THE TWO WORLDS OF MIDDLE EARTH: NEW ZEALAND'S

S E C R E T SECTION 01 OF 03 WELLINGTON 000274

SIPDIS

NOFORN

E.O. 12958: DECL: 03/23/2015
TAGS: PREL PGOV NZ
SUBJECT: THE TWO WORLDS OF MIDDLE EARTH: NEW ZEALAND'S
STRATEGIC POLICIES

REF: A) WELLINGTON 0234 B) WELLINGTON 0233 C)

WELLINGTON 0157 D) 04 WELLINGTON 0470 E) 04
WELLINGTON 0173

Classified By: Ambassador Charles J. Swindells; reasons 1.5 (B and D)


1. (S/NF ) Summary: Foreign and defense policies in New
Zealand are the product of an internal debate between two
worlds. The first world -- most military, intelligence,
foreign affairs and business professionals, and a handful of
politicians -- values its relationship with the United States
and still sees New Zealand as a U.S. ally. The other world
-- most politicians, media, academics and much of the public
-- views the United States with suspicion or hostility and
sees New Zealand as non-aligned. These worlds meet in the
person of Prime Minister Clark, who alone controls the
defense and intelligence portfolios within cabinet, and who
can always call on the "other-worlders" in the Labour caucus
to rein in her long-time rival, Foreign Minister Goff. This
matters to the United States, because the Prime Minister uses
military and intelligence cooperation with the U.S. -- and
high-level visits in particular -- to give the illusion in
some circles in Washington that New Zealand is still an ally,
while maintaining as much as possible New Zealand,s
non-aligned policies and the PM,s anti-American image at
home. Post's ability to bridge the gap between these two
worlds and effect needed policy changes requires a clear,
consistent message both here and in Washington of USG
interests and priorities. End Summary.


2. (SBU/NF) Since New Zealand left ANZUS in 1987, its
foreign and defense policies have been formed by an internal
debate between two worlds. The first includes most military,
intelligence and foreign affairs professionals, and a few
politicians. This world understands that New Zealand can be
greatly affected by events outside the South Pacific and
therefore must help shape events despite its small size and
geographic isolation. This world recognizes that as a small
country New Zealand cannot by itself impact world events, and
sees the United States as the greatest source of global
stability and positive change. By extension, even though
this world may disagree with the United States on specific
policies, it still sees New Zealand as a U.S. ally, and is
eager to play a role, however small, supporting us around the
globe. Washington policy makers deal almost exclusively with
first-world New Zealand.


3. (C/NF) The other world -- made up of most politicians,
the media, academics, non-governmental organizations and a
slight majority of the public -- also believes that New
Zealand's small size means its own actions cannot by
themselves effect international change. But this world sees
the United States as a source of global corruption and
instability: a bully, inimical toward small nations (and
toward New Zealand in particular, because of its "heroic"
defiance over the nuclear issue). It views any cooperation
with the United States with suspicion or outright hostility.
The other-worlders believe that New Zealand,s small size,
geographic isolation and "internationalist" foreign policy
protect it from harm. U.S. officials are seldom exposed to
the other New Zealand except through Embassy reporting,
though occasionally meetings lift the veil, as when Minister
for Disarmament and Non-Proliferation Marian Hobbs indicated
to U.S. Ambassador to the Conference on Disarmament Jackie
Sanders that elimination of all U.S. nuclear arms was as
important to world security as was blocking Iran's nuclear
program (Ref B).


4. (S/NF) These two worlds meet in the person of Prime
Minister Helen Clark. The Prime Minister holds the
intelligence portfolio, and provides extremely limited
briefings to her cabinet colleagues on the extent to which
New Zealand cooperates with the United States in this area.
Senior Foreign Affairs and Defence colleagues (strictly
protect) tell us only Foreign Minister Goff, Finance Minister
Cullen and (possibly) Economic Development Minister Anderton
have any inkling of U.S.-New Zealand joint intelligence
activities. The Prime Minister also runs defense policy.
She appointed a loyal, self-professed "peacenik," Mark
Burton, as Defence Minister. Burton, who devotes most of his
time to his other ministerial portfolio, Tourism, defers all
decisions on defense matters to the Prime Minister. The PM
Clark's control over foreign policy is less absolute, but she
occasionally outflanks Foreign Minister Goff on the left by
stirring up her largely other-world Labour Party Caucus.

