. He is one of her best friends. And he either couldn’t convince her or didn’t really try.”

Should Hipkins be replaced as Labour leader?

The worst part of the 1News poll for Labour last week was Hipkins’ plummeting numbers for preferred Prime Minister. Falling by 10 percentage points revived speculation about whether Hipkins had to go. The NBR’s political editor Brent Edwards argued on the weekend that Hipkins is safe for the moment: “The knives will not be out now. It is surely too early in the electoral cycle to consider a change of leader, but the question might arise closer to the election if Labour is unable to lift its support and bridge the gap between it and National.” See: Tragedy, polls, retirement, forced apology and a grim scorecard

Herald political editor Claire Trevett also says that Hipkins is currently safe: “He does have some time up his sleeve. There are no signs as yet that any other credible leadership contender is ready to put their hand up. Once regular speculation starts around one or two names, that will become a more present danger for him. But until there are proper contenders to be a new leader, there is no point in rolling the old one. That gives him a window of opportunity to make sure that those names do not emerge, and that he is the one still standing in 2026.″ See: Ginny Andersen’s attack on Mark Mitchell does Chris Hipkins no favours (paywalled).

Chris Hipkins has dropped 10 points to 15 per cent in the preferred Prime Minister rankings, according to a recent 1News poll. Photo / Mark Mitchell

Trevett also points to another low point in Labour’s past week, with another rising star in the party displaying questionable judgment, and making Hipkins’ job harder: “Ginny Andersen has done no favours for him with her bizarre attack on Police Minister Mark Mitchell on Newstalk ZB about his past as a security contractor in the Middle East. Mitchell quite rightly described it as a character assassination. Hipkins has said it went too far. Andersen has apologised to Mitchell personally, but not publicly and clearly not satisfactorily. She is now refusing to front on it.”

Nonetheless, Anderson is still talked about as the “running mate” for Kieran McAnulty in any attempt to replace the current leadership with a new generation of leaders that might be more able to connect with working class voters.

Labour got its first new finance spokesperson in nearly a decade last week, when Grant Robertson announced his retirement from Parliament, handing the job to Barbara Edmonds (left). Photo / Mark Mitchell

Labour is still the party of the professional managerial class

Labour’s progressive agenda and identity is very much their strongest sales pitch. And with the departure of Robertson, the party’s reputation as a feminist force has become stronger - 70 per cent of its front bench is now female.

Also, by appointing Barbara Edmonds to replace Robertson as finance spokeswoman, she creates a record as the party’s first female in that role and the first Pasifika person as well.

This achievement is saluted in yesterday’s Herald with an editorial that says: “The once impossibly high glass ceiling has been smashed”, with Edmonds creating “a new pathway not only for herself but one for other Pacific politicians and those aspiring to be so one day. She also represents something that was not always evident in New Zealand and overseas - brown women in leadership roles. Brown women in politics”. See: Barbara Edmonds’ new appointment another step forward for Pasifika (paywalled).

However, whether the party still represents working people is more in question these days. In recent years, it’s become more apparent the party has been captured by the Wellington “professional managerial class”, pushing the party away from its traditional working class politics towards a middle class social liberalism.

This was discussed on the weekend by political commentator Janet Wilson: “October’s election result proved Labour has a problem of Democrat-sized proportions; they’ve become disenfranchised from their base while other left-wing parties enjoy the benefits. Which is how the Greens managed to snaffle the red strongholds of Rongotai and Wellington Central and Te Pāti Māori grabbed six of the seven Maori seats. That’s what happens when there’s a divide between the professional managerial class running the party and the supposed blue-collar workers they’re meant to represent.” See: As Robertson heads for the exit, Labour’s reset becomes critical (paywalled).

Wilson explains that Hipkins epitomises that professional managerial class and continues to hamper any tax reform that might threaten the interests of his own wealthy milieu: “As a paid-up member of that managerial class, having worn the well-trampled path from student politics directly to Parliament, the question must be, is Chris Hipkins the man to represent the workers in an age when AI threatens to disrupt all jobs? Can a leader who scuttled the tax work of his peers in one election hope to stop increasing dissension in the ranks if its polling numbers continue to slide and party irrelevancy beckons?”

There’s a hollowness to a party that continually refuses to implement reforms that would benefit Labour’s traditional base. Wilson says the party has therefore “lost its ideological compass and is adrift in the wilderness of what-it-doesn’t-stand-for. All while applying the magical thinking of all Opposition parties - that the Government of the day will only last for a term before they are ushered back into power.”

The hollowness has been recently discussed by Matthew Hooton, who has argued that Labour (along with National) has become a “mere empty vessel” for “the personal ambitions and brands of whoever gets control” of the party. Therefore, in lacking any real connection with social forces apart from the liberal establishment of places like Grey Lynn, Hooton says the party can’t enthuse working people anymore.

In his recent column, What Labour must do to reclaim its core support (paywalled), Hooton says that Labour was “supposed to be about redistributing at least some power and wealth from capital to labour and from the ruling establishment to ordinary people”. But looking through Labour’s last two times in office, Hooton suggests that the party has given up on its traditional constituency in favour of conservatism and this will need to change if it is to be re-elected: “Labour will never win back the working-class and middle-income voters who switched to National in 2023 until it offers more change than Ardern and Hipkins were comfortable with. If there is to be a do-nothing Government, former Labour voters may as well stick with National, which is historically so good at it, but isn’t seen to pander to the woke, Wellington pounamu- and David Jones-wearing - yet mainly Pākehā - elites.”

A similar argument was made two weeks ago by Andrea Vance, writing in The Post, saying that Labour’s “existential crisis” relates to its inability to relate to working people, and the fact that it has evolved “into a clique of career-driven politicians who marketed themselves at the progressive middle class”. In lieu of an interest in working class politics, Labour now specialises in “futile culture wars and identity politics”. See: What’s left for the left? (paywalled).

To find a way forward, Vance argues “Labour should be asking: who does it now represent?” And “this requires a more fundamental reshaping of how the party thinks about workers”. Is there anyone in Labour that can at least pretend to be in touch with working people rather than the professional managerial class? Hooton wrote a column for the Herald at the start of the year that singled out who the best replacement for Hipkins might be - see: Apologies needed for Labour to be taken seriously (paywalled)

Here’s his conclusion: “Thirty-eight-year-old list MP Kieran McAnulty is on manoeuvres, with speculation list MP Ginny Andersen would make a good running mate. Both served briefly as ministers in the last year of the defeated regime. McAnulty, while assuring Labour activists he is well to the left of Ardern on economics and tax, has built a blokey non-woke brand based on driving a ute and liking a beer and a bet. He’s certainly more in tune with today’s post-Covid, recessionary New Zealand than anyone from Grey Lynn.”

Dr Bryce Edwards is the Political Analyst in Residence at Victoria University of Wellington. He is the director of the Democracy Project.