Positive moves on housing

Written By: - Date published: 10:58 am, July 9th, 2008 - 88 comments
Categories: election 2008, housing, labour - Tags:

Housing has always been an important issue for Labour. The First Labour Government instituted a massive State house building project, freeing working class New Zealanders from slum landlords, creating healthier living conditions, and stimulating the economy during the Great Depression.

Now, New Zealand faces some of the same conditions as existed at the start of the first State housing building programme, albeit with the higher expectations of the 21st century while there is no housing shortage, landlords who bought state houses off National in the 1990s have allowed them to degrade, the bottom tier of housing stock does not meet modern health standards, and the housing construction sector is pulling down the rest of the economy. New issues of peak oil and climate change mean we also need housing for low income families that is energy efficient and coupled to good public transport.

The Government has been working in this area the Hobsonville and Tamaki projects will build over 6000 homes along with schools, businesses and reserves, and it is looking at other areas for large scale developments by itself and non-profit groups. Yesterday, Michael Cullen signalled more big projects could be in the pipeline and it is thought a shared equity plus scheme is in development whereby the State retains ownership of the land, lessening the cost of buying a house.

This is great news. A good housing stock underpins a well-functioning, sustainable society. But these developments need to be done right, using housing designs that are healthy and low-energy and urban design that discourages crime and gives public transport primacy. If done well, these developments could be the model for housing in the low-carbon, peak oil future.

Not each house in these new developments needs to be State-owned, some could be sold to families with the help of the shared equity scheme, but a significant state holding ensures there is decent housing for those who can’t afford to buy even with government help. A condition on privately-owned houses could stipulate that they must be owner-occupied, not rented out which would keep prices down and ensure their quality is maintained.

Done right, Labour’s housing policy can deliver for the people, the economy, and the environment.

88 comments on “Positive moves on housing ”

  1. Tane 1

    It’s just a pity it’s taken them this long to do it. I know there’s been a lack of capacity during the construction boom, but it’s now got to a stage where some drastic action’s going to be needed to make housing even remotely affordable for people coming into the market.

    Good on them though – if sold properly this could be a real point of difference in the election.

  2. Lew 2

    This is the one thing Nicky Hager (at Linking Driberally) recommended Labour focus on to claw back electoral popularity. Therefore Nicky Hager is clearly behind Labour’s policy agenda. Conspiracy theorists, start your engines!

    L

  3. T-rex 3

    Tane – I don’t think that’s really true. Speculation, not supply, has been the cause of current affordability issues.

    Over the next few years, the speculators are going to see their investments tank, and housing will be as affordable as it ever was.

    That said, I completely support the development of an improved state housing stock. It does no good to anyone to have poor people living in crappy homes.

  4. Blar 4

    This would have been a real winner for Labour if they had done it sooner but I’m not entirely sure that it is smart politics to be talking about lowering house prices given the current economic situation. You’ll note the Nats have gone quiet on the issue, probably for this reason.

    By all means say this is a worthy policy but don’t sell it as a political masterstroke or real point of difference Tane.

  5. Been to South Auckland recently ? Large areas of subsidised state housing are breeding grounds for crime and violence.

  6. Tane 6

    T-Rex, certainly speculation has played a large role, but a strong state housing programme could have dampened that down. One of the problems with letting a boom get out of control is homeowners bank that capital gain and will punish any moves to make housing more affordable.

    Blar, I happen to think helping young families into housing is a worthy goal, and it’s certainly a political difference with the right. Whether it’s a masterstroke depends on how Labour implements it and how they sell it. I’m sure the implementation will be fine; the selling’s where they’ll probably fall down if recent history is anything to go by.

  7. T-Rex”Speculation, not supply, has been the cause of current affordability issues.”

    Investment in rental property was driven by the Labour governments introduction of a 39% tax rate inducing us “rich pricks” to invest in this way.

  8. infused 8

    T-Rex if you think housing is going to go down much your mistaken. Yes, it will fall slightly, but only slightly. Gone are the days of housing being cheap. I don’t think this is the fault of any govt, it’s just the way New Zealand is moving.

