Paradise Reforged by James Belich

Author:James Belich
Language: eng
Format: epub
ISBN: 9781742288239
Publisher: Penguin Random House New Zealand
Published: 2010-12-21T16:00:00+00:00

By 1949, Leviathan absorbed 28 per cent of gross domestic product. But increases in its cost, contrary to some legends, were modest thereafter until 1974. In the 1950s, the level was about 32 per cent, and until 1973, about 33 per cent.50 Between 1949 and 1972, the number of core public servants increased from 51,000 to 72,000 – fewer than the population growth of the same period.51 Growth in the cost of the state was well below that of the period 1974–84, and below that of some welfare-oriented European countries in the 1950s and 1960s. The relative stability in the cost of the state was due to economic growth and full employment, which kept the cost of social security down to about 7 per cent of GDP in the 1950s and 1960s. Cheapness did not mean that Leviathan was becoming less active, however.

There was further development in ‘sectoral harmony’: the alliance of workers, farmers and business with the state and – to some extent – with each other. Workers benefited from this, despite the signal defeat of 1951. Unemployment was virtually nonexistent, and real incomes per capita rose modestly to the late 1960s. There were pockets of poverty, but commentators tended to cry wolf about their scale. The number of days lost to strikes was low 1951–68. The mainstream union movement increased in strength, but also in moderation, and became increasingly closely allied to the state. As one left-winger noted in 1968, ‘The unions have united the New Zealand working class, but at a cost of a subservience to the State unparalleled in any other country.’52 Tom Skinner succeeded F. P. Walsh as leader of the Federation of Labour in 1962. ‘Nobody would suggest that Skinner wielded the influence with a National Government that Walsh exerted under a Labour administration, but the Federation was, and still is, regularly consulted and listened to with respect.’53 Indeed, National Party Prime Minister Keith Holyoake once sang ‘The Red Flag’ at a gathering of trade unionists.54 The Public Service Association emerged as the uncrowned king of white-collar unions, but as much by working in tandem with their employers as by opposing them. Intensifying sectoral harmony also extended to farmers, as we have seen above, and to business, as we will see in Chapter Fourteen.

A second spurt of state activity in the 1950s and 1960s was a new, almost Vogellian spasm of development work: in transport, especially roading; in forestry; and in hydro-electric power. Public works expenditure, as a percentage of all government spending, was staggeringly high in this era. It peaked at 35 per cent in 1958, and exceeded 20 per cent in each year between 1949 and 1967. Compare this with less than 10 per cent in the early 1930s and the 1980s.55 Tarsealed roads quadrupled from 5,500 miles in 1945 to 20,000 in 1965.56 Motorways emerged in 1951, and the Auckland Harbour Bridge was opened in 1959. Only the cost of the last was repaid by tolls. Airports also sprouted, as did public buildings, especially school buildings.

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