The Boys In Blue: a New Zealand dictatorship TL

The Boys In Blue: New Zealand's Emergency Years


Part A: The 1935-1945 Labour Government

On the night of Wednesday, 27th November, 1935, a large crowd gathered outside the Evening Post office in Willis Street, Wellington. As they had four years earlier, they had come to watch the large screen election results.

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Election night crowd

It had been a difficult four years. Four years of unemployment, four years of sugar bags being sewn into clothes. Four years of grinding poverty and deprivation.

The papers all said the economy was on the mend, that Coates' daring currency devaluation had worked, and that he and Prime Minister Forbes ought to be thanked for steering the nation through such a major crisis. But the crowd on Willis Street was having none of that. The Reform-United Coalition deserved to be thrown out on its ear. But voting the rotters out was one thing. Who would take their place was another. Could Labour be trusted? Some shook their heads. That Holland was a Bolshevik, they said. Others said that Bolshevism sounded a damn good idea after the hell the Coalition had put the country through.

As the results came in, seat after seat fell to Labour. From Invercargill and Dunedin, to Mid-Canterbury, to Masterton and Manawatu, and even to Tauranga and Bay of Plenty, the country was turning red. In many cases the Government was splitting the right-wing vote with the small Democratic Party, just as Labour had hoped and the press had feared.

As the night wore on, the result became a rout, in seats if not quite in vote share. The Reform and United loyalists in the crowd muttered darkly about "combined conservative votes", but their socialist brethren were having none of it. Tonight they would walk back home, knowing that the forces of hope and light had triumphed over greed and darkness.

1935 election results

Labour: 45 seats (42% of the vote)
Reform-United: 24 seats (35% of the vote)
Democrats: 3 seats (10% of the vote)
Country Party: 2 seats (2% of the vote)
Ratana: 2 seats (1% of the vote)
Independents: 4

Harry Holland had become leader of New Zealand's first Labour Government

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Harry Holland

In front of the Westport Town Hall, the 67 year old Holland openly wept amid the swarming newspaper reporters. He had never thought he would live to see this day, especially after the health problems and minor heart attack a couple of years back. Some in the party had muttered about him being too old, and too extreme to appeal to voters in marginal seats, especially women. After 1931 the papers had piled on too, mocking him for not understanding the fine detail of policy. There had been dark nights when he'd nearly considered quitting.

But no, tonight the people of New Zealand had thrown off the shackles of capitalism. A new socialist dawn awaited, and as with the old Ballance Liberals forty years earlier, the country would again be the envy of the world.

"A socialist utopia is all well and good, Mr Holland," said a reporter. "Or should I say, Prime Minister Holland, but throughout the campaign Mr Forbes and Mr Coates suggested that you are an extremist. What do you say to that now?"

Holland wiped his eyes with a handkerchief.

"Ah," he said with a smile. "“What man is worthwhile if he is not an extremist? Would Christ ever have gone to the Cross if He had not been an extremist? Would the primitive Christians, especially during the first three centuries of Christian history, ever have been called upon to endure what they endured if they had not been extremists? Would the Christians have made Christianity the power it eventually became if they had not been extremists? Who would object to a man being extremely honest?”
 
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A New Zealand what now?:confused::confused:

Well, if anything its original. :D:D

You sir have garnered my interest. It will be nice to see my little southern neighbor change its stripes, so to speak.
 
This sounds like I'm going to enjoy this so much, but it doesn't seem to be particularly plausible. I guess I'll have to wait for more updates to make a proper judgement :)
 
(OOC - Much of this part is still laying the groundwork. We won't get to the actual dictatorship for a little while yet (it won't be a Christian Socialist one either). As for plausibility, literally the only significant thing I changed in the first post was Holland not dying in 1933 - OTL Labour won a bigger landslide under the moderate who replaced him, Michael Joseph Savage. The divergence is going to get more marked though...).