5. (C/NF) New Zealand,s absence from the Coalition in Iraq
is a good example. We are told that Foreign Minister Goff,
while not a strong supporter of the Coalition, worried that
New Zealand,s absence would have significant economic and
political ramifications. (Comment: Goff also has an Amcit
nephew serving in Iraq and another soon to graduate from West
Point. End Comment.) PM Clark stoked anti-American
sentiment in the Caucus, leaving Goff isolated in Cabinet
discussion of New Zealand,s participation. Senior MOD
officials (strictly protect) tell us it was not until Finance
Minister Michael Cullen pointed out in a subsequent Cabinet
meeting that New Zealand's absence from Iraq might cost NZ
dairy conglomerate Fonterra the lucrative dairy supply
contract it enjoyed under the UN Oil for Food program, that
the PM found a face-saving compromise and sent combat
engineers in a non-combat role to Basra, where they were
embedded with British forces. By then, however, the PM had
so stirred up anti-war sentiment that she had to expend a lot
of political capital to get Caucus and Cabinet support for
this time-limited deployment. The PM deftly managed the
dust-up, while GoNZ officials quickly cashed in on New
Zealand's presence in Iraq, receiving repeated expressions of
thanks from senior USG officials (possibly because they had
so little else to discuss with visiting NZ dignitaries).


6. (S/NF) Prime Minister Clark's tight control of the
bilateral security relationship allows her to play up New
Zealand's support for USG objectives to Washington while
avoiding significant, potentially controversial policy
changes at home, changes that would strengthen the
relationship in the long term. This tactic has been an
important element of New Zealand's charm offensive in pursuit
of a U.S.-NZ Free Trade Agreement (FTA). NZ officials admit
in private that they have not come up with compelling
economic arguments that would interest the USG in an FTA
negotiation, so they are working hard to make the case that
New Zealand's "strategic" importance to the U.S. -- the PRT
and SAS deployments in Afghanistan, growth in intelligence
cooperation, and sending combat engineers to Basra -- merits
an FTA. The Prime Minister's meetings with senior USG
officials, including flag-rank officers and members of
Congress, are carefully scripted to that end, and she has
made it very clear that she resents the Ambassador's use of
country team pre-briefings to reveal her government's "other
world" policies to U.S. visitors (Ref A).


7. (C/NF) But whether New Zealand should or should not have
an FTA with the United States is only one issue in a diverse,
complex bilateral relationship. The FTA discussion has been
useful mainly because it has focused public attention on New
Zealand's relationship with the United States and has raised
public questions about the country's lack of strategic policy
direction. PM Clark's balancing act between New Zealand's
two worlds shows how little has been done here since New
Zealand left ANZUS to shape an agreed vision of the country's
foreign and defense policies. We have been told by senior
MOD and NZDF officials (strictly protect) that their efforts
to update the badly outdated 1999 Defence White Paper, which
underlies military spending priorities through 2009, was
rebuffed because the Prime Minister did not want to re-open
contentious debate in the Labour Party Caucus on the
direction of New Zealand's security policies. The general
consensus among the otherworlders that New Zealand's
influence is greater working through the United Nations,
because of the UN's "moral authority," is too vague to
constitute a clear vision for most Kiwis. Further, recent
events highlighting UN ineffectiveness and corruption have
shaken the faith of New Zealanders in their strict
internationalist approach to global issues.


8. (C/NF) Even some otherworld Kiwis, particularly
journalists and academics, are beginning to wonder publicly
if New Zealand has not cut itself adrift in increasingly
dangerous seas. But while the first-world solution to this
policy incoherence would be to get rid of New Zealand's
anti-nuclear legislation and return to ANZUS, this would be a
bitter pill for the otherworlders to swallow. And, of course,
a full-court press from the U.S. Embassy on the subject would
allow the Clark Government to dismiss our concerns as "U.S.
bullying." Still, our first-world contacts continue to
encourage us to, in the words of a senior MOD official
(strictly protect),"help us get out of the hole we have dug
for ourselves." Therefore, we have worked hard to reach
beyond our customary first-world contacts with explanations
to other-world New Zealand of how the nuclear propulsion ban
keeps New Zealand's relationship with the United States (and
to a large extent, with Australia) stuck in the Cold War era.
We have used media backgrounders and classroom discussions
to ask what kind of relationship New Zealand wants with the
United States in the future, and what its government might do
to convince us that it is serious about a forward-looking
security relationship. We have worked with the Australian
High Commission and the Japanese Embassy to reiterate our
message that New Zealand cannot continue its current policy
drift without consigning itself to irrelevance in the South
Pacific, let alone the rest of the world.


9. (S/NF) These and other outreach efforts will have little
impact if our message differs from what the Kiwis hear in
Washington. Ambassador Swindells requested a reality check
of the bilateral relationship (Ref C) to ensure that what we
say here is what Washington has agreed we should say. We
strongly support the desire of many in Washington to do all
we can to help our first-world Kiwi friends, and to benefit
from any assistance they can offer us. We also understand
that in the short-run, policy success may be judged by how
many players we get to the table, though in the long haul,
success depends on what they bring to the game. We just want
to make sure all of our Washington clients understand that we
are being asked by many of our first-world friends to help
them help themselves in moving from ideologically motivated,
self-congratulatory policies to a clear vision of New
Zealand's role in the world and of how our bilateral
relationship might move forward, consistent with that vision.
Burnett