THE FAT CATS GET FATTER

The 2015 National Business Review  Rich List reveals that, while the rest of us struggle to get by, the rich have increased their wealth by $4 billion in just one year.

 An Oxford University professor meets a former Ph.d student and courteously inquires what he's working on these days. 

 "I'm writing a book," says the other, "on the survival of the class system in New Zealand."

 "Really, how fascinating. I didn't think they had a class system in New Zealand."
 "Nobody does. That's how it survives."

ThIS IS AN OLD JOKE  but there is a kernel of truth to it. Until the early 1970s New Zealand had a reputation of being one of the most egalitarian countries in the world. A cursory check through the archives will reveal commentaries about New Zealand being the 'first welfare state' and a country that didn't have the obvious class divisions of other countries such as Britain.

Indeed New Zealanders themselves mostly viewed themselves as one people. We took pride in the achievements of the Labour government of Mickey Savage, we enjoyed long hot summers on the beach and the All Blacks never lost.

But in 1967 the National Government presented the country with a nil wage order. It was the first announcement of the end of the post war boom, in which social democracy had prospered, and the foretold the neoliberal offensive of the past three decades. In the last thirty years the gains of social democracy have been dismantled by Labour and National governments alike.

Obviously this has accelerated the division between the rich and poor and New Zealand's class system has become fully exposed.

The recent talk from the corporate media and economists has been about the 'rock star economy', and it certainly has been a prosperous time for the wealthy. The 2015 National Business Review rich-list reveals that the rich have increased their wealth by $4 billion in just one year. The total wealth of the top 184 earners in New Zealand now tops $55 billion.

In stark contrast the rest of us are either treading water or drowning.  There has not been much evidence of 'the rock star economy' in the growing queues outside the food banks.

This week my local newspaper The Star features a front page story abut more and more Canterbury people struggling to pay the winter power bills. A budget advisor with the Salvation Army comments that in the past it was mostly beneficiaries who struggled paying the power bills - now an increasing number of people in paid employment are  turning to the Salvation Army for help. There's no evidence of the economic good times here either.

Of course there will now, inevitably, be a universal condemnation of the widening gap between the wealthy and the rest of us . Various commentators and bloggers, some of them linked to the Labour Party, will again demand economic policies that will address New Zealand's growing inequality.

Putting aside the very big problem that Labour, if it ever becomes the government, has no intention of upsetting the neoliberal applecart, such a view is back to front. It is not that inequality is the source of all our problems, it is a symptom of a much more fundamental problem.

The central contradiction is not the distribution of wealth. Instead it is the mode of production itself: production for the profit of the owners of the means of production against the social need of the majority.

It was Rosa Luxemburg who observed, somewhat wryly, that “the end of political economy as a science constitutes a world historic task” . Indeed those who talk of 'the economy' as if it was some kind of natural reality undisturbed by class interest display their ignorance and their failure to read and understand Marx.

It was Marx who observed that the impoverishment of the working class develops alongside the concentration of capital.

The solution to New Zealand's growing level of inequality, with all the many social problems that provokes, is the replacement of the present mode of economic production with a planned economy based on common ownership.

In 1918, in one of her last articles, Rosa Luxemburg wrote that 'a world must be turned upside down'. That still applies today.