  9. T-rex 9

    Bryan – I can’t be bothered explaining tax law as it relates to rental properties, suffice to say the investment seemed attractive because people were relying on capital gain. Many did well out of it, as you do when you time a cyclical market right. Those who bought six months ago, however, probably not sitting so pretty right now.

    Lesson for the day: When you’re wondering how housing prices are going to track, don’t ask a realestate agent.

    Infused – Perhaps not in absolute terms, but in real terms they’re guaranteed to. Simple economics. If you don’t believe me, go invest in a house 🙂 I’m going to wait a few years – I’d be surprised if houses weren’t 30% cheaper in real terms in 5 years time.

    Considering they’re now 4% cheaper in real terms than they were in december, and we’re only just beginning to move from sales volume crash into value slump as reality dawns.

    What do you think home builders would rather do – cut their margins, or be out of a job? The price of a new house is pretty obviously going to set the price of an old house.

  10. J 10

    “T-Rex if you think housing is going to go down much your mistaken. Yes, it will fall slightly, but only slightly. Gone are the days of housing being cheap.”

    Anybody who thinks that housing prices will continue to rise is deluded. The NZ residential housing market was subject to one of the largest price increases in the world along with the US, Spain and the UK. The case-schiller index which measures prices in the US has decreased by 15%.

    What makes people think the NZ is somehow different from those markets?

    The traditional relationship between income and house price will assert itself once again unless of course NZer’s income somehow double which I doubt will happen.

  11. T -Rex: “I can’t be bothered explaining tax law as it relates to rental properties,” Labour Party code for “I am wrong but don’t want to admit it” so I will claim victory and move on.

  12. T-rex 12

    What makes people think the NZ is somehow different from those markets?

    Denial

    edit: lol, whatever thrills you Brian. I don’t care how you demonstrate your ineptitude, but tell me this – are you still looking to buy rental property at the moment?

  13. T Rex: BTW did you learn that technique from Brian Edwards- New Zealands (poor mans) answer to Crosby Textor.

  14. T-rex 14

    Yes. Yes I did. We are best-friends-forever.

    I was at a barbecue at his house on sunday, and he said “Hey T-Rex, if some guy called Bryan Spondre has you on the brink of defeat with his razor sharp wit and fearsomely perceptive insight, mention that he has a long history of having no idea what he’s talking about”. God I’m glad I’ve got him whispering these things in my ear, I’d never have thought of it myself.

  15. “Anybody who thinks that housing prices will continue to rise is deluded.”

    Agreed: the Reserve Bank certainly believes that house prices are going to fall and have “told the banks to include the potential for a 30% fall in house prices in their risk modelling.”

  16. sean 16

    J – economics 101 – as our population increases, so does the demand for a limited housing stock. New Zealand’s population is not at a plateau, in fact it has been increasing pretty rapidly.

    The primary reason for the current housing bust is the government’s inflationary spending – which has forced Bollard to keep on hiking the interest rates. Blaming this on homeowners and speculators is a piss take when 43% of GDP is spent by the government.

    The other factor is the cheap apartment market in Auckland collapsing in on itself – however anyone who bought one of those as an investment should’ve done a bit more homework.

  17. T-rex 17

    Sean
    ^
    |
    Fell asleep in economics 101

  18. T-rex, in a round about way that reminds me of the old joke about Gerry Brownlee – Standard 1 was the best three years of his life.

    (I think in the original it was Matiu Rata)

  19. coge 19

    Here is a valid question, how many Standardistas have ever had a house built? Ultimately one set of slum lords get replaced with another lot. Construction & compliance costs have skyrocketed in recent years. There is no reason to suspect this is going to stop anytime soon. Truly green buildings are the domain of millionares,
    until something is done to free up the RMA & lessen compliance cost burdens. I fully expect a construction slow done over the next few years, hence the supply will be choked increasing the value of the existing housing stock.

    The Govt would be best to adequately consult the private sector before embarking on such proposals. It ain’t 1936 anymore.

  20. Byran. We talking about making good housing more affordable, how anyone can be against that is beyond me.

    Well designed suburbs have much lower crime rates than poorly designed ones. While Labour’s first state housing projects did a world of good in providing housing that was good for its time the urban design was lacking. Furutre developments could be better designed to be low-crime environments.

