Libertarians are getting nervous

The corporate shills have been deployed to reassure the public that what they are seeing is not in fact real. Don't be fooled.

Something extraordinary is happening. While David Seymour and ACT had hoped to slip their consultation on the proposed Regulatory Standards Bill discussion document under the radar over the holiday break, that didn’t go as planned. Due in large part to a late-breaking independent media campaign started by Melanie Nelson which was picked up by more mainstream outlets over the summer break, the consultation resulted in 23,000 submissions on the proposed bill, around 80% of which were received in the last four days of the consultation period.

Now that the break is over and more and more people seem to be realizing the ideological reasons for the proposed legislation, a flurry of opinion pieces have been written to reassure the public that no, the Regulatory Standards Bill is not in fact what it very clearly appears to be, a corporate move to enshrine corporate rights over the good of the public. It’s actually about transparency and freedom.

But even a short skim through these pieces reveals that these corporate actors are scared to address the actual arguments against their proposed legislation, instead relying on platitudes about freedom and choice and vague references to “bad regulation.”

Let’s break down the arguments.

The first piece that I’m aware of is by John McLean. I don’t know who this guy is but he’s got nearly 1000 subscribers. His post was meant to be humorous but illustrates perfectly how when you don’t have any real answers to criticisms, a surefire strategy is to just engage in inane “gotcha” moments and personal attacks. His whole piece appears to be an exercise in “owning the libs”.

McLean begins by parroting wholesale the stated purpose of the proposed bill as being to “improve the quality of legislative rulemaking in New Zealand—a laudable goal, one might think.” He then engages in meanspirited and personal attacks on political reporter Lillian Hanly (she used the word “bill” in her title, and it’s clearly just a discussion document, stupid), Melanie Nelson (“Jane Kelsey and Lillian’s little friend”), and Jonathan Milne (“Managing Editor” of Newsroom in scare quotes).

But most of his ire is saved for Emeritus Professor Jane Kelsey, who he labels an “OUTRAGE Queen” a “serial shrieker”, “Matriarch of Madness”, “Marxist Fascist”, and “Strange Jane”.

Throughout his piece, he pulls the same trick that right-wing bloggers and authors always use, which is to quote large blocks of text out of context without engaging with the arguments, as if simply quoting these statements is enough to show their self-evident wrongheadedness or stupidity. The only counterargument he seems to have is that the criticisms of the bill are “paranoic pontifications”, “crazy Cris de Coeur”, and “malodorous crapulence”. Leftists clearly just hate democracy.

He ends his piece by repeating the libertarian party line about the purpose of the bill, wondering why leftists hate Seymour so much when he is clearly just a nice guy

At core, what Jane Kelsey and others of her ilk are saying is…DAVID SEYMOUR IS EVIL & WE HATE HIM. The level of visceral hate for this perky, industrious, enthusiastic, funny, patriotic gent is weird and slightly sinister. I don’t happen to agree with him on lots of stuff – including his contention that New Zealand’s electricity market is working as it should - but hey…how could anyone hate him over such things?

This is a pivot from criticizing ideas to accusing his critics of personal hatred and persecution of a corporate actor, a strategy often used by the right to diffuse arguments they can’t address. Nowhere does he address the criticisms related to how the proposed law will free corporations to exploit under cover of the liberties and freedoms proposed to be enshrined in the bill. Best he can do is engage in personal attacks and accuse people of being fanatical leftists.

Other writers, realizing that coming off looking like a giant asshole might not be the best strategy to win over support, have engaged in classic smoke and mirrors techniques, obscuring the corporate purpose of the proposed bill and focusing on vague notions of freedom, liberty, and choice, and tugging at the heartstrings by including stories of the trials and tribulations caused by too many regulations for your everyday, average New Zealander.

The architect of the proposed bill himself, David Seymour, got in on the action with a piece in the corporate apologist NZ Herald (the piece is currently paywalled, but ACT have been so good as to reprint it in full for all you freedom lovers out there).

Seymour’s piece is a masterclass in manipulation and obfuscation. He starts off by quoting 1970s Labour Prime Minister Norman Kirk saying that people everywhere need “someone to love, somewhere to live, somewhere to work, and something to hope for”. But for New Zealanders who have worked hard and been responsible, it’s hard to live here, and so many leave. He sets up the problem nicely here. Nice baiting.

