The case for armed neutrality

The government tells us we can’t afford to repair our broken public health system, lift families out of poverty, or meet our international climate change or aid obligations (the list goes on and on) but an extra $9 billion to increase the lethality of our armed forces, no problem.

The coalition government isn’t alone in claiming that the books need to be balanced and there’s zero new money for the essentials of life but on the other,  that the fiscal straight jacket doesn’t apply to military budgets.

Germany, long the poster child of austerity economics, and the UK Labour government, which cut its winter heating allowance pushing up to 100,000 pensioners into poverty, have embarked on massive rearmaments projects.

In both the UK and Germany, a case – no matter how morally dubious – can be made that the move makes economic sense.

The one-time leftwing financial journalist and unsuccessful UK Labour candidate Paul Mason, a cheerleader for increased military spending, recently enthused on X: 

Rearm and the economy will grow. Period. In 18 months’ time our problem will be skills shortages and inflation, while America’s problem will be people bankrupted by crypto. Embrace the change, connect with Europe and lead the free world!

In Germany, Volkswagen is, not for the first time, planning to shift from making cars to tanks. An EY study on the “Economic Effect of European Defense Investments” estimated Europe’s NATO members will invest €72 billion annually resulting in 680,000 jobs.

Former Greek finance minister, economist Yanis Varoufakis has pointed out the success of US military Keynesianism is dependent on its “forever wars.” (It’s not hyperbole: the Congressional Research Service documented 251 instances of US military overseas engagements between 1945 and 2023.)

Any ethical qualms aside, for New Zealand military Keynesianism isn’t an option. The government says it’s committed to the country’s armed forces being interoperable with Australia and our Five Eyes partners: that means buying high-tech weaponry manufactured by the US and its allies.  The economic impact will be seen in our balance of payments deficit not increased jobs. 

In an interview, in which she compared releasing the Defence Capability Plan, last month, to giving birth, defence minister Judith Collins said history showed us that there was a “very strong possibility” that the enhanced strike ability would be used in coming decades.

It’s hard to know for sure which history Collins is referring to but if it’s, say, the Vietnam or Korean wars, it’s not at all obvious that the lesson we should take is to send our young soldiers overseas to once again kill and be killed.

The world, the plan notes, is increasingly volatile and “our personnel are expected to be called upon more often, in more places, for longer”. 

It commits New Zealand to spending $12 billion over the next four years – an increase of $9 billion over baseline funding – to enhance the lethality of our strike capability. 

The stated rationale for the massive increase in spending is a need to protect the rules-based order, shared values, and supporting our Pacific neighbours.

The rules-based order is crumbling and has been for some time. The US recently announced it wouldn’t pay its WTO dues. This comes after years of blocking the appointment of WTO judges effectively neutering the organisation tasked with upholding the rules-based order when it comes to trade.

Meanwhile, efforts by the International Criminal Court and the International Court of Justice to adjudicate the legality of what Amnesty International, Human Rights Watch and B’Tselem have all described as Israel’s genocide in Gaza have been actively opposed by the US.

A country recently described by economist Paul Krugman like this: “[W]e’ve become a country whose government claims the right to kidnap people whenever it likes and ship them to foreign gulags. Who wants to be allied with such a government? Who will trust such a government to keep its word on anything?”

It seems the answer to that question is our coalition government. While the US isn’t specifically mentioned in the document – presumably because it would be politically unpopular – being interoperable with Australia means being interoperable with its number one ally: the USA.

You’d think that “supporting our Pacific neighbours” would begin by listening to them.

Pacific Island leaders have been vocal in their condemnation of Australia’s agreement to purchase up to eight nuclear powered submarines as part of the Aukus agreement which they say goes against the spirit – if not the letter – of the South Pacific Nuclear Free Zone Treaty (also known as the Treaty of Rarotonga.)

Climate change, not armed conflict, is the existential threat lapping on their shores.

It’s a thought echoed recently by the former chief of the Australian Defence Forces, Chris Barrie: “[R]eal climate action means making climate the number one priority of economics and politics.

“Among other things, that means putting strategic rivalries to one side in favour of co-operation between states in this fight for survival.”

The coalition government has rolled back the country’s climate change efforts that were already rated “highly insufficient” by Climate Action Tracker. 

It’s easy to imagine a role for a beefed-up New Zealand military in helping our Pacific neighbours deal with the inevitable impact of climate change and the resulting sea level rise.

But increased engineering and medical capability would replace lethality as the priority in a scenario where climate change was recognised as a greater threat to our region than China.

A recent RNZ survey found that the majority of New Zealanders viewed the country’s relationship with both China and the US as either neutral or friendly with just 16.8 percent viewing China a “foe” and 14.3 percent the US.

But 50.3 percent of respondents did support increasing our military spending.

I’d like to think that given the choice between what the Canadian writer Naomi Klein calls Market Stalinism and Trump’s gangster capitalism most New Zealanders would opt for neither.

It’s an idea that appeals across the political spectrum. In the 1980s Bob Jones’ economically laissez-faire New Zealand Party ran on a policy of neutrality and today Te Pati Maori points to neutral Switzerland as a model for Aotearoa.

The government boasts that the increased military spending will see New Zealand reach 2 percent of GDP – the target for NATO countries.

Switzerland spends under 1 percent of GDP which includes the cost of conscription. It spends 0.6 percent on international aid – just shy of the UN target of 0.7 percent. 

New Zealand spends less than 0.3 percent of GDP – and dropping –  on international aid.

Jeremy Rose is a Wellington/Pōneke journalist.