  21. J 21

    “economics 101 – as our population increases, so does the demand for a limited housing stock. New Zealand’s population is not at a plateau, in fact it has been increasing pretty rapidly.”

    By your reckoning if we imported the entire impovished population of zimbabwe here then the housing market would rise?

    The price of housing is inherently tied to affordability. House prices started to rise as interest rates were lowered and mortgages became easier to obtain. In other words it was driven by the lowered cost of capital and credit expansion. People were able to bid up the prices of houses because banks were prepared to lend a lot more money on generous terms.

    It’s the same for every asset boom if you cared to look at history. Gross generalisations like increased population does not adequately explain rising house prices.

  22. coge. why would one set of slum landlords repalce the other? you just need the right controls in place or state ownership.

    Incidentally, isn’t that poster from the 1938 election awesome? nzhistory.net.nz is a great resource, publicly run too.

  23. Sean: “Blaming this on homeowners and speculators is a piss take when 43% of GDP is spent by the government.”

    Right on (pun intended).

    T Rex: from your response to Sean I see you were taking notes during Michael Cullens lecture entitled “If your opponent is correct, ridicule him rather than refute.”

  24. T-rex 24

    Bryan:

    1) You’re dumber than a sack of hammers.

    2) Read what J said. Do you think that if interests rates remained at 7% the housing CAGR of 13% would have continued unabated? Who would have been paying the 1.5million average price in 2017? At 7% interest it would cost $100k/annum to service that loan. Assuming inflation stayed at 3%, the average household income in 2017 can be reasonable expected to be $80k. Lower if National are in power in the interim, obviously.

    I ridicule unbelievably poorly founded positions because I’m tired, and because it’s more fun than taking people like you through kindy on issues you already think you’re an expert in.

    Funny stuff with the ‘Right On’ too. You might want to have a read of this.

  25. coge 25

    Hi Steve. My point is, for various reasons, right now HNZ is the biggest slumlord in NZ. There are a few private slumlords as well,
    although I’m not sure why anyone would choose to be one. Over the last decade many folk got into the landlord profession. Many of them were totally inexperienced, & I expect loads of them will exit over the next year or two. So, yes there is an opportunity for others to take up the slack at this point. This applies only to existing buildings. There is much talk about affordable housing,
    well what the Govt is suggesting is certainly NOT affordable. Providing well located, green, medium density housing is the strictly the domain of the wealthy. The Govt needs to consult the private sector to get the full costing facts, otherwise the suggestion is merely lip service.

    I enjoyed the poster too, Mikey J Savage was indeed a man for the times “Where Britain stands we stand. Where she goes we go” Or something to that effect!

  26. Phil 26

    “A condition on privately-owned houses could stipulate that they must be owner-occupied, not rented out which would… …ensure their quality is maintained.”

    I wonder to what extent this is actually true? I suspect that maintenance/quality of a property has very little, if any correlation to ownership, once you’ve taken the compositional difference in the two ‘stocks’ of housing into account.

    “Well designed suburbs have much lower crime rates than poorly designed ones.”

    Correlation does not equal causality. Suburban design has improved significantly in the last couple of decades, but tends to be limited to new developments – the ones in Chch outside of Halswell/Westlake spring to mind – which are almost always more expensive than the existing housing stock in the surrounding area.

  27. Steve: “a shared equity scheme” ?

    so given the Reserve Bank is forecasting a 30% drop in house prices will the taxpayer not be risking a significant loss on these investments. Then again Labour is quite hope to sink taxpayers money into black holes: “The newest of the trains in the fleet is about 30 years old and about half of New Zealand’s 1800 rail bridges are nearing the end of their 100 year life span. Replacing the bridges alone could cost $500 million, so the total cost of getting rail back on track over the next few years will be about $1.5 billion.”

  28. T-rex 28

    Steve – that joke just fits like a charm.

    Keep talking Bryan, I’ll do the soundtrack.


