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Fran O'Sullivan: Labour gets back into the game

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Fran O'Sullivan writes that Phil Goff has been handed a couple of political aces - but how he plays them remains to be seen.

Labour Party Leader Phil Goff (left) is greeted by Deputy leader David Cunliffe. Photo / Paul Estcourt
Labour Party Leader Phil Goff (left) is greeted by Deputy leader David Cunliffe. Photo / Paul Estcourt

Out of nowhere Goff has been dealt some valuable cards. Just weeks ago Phil Goff's leadership looked like a busted flush.

To be brutally honest, Labour MPs had lost any expectations that Goff had any hope at all of leading them to victory at the 2011 elections - let alone create a suitable launching pad for the party to steam-roller over National at the 2014 election.

"A bit like pissing in a pond mate," was the response of one well-connected Labourite when I asked if Goff would be able to create sufficient impact to persuade voters to break-off their love affair with John Key.

When I met him at a rugby match, the Labour leader appeared fatalistic. It was as if, after a three-decade career in national politics, he was contemplating what life might hold for him beyond this parliamentary term - perhaps following in the footsteps of other New Zealand foreign or trade ministers such as Don McKinnon (National) and Mike Moore (Labour) who went on to occupy big roles in international politics.

He was even handing out a few kind words about the Prime Minister's better attributes. The kind of bipartisan respect that politicians sometimes have for their opposition peers, but rarely show while still locked in Parliament's arcane and feral world.

But Lady Luck has smiled on the Labour leader. Out of nowhere Goff has been dealt some valuable cards to play himself back into the game.

Strong-arming Chris Carter from his caucus after the MP was stupid enough to leave his fingerprints at the site of a botched political execution was easy enough. Carter's colleagues had got heartily sick of him playing the "gay card" when challenged on his taste for the high life at the tax-payers' expense.

But the real thing Goff has going for him is the "fourth dimension of politics" - time. Confidence is eroding and unemployment surging as the New Zealand economy enters a long and bumpy phase.

Finance Minister Bill English is softening up the public for some prudent - but tough - times ahead. In recent days, international worries have re-emerged that the world may be on the verge of a double dip recession; a factor that should prompt the Reserve Bank to call a halt to interest rates hikes. In this environment Goff and his finance spokesman David Cunliffe, who is taking a higher profile these days, will be tempted to exacerbate the public's concerns over their capacity to absorb mounting bills - rising mortgage rates, increased power and fuel bills and the upcoming GST hike.

Labour's top duo has already begun carving out a distinctly different policy hue to National. While the party's top brass maintain nothing is cast in concrete until election policies are formulated, it seems obvious that Labour will do the following:

* Raise the top tax rate back to 38 cents in the dollar for Kiwis who earn above six figures (whether it's $100,000 or a higher threshold has yet to be decided).

* Leave the GST rate at 15 per cent and make fruits and vegetables GST free.

* Change the Reserve Bank's monetary policy focus to also include employment as well as inflation.

* Introduce compulsory superannuation - possibly through making KiwiSaver compulsory; restart contributions to the Cullen Fund, get out of Afghanistan, tighten up on foreign investment rules.

And again make it illegal to trade-in the fourth week's leave for cash (even though Goff knows it is nonsensical to deprive workers of the opportunity to get themselves a 2 per cent pay packet increase, and has said so).

It's not an easy balance. Cunliffe - who is after all a former executive at Boston Consulting - was talking through a forked tongue when he ramped up fears this week that the Government's decision to measure state-funded projects against a public-private alternative would lead to a "fire sale of Crown assets".

While Cunliffe was applying the purple paint, Labour's infrastructure spokesman Darren Hughes was making it abundantly clear that he had no problems considering public-private partnerships for bigger projects ("after all it's the private sector that builds and maintains Government assets ... there is no Ministry of Works") but that he might be concerned at getting bogged down in bureaucracy if the threshold was too low.

Tough economic conditions are not kind to the electoral chances of incumbent governments. It is instructive that in the United States, Barack Obama's approval rating has slipped into negative territory in two recent polls.

More Americans now believe the country is worse-off since Obama became President that those who think it is better-off.

Cunliffe is categorising Key as a "Smile and Wave" Prime Minister.

Labour will get an early insight into how well this tactic plays out when Goff and Cunliffe go on the hustings to support Labour's candidates at upcoming byelections.

- NZ Herald

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