Cabinet:

Prime Minister Harry Holland
Attorney General: Rex Mason
Minister of Defence: John A. Lee
Minister of Education: John Payne
Minister of Finance: Walter Nash
Minister of Foreign Affairs: John A. Lee
Minister of Health: M.J. Savage
Minister of Industry: Paddy Webb
Minister of Labour: F.P. Walsh
Minister of Justice: Rex Mason
Minister of Maori Affairs: Harry Holland
Minister of Railways: Bob Semple
Minister of Social Welfare: John Payne
Minister of Internal Affairs: Bill Parry

Notable was the treatment of the three leaders of Labour's perceived moderate faction: Peter Fraser was given a non-cabinet undersecretarial role, with M.J. Savage being given the thankless role of Health (the third, Walter Nash, retained his iron grip on Finance). The exact reasons for this apparent marginalisation remain unclear, though it is known that Holland distrusted Fraser and Savage, possibly due to their rumoured role in an unsuccessful leadership challenge in 1933. For his part, John A. Lee would, in his later years, be known to cackle madly in his prison cell about "getting one over those bastards". Given Lee's mental state during his confinement in the Auckland Islands, it is anyone's guess what he was referring to.

The new Government moved quickly, approving an emergency Christmas Bonus for the unemployed, followed within a matter of months by Payne's creation of a comprehensive and integrated system of social welfare. In his other capacity, that of Minister of Education, Payne enacted his long-standing goal of free tertiary education.

Perhaps more interesting was Savage's creation of a free and universal health care system, with a Government monopoly on provision of medical and dental services. This evoked outrage from within the medical profession, to the extent that the issue dragged out well into 1938, becoming a lingering difficulty for the Government. Holland was forced to intervene personally in order to prevent a service boycott from the British Medical Association:

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Cartoon, featuring the Ministers for Health and Finance trying to treat patients

One Remuera woman wrote to the New Zealand Herald on 15th August 1937:

This barbaric attack on individual freedom shall not be borne. I suspect the country shall not long stand for this grubby-fingered barbarian and his Government. Half of them have been in prison before, and one only hopes they will be in prison again!

But it was in the sphere of economics where the Labour Government proved most contentious. Notwithstanding the opposition of Nash, who felt others (especially Lee) were intruding into his domain, the Government embarked on a vast and ambitious programme of nationalisation. The Reserve Bank of New Zealand, operating as the Central Bank, was brought into state control immediately. It was followed within a year by the Bank of New Zealand. Ports, shipping companies, and the entire mining industry were nationalised in 1937 (the last having been a lifelong goal of Paddy Webb), together with freezing works, freight, timber, pulp and paper mills, and even breweries.

The response of the financial class was swift. Pounds flooded out of New Zealand, seeking security in Australia instead. In early 1938, Treasury Officials informed Nash that the country faced an impending Balance of Payments crisis.

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Walter Nash

Our knowledge of subsequent events is extensive, for which we can thank Nash's well-known propensity to hoard all paperwork regardless of importance. The relevant documents, including much sensitive cabinet material, was discovered in a suitcase by Nash's adopted grandson, Stuart, in March 2001.

In February 1938 Nash seemingly approached Cabinet with twin recommendations: a public assurance from the Government that the nationalisations would cease, and that in his capacity as Minister of Finance he would be permitted to seek a low-interest bail-out from the Bank of England.

The Prime Minister rejected the idea of a stop to nationalisation, pointing out that Labour's foremost role was as the champion of the working man. Socialism could only be achieved by the gradual extension of public ownership, a point cabinet was near unanimous in endorsing.

More problematic was the issue of the apparent run on the pound. If Nash was to get a bailout, the Government's agenda would be hamstrung. It was at this point that Lee suggested replacing the entire financial sector with a state monopoly on the provision and control of credit.

"And so," said Lee, "we would cease to be at the mercy of a capital strike controlled by overseas interests."

Rex Mason was reportedly delighted, suggesting that the country take the opportunity to replace the pound with decimal currency. "We would kill two birds with one stone."

Though Nash and Savage argued for several hours for a more orthodox approach, the radical majority in cabinet carried the day.

Walter Nash tendered his resignation the following morning, subsequently telling his family that he expected Lee to come to a bad end. Holland replaced him with John Payne, who had a background in accountancy. Terry McCoombs took over at Education.
 
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Very interesting idea! I'm also interested in what Britain would do here. I would have thought they would have said and done a lot already, admittedly behind the scenes (just look where the High Commission is based today, right across the road from parliament).

Given at the time (like now) the main banks were foreign controlled (Australia/London), the London money markets and the vice like grip London had on our export market, I imagine they could exert a hell of a lot of pressure if they wanted to do so.
 
