Social Credit Party (New Zealand)
The New Zealand Social Credit Party is a political party which served as the country's "third party" from the 1950s through into the 1980s. The party held a number of seats in the New Zealand House of Representatives, although never more than two at a time. It renamed itself the New Zealand Democratic Party from 1985 to 2018, and was for a time part of the Alliance from 1991 to 2002.
The party is based on the ideas of social credit, an economic theory established by Major C. H. Douglas. Social Credit movements also existed in Australia, Canada, and the United Kingdom although the relationship between those movements and the New Zealand movement was not always good.
History
The Social Credit Association
Before the founding of the Social Credit Party in 1953, there was the Social Credit Association. The association focused most of its efforts on the Country Party and New Zealand Labour Party, where they attempted to influence policy.The Social Credit Movement decided to set up a "separate political organisation" the Real Democracy Movement in 1942, but the RDM got only about 4,400 votes in the.
Roly Marks had stood as a monetary reform candidate on behalf of the Real Democracy Movement in the Wanganui electorate in 1943, and was later made a life member of the League.
Maurice Hayes stood for the electorate on behalf of the Social Credit Association in the, receiving 374 votes and coming third.
Social Credit claimed that the first Labour government, which was elected at the 1935 election, pulled New Zealand out of the Great Depression by adopting certain Social Credit policies. Several followers of Social Credit policies eventually left the Labour Party, where their proposals were strongly opposed by the "orthodox" Minister of Finance, Walter Nash and other prominent Labour Party members.
In 1940 Lee, who had by then been expelled from the Labour Party, and Bill Barnard formed the Democratic Labour Party. However the new party got only 4.3% of the vote in the 1943 general election, with both Lee and Barnard losing their seats.
Foundation
The Social Credit Party was established as the Social Credit Political League. It was founded on 10 January 1953, and grew out of the earlier Social Credit Association.The party's first leader was Wilfrid Owen, a businessman. Much of the early activity in the party involved formulating policy and promoting Social Credit theories to the public.
Early history (1953–1972)
Social Credit gained support quickly, and in the 1954 elections, the party won 11.13% of the vote. The party failed to win seats in parliament under the first past the post electoral system. The party's quick rise did, however, prompt discussion of the party's policies. National saw Social Credit as a threat in the 1957 election and established a caucus committee to challenge their theories. Gustafson comments that the successes in some seats came from a "peculiar and infrequent combination of factors", with votes in those seats coming from "a handful of committed monetary reformers plus alienated National voters and the tactical voting of Labour supporters in a seat where Labour could not win".In 1960 P. H. Matthews replaced Owen as leader. It was not until the 1966 elections, however, that the party won its first representation in parliament. Vernon Cracknell, an accountant, won the Hobson electorate in Northland, a region that had been a stronghold of the Country Party. Cracknell narrowly defeated the National Party's Logan Sloane, the incumbent, after having placed second in the previous two elections.
Cracknell did not prove to be a good performer in parliament itself, however, and did not succeed in advancing the Social Credit manifesto. Partly due to this, and partly due to an exceptionally poor campaign, Cracknell was not re-elected in the 1969 elections, returning Sloane to parliament and depriving Social Credit of its only seat.
The following year, a leadership contest between Cracknell and another prominent Social Credit member, John O'Brien, ended in disaster, with brawling between supporters of each candidate. The damage done to the party's image was considerable. O'Brien was eventually victorious, but his blunt and confrontational style caused him to lose his position after only a short time in office. He split from Social Credit to found his own New Democratic Party.
