Those fortunate enough to have visited Huangpu Park, alongside the Bund in Shanghai, will know about the sign that was supposedly displayed in the Park in the early part of the last century, at a time when the British had taken over Shanghai. The sign was said to have read "No dogs or Chinese allowed."

Most historians now regard the story as apocryphal, at least in its detail; but whether true or not, it epitomises and justifies a sense of outrage and grievance felt by Chinese at the humiliation imposed on their country by their unwelcome occupiers.

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However much we may sympathise with this Chinese sentiment, it was still a surprise to see that the issue - understandably important to the Chinese - had somehow become a significant factor in the debate about our national flag.


We have it on the authority of Lewis Holden, the chairman of the Change Our Flag campaign that, at a dinner arranged for the Prime Minister and his National Party colleagues to solicit substantial contributions to the campaign from a group of Chinese businessmen, the donors agreed to pay up because they wanted "the Union Jack gone from the New Zealand ensign."

The dinner gives the lie, of course, to the story that the flag campaign was non-political. And, as the media reports made clear, John Key was repeating a ploy that had involved a dinner with Dong Hua Liu - an experience from which he seems to have learned little.

Of much greater interest, though, is how what was surely a minority preoccupation in New Zealand terms became a key factor in the flag campaign in a way of which most people were completely unaware and did not in any case have the resources to match.

The RSA's flag preference was just as strongly felt and their allegiance to our current flag was shared by many more than the Prime Minister's dinner companions; but the RSA did not have the cash to throw at the campaign and would have been alarmed to know that they were being outgunned from such an unlikely quarter.

The revelation from Lewis Holden, a former National candidate, about the motivations of his benefactors, however, was not the only revealing point he made. He sought to justify the pitch to his Chinese colleagues by saying, "That's the necessary evil of the democratic process - money plays a part... .Democratic processes are costly. The more democratic they are then the more costly they are."

Mr Holden clearly has a curious concept of what democracy means. In his mind, it seems, it is simply a process, in which rivals compete to manipulate public opinion - a competition that costs the participants a great deal of money and where victory goes to whomever can raise and spend the most money.

We see a graphic demonstration of this view of politics unfolding before our eyes in the United States as millions - perhaps in some cases even billions - of dollars are being spent by rival candidates for the Presidency.

In New Zealand, however, we have always regarded democracy not just as a process, expensive or otherwise, but as a form of government that actually represents what people want and that serves their interests accordingly. The true purpose of democracy is not to win the propaganda battle but to elect a government that is accountable to the whole community and not just to a few with money to spend.

Mr Holden's belief that democracy is like wallpaper - the more you spend the more you get - runs directly counter to that view. It is, however, rapidly gaining ground and taking over our public life. We have fairly sensible limits - at least by comparison with the Americans - on how much can be spent on elections but there is still a huge advantage to those who can tap large resources from private donors to fund their campaigns.

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That disparity in funding is increasingly a threat to our democracy - a threat that will go on growing for as long as we allow only minimal public funding of political campaigning and leave the running to those with access to the deepest pockets.

It is only occasionally that the lid is lifted on what is really happening. Mr Holden has done us a service by revealing the truth - and alerting us to the very real danger that completely unrepresentative minority views can exercise a disproportionate and hidden influence on how our country is run.

It might have been hoped that the National Party would be particularly alert to the dangers. They have, after all, been burnt in the past by their willingness to take money from donors with a purely sectional interest. Have they so quickly forgotten Don Brash's disastrous flirtation in 2008 with the Plymouth Brethren?

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