Regarding Britain and control of finance: in OTL there really was a run on the New Zealand pound, and Nash really did go cap in hand to the Bank of England for a bailout. The war then proceeded to make the issue rather moot, though Lee (who was on the sidelines, and well on the way to being chucked out the party) did suggest state controlled credit as an alternative to the bailout.

The real difference between TTL and OTL so far is the level of nationalisation: in OTL the likes of Paddy Webb fought endlessly at cabinet level to nationalise the mining industry, only to be blocked by the moderate troika of Savage, Fraser, and Nash. New Zealand's real-life Labour Government arguably had more in common with Sweden's Social Democrats than it did with Attlee in the UK.
 
The Government's proposed monopolisation of banking and credit met with a firestorm in the press. The editorials of the New Zealand Herald gleefully noted that 1938 was indeed an election year, and that the people of New Zealand would soon remove this monstrosity of a socialist government. Egged on by Lee, Holland pressed ahead anyway, but soon discovered that the biggest obstacle was not the newspapers or even the bitterness of Nash on the backbenches. Rather, a constitutional relic decided to revive itself: the Legislative Council.

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Legislative Council chamber

New Zealand's appointed Upper House, modelled on the British House of Lords, had long been considered a bad parliamentary joke. Intended as a chamber to scrutinise legislation passed by the House of Representatives, it had been a good half a century since the Council had operated as anything other than a convenient source of patronage for the government of the day. It thus came as a horrible shock to the Holland Government, when the Council, still packed with appointees from previous conservative governments, decided to veto his banking and credit scheme.

Two approaches suggested themselves to Cabinet. The first was to flood the Legislative Council with Labour appointees in order to get the bill passed. The Liberals in the 1890s had previously used this tactic. The other was to seek to abolish the Legislative Council altogether. John Payne, the new Minister of Finance, had long favoured the latter option, but as Attorney-General Rex Mason pointed out, abolition would not be possible without packing the Upper Chamber first.

So Prime Minister Holland, with Cabinet approval, approached the Governor-General, Viscount Galway, requesting that two dozen appointments be made to the Legislative Council.

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Viscount Galway

Viscount Galway, Eton-educated and having previously attempted a political career in the United Kingdom, declined the request.

The Labour Government erupted in outrage. First they had been blocked by the previous government's stacking of the Upper House. Now they were being thwarted by another unelected figurehead: the supposedly neutral vice-regal representative. Holland's health was starting to fail again, so he was unable to vent his full fury in the public arena, other than to note that the will of the people would not be thwarted by a mere toff in a silly hat. He also warned the Governor-General that unless the appointments were made, he would send a telegram to King George VI, requesting that the King remove him as Governor-General.

"But what if the King refuses too?" muttered more than one Cabinet minister on learning of developments.

According to Mason's diary, Lee only smiled. "Then we fight," he said. "Then we fight."

Meanwhile, events were threatening to get nasty at Government House.

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Government House

Walsh's friends in the union movement had invaded the grounds at the Governor-General's official residence, essentially barricading the Viscount inside. And the Cabinet was in no mood to instruct the police to remove them.

"Anarchy!" screamed the New Zealand Herald headline the next day. "Labour's violent thugs have declared war upon the person of the King's representative. This is an outrage!"

But by then the Viscount had announced both his surrender and his resignation. The appointments would go ahead.
 
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I'm just surprised the Legislative Council hadn't already raised trouble. For the life of me, I can't remember what it actually did in 1935-8 though. There must have been some issues surely.
 
NZ politics, my guilty pleasure, fantastic!

Sad to see Walter Nash's long career truncated so soon - though he'll live another thirty years in OTL, so there's always the chance of a comeback. Its many years since I've read his biographies, but I seem to recall that his tenure as Finance Minister was plagued by a precarious and utterly one-sided economic relationship with London. Ideology dictates that his successor will have even less room to maneuver.

Points for a creative and unique POD. Now with Frasier and Nash marginalised and Savage's time running out - who will succeed Holland? My hunch is a further lurch towards radicalism under John A Lee, with things going south from there? Dictatorship/"National Government" from '46?

What's Holland's (wider) public image like ITTL? How does it compare with the "kindly uncle" (and latterly martyr) image of MJS?

Welcome to posting :)
 
Given that New Zealand hadnt ratified the Westminister Accords, they are not yet completely self governing. Judicial appeals can still be made to London, etc. It will be VERY interesting to see what happens.

Welcome, as others have said, and have a virtual drink on me.
 
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