    Bryan went on to flawed assumptions
    Dum dum dum dum dummm
    Then he made some crap inferences
    Dum dum dum dum dum
    He is like a crate of hammers
    Dum dum dum dum dummmm

    DUM dA DUM DUM DUMM DUM DUMMMM da..d.d

  29. T-Rex: I see I am in the presence of greatness. It is clear you graduated with an A+ ( as did Helen Clark) from the recent Labour Party Seminar : “Ignore The Ball, Play The Man ( but only under parliamentary privelige)” hosted at the Owen Glenn School of Business.

  30. coge 30

    Goodness. The dumbing down of political debate. Has it ever occurred to you, T-Rex, that some of us commenting here might actually know what we are talking about? Maybe, it’s this knowledge that has allowed us the free time to be here.
    Consult with us for facts, do you think shutting us down will help your cause, or the people you claim to represent?

    “Don’t ban me bro!”

  31. T-rex 31

    Bryan: Only relative greatness.

    This is your ball –
    Bounce.. oh my god taxpayers money being spent on housing stock that is going to lose value…bounce…oh my god tax payers money being SUNK INTO A RAIL NETWORK…bounce…oh my god I tripped over and I can’t get up help help I need an adult.

    1) The government is not saying it’s going to go and buy houses at the present market rate. It is saying it might build some. You know, while there’s a housing slump and excessive demand isn’t driving up the cost of said building? Aww yEAH! Now it makes sense!

    2) It’s not being ‘sunk’ you dumbass, it’s called ‘investing in infrastructure’. Thanks for highlighting just how terribly private enterprise managed the network though.

    3) I can’t help you with that really. Maybe if you go someone to tie up your shoelaces instead of doing it yourself? Or you could get some of those shoes with the velro straps?

  32. T-rex 32

    Coge – Some of you? Certainly! You yourself aren’t bad – while I don’t entirely agree with your conclusions about the cost of quality housing above they’re at least not totally unfounded.

    Bryan, however, seems to manage to be wrong almost all the time. His point on trains above? Completely fair – it was a copy and paste. His interpretation? dumdumdumdumdummm

  33. AndrewE 33

    Our housing is still relatively cheap to people coming in from overseas and I suspect that if our dollar drops (as forecast) then prices may not drop as much as some predict.

    Government housing is a thorny problem as you are pretty much damned if you do and damned if you don’t.

  34. T Rex:- “Bryan, however, seems to manage to be wrong almost all the time. His point on trains above? Completely fair – it was a copy and paste. His interpretation? dumdumdumdumdummm”

    “dumdumdumdumdummm” along with “diddums” is of course Labour Party speak for anyone who doesn’t agree with us.

  35. roger nome 35

    Good grief Bryan. Did you really mean it the other day when you told us that you’re a protégé of Bernard Hickey’s? No wonder your analytical capabilities are zilch.

    In the housing bubble OECD countries (NZ, Aus USA etc) housing prices were around 20-30% above what their rental revenue based value. i.e. the problem was heaps of cheap capital sloshing around the world (3% interest rates in the US), which resulted in massive over-speculation. The problem was never supply.

    Dum dum dum dumbie do wah . oh yeh yeh yeh yeh yeh yeh.

  36. Pascal's bookie 36

    “the problem was heaps of cheap capital sloshing around the world (3% interest rates in the US), which resulted in massive over-speculation.”

    And this didn’t help:

    Pension and money-market funds bought AAA-rated securities backed by mortgages to the riskiest borrowers because they offered higher returns than government bonds with the same ratings. In many cases, credit raters were paid by investment banks selling the bonds, prompting regulators and lawmakers to question their independence.

    The SEC report describes an e-mail in which an analyst refers to the market for collateralized debt obligations as a “monster.”

    “Let’s hope we are all wealthy and retired by the time this house of cards falters,” said the e-mail, which was sent Dec. 15, 2006, to another analyst at the same firm.

    bloomberg

    Who would of thought deregulating the financial markets would lead to such trouble?

