You can’t say you weren’t warned. Whatever relationship-building and merger-and-acquisition skills Christopher Luxon displayed in business, they haven’t translated to political leadership.
By 11pm on election night, it was clear to anyone who could do year 10 algebra or operate an Excel spreadsheet that Luxon needed both Act and NZ First.
Hours later, proudly wearing his All Blacks jersey, the incoming Prime Minister seemed to agree, declaring that “I’m a person who likes to bring teams together and make sure that I get the best out of that team and use all the skills that are in that team.
“I’ve done a lot of mergers and acquisitions,” he boasted. “I’ve done a lot of negotiations.”
Back in Wellington, Luxon criticised the way Jim Bolger, Helen Clark, John Key, Bill English and Jacinda Ardern had conducted coalition talks, insisting he had a better way.
“I’m going to use the next three weeks until the special votes are fully counted,” he proclaimed, “to actually progress the relationships and the arrangements with each individual party.”
Alas, he failed.
Act, NZ First and National insiders say Luxon is a talker rather than a listener. He never asked how Act or NZ First thought negotiations should proceed, or what they wanted from them.
The smaller parties’ priorities differ from National’s and from each other’s, and they have very different styles.
Act prepared detailed policy papers for National, hoping to prompt in-depth discussions. National teased them for being so diligent with their homework and didn’t respond.
In contrast, Peters held his cards tight, waiting for Luxon to ask for his view of the world and priorities. Luxon never did.
While Act was perplexed with Luxon’s trite public statements that everything was terrific and progressing fantastically well, NZ First was amused by him setting himself up for a fall.
With no relationships built or policy agreed over the three weeks before special votes were counted, things went downhill after the final result two weeks ago.
Wanting to meet Chinese and US presidents Xi Jinping and Joe Biden at Apec yesterday and today, Luxon presented a proposed deal to David Seymour and Winston Peters on Friday.
It was written from National’s perspective, with a few concessions to what National thought Act and NZ First might want.
Act felt its time preparing detailed policy had been wasted. NZ First was offended that National presumed to know its priorities without asking. Neither felt respected or heard.
When Seymour and Peters swapped stories last Friday, Luxon finally succeeded in building one relationship: between the curmudgeonly 78-year-old nationalist conservative and the chirpy 40-year-old cosmopolitan classical liberal.
Seymour continued playing nice, but Peters decided it was time for Luxon to learn an important lesson.
The rest is history. After Peters went Awol on Tuesday, Luxon humiliatingly flew back to Auckland to meet him on his terms on Wednesday.
After a perfunctory photograph of the three leaders was issued with all the transparency of the North Korean Ministry for Information, Seymour left the room and Peters made clear that it was now time for Luxon to listen to what NZ First expected from the talks.
If Luxon has now learned his lesson, a deal may be closer than thought.
Luxon hubristically rejected advice from almost everyone to rule out working with Peters. He thought his people skills could tame the old warrior.
But Luxon’s even bigger misjudgment was not understanding that he is the only one who has to close the deal.
It’s not clear what mergers and acquisitions Luxon was involved in for Unilever in Canada or when running its soap, deodorant and toothpaste category in the United States.
He was responsible for Air New Zealand’s alliance with Virgin Australia, but failed to build a strong working relationship with Virgin’s chief executive John Borghetti and its board. After reportedly failing to win board support to sack Borghetti, Luxon quit Virgin and sold Air New Zealand’s 25.9 per cent shareholding, although luckily the loss to Air NZ shareholders, including taxpayers, was probably under $100 million.
In commercial negotiations, it’s the bigger player, like Air New Zealand, that can walk away, while the smaller players usually feel pressure to close.
In coalition negotiations, it’s the other way around.
Luxon has been elected leader of the country. It is he who must close a deal before Christmas or there will be new elections. Seymour and Peters can quite happily walk away, leaving Luxon to form a minority Government that would need to win their agreement issue-by-issue.
If anything, Seymour and Peters would be more powerful if not limited by a coalition agreement and the decaying but still burdensome rules of Cabinet confidentiality and collective responsibility.
Seymour and Peters understood this all along. Luxon needs them if his Government is not to be a complete circus, with the clown show of the past five weeks being repeated whenever it wants to do anything contentious. Seymour and Peters don’t need him at all.
If new elections are required early next year, Seymour would campaign saying he refused to compromise on Treaty issues. Peters would claim he wouldn’t let National invite Chinese investors to buy up our houses. Both could bet on increasing their vote.
Luxon’s failure to take up the mantle of national leadership after Chris Hipkins handed him the stage on election night means he has failed to project the sense of inevitability and momentum that would have generated him greater political capital and thus more negotiating power over Seymour and Peters.
He could have given brief daily updates on how things were going that demonstrated to Seymour and Peters that he had the platform to throw them under a bus if necessary.
Instead, he has spent five weeks reciting his vacuous and facile slogans that everything is just swell.
It has made him sound less like the leader of the country at a confusing time and more like a cheap salesman promising that this great new toothpaste really will make those pearlers shine fantastically white.
His approach even breaches McKinsey and Co’s first rule of managing mergers and acquisitions, which is to overcommunicate. Shareholders, customers and employees will accept being told that, while yesterday went well, today went badly and things will take more time. Silence is lethal. Worst of all is brain-dead and meaningless spin.
Perhaps Luxon never got to that chapter of the self-help books that are his main reading materials.
Matthew Hooton has over 30 years’ experience in political and corporate communications and strategy for clients in Australasia, Asia, Europe and North America, including the National and Act parties and the Mayor of Auckland.