The rare Genius of Sir Robert Muldoon
Its funny to write those words, but its true.
Robert Muldoon was our last economic nationalist PM. Everyone else since has been a failure; and more so by design than accident. Just follow the money. You’ll see.
Unlike his successors, Muldoon didnt see us as a playground for foreign capital. His genius was simple: he refused to surrender economic sovereignty. He saw us as players, and he was number eight in our scrum.
He believed in full employment. Not as an abstract goal, but as a moral and economic imperative.
He understood strategic state investment builds long-term national wealth.
He knew that real interest rates (???) determine whether public borrowing is a burden or a tool for national development.
(Dont worry, trust me. We will circle back to these points another day.)
Muldoon’s Think Big projects were massive investments in energy, industry, and infrastructure. They weren’t just short-term stimulus. They were about insulating New Zealand from global shocks, ensuring energy independence, and preventing the country from becoming a raw commodity exporter under foreign control. He understood a basic truth that ‘eluded’ those who came after him:
Once you sell an asset, you lose control forever.
A lesson proven brutally true when everything he built was later privatised. In the name of efficiency. But not resulting in efficiency. In the name of public interest, but with profit extraction by foreign and corporate interests. We were betrayed from within, in a coup against economic sovereignty. Just as our investments were bearing fruit.
Because, unlike the neoliberal profiteers and useful idiots (Lange) who followed him, Muldoon had grasped the vital reality that a nations wealth isnt its budget balance.
It’s its productive capacity.
It’s its natural resources.
It’s its sovereignty.
All of which have been suffocated since.
With two exceptions ”Jim Anderton (Kiwibank) and Michael Cullen (KiwiSaver) kiwi politicians have done little to rebuild national wealth. Instead, they have hollowed it out, often under the pretence of “market efficiency”. But really looking like some version of corruption instead.
How, for example, did Muldoon’s oil refinery end up in the hands of the petrol companies? Sold off in the name of efficient markets? A smart child would see that as a cartel, a con, and a political betrayal.
Privatisation is too often just a fraud. Its not inherently bad, there are times when its useful, even necessary. But in New Zealand, it has been a wealth transfer from the public to the private, from New Zealanders to foreign capital.
The Last Great National Party Leader?
Muldoon had the guts to challenge global financial orthodoxy. To resist Rogernomics, stand up to speculative finance, and prioritize public welfare. In a very strange way, this makes the old reactionary an anti colonialist. Because we have been, and continue to be, colonised by corporations.
Muldoon’s kind of courage has been absent for too long.
Jim Bolger may have been the last good man in the National Party, and, like Caesar, he was stabbed for it. But Muldoon was the last great National Party Prime Minister.
Muldoon’s flaws? Many. His manner? Uncompromising. But his economic vision? Sound.
Muldoon was a man out of time. The bankers pets took him down. Keynesianism was killed in the west. The price of his fall? New Zealand lost control of its own future. Our infrastructure, industries, and wealth were stripped away.
And yet, in hindsight, his defeat proves he was fighting the right battle.
New Zealands task now, is to reclaim what was stolen. Who are we as a nation? For forty years, we’ve been trained not to ask that question. Because if we did, we might realise that our country isn’t actually run for us.
But we should ask it. And we should ask it urgently. Because we live in interesting times, and our Tweedle Dum, Tweedle Dee leadership seems determined to make them more interesting than we ever wanted them to be. Let’s improve things.
The power is in our hands.
Oh brother, I’m going to have to expand this comment. First though, good essay. :) It is going to be cathartic for me to write about Muldoon, but it was always inevitable. Just a few push-backs on your piece Tadhg, if you don’t mind?
Muldoon was forever in the wrong in his right-wing analysis that workers got a fair shake under the prevailing political economy (the hybrid monstrosity we know as 20th century “Western Capitalism”).
Muldoon was correct in recognizing full employment was good (but is this genius?). He was the “Last Mo-Keynesian” — that’ll be my title for the follow-up.
But, tragically, he and everyone else in his circle had no clue about the source of all unemployment. Result was, blaming the victim — instead of fixing the government policy mistake of unemploying and damaging people. That was unforgiveable. Why?
After all, in ignorance is it not at least good action to try to “create jobs”, something noble? We could debate it maybe, but in my book, when you see the plight of the poor, you need to recognize it is no fault of their own.
Thus, even without an understanding of the monetary system (and the effect of fixed exchange rates in Muldoon’s era) the right policy was to tolerate the inflation by providing for full employment. Not merely “jobs creation programs”. (Those programs, like “Think Big” can never satisfy all the justified wage demands.) You just instead go full Keynesian when in a fixed exchange rate environment. There is no other moral option unless you choose non-ignorance and adopt a floating exchange rate.
Double tragedy was when Douglas came in he dimly realized an NZD float was best, my guess is the extra policy degree of freedom is discernible to a nitwit (so again, speaks against Muldoon’s “genius”, but you know, he was caught up in a paradigm), but then Douglas and the Labour neolibs butchered everything else in NZ entirely like a gdamn economic Tarantino movie, but IRL.