This week, Labour has been under heavy fire for apparently receiving a $15,000 donation from Donghua Liu back in 2007, while David Cunliffe has been under sustained attack for forgetting about a 2003 letter written in support of Mr Liu. Cunliffe’s gullibility in walking into National’s trap regarding the letter speaks volumes about the Labour leader’s political competence, but the more important story is the donation. If $15,000 was given to the Labour party, where did it go and why was it not declared?
The problem for Labour and the media is that there really has been no trace whatsoever of the alleged donation. There’s been an unnamed “Labour source” who provided the initial story, and that’s apparently been backed up by a second anonymous “Labour source”. From there, the trail goes cold. Was it for a book, a bottle of wine, or neither? If it was for a book at an auction fundraiser, wouldn’t a $15,000 winning bid have caused somewhat of a stir at the time? Who in the Labour party received the donation, or was it an electronic transaction? If it wasn’t an electronic transaction, was it cash or a cheque? Did it go to Head Office or to one of the electorate committees?
And of course there’s been the rather large question of “Did it even happen?” With no paper trail and no names, just the word of an anonymous source that $15,000 was received, Labour has only been able to collectively shrug and say they’ve got no idea what anyone’s talking about. Has it all just been a hatchet job by some disgruntled Labourite who wants to watch Cunliffe crash and burn?
John Key was enjoying himself immensely, stoking the rumour mill that Donghua Liu had in fact donated a six figure sum to Labour. There was More To Come, and everyone – Labour included – was Watching That Space. Rick Barker – Labour’s former Immigration Minister – was unimpressed, calling for Mr Liu to make everything public in affidavit form.
Which meant that the rumour mill went into overdrive last night when Vernon Small reported that:
“Labour is bracing for the expected release of an affidavit claiming six-figure donations were made to the party by wealthy businessman Donghua Liu. … It is understood the affidavit was being pored over by lawyers today because there was a lack of documentation.”
However, in the NZ Herald this morning, the reporting related to a media statement by Liu that he had given “equally to Governments of both colours”. All other questions remained unanswered. Amounts? Dates? How the donations were made? Silence. Instead, the Herald reported that “Liu said he would not make any further comments about political donations or swear an affidavit outlining dollar amounts”.
If Donghua Liu thinks that his statement will make the issue disappear, he’s likely to be sadly mistaken. At the very least, he needs to confirm whether, in any single year, he donated more than $10,000 – enough to trigger Labour’s disclosure requirements of that time. If he did, then something either went horribly wrong with Labour’s record-keeping or someone in Labour made a conscious decision to break the law by keeping the donation secret.
Mr Liu may say in his statement, “As a private citizen it’s not for me to make declarations about donations and political relationships.” Nonetheless, if he donated $10,000 or more in any given year to Labour, that information should now be a matter of public record. The fact that Labour can’t seem to find anything in their records surely imposes a moral obligation on Mr Liu to make public what should have been made public over half a decade ago.
If Donghua Liu did make sizeable donations to Labour, someone in the party is surely now sweating bullets.
Occasionally Erudite Publications 
You also have the issue that it apparently was for an object being sold at an auction. So how much was the object worth? Often the value of an object is in the eye of beholder.
For instance I have a signed framed left-over campaign poster of Helen Clark from a late 80’s campaign that I bought at the Mt Albert Great Debate after she became Prime Minister. Sure it has Helen’s signature on it. That may be relevant if I or more likely my heirs decide to sell it. It’s value in my eyes has more to do with memories of that time and with my long association with the Mt Albert’s election campaigns.
From memory, I paid something like $400 for it to the Helen Clark supporters fund, and I can assure you that wasn’t given as a donation. It was because while I have also sequestered other campaign memorabilia over the years, I didn’t have anything from that first campaign.
Contrast that to donations. I have given many donations of money and time to the Mt Albert LEC campaign funds and the Labour party over the years when I have been able to afford it. But I just give a cheque, direct credit, or just work those. But they have no particular value to me.
It was because I wanted it. For many years it used to live on my wall along with a limited image print of Bob Dylan, a limited print image from one of the Alien movies, and other artworks that I liked because of the memories they invoked. I grew up in a household that collected stuff like that. Unfortunately none of that stuff is currently on my walls. My partner Lyn does the decor and I do the hardware. So images of predators looming over bald women are out. Like Helen’s poster they are stored for whenever we move somewhere bigger and I can have a non-socialising space of my own
My parents were into old history and we had antique furniture going back to the elizabethan era, each with their own history attached. It started because they were poor about the time that I was born, and brought the old furniture rather than new and repaired and refurbished it. They kept doing that because they liked furniture that had managed to withstand decades of wear and tear. If you ever look at or use the furniture of the late 50s and early 60s you can understand why. It evolved into a hobby that me and my siblings all got involved in.