Then, the switch

Bad regulation is at the heart of this. Make no mistake, in a country where you’re free to do as you please unless there’s a law against it, every extra law is a restriction on your basic freedoms, and I hear about it in nearly every field.

Seymour then relates a number of interactions (real or imagined) he’s had with people, including builders who have to go through endless amounts of “red tape” to, among other things, earthquake-proof their buildings (nevermind that fewer than 500 people have ever died from earthquakes in NZ, he reminds us). Financial institutions are regulated to make sure they don’t loan money to people who can’t pay it back. Educators just want to help children learn and thrive but are stifled by bureaucracy. We live in a culture of regulation, and it’s making us all sad and unable to do what we want.

I have to give it to Seymour. He tells a compelling story. And to be sure, some regulations are probably too onerous and not thought through enough in terms of their impacts at the ground level. But many regulations have been put in place because businesses and corporations have shown repeatedly that they will not be responsible unless forced to. The fallout of these actions has devastating consequences for ordinary people.

For example, in his critique of the regulations around financial institutions loaning to people with bad credit, Seymour says “Somewhere the regulators missed that the whole point of the finance industry is not to lose money by giving loans people cannot repay.” Does someone need to remind him that the global financial crisis of 2007-2008 was caused in large part by this very action of banks making loans to those who couldn’t pay them back (so-called sub-prime lending), inflating the housing bubble and then popping it when these people defaulted on their loans?

What would Seymour say to those who were taken in by promises of low-interest rates and giant home loans who ended up losing their homes, jobs, and livelihoods while the US government bailed out the big financial institutions? Clearly the finance industry does not care about making loans to people who cannot pay them back unless required to by regulations.

And this is the point. Nowhere does Seymour discuss how regulations have spared people financial ruin or preserved their freedom from want, hunger, or precarity. They are always only bad. They limit people’s ability to do whatever they want. No mention of how this government’s deregulation has only benefited corporate interests, not regular working people. His bill will only make the process of lawmaking transparent, he claims

It requires politicians and officials to ask and answer certain questions before they place restrictions on citizens’ freedoms. What problem are we trying to solve? What are the costs and benefits? Who pays the costs and gets the benefits? What restrictions are being placed on the use and exchange of private property?

Sounds reasonable right? Missing from this discussion is any mention that “citizens” in Aotearoa include corporations, according to the Interpretation Act 1999 and the Legislation Act 2019. This is particularly relevant when the proposed bill talks about taking property or taxes, fees, and levies. Essentially, the bill will make it extremely difficult to limit corporations’ profits (as these constitute property) or to tax them.

Seymour is mum on any of these issues. It’s telling.

The next diversionary propaganda piece came from Richard Prebble, also for the Herald. Prebble begins by invoking the old bogeyman, stating that “A majority of MPs could at any time wipe away freedoms. We know because they have.”

Prebble’s strategy seems to be to pepper in facts with statements for which he provides no evidence or takes out of context. For example, he states that in 2009, a Regulatory Responsibility Taskforce gave recommendations for and drafted a proposed bill (the initial version of which, the Regulatory Responsibility Bill, was drafted in 2001 and introduced and rejected in 2006) for consideration by Parliament

The taskforce said in a free democratic country all laws should meet six tests: The rule of law that includes equality before the law. Law should only reduce liberty to protect the liberty of others. Property should not be taken without compensation. Taxes and charges should not be imposed except by Parliament. Only courts should interpret laws. The benefit of a law should outweigh the cost.

Seems reasonable enough.

Then, for some reason, he skips 11 years, including another rejection of the proposed bill for being unnecessary and overly broad (the last go around was sponsored by Seymour in 2021 and also rejected; that’s three rejections, if you’re counting). But, you see, he needs to get back to the real bogeyman, the radical left

The Ardern Government ignored the recommendation and instead on March 25, 2020, adjourned Parliament and issued orders that the High Court later found to be unlawful. Our freedoms are fragile.

Missing from this statement is the fact that these orders weren’t issued arbitrarily. They were in response to the COVID pandemic. Admittedly, individual freedoms were curtailed. But, as a society, many of us were willing to pay the price because many others, including our loved ones, were in danger of serious illness or death from COVID. Indeed, an analysis found that Ardern’s COVID policies saved at least 20,000 lives. But this is cold comfort to the likes of Prebble, whose barometer for freedom is whether he can do anything he likes, consequences to others be damned.

