Luxon uses Reagan’s playbook in blaming welfare recipients

The National Party has a useful bogeyman to blame for the failures of a political and economic system that prioritises accumulation of wealth over the lives and livelihoods of people

For Ronald Reagan, who ushered in neoliberal economic reforms that were then adopted by all subsequent Republican and Democratic administrations, the target was the “welfare queen”. Photo: Getty Images

Listening to the Prime Minister’s State of the Nation address, there were a few clear overarching themes.

First, the nation is in a ‘fragile’ state. Second, his government has a mandate for change. Third, not everyone will like the changes they make.

It will involve some tough love.

Anyone familiar with the last 50 years of economic and political policy in the West will recognise these themes.

Historically, beginning in the UK under Margaret Thatcher, the US under Ronald Reagan, and in Aotearoa under Finance Minister Roger Douglas, this rhetoric has been used to justify a programme of austerity (cutting public spending and services), the privatisation of public services (as Labour did with Air New Zealand and National with the electricity sector), and the deregulation of business and rolling back workers’ protections.

This economic and social system is known as neoliberalism.

Without fail these approaches lead to massive upwards transfers of wealth and large gaps between the wealthy and the working class.

This in turn increases disparities across the board, including in health and mental health services, and leads to increased poverty and precarity among the already at-risk.

If history repeats itself, this is what New Zealand has coming under the new coalition government.

There was a lot of talk about “tight budgets” and “careful stewardship of public money”.

Finance Minister Nicola Willis’ recent address to the NZ Economics Forum promised more public service cuts, though she was tight-lipped about just how deep they would be.

The new Government has already begun to deregulate businesses, and we can expect privatisation on the horizon (possibly in a three waters programme or to compensate for the axed public works projects).

The three pillars of neoliberalism are thus firmly entrenched within the first 81 days.

But those listening would have also noticed a somewhat strange (given the broad remit of the rest of the speech) focus on welfare recipients.

There was plenty of talk about infrastructure, wasteful government spending, and law and order, but one of the only groups specifically singled out was welfare recipients (truant school kids were the other).

This is part and parcel of the neoliberal playbook.

As shown by Adam Kotsko in Neoliberalism’s Demons, the only way neoliberalism, a socioeconomic system that produces poor outcomes for the vast majority of society, can survive with a public mandate (even if only a slim majority or plurality) is by blaming its victims.

For Ronald Reagan, who ushered in neoliberal economic reforms that were then adopted by all subsequent Republican and Democratic administrations, the target was the “welfare queen”.

Though based on a single high-profile instance of welfare fraud, the term took on an almost mythological significance. She became a racially stereotyped black single mother who was on welfare, but nevertheless had enough money to spend lavishly on opulent displays of wealth (related closely to the “crack whore”, who slept with men to fuel her expensive drug addiction).

For Reagan’s campaign, the welfare queen became the symbol of everything wrong with America.

She was poor, not because of a system that was rigged against her, but because she chose to be.

Morally bankrupt and lazy, she would rather live a life of ease and luxury on welfare than work.

She bilked the honest, hardworking American out of their taxes by being on welfare, and she wasted the money on frivolous displays of status.

Reagan sailed into office on the promise to crack down on welfare queens and people like them who abused the system.

Luxon’s explicit targeting of welfare recipients sounded uncannily similar to Reagan’s demonisation of welfare queens.

It wasn’t a coincidence.

“We’ll do everything we can to help people into work, but if they don’t play ball the free ride is over,” he said in his State of the Nation speech.

Luxon has staked his political life on being the only person that can turn things around for Aotearoa.

But as shown by his dog-whistling election campaign, as well as that of his coalition partners, his politics are really about finding someone to blame for society’s ills.

This is a logical rhetorical strategy for a government that seems less interested in transformative (or even evidence-based) policy, and more interested in regressive politics and blaming others as a cover for a political agenda that enriches the already-wealthy.

Much of his address pulled a double move of lauding New Zealand for its opportunity and resilience, and then blaming welfare recipients for their failure to work hard enough to take advantage of their opportunities.

Never mind that many who can’t work have Long Covid, or that many students don’t attend school so they can work to help pay for family expenses, or that his coalition’s axing of fair pay agreements and reinstatement of 90-day trials will make good jobs harder to find for welfare recipients, or that half the inflation that hits working people the hardest is caused by corporate price-gouging.

All of that is secondary to having a useful bogeyman to blame for the ongoing failures of a political and economic system that prioritises accumulation of wealth over the lives and livelihoods of people.

No amount of deflection or obfuscation, however, can change the fact that successive National and Labour governments have offered no transformative political vision or programme, settling instead for piecemeal tinkering around the edges and jockeying for the moral high ground in identity politics.

But for the neoliberal system to maintain its legitimacy, the blame must always be shifted from its internal structure to somewhere (or usually onto someone) else.

Once Luxon kicks people off the benefit and that still doesn’t save the economy, there will always be another “welfare queen” to blame.¹

1. This article first appeared in Newsroom