I spent weekends when I was 14 volunteering to clean up the old Kerr-Taylor house in Mt Albert after it was left to the Historic Places trust back in the 1970s. These days after they retired and downsized (at one stage they moved a parnell villa north and extended it into a bit of a mansion so they had more room), my parents sold off large chunks of their goodies at some very inflated values – much of it to the UK.
As I write this, I’m looking at a painting on my wall that my Lyn has. It was painted by a friend back in 1996. The painter has gone on to sell their work for many thousands of dollars.
Anyway, getting back to the topic and away from nostalgia.
I was looking at guidelines at the electoral commission the other day while writing this post. One thing I noticed in passing was the question of how you account for donations that are paid for goods and services. I noticed it because of the advertising issues. If we give free or cheap advertising to people or parties, then we have to account for it as a donation at a reasonable market rate. Similarly if we provide services for a fundraiser like an auction then if we don’t charge then it becomes a donation at a market rate.
But I seem to remember there was a reference in there to selling goods and services at auctions. The donation part is whatever is paid above a market value. Now that is probably calculable for a bottle of wine, although given the prices of some wines sold at auction clearly some people don’t value them as I do as I drink them. But what would the market value of my signed poster be? Especially if it has never been to auction. I know what I think it is worth. But that someone else might pay that for it is questionable.
A good illustration of that point was the “paintergate” thing back in 2007 (?) where a punter brought a painting signed by Helen at the Mt Albert debate that she hadn’t actually painted but which had been donated by a supporter. Clearly from the reported remarks of the punter afterwards, he thought that painting was of far less value because she hadn’t actually painted it and he felt gypped.
Anyway, I think that the rules that the electoral commission has about donations are less rigid than you are portraying, and they make the whole thing a whole lot more complex than you’d be expecting.
All I can say is that the sooner we move to a completely transparent state funding of political parties under a rule system that is like that of the TV advertising allocations, the happier I’d feel. Then a lot of this kind of nonsense about anonymous trusts funneling millions of dollars in anonymous donations and the spectacle of having millions of dollars expended by the likes of Bob Jones, Colin Craig, Tony Gibbs and DotCom to their pet political parties to buy influence would disappear. Of course it won’t make journalists happy as they’ll have to discuss policies rather than titillation…..
🙂
My sympathies regarding your undisplayed art, Lynn! My wife won’t let me hang my prints of Munch’s ‘The Scream’ and van Gogh’s ‘Skeleton Smoking a Cigarette’ anywhere in the house…
You’re absolutely right about the issue of the value of the good/service acquired vs the total amount paid/donated. Mike Williams has been discussing the issue in various forums this week, relating the difficulties he had in his former life as a Labour official in trying to calculate the market value of goods/services sold at auction fundraisers.
What I took from Mr Williams’ comments was that at the time that Donghua Liu’s $15,000 donation was allegedly made, Labour was being quite assiduous in accounting for the actual market value of auctioned goods/services, rather than attempting to place some hugely inflated value to the good/service in an attempt to disguise the totality of a donation.
(As opposed to what National appear to have been doing at the same time, based on the link you provide in your second comment – which I must say staggered me. Thanks for passing it on.)
Essentially, based on what Mr Williams has said, it would be incredible if a $15,000 donation, received following the purchase of a book or a bottle of wine, would have been entered into the Labour Party books as a $15,000 “business transaction” (with the book or bottle being deemed to be worth $15,000). Certainly, I’m sure Mr Williams would have remembered it…
But yes, based on that link to Bryce Edwards’ post, there’s possibly rather more to the issue than meets the eye. As you say, it makes the whole thing a whole lot more complex than I’d been expecting!
Re. state funding of political parties, I’d have to disagree with you there, but that’s a matter for another post…
Speak of the devil. NZ Femme unearthed this link from 2007
http://liberation.typepad.com/liberation/2010/12/pansy-wongs-dubious-solicitation-of-political-funding.html
It looked at the disappearance if $50k purchase from a National party fundraiser for John Keys tie.
in a mini nut muffin