Roger Douglas

"*These were dangerous times. David Lange and Roger Douglas, who have a huge responsibility for the colossal inflation during the mid-1980s, had given in to rapid wage inflation. At that time we were paying 25 per cent interest on bill rates, with inflation running at 18 per cent. The world was not very happy. Banks were pretty wary of lending money in those circumstances. Who the hell could pay 25 per cent interest? The way to make the Freightways privatisation risk free was to pre-sell the parts of the business that we wanted to sell but also to get ‘put options’ on bits of business we didn’t want to sell. That way the bank could put those businesses to our partners if it needed to.* *We had subsidiaries partly owned by Bandag, tyre retreading specialists, and Mayne Nickless. We went to them and said, ‘We’re going to* *buy the business; to help us fund it, we want you to agree to buy our half of the business if the banks insist, at this price.’ These were major companies and the combination of put options was sufficient for the bank to get all its dough back if the worst happened.*"

"The combination of Roger Douglas and the Treasury at that moment was brilliant. He wouldn’t have been purist if left to his own devices, and they wouldn’t have had much influence on their own. Then he reached out to serious businessmen to help sort out the problems like the state-owned enterprises; the sorts of roles that had traditionally been given to party hacks. It was a very exciting time for people interested in New Zealand and Roger executed many far-reaching and important reforms. The man deserves a bloody great statue; aside from Ruth Richardson, no other figure in recent New Zealand politics comes within a bull’s roar of him. Margaret Thatcher dragged England out of its socialist impasse and is now voted the most important British leader since the war. It is very slack that Roger and Ruth are not given the same regard in New Zealand."

"[6](private://read/01jrsfvkjy84rkprtbz9amfvj8/#rw-ref-note-477346-006497775-6). Goldsmith/Roger Douglas, October 2009; S Sheppard, *Broken Circle: The decline and fall of the Fourth Labour Government,* Wellington: PSL Press, p. 13, refers to a wager between Gibbs and Douglas over a couple of beers that he could trim 33 per cent off health costs."

"Gibbs had kept in touch with Roger Douglas since his exit from politics at the end of 1990. In 1992 he encouraged the former finance minister to write a book which tested his understanding that most of the money governments took in taxes was simply recycled back to the middle classes through the superannuation, education and health systems. The churning cost a lot but didn’t achieve much redistribution of income from rich to poor. Rodney Hide was dragooned to help with the book in the early months of 1993. Richard Prebble, who remained the Labour MP for Auckland Central until the 1993 election, helpfully asked a series of questions in the House. Treasury’s answers provided much of the research for Douglas’ book.[15](private://read/01jrsfvkjy84rkprtbz9amfvj8/#rw-num-note-477309-807254973-15)"

"Having helped set the ball rolling, Gibbs stepped back, much as he always had with a business, confining his role to asking difficult questions and proposing fresh ideas at strategy sessions. Roger Douglas continued to be struck by Gibbs’ restlessness. ‘He was always out at the sharp edge, looking for better ways of doing things,’ he says.[18](private://read/01jrsfvkjy84rkprtbz9amfvj8/#rw-num-note-477309-807254973-18) Money was his other prime contribution. Some years later, the party’s finances were leaked to the *Sunday Star-Times*. They revealed that Gibbs and his associates put $4 million into ACT’s 1996 election campaign, a huge sum in the context of New Zealand politics."