ACT have always had two strong components to their brand. On economic issues they were strongly liberal, supporting massive tax cuts, no minimum wage, privatization of all SOEs etc. Those who served with Banks in the National Cabinet say Banks was not a huge supporter of the Richardson camp. He certainly is a fiscal conservative, and centre-right economically. But not someone who would privatize the hospitals.Lindsay Mitchell agrees.
The other component to the ACT brand has been a degree of social liberalism. This has been patchy rather than consistent, but overall most ACT MPs have been social liberals. John Banks would not describe himself as a social liberal.
Therefore my conclusion is that ACT, as we know it, is dead. There is talk of a name change for ACT, and that would be a sensible move, both because of the different brand John Banks has, but also because the ACT brand itself is pretty tarnished also.
Banks should move to position ACT as a conservative party, which reflects John Banks. Banks would be a good leader of a conservative party. The challenge of course is you also have a Conservative Party led by Colin Craig. And as I understand it, relations between Craig and Banks are not friendly – Craig took many votes off Banks for the Auckland Mayoralty.
A merger between whatever ACT gets re-named and the Conservatives would be a win-win, if they can work together. Craig has the money and the membership base. Banks has the seat in Parliament which means you do not need to make 5%. However just because it is logical does not mean it will happen. Colin Craig doesn’t strike me as someone who would settle for co-leader.
As for ACT itself, my suggestion is that those who identify as economic and social liberals need to have a get together next year and look at who is willing to commit to a new party, perhaps calling it the Liberal Party, and targeting the 2014 election. Many many especially urban younger New Zealanders are classical liberals (even if they have not heard the phrase) and support lower taxes, a smaller state etc but also don’t think Parliament should be greatly restricting what consenting adults can do.
I’m not about to quit the party I support, but I would be prepared to spend quite a bit of time assisting the formation of a new Liberal Party, and making sure lessons are learnt from the mistakes of the past.
I wonder whether Banks' overtures to the Conservatives were designed to push out the remaining liberals. By various online discussion threads, that seems to have been the effect.
I think there's space for a cosmopolitan liberal party grounded more in evidence-based policy than in ideology - pushing liberal policies for which there's sound support - and focused on incremental gains. As a rough cut from the 2008 NZES, there are around 7-8% that would fall into the top quartile of economic liberalism and the top quartile of social liberalism. That's more than are found in the top quartile of economic liberalism and bottom quartile of social liberalism, but still suggests that a Party playing to a hard-core libertarian base would fail.
A party focused as strongly on social freedoms as economic freedoms would have a harder time getting the soft-touch treatment that National has given ACT as it could plausibly go into coalition with Labour. But if it could get over the 5% hurdle, which would involve a massive amount of work with a good chance of failing, it could have reasonable long-term influence relative to a limited set of goals. Advancing economic freedom in coalition with National while preventing some erosions of social liberty, and advancing social liberalism in coalition with Labour/Green while perhaps mitigating the worst of their economic policies, would be an admirable achievement. I'd hoped that this was where Brash would take ACT, back before I figured out what Banks was.
The core enthusiasm and grunt-work for any new Liberal party would have to come from the ranks of the ACT on Campus group and the better parts of their List. But they'll need a few more experienced hands; it's good to hear Farrar's willing to help them out.
Bit of fun: on one of the discussion threads, Peter Cresswell paints me as part of a Gramscean liberal march through the institutions; I suppose I tend to be a bit of a counterhegemonist at the margin. Can there be marginal counterhegemony? Heck, just promoting mainstream economics is sometimes counterhegemonistic [though heads may explode both right and left at the suggestion].