  37. Roger nome: Protege ? Alas no Roger, I am not worthy of being his protege.

    I am Bernards colleague and (very highly) paid link whore. As Bernards “link whore” let me point you to an article Bernard wrote on this very topic where he is in agreement with you:

    “At the same time, New Zealand was experiencing its own boom in borrowing and consumer spending as homebuyers borrowed from foreign investors (via the banks, the swaps market and the issue of Uridashi/Eurokiwi bonds) at relatively low longer term fixed mortgage rates. This was possible because of that wave of cash circling the globe looking for higher yield in a low interest rate environment.”

    I would still however argue that the local authority restrictions on housing development on the edges of cities has unnecessarily restricted supply. Why else would the government be building 6000 new homes if supply wasn’t a part of the equation ?

  38. lprent 38

    Bryan: Of course knowing national’s last campaign to free up house building, the costs will last as long as mine. Leaky buildings because they removed “local authority restrictions” to produce crappy housing in the early 90’s. Deregulated inspections caused a decade of problems that are still being felt by all concerned.

    I’m still paying for the repairs to my apartment block and hopefully getting to court by next year.

    What makes you think that the idiots in National are any better now than they were in the early 90’s. The rhetoric is still the same – probably the outcomes will be similar.

    Besides why in the hell build houses far from their workplaces on city peripheries, and force those long commutes in a period of rising fuel prices. Or do you expect that miraculously fuel prices will come down.

  39. G 39

    Hey I’m liking Labour’s hot new ad campaign that you posted up there SP!!! It really captures where their brand is at, don’t you think? 🙂

    T-Rex seems to have a bee in his bonnet over Mr. Spondre: “1) You’re dumber than a sack of hammers.”

    I have to say in his defence, Mr. Rex, when it comes to economic theory, at least he’s not dumber than the sickle and hammers… if Socialist economics was so damned utopian, why have millions risked their lives scrambling over barbed wire fences, digging tunnels under unscalable walls, and running across machine-gun-guarded minefields to get away from it?

  40. T-rex 40

    Ok, Bryan, your new tagline can be:

    Bryan Spondre: Better at ensuring societal freedom and wellbeing than Josef Stalin

    It’s not that he doesn’t subscribe to socialist philosophy, it’s that he has an incredibly poor grasp of the interactions that occur in any economy. That in itself wouldn’t bother me (many people don’t), were it not for the fact that he keeps talking like he’s the freakin’ Yoda of macroeconomics! For a while I argued the point, but it’s like arguing with a blind yet incredibly stubborn person about how various colours complement eachother.

    So, I take the piss, and live in hope he’ll go and bloody well educate himself, so that he stops doing agreeing with people who say things like “The primary reason for the current housing bust is the government’s inflationary spending – which has forced Bollard to keep on hiking the interest rates.”, which are plainly totally ridiculous.

  41. T-rex 41

    Thanks for the Mr Rex though. I tell you, people are getting a little too fncking familiar around here…

  42. coge 42

    Iprent, sorry to hear about your apartment. That must be a real pain. But I must reiterate my earlier point. That quality, well located, green compliant, medium density housing is enormously expensive to build. I’m very keen for anyone to explain how it could ever be affordable. Because I know it ain’t.

  43. T-rex 43

    Coge:

    The key elements of green housing are…

    1) Good insulation
    2) Dry
    3) Enduring

    Those features are more expensive than the alternative, but by no means prohibitively so.

    A huge part of the cost is dependent on good design.

    What do you estimate the cost/sqm to be for the housing you describe, exclusive of land?

  44. r0b 44

    Hey I’m liking Labour’s hot new ad campaign that you posted up there SP!!! It really captures where their brand is at, don’t you think?

    It certainly shows that some things never change.

    if Socialist economics was so damned utopian, why have millions risked their lives scrambling

    Pretty silly to compare public housing with the worst examples of socialism don’t you think?

    Millions have not crawled through mine fields, and even if they had, pretty small change compared to the Billion that will be killed by a shining example of capitalism this century. There now – see how silly it gets?

  45. T-rex 45

    r0b, don’t try and defend communist russia, they clearly f*cked up completely.