The rest of the piece is one after another of selective information followed by absolutist or alarmist rhetoric. The OECD report states that our bad regulation is “one reason our productivity is so poor.” Looking at the report, notwithstanding Seymour’s characterization of it as showing that "New Zealand is a red-tape state” shows a range of indexes and that overall, New Zealand is bang on the OECD average in terms of its “overall economy-wide product market regulation indicator”

Interestingly not mentioned by Prebble (or Seymour) is that New Zealand is substantially worse on the index of lobbying transparency, scoring 37 out of 43 countries, indicating that special interests are very likely to influence government policy, or that New Zealand has a larger inequality score across a range of measures than comparable OECD countries.

Prebble claims that the 23,000 submissions were the result of an

online campaign against the proposal. Most of the comments I have observed are personal abuse directed at Seymour. The socialists, who do not believe citizens should own private property, are opposed. Those who think it’s the function of Government to redistribute wealth are opposed. Then there are people one would expect to be in favour of a liberal democracy who think that their issue is so important that the test of good law-making should not apply.

Ah yes, it’s those pesky socialists and people who don’t want anyone to own private property who are behind this. And shame on those radical leftists who are being mean to Seymour when he’s just a nice guy

These objectors believe protecting the environment, or promoting safety or banning smoking, or limiting alcohol or whatever is their issue, is more important than any freedom.

Not any freedom. Just the freedom to not be exploited by corporations who do not care one iota for our personal freedoms or how their programs of profit-seeking affect the lives of normal people.

Prebble blames the failure of Shane Reti (“one of our better Ministers of Health”) not on a government who has funded health at the lowest level this century and continues making cuts, but on the fact that “No matter what powers the minister is given, no one can efficiently run a Soviet-style health system. No system beats taking personal responsibility.”

Uh, I’m sorry. Personal responsibility? If those people who are dying from bowel cancer or not getting surgeries or treatment because of the underfunding of the health system would have taken more responsibility… then what? Prebble can’t help but succumb to classic libertarian moralizing, even when it has no relevance to the argument at hand.

He then trots out the old libertarian canard that “Freedom Indexes demonstrate countries that protect freedom are wealthier.” Honestly I can’t be bothered to go into details about why this argument makes no sense. These “freedom indexes” are calculated by corporate libertarian think tanks to give the illusion that smaller government means more freedom means more wealth. But they don’t stand up to even the slightest scrutiny. Not that this matters to libertarian propagandists. For the proponents of free markets and low government intervention, even Nordic countries, notorious for their mix of free-market and heavy state control, are cast as success stories for economic freedom.

Prebble ends by stating that “even if the basic freedoms did not result in a more prosperous country I would still be in favour.” The sacrosanct notion of individual liberty must be preserved, any costs or impacts on society be damned. For Prebble, Seymour’s bill is “so important it should be called the New Zealand Magna Carta.”

While we are all wiping the tears from our eyes and having a moment of silence, it bears keeping in mind that Prebble was an early joiner and first leader of the ACT party, founded by former Labour Finance Minister Roger Douglas, whose reason for taking his toys home and starting ACT was that Lange’s government wanted to put the breaks on some of his most extreme neoliberal reforms. So it doesn’t take a rocket scientist to guess where his sympathies lie.

Many of these pieces seem to be in response to the increased exposure of the libertarian ideology and its connection to a neoliberal policy agenda, which I and others wrote about last year and I detail the history of here. Two recent pieces in particular by Dame Anne Salmond for Newsroom seem to have hit a nerve, with her piece entitled “Hayak’s bastards” published only two days ago, in which she connects the dots between libertarian ideals, corporate interests, and neoliberal policy, having 36 comments.

Chief among the commenters is Eric Crampton, the chief economist for the New Zealand Initiative (formerly the Business Roundtable who wrote the initial regulatory standards legislation, I guess their old name was a bit too transparent) and a current board member for the Mont Pelerin Society. Crampton takes Salmon to task for her misunderstanding and misrepresenting the nature of libertarian think tanks as corporate propaganda mills, when in fact they are bastions of “academics and intellectuals in the classical liberal tradition.” He also repeats that the problem for your average New Zealander is the regulations. Those pesky regulations.

