For a brief period this new vehicle was a radical new right force that was serious about substantially changing New Zealand society. In its early days, the Act was known for promoting very low taxes, a minimal state, increased individual responsibility, and a general continuation of the new right “revolution”. Roger Douglas’s book Unfinished Business was essentially the party's founding document, and Douglas played the role of the party’s guru or thinker. In reality, however, Act’s political ideology was derived from the political economy of Milton Friedman and Frederick A Hayek. In a sense, Douglas’s Unfinished Business represented the views of Hayek and Friedman as applied to the New Zealand case. The essence of Act’s philosophy was a strong belief in deregulated markets and a minimal State. As opposed to other variations of new right political economy, the place of the consumer played a significant role in Act’s schema. Accordingly, the consumer, rather than simply the capitalist, should be entitled to the maximum “choice” and “freedom” in the marketplace. [Read more below]
Welfarism – or perhaps “anti-welfarism” – also plays a central role in Act’s ideology. Intrinsic to the “Act idea” is that the consumer should have access to quality welfare, although the State should have little to do with actual provision, instead providing the necessary minimal regulation and supervision of provision. As one commentator summed up Act’s claims: 'In Douglas's welfare state, you get more welfare but much less state.’ (Hubbard, 19 March 1994).
The ideology of Act was never really a libertarian ideology. Douglas and co deviated from a pure libertarian philosophy right from the start. Act’s attitude towards the state was somewhat ambiguous and contradictory. For example, Douglas acknowledges in his book Unfinished Business that 'in order for these policies to work there will have to be an element of compulsion’ (Douglas, 1993). This compulsion was that every citizen would be forced to take out various forms of welfare insurance – hardly a libertarian stance. As one academic put it: ‘They are, in effect, proposing to make participation in a free market compulsory’ (J Roper, 1996: p.40).
In an analysis of Act’s advertising and rhetoric, Juliet Roper pointed out that Act attempted to “side-step” their inconsistency with Act’s alleged neo-liberal theory ‘by the removal of imperatives in their explanation of policy. The information given says "you buy", "will get to choose" or "everyone will have" rather than "must buy" "have to choose" or "have to have" ' (J Roper, 1996: p.40).
Act’s orientation to the State therefore provides an interesting and alternative illustration of the nature of the “rolling back of the state”. It gives credence to the argument that the neo-liberal agenda is not about the abolition or curtailing of the State, but merely its re-composition (J Roper, 1996: p.40). Act’s social policy is in the final instance somewhat interventionist, albeit only in order ‘to irrevocably establish a free market system in key social policy areas’ (J Roper, 1996: p.40).
This compromise on libertarianism meant that Act failed to recruit an element of New Zealand’s rightwing political community. Although Douglas had already signed up journalist Deborah Coddington and broadcaster Lindsey Perigo to Act’s first phase, these individuals later left to publish the magazine The Free Radical, and establish the rightwing liberatarian political party Libertarianz. The Libertarianz party was highly critical of Act, as their own party ideology was based on a more pure New Right tradition – that of ex-Russian economist Ayn Rand.
Coddington complained publicly that participants had been directed to leave all statements to the leadership. Edlin reported that 'She complained this was respectable, boring, wimpish and passionless, suggesting ACT was being used more as a vehicle for flexing power than to formulate policy ideas and promote reforms.' (Edlin, 27 Aug 1993: p.3).
The Libertarianz registered itself as party with the Electoral Commission in time for the 1996 general election, but performed very poorly, accumulating only 671 party votes and 553 electorate votes in the two constituency seats they stood candidates. They stood on a platform of an unfettered free market society, free from all state interference, except on “necessary” intervention to ensure the maintenance of law and order – in particular the protection of private property. Much of the Libertarianz platform was characterised by far-right populism, such as the opposition to NZ on Air, the Human Rights Commission, the Resource Management Act and the Waitangi Tribunal. They also proved to be conservative on social and race issues.
Next blog post: Initial factions and differences