  46. coge 46

    Back in 1936 they were building vast amounts of state housing. Most of those old venerable buildings are still standing. Their quality was never in doubt. Back then they didn’t cost much to build. There was no RMA to consider. Wood was usually native timber, of which there was a plentiful supply. Land was cheap. Often in small country towns or the outer burbs. Quarter acre sections were used so the occupants could grow veges, house chooks & the occassional pig. Labour was cheap too in those days. The houses were heated with open fires. It was a damn good scheme at the time. But there is no way that any of those old state houses would get a modern code of compliance, even if they were new buildings. The situation these days, however you look at it, is it is no longer possible to build truly affordable housing for average Kiwis.

    T-Rex, land is a critical part of the cost these days especially
    in central urban areas, where there is a very tight supply. Even then in multiple story situations the sqm rate would very easily exceed $2500.00 Bear in mind inflation, even if the plans were approved last week it could take up to three years for the build to be finished & occupied.

  47. r0b 47

    r0b, don’t try and defend communist russia, they clearly f*cked up completely.

    Didn’t mean to do any such thing T-rex. I referred to “the worst examples of socialism”, of which USSR was certainly one.

    All I’m doing is noting that if we want to point out the worst manifestations of economic ideologies, then capitalism has a few skeletons in its closet too.

  48. T-rex 48

    Fair enough, didn’t mean to sounds as admonishing as I probably came across.

    Both are terrible at their extremes, it’s a pointless argument.

    G argued that Bryan had a better grasp of economics than Stalin – I just don’t think it’s worth bothering with any response beyond “Gee, wow!”.

    Coge – looking into a response for you.

    Land in a central urban area is always going to be tricky, but with good transport solutions isn’t an absolute necessity. With good urban planning it’s even less important (because people don’t necessarily have to go there!).

    I’d quite happily see the smaller centres grow a bit more in response to population growth – there’s no shortage of land in absolute terms.

    On the cost of housing – your figure is fairly high, but assuming we stipulate a very high build/material quality I’ll go with it. Perhaps the key element in creating ‘affordable housing’ in this instance is for people to re-evaluate what they actually want/need in a home. ESPECIALLY a first home! If you can get the size down to about 50m2 then that’s pretty affordable. You can certainly get a pleasant 2 bedroom house in that space as long as you don’t use it all up with hall/entryways!

  49. lprent:”Besides why in the hell build houses far from their workplaces on city peripheries,”

    This is exactly what Labour intends to do:

    “the Hobsonville and Tamaki projects will build over 6000 homes along with schools, businesses and reserves,”

    I agree with the idea of having greater density. Pity the Labour dominated council of Dick Hubbard didn’t agree and reduced population density with decisions like buying up the Cook Street Placemakers site, and the POnsonby Road Liquor King site for parks instead encouraging more housing in these areas. Or the frustration of two developers who wanted to develop the Gables site in Jervois Road into housing by the Green Party dominated community board.

  50. T-rex 50

    “I agree with the idea of having greater density.”

    Well shit Bryan, now you go and say something I agree with!

    I’m kind of sorry I gave you so much sh*t today, but god you drive me nuts sometimes. Argh. I really DO think you need to learn a bit more about some of the issues you pontificate on. You do, at least, seem earnest though, unlike some of the trolls who lurk around here, so I’ll try and moderate my responses somewhat.

    We could learn a lot from europe on urban infill housing and apartment living. Get away from the perception that “affordable” has to be “total crap”.

    I think the biggest perpetrators of this crime in the last few years in NZ have been residential developers. The houses that have infested these new developments are very, very, average. And the design. DEAR GOD THE DESIGN! MY EYES!

  51. Draco TB 51

    I agree with the idea of having greater density.

    I agree with this as well and high density housing goes really well with public transport.

  52. G 52

    Rob, that was an insightful comparison: Smoking and Socialism (communism by democratic vote) are both self-inflicted. 🙂

  53. r0b 53

    So there you go, a billion deaths flipped off with a smiley. Jolly good then. Reckon G must be one of them there “compassionate” conservatives.

  54. G 54

    Are you suggesting I should feel bad for someone who accepts the risks and takes up a lethal habit, Rob — of inhaling deadly carcinogens or voting in deadly dictatorships? As an ex-smoker, who accepts personal responsibility for my actions, I do not; these are after all voluntary acts.