Crampton singles out the regulations to the housing industry, as if government regulations are the sole cause of the housing crisis.

Commenter Andrew Riddle nails Crampton dead to rights in his response

Of course there are other views on housing that do not depend on blaming government regulation or land use planning. Such as housing is provided by the private sector at the rate and type that is most profitable, not necessarily of a type or at a rate that is the most needed.

Unable to respond to that, Crampton sort of retreats, offering some condescending comments about how the bill isn’t even drafted yet and how since the public has hijacked the consultation with ideological views and conspiracy theories, it’s not worth having a consultation in the future.

The good thing here is that the vast majority of comments are sympathetic to Salmond’s views. She puts it brilliantly when she says “No conspiracy theory is needed to explain these links.” For those willing to dig a bit, the links between the libertarian ideology that is so prevalent in the defense of the Regulatory Standards Bill and the corporate propagandists are clear. Even the libertarian thinkers and economists that Crampton lionizes, like Mises, Hayak, and Friedman, have been shown to be on the payroll of big business, and the Mont Pelerin Society itself was founded by business interests. It’s getting harder for these apologists to deflect and deny the associations, although they will clearly try.

The last piece came out today in the Herald from Bryce Wilkinson. Wilkinson, is of course, a Senior Fellow at the New Zealand Initiative. He wrote a book called Constraining Government Regulation (prepared for, published by, and handily available for free from the NZ Initiative here) which was the foundation for the first rejected Regulatory Responsibility Bill. He was also a member of the Regulatory Responsibility Taskforce, which produced the second rejected version of the bill. He gets trotted out periodically when the corporate class needs someone to dress up their libertarian propaganda in less offensive language.

I won’t spend a lot of time going over his piece. It’s more of the same. Reassuring the public that there is nothing nefarious about the bill. It’s about improving the quality of regulation, not tying the government’s hands.

Wilkinson comes the closest of anyone to addressing the explicit criticism that the bill would allow corporations to claim rights over and above the public interest

The argument that protecting property rights only helps the wealthy doesn’t stand up to scrutiny. Yes, wealthy people own more assets, but low-income families surely suffer more when their security, property and freedom to work are ill-protected. They cannot afford to replace a stolen car or move to a safer neighbourhood. Protection for personal safety, autonomy and possessions is not a parochial matter.

This is a bait and switch. He admits that wealthy people own more assets but claims it’s the low income families that will suffer if their property rights are violated. But what if their rights are violated by a corporate entity? Surely the person (including corporations as people) with the most financial resources will be able to secure a favorable outcome. Sure if someone’s car is stolen they will have a hard time replacing it. But what about people’s water that is poisoned by the agricultural or meat or mining industries? What recourse do they have against a corporation that can claim that its rights and property are being taken away by the government if they are required to clean up or pay more tax? Or a tobacco company who sues to stop plain-packaging laws because they infringe on their intellectual property?

These are not hypotheticals, they have been experienced by communities throughout the world. The bottom line is that when corporations are deregulated, they produce harms to people and communities. And they do not pay for them. They leave the communities poisoned and ruined, left to pick up the pieces however they can.

This is the door that the Regulatory Standards Bill will open. It is not merely about transparency. It never has been. As evidenced by the funders and founders of the think tanks that are rushing to its defense, it is about corporate profits. It is about equating the idea of freedom with a narrow ideological view of economic freedom that cares little for the good of society. Indeed, society as such does not exist in the eyes of libertarians, only individuals competing with one another for their own self interest.

The flurry of propaganda in the last week suggests that, while not on the run, Aotearoa’s libertarians are in damage-control mode. They, however, cannot answer the criticisms against their proposed legislation directly, so they are employing the tried and true methods of personal attack and appealing to universal values such as freedom and liberty.

This is a cause for hope, although the victory is not won. It may not be, as the money is on the side of those who work for the corporate class. But at least more of us are waking to the reality behind the corporate agenda. At least they aren’t pulling the wool over so many of our eyes. If they force this agenda on us, it won’t be with public consent. It will be with us fully and completely aware that they are governing for the rich and wealthy, and that they care nothing for the rest of us.

And therein lies the hope for the future. Let’s keep the pressure on this year.