Viewing cable 05WELLINGTON902
Title: WHAT HONEYMOON? PM CLARK'S NEW COALITION SHOWS

IdentifierCreatedReleasedClassificationOrigin
05WELLINGTON9022005-11-22 21:25:00 2011-08-30 01:44:00 CONFIDENTIAL Embassy Wellington
This record is a partial extract of the original cable. The full text of the original cable is not available.
C O N F I D E N T I A L SECTION 01 OF 02 WELLINGTON 000902 
 
SIPDIS 
 
STATE FOR D (FRITZ), EAP/FO (STEPHENS) AND EAP/ANP 
NSC FOR VICTOR CHA 
SECDEF FOR OSD/ISA ELIZABETH PHU 
PACOM FOR J2/J233/J5/SJFHQ 
AIT FOR DAVID KEEGAN 
 
E.O. 12958: DECL: 11/21/2015 
TAGS: PGOV PREL NZ
SUBJECT: WHAT HONEYMOON? PM CLARK'S NEW COALITION SHOWS 
SOME STRAINS 
 
Classified By: DCM DAVID BURNETT, 
FOR REASONS 1.4 (B) AND (D) 
 
¶1.  (C) SUMMARY: Less than two months into her new 
Government, the local press has quoted PM Clark's coalition 
officials as contradicting each other over foreign policy, 
notably whether or not New Zealand needs to repair its 
relations with the United States.  (Foreign Minister Peters 
says yes, Clark and Defense Minister Goff say no.) 
Conflicting media signals are unusual from those under 
Clark's command, and reflect the unprecedented arrangement 
that has put opposition politician Peters nominally in charge 
of foreign policy.  The reports come on top of a bad week for 
the PM that has seen her Finance Minister slammed for 
resisting the tax cuts recommended by the bureaucrats who 
work for him.  But Clark is a master at management and is 
unlikely to lose control of her party or government any time 
soon.  Meanwhile, the Embassy is taking seriously Peters' 
attempts to reach out to us, and will be looking for ways to 
leverage his efforts.  END SUMMARY. 
 
¶2.  (C) Hints of trouble with Clark's new coalition began 
with New Zealand media reports that during his first trip to 
Australia as foreign minister, Peters had asked Australian 
Foreign Minister Downer for help in improving the US-New 
Zealand relationship.  Peters denied asking for Downer's 
help, and claimed he had been misquoted by the Australian 
journalist who reported the story.  Peters did, however, tell 
NZ reporters that that New Zealand should look to improve its 
relationship with traditional allies, including the United 
States.  He highlighted as an opening former Ambassador 
Swindells' July 4 speech calling for a comprehensive 
discussion about the relationship.  Clark promptly told the 
press that there is nothing in the US-NZ relationship that 
needs fixing. 
 
¶3.  (C) The story resurfaced again on the margins of the APEC 
meetings in Busan last week, when Defense Minister Goff 
reportedly told the press that Downer had asked him to 
explain who was speaking for New Zealand foreign policy. 
Peters, meanwhile, told the press he had explained his role 
fully to Downer.  He also claimed to have asked Downer to 
help New Zealand in its relationship with the United States, 
and Downer was quoted in the media as having agreed.  ("I'll 
definitely be putting in a good word for New Zealand during 
the course of this week with the Americans.")  But this 
putative accomplishment was sidelined by Downer telling 
reporters that although he and Goff are good friends, he was 
"a bit surprised" to hear that Goff had told the NZ press 
about his inquiries.  This admission also effectively drowned 
out Peters' later claims that he had had a good conversation 
with Secretary Rice. 
 
¶4.  (C) The NZ press, which has a testy relationship with 
Peters, promptly seized on Downer's questions to Goff as 
proof that the governing arrangement that leaves Peters out 
of Cabinet and free to criticize Labour on issues outside his 
portfolio is unworkable.  For his part, Peters, who loathes 
the NZ press, has stormed out of press conferences and called 
the NZ Herald "treasonous" for having questioned his 
authority on foreign policy during the Busan meetings.  (FYI: 
Peters also told Pol-Econ Couns earlier that the NZ press are 
all Marxists and will never report honestly on anything he 
does.) 
 
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COMMENT 
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¶5.  (C) It may be that tensions between Peters, Goff, and 
Clark are being overstated by the NZ media.  For his part, 
after returning to New Zealand Goff disputed press coverage 
of his remarks, chalking the misreporting up to "bored 
journalists trying to justify their airfares."  He denied any 
tension between himself and Peters, and said the media was 
"hounding" Peters, whom he classified as capable of handling 
the foreign affairs portfolio.  Goff also claimed that he had 
told FM Downer that the Government's arrangement with Peters 
was akin to having his mother-in-law living nearby in her own 
apartment, in that he got along with her but it was important 
for everyone to have his or her own space. 
¶6.  (C) We believe, however, that there is genuine tension 
between Peters and the rest of the Government.  The coalition 
arrangement that leaves Peters free to criticize Labour on 
issues outside his portfolio is a recipe for problems, since 
areas such as defense, trade, and immigration are closely 
entwined with overall foreign policy.  The grayer the areas 
of distinction, the greater the chance of conflict between 
Peters and his Cabinet colleagues -- especially Goff and PM 
Clark -- in the weeks and months ahead.  Add to this 
structural tension Peters himself: as we have previously 
reported, he is mercurial and often difficult to get along 
with.  National leader Don Brash recently told Pol-Econ Couns 
that he was not altogether sorry not to have been able to 
form a coalition government, because "Winston Peters really 
is a nutter."  It will be entirely in Peters' character to 
push the Government on issues he cares about, and in a very 
public way.  For his part, Goff may be positioning himself as 
the next Labour Party leader by attacking Peters, as the 
party caucus is reportedly livid that Clark made Peters 
Foreign Minister. 
 
¶7.  (C) PM Clark has been on travel, but has already begun to 
try to recast Peters' remarks, calling him a "moderate."  She 
also claims that Peters is saying less on defense and trade 
issues than he had before joining the Government.   Clark is 
a skilled manager, and it is unlikely that she will lose 
control of her Government or party any time soon over Peters' 
defections from the Labour line.  Nevertheless, Peters' 
unpredictability will put even the Prime Minister's 
considerable spinning skills to the test.  These first 
dust-ups are also coming at a difficult time for the PM: a 
Treasury report recently called on the Government to 
implement broad tax cuts, a policy Labour specifically 
rejected during the elections.  The sudden death of Green 
Party co-leader Rod Donald has also cost Clark a pragmatic 
ally with both the Greens and the more leftist elements in 
her own party.  Nor will she ever be able to sweep her Peters 
problem completely under the rug: National is keen to drive a 
wedge between Peters and the rest of the Government, and will 
use any chance to fan the flames.  National MP (and former 
WTO Ambassador) Tim Groser told DCM that he, National Foreign 
Affairs spokesperson Murray McCully, and former diplomat John 
Hayes are caucusing regularly to discuss how to embarrass 
Peters, and through him, the Government. 
 
¶8.  (C) We believe that Peters is genuinely interested in 
improving bilateral relations with the United States, and 
during his introductory meeting with Ambassador McCormick 
last week he made clear this was a priority.  (FYI: Peters 
purposely made sure that Ambassador McCormick was the first 
Ambassador he met with as Foreign Minister.)  The Embassy 
will seek ways to leverage this interest, keeping in mind 
that the real reins of power on foreign policy will remain 
firmly vested with PM Clark and, to some extent, Minister 
Goff. 
McCormick