    On the other hand I do feel very sorry for the minors trapped in a secondhand smoking environment and the minorities trapped in socialist dictatorships. They mostly certainly deserve my compassion.

  55. Kevyn 55

    T-Rex, I’m not sure quite what to make of your reply to Bryan Spondre: “Thanks for highlighting just how terribly private enterprise managed the network though.”

    Those bridges were built when King Dick was Premier. You can hardly blame private enterprise for them still being in use 100+ years later. Two of those clapped out bridges are still being leased by Transit to carry state highway traffic (at 20kmh). Transit has never been privatised. In fact if the motorcar had arrived twenty years earlier then Transit would be in exactly the same boat as Ontrack – without the help of private enterprise.

    IMHO Faye and Richwaite simply copied what Muldoon and Douglas had done to the State Highway system. The $6bn in petrol taxes that Muldoon and Douglas stole from the road fund could have and should have been spent making our highways safer, the social cost benefits would have been better for the country than letting Muldoon or Douglas use it for whatever was needed in marginal electorates.

    Surely you meant to tell the whole truth “Thanks for highlighting just how terribly private enterprise and public entrprise have managed the network though.”

    I haven’t seen any convincing evidence that big business and big government are different any fundamental way except for the currency used to measure success. Money for one, votes for t’other.

  56. Kevyn 56

    T-Rex, “Land in a central urban area is always going to be tricky, but with good transport solutions isn’t an absolute necessity.” That first Labour government recognized that a bit belatedly, only amending the Public Works Act to allow motorways in their last year in government.

    The most striking thing about that election poster is that the picture on the left is the mixed-use walkable community being proposed as part of the solution to peak oil and climate change, while the picture on the right is of the autocentric standalone suburban housing that gets so much of the blame for todays environmental problems. In the debate the introduction of the petroltax John A. Lee and Michael Savage made comments that indicate that they believed that the working man would only ever own a motorvehicle as a means to earn a living, never as a toy or a convinience. If that thinking took precedence over Department of Transport advice to the contrary then that would explain why state housing was built as suburbs rather than as urban villages. There were plans for at least one urban village state housing development in Auckland in 1946 but it ended up being built as just another cheap subdivision.

    During the same debate John A. Lee mentioned the trend of ratepayers voting against special loans for tramway extensions, including Auckland. His conclusion that the alternative of buses would be penalised by the petrol tax turned out to be wrong on two counts.
    Firstly people eventually turned to cars rather than buses, although it took the arrival of supermarkats and malls to make that happen.
    Secondly by the time cars became affordable for the average working man the petrol tax had been assimilated so well into the price of petrol that nobody really noticed it was there, at least until Nordy and Rowling doubled it. But even those two hits don’t seem to have slowed the growth in car ownership for very long. Maybe peak oil will finally do the trick. Then the government will have egg on its face over the new state houses at Whenupai. It’s a long walk to the nearest railway station.

    A PDF of the debate petrol tax resolution debate here.
    http://www.petroltax.org.nz/documents_1918-1953.html
    I’m still in the middle of converting the scan to text, it’s readable but still has the wrong fonts and spelling mistakes created by Adobe’s text converter. I’m too cheap to buy a newer version of Acrobat and too busy to do all the fixups at the moment.

  57. r0b 57

    On the other hand I do feel very sorry for the minors trapped in a secondhand smoking environment and the minorities trapped in socialist dictatorships. They mostly certainly deserve my compassion.

    The right wing are always so certain that they can divide the world into those that “deserve” something (in this case pity) and those that do not. It must be wonderful to have such godlike powers.

    Are you suggesting I should feel bad for someone who accepts the risks

    And therein lies the issue. Would you say G, that in order to “accept risks”, one must be aware of and understand them?

  58. G 58

    Rob, cavemen knew inhaling smoke was dangerous. Voting without understanding what you’re voting is also very dangerous. The responsibility rests on those who choose to do these dangerous things, not with me.

    The left wing are so certain the world can’t be divided — they’re always making other people’s problems everybody’s problem, e.g. “Problem Gambling: Our People, Our Communities, Our Problem.”

