Comments on immigration and interest rates damage credibility.

If Andrew Little's aim this week was to annoy his most important coalition partner, unsettle the markets and horrify his ethnic support base, he had a good week.

Otherwise it was a shocker.

In most respects it was as bad a week as Little has had in his 16 months as leader and not one he would want to repeat.

He must have realised it wasn't going so well when Winston Peters described him as indulging in dog-whistle politics - and it wasn't an insult.


Little's clumsy foray into immigration with comments on an apparent over-supply of ethnic chefs looked like race baiting.

His refusal to rule out legislating for interest rates was more extraordinary.

It has the potential to do longer-term damage to the party's credibility and that of finance spokesman Grant Robertson as alternative stewards of the economy.

Certainly it wasn't the ideal prequel to Robertson's big conference in Auckland next week on the future of work to showcase the degree of creative thinking and planning going on in the party.

Policy on the hoof over interest rates is the antithesis of that.

It came about accidentally during what we call the caucus-run when Little responds to any questions thrown at him on his way into the Tuesday caucus meeting.

On occasion there is more than a little leader-baiting that goes on from journalists, particularly when a leader looks hesitant or flummoxed.

The fear of not being able to answer a question or looking equivocal drives politicians and leaders in particular to say things they do not actually mean.

It was the downfall of David Shearer.

Little wanted to say Labour would be tough on the banks. It would meet them, to pressure them ("stiff-arm" them) to pass on cuts to the official cash rate to customers.

He did not intend to suggest that Labour would pass laws to force banks to do so, but ended up saying that while it didn't want to it, would do so with a heavy heart.

The most charitable comparison I've heard about Little's failure to rule out legislating for interest rates is that his approach to putting pressure on the banks was akin to how unionists behave in meetings with employers.

The fear of not being able to answer a question or looking equivocal drives politicians and leaders in particular to say things they do not actually mean. It was the downfall of David Shearer.


You don't go in saying striking is not an option - even when you don't intend to strike. You don't even have to threaten to use it. You don't rule anything out; everything is on the table in theory.

The problem for Little is not just getting into tangles, it is that he has difficulty extricating himself from them because of the dilemma it creates.

In the case of the interest rates issue, there has been no unequivocal closure of the legislative door since he opened it on Tuesday.

While it opens up the party to ridicule and associations with Pyongyang and wacko economics, retracting it would look like capitulation to the banks or, worse, capitulation to National's criticism.

It is the dilemma of every party that tries to be different things to different interests.

It is becoming increasingly necessary to distinguish between what Labour could do and what it would do.

It could legislate for interest rates but it almost certainly wouldn't.

Robertson this week confirmed a scenario in which Labour could contemplate a Government bail-out for farmers in the dairy downturn - something we know it could do but in all probability would not do.

Similarly with TPP, its opposition to the big trade deal suggests it could pull out of the deal in Government, but we know for sure it would not. It would not be that reckless.

Incidentally, Labour has virtually stopped campaigning against the TPP. It has become too difficult for the party to talk the walk. David Clark occasionally tries to assert Labour's free-trade credentials in the House but he is laughed down.

The blips of the past week suggest a party that is still struggling for coherence - which is why the Future of Work conference takes on a greater significance.

It is the centrepiece of Labour's narrative that it is the party planning for the future - in a coherent way - while National is content with a hands-off policy.

Labour embraces a hands-on approach or as Robertson put it in his conference speech, "the transformational role of Government to help New Zealanders build their dreams".

Little and Robertson are having to learn fast.

Little, a former moderate union leader, entered Parliament only four years ago.

Robertson, the spiritual leader of the left in the party, a former student leader and political adviser in the Beehive, entered Parliament eight years ago.

Respected former finance spokesman David Parker ruled himself out of contention for finance during the 2014 leadership contest.

After the contest, Robertson got his pick of jobs because he was the top choice of the membership and caucus (but not the unions).

With no experience in business, and as leader of the anti-TPP movement in the party, Robertson will never be the darling of business in a way that Parker was.

Nor is he trying to be. Acceptance of him by business would only come with incumbency.

But he is no slouch either and he does his homework - it should be noted that in a pre-2014 election clash with National's Steven Joyce, Robertson predicted a five-year oversupply of milk in the world market - which Joyce scoffed at at the time.

Robertson relishes the politics and setting the narrative more than balance sheets.

Both Little and Robertson are safe in their jobs until the next election.

Robertson hasn't made any blunders yet. Little's were not a federal case in the caucus.

Little can afford to have the occasional bad week without it destabilising his leadership.

It is the effect on the voter that he needs to worry about more.

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