The Cold War did not leave a marked imprint on New Zealand society. New Zealanders were largely tolerant of domestic communism except for a fairly brief period in the 1950s, at the height of the Cold War’s uncertainties. New Zealand’s Communist Party, which had been established in 1921, gained support, as elsewhere in the West, from the crisis of capitalism in the 1930s and from the Soviet Union’s heroic effort in the war against Hitler. It never had success in elections, and after 1945 retreated from parliamentary politics to focus more on industrial agitation and influence in the trade-union movement.
The 1951 waterfront dispute took place in a climate of Cold War mistrust. When employers declined to increase the pay of waterside workers (wharfies), the wharfies refused to work overtime, leading the employers to lock them out. The dispute caused havoc at the country’s ports. The government accused the wharfies of being militant communists who wanted to wreck New Zealand, and introduced draconian laws to undermine them. After 151 bitter days the wharfies were defeated and their union was forced to split into separate unions for each port.
Reds under the bed
The shift to behind-the-scenes influence, and the secretive tactics inherited from the Russian Bolsheviks and Lenin, raised fears of an internal threat to New Zealand from subversion aimed at overthrowing the elected government. During the Cold War communist-ruled countries feared capitalist spying and intrigue. This was matched in New Zealand and other Western countries by a renewed fear (it had existed before the Second World War) of hidden communist infiltration and conspiracies – the so-called ‘reds under the bed’. There was a striking parallel with that other great ideological divide, the religious divisions of Europe in the 16th century – the same pervasive fear of uncertain loyalties, of undeclared believers, betrayals and changes of side, and the same vigorous searches for those of suspect beliefs.
Enhancing national security
The alarm was not so much over the presence of known communists in some parts of the trade-union movement. It was a fear of undercover agents, encouraged by dramatic spy trials in the US and Britain. Parliament passed the Official Secrets Act 1951, and the Security Intelligence Service was established in 1956 to handle the task of vetting government workers who had access to sensitive material, and to carry out surveillance of those suspected of subversive activities.
Soviet spy or heritage spotter?
Bill Sutch was arrested in 1974 after police allegedly saw him hand a parcel to a KGB agent, Dimitri Razgovorov, outside a public toilet in Wellington’s Aro Street. Razgovorov passed the parcel to his driver, who sped off to the Soviet embassy. He then ran off down Aro Street but was chased down by an athletic SIS agent. A detective found Sutch standing in nearby Holloway Road. Asked what he was doing out so late on a rainy night, Sutch reportedly said that he was studying the area’s historic buildings.
In this nervous climate the public service was influenced by McCarthyism (named after US Senator Joseph McCarthy, who campaigned against communists in the US government). There were no trials, but some Department of External Affairs employees were made to leave the department. Two or three others aroused more serious suspicions. Ian Milner, a New Zealander working for the Australian Department of External Affairs, took refuge in Prague, and Paddy Costello, a brilliant linguist and acknowledged Marxist, had to leave New Zealand’s embassy in Paris after passports were issued to two people later revealed to be Soviet spies. The only prosecution ever brought under the Official Secrets Act was in 1974, when Bill Sutch, a retired departmental head and long-standing government adviser, was tried, but acquitted, of passing secrets to Soviet representatives in Wellington.
Communist influence wanes
Outside the trade-union movement, the Communist Party’s influence, never large, went into a steady decline. The suppression by Soviet troops of the 1956 Hungarian revolt led a number of prominent members to leave the party. After 1966 the party’s influence was further diminished when it split into Soviet and Chinese factions. The Soviet-backed group was the Socialist Unity Party, led by Council of Trade Unions secretary Ken Douglas. It suffered an embarrassing blow in 1979 when the Soviet ambassador was intercepted passing funds to a party representative. The ambassador was expelled and Moscow responded by expelling the New Zealand ambassador.