Popularity zenith (1972–1985)
O'Brien's replacement was Bruce Beetham, who would become the most well known Social Credit leader. Beetham took over in time for the 1972 elections. Despite a relatively strong showing, Social Credit failed to win any seats, a fact that some blamed on the rise of the new Values Party. While the Values Party did not win any seats, many supporters of Social Credit believed that it drew voters away from the older party.In the 1978 by-election in Rangitikei, caused by the death of National Party MP Roy Jack, Beetham managed to defeat National's replacement candidate and win the seat. Beetham was more successful in parliament than Cracknell had been, and gained Social Credit considerable attention. He also put forward a New Zealand Credit and Currency Bill, intended to implement many Social Credit policies. The Bill was criticised by some of the more extreme Social Credit supporters, who claimed that it was too weak, but was nevertheless strongly promoted in parliament by Beetham. The Bill quickly failed, although this was not particularly unexpected - it had been put forward primarily for the purpose of drawing attention, not because Beetham believed it would succeed.
Beetham retained his seat in the 1978 general election. He was later joined by Gary Knapp, who defeated free-market National Party candidate Don Brash in the 1980 by-election in East Coast Bays. Knapp, like Beetham, was highly active in parliament.
Led by Beetham and Knapp, Social Credit became a popular alternative to the two major parties. Political scientists debate how much of this was due to Social Credit policies and how much was merely a "protest vote" against the established parties, but one poll recorded Social Credit with as much as 30% of the vote.
By the 1981 elections, the party's support had subsided somewhat, and Social Credit only gained 20.55% of the vote. As expected, the electoral system did not translate this into seats in parliament, but Social Credit did retain the two seats it already held. A year later, it officially dropped "Political League" from its official name, becoming merely the Social Credit Party.
During that parliamentary term, Social Credit's support was damaged by a deal between Beetham and National Party Prime Minister Rob Muldoon. In exchange for Social Credit support for the Clyde Dam, a controversial construction project and part of Think Big, Muldoon undertook to back certain Social Credit proposals. This did considerable harm to Social Credit's popularity, as Muldoon's government were opposed by most Social Credit members. To make matters worse, Muldoon did not deliver on many of his pledges, depriving Social Credit of any significant victories with which to mitigate its earlier setback.
In 1983, Beetham suffered a minor heart attack, causing him to lose some of his earlier energy. He also became, according to many Social Credit supporters, more demanding and intolerant. This reduced Social Credit's appeal to voters.
In the 1984 elections, Beetham lost his Rangitikei seat to a National Party challenger, Denis Marshall. Knapp retained his East Coast Bays seat, and another Social Credit candidate, Neil Morrison, won Pakuranga. Despite still holding the same number of seats, Social Credit won only 7.6% of the total vote in 1984, a substantial drop. Some commentators attributed this to the New Zealand Party, an economically right-wing liberal party that opposed Muldoon's government. The New Zealand Party may have taken some of the protest votes that Social Credit once received. It was from this election that the term "Crimplene Suit and Skoda Brigade" was coined for Social Credit.
Democrats (1985–1991)
At the party's 1985 conference, the Social Credit name was dropped, and group became the New Zealand Democratic Party. At the 1987 election, the party held two seats in parliament. The Democratic Party lost both those seats, removing them from parliament. In 1988, Knapp and a group of other Democrats were involved in a protest at parliament to highlight the Labour government's abandonment on its election promise to hold a referendum on the first-past-the-post electoral system.The Social Credit name did not vanish immediately, however. In 1986, the year after the party was renamed, Bruce Beetham was removed from the leadership of the Democrats and replaced by Neil Morrison. Beetham was extremely bitter about his dismissal, and led a short-lived splinter group which readopted the Social Credit label. It failed to win any seats in 1990, however, and quickly vanished.
Alliance years (1991–2002)
The Democrats, finding themselves increasingly pressured by the growth of NewLabour and the Greens, decided to increase cooperation with compatible parties. This resulted in the Democrats joining NewLabour, the Greens and Maori-based party Mana Motuhake in forming the Alliance, a broad left-wing coalition group.In the 1996 election, which was conducted under the new mixed-member proportional representation electoral system, the Alliance won thirteen seats. Among the MPs elected were John Wright and Grant Gillon, both members of the Democratic Party. However, there was considerable dissatisfaction in the Democratic Party over the Alliance's course. Many Democrats believed that their views were not being incorporated into Alliance party policy, particularly as regards the core economic doctrine of social credit. The Alliance tended towards orthodox taxation based left-wing economics and was not prepared to implement the Democratic Party's somewhat unusual economic theories.
