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.
Kia ora bud! Thank you for the gift of your time and attention! I appreciate you.
You raise strong points, and I agree—Muldoon didn’t challenge the broader capitalist structure, and his employment policies weren’t as radical as they could have been. But my thesis of his genius isn’t just about ideas—it’s about having the will to fight for them against enormous pressure. Genius is 1% inspiration, 99% perspiration, and Muldoon actually fought to hold the line when others folded. He was a flawed man at an extremely difficult point in political economic space/time.
Muldoon wasn’t operating in a vacuum—he governed during a tectonic shift in (we tend to focus on the social changes) *global finance*.
As Eric Helleiner documents, the late 1970s and early 1980s were the birth of financial liberalization—global capital was breaking free from state control, and Muldoon was resisting that tide.
So was he a perfect Keynesian? No. But was he trying to protect national economic control in the last moment before it was lost? Yes. If he had caved earlier, New Zealand might have gone down the neoliberal path even sooner and even harder.
So the real question isn’t just ‘Was Muldoon’s model perfect?’ (If I’m reading your criticism correctly?)—it’s ‘Was what came after him better?’ If we agree the answer is no, then the real lesson isn’t about him—it’s about how we reclaim what was lost. Or rebuild it.
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.
Kia ora bud! Thank you for the gift of your time and attention! I appreciate you.
You raise strong points, and I agree—Muldoon didn’t challenge the broader capitalist structure, and his employment policies weren’t as radical as they could have been. But my thesis of his genius isn’t just about ideas—it’s about having the will to fight for them against enormous pressure. Genius is 1% inspiration, 99% perspiration, and Muldoon actually fought to hold the line when others folded. He was a flawed man at an extremely difficult point in political economic space/time.
Muldoon wasn’t operating in a vacuum—he governed during a tectonic shift in (we tend to focus on the social changes) *global finance*.
As Eric Helleiner documents, the late 1970s and early 1980s were the birth of financial liberalization—global capital was breaking free from state control, and Muldoon was resisting that tide.
So was he a perfect Keynesian? No. But was he trying to protect national economic control in the last moment before it was lost? Yes. If he had caved earlier, New Zealand might have gone down the neoliberal path even sooner and even harder.
So the real question isn’t just ‘Was Muldoon’s model perfect?’ (If I’m reading your criticism correctly?)—it’s ‘Was what came after him better?’ If we agree the answer is no, then the real lesson isn’t about him—it’s about how we reclaim what was lost. Or rebuild it.