By the 1999 election, the Democrats were one of only two remaining component parties in the Alliance as the Greens had left the grouping and the Liberals and NewLabour components dissolved, their members becoming members of the Alliance as a whole rather than of any specific constituent party.
Progressive Coalition and independent again (2002–present)
In 2002, when tensions between the "moderate left" and the "hard left" caused a split in the Alliance, the Democrats followed Jim Anderton's moderate faction and became a part of the Progressive Coalition. In the 2002 election, Grant Gillon and John Wright were placed third and fourth on the party's list. However, the Progressives won only enough votes for two seats, thus leaving the two Democrats outside parliament.Shortly after the election, the Democrats split from the Progressives, re-establishing themselves as an independent party. However, Gillon and Wright, both of whom opposed the split, chose not to follow the Democrats, instead remaining with the Progressives. The Progressive Coalition became the Progressive Party after the Democrats left. The Democrats chose Stephnie de Ruyter, who had been fifth on the Progressive list, as their new leader.
In 2005, the party re-added "for Social Credit" to its name to supplement its party name. The Democrats contested that year's general election as an independent party and received 0.05% of the party vote. In the 2008 general election, the party again won 0.05% of the party vote.
The party did not apply for broadcasting funding for the 2011 election. During the election, it won 1,432 votes and was the only party to not attract a party vote in an electorate. The party fielded thirty electorate candidates and four list only candidates in the 2014 general election but continued to fail to gain any seats in the 51st New Zealand Parliament.
During the 2017 general election, the Democrats for Social Credit ran 26 candidates, namely 13 electorate candidates and 13 list only candidates. The party gained 806 votes on the party vote and failed to win any seats in Parliament.
In June 2018, the party voted to change its name back to Social Credit after Chris Leitch was elected leader.
Antisemitism
During the 20th century, the Social Credit movement in New Zealand was accused of indulging in antisemitic conspiracy theories. Major C. H. Douglas, the founder of the Social Credit movement, toured New Zealand in 1934 and expounded his view that Jews were involved in a global conspiracy to control finance. His ideas were discussed in the New Zealand Social Credit publication Plain Talk. Social Credit, along with the Department of Internal Affairs, published From Europe to New Zealand: An Account of Our Continental European Settlers by Eric Butler and R.A Lochore, which repeated Jewish financial conspiracy claims. In the 1980 East Coast Bays by-election, the Labour Party attempted to discredit Social Credit with a pamphlet that set out Major Douglas’s antisemitic views.The encyclopedia states that the antisemitism of Social Credit ended in the 1970s with the election of leader Bruce Beetham who was more liberal. Professor Paul Spooney stated that antisemitic sentiment was "largely irrelevant" by the 1970s, but remained present until 1984 when Beetham ejected party members who believed in an international financial Jewish conspiracy.
Social Credit continues to receive accusation of conspiracy theory and anti-semitism in spite of Major C. H. Douglas making distinctions between the ethnic-individual "Jew", who he specifically remarked as not "on trial", and the actual behaviour of banking cartels he sought to oppose. In contrast to accusations of anti-semitism, Mr Douglas also praised the "success in many walks of life" of Jewish people. More-recent analysis of fascist movements during post-war New Zealand suggests that although such conceptions are notable within the Social Credit movement, anti-Semitism was not a predominant
feature of monetary reform groups and was unlikely to provide the basis of a right-wing movement.
Electoral results
Office-holders
President
Vice-President
| Vice-President | Term |
| Cecil William Elvidge | 1953-? |
| Bruce Beetham | 1971-72 |
| Alan Patterson-Kane | 1972-? |