    I’m not interested in power. I just want to look after myself and my own. It’s you guys who have the god-knows-best complex, who tell us all to grow a bleeding heart for the undeserving and open our wallets to help those ‘poor unfortunates’.

  59. T-rex 59

    G – the problem is that your method of looking after yourself and your own ultimately requires you to build a big fence around your independent community and shoot anyone who tries to cross it. It is totally immoral, largely ineffective, and grossly expensive in comparison to the alternatives.

    Contributing to a stable community IS looking after yourself and your own, you’re just too stuck in some weird fortress mentality to realise it.

    Your objection to the problem gambling thing is a shining example of this.

  60. r0b 60

    I’m not interested in power. I just want to look after myself and my own. It’s you guys who have the god-knows-best complex, who tell us all to grow a bleeding heart for the undeserving and open our wallets to help those ‘poor unfortunates’.

    Cheers G, that was a very nice exposition of the essence of right wing thinking. Or it was a temper tantrum from a greedy two year old. Kinda hard to tell the difference.

  61. G 61

    Mr. Rex: “G – the problem is that your method of looking after yourself and your own ultimately requires you to build a big fence around your independent community and shoot anyone who tries to cross it.”

    Why would I have to do that?

    “It is totally immoral…”

    Why is looking after myself and my family immoral?

  62. G 62

    Rob, you’re not being clear.

    Are you saying that I’m greedy and infantile for wanting to look after myself and my family? Or for not wanting to be forced into suffering the consequences of someone else’s bad choices?

  63. r0b 63

    Rob, you’re not being clear.

    Goodness gracious I do hate to be unclear.

    Are you saying that I’m greedy and infantile

    Yes…

    for wanting to look after myself and my family?

    no…

    Or for not wanting to be forced into suffering the consequences of someone else’s bad choices?

    yes, that one. Or, to be more clear about it, for closing your eyes to the needs and circumstances of others by sticking a big label reading “bad choices” on them, and then feeling justified in ignoring them.

    The majority of people who are poor and in need are not that way because they have made “bad choices”, they are that way because they never realistically had any choices to make:
    http://en.wikipedia.org/wiki/Cycle_of_poverty

    In economics, the cycle of poverty is the “set of factors or events by which poverty, once started, is likely to continue unless there is outside intervention.”

    This is the idea that poverty is continued as a result of people trapped in an array of social situations including: low income, poor education, poor housing, or poor health. These disadvantages collectively work in a circular process making it virtually impossible for individuals to break the cycle. This occurs when impoverished people do not have the resources necessary to get out of poverty, such as financial capital, education, or connections. In other words, poverty-stricken individuals experience disadvantages as a result of their poverty, which in turn increases their poverty. This would mean that the poor remain poor throughout their lives.

    Read the article G, read some of the references. Think about the fellow humans that you share this brief life with. Or, more likely, keep your fingers stuck in your ears and chant “bad choices, bad choices, la la la I can’t heaaar you” until the unhappy thoughts go away.

  64. G 64

    Rob, who said anything about the unfortunate poor? We were discussing those who take up dangerous habits like smoking, gambling, voting for dictators – those who the left pity and call ‘unfortunate’.

    Let’s try that question again in context: are you saying I’m greedy and infantile because I don’t want to be forced into suffering the consequences of someone else’s bad choices?

  65. r0b 65

    Rob, who said anything about the unfortunate poor

    That would be you G, at 10:03 am, with some pretty sweeping generalisations, including:

    The left wing are so certain the world can’t be divided … It’s you guys who have the god-knows-best complex, who tell us all to grow a bleeding heart for the undeserving and open our wallets to help those ‘poor unfortunates’.

    “The world”, the “poor unfortunates” and so on, are your very general terms not mine.

    But if you want to “clarify” your position, can we take it then that you’re happy to pay taxes to support those in need (as long as they aren’t smokers). Is that your position? Is that what you meant when you said “I just want to look after myself and my own”?

    Catch you later maybe G, gotta go…

  66. T-rex 66

    G:
    Why would I have to do that?

    Because eventually all the people who you’re refusing to make any effort for, and are not acknowledging, and are not giving any opportunity to, will become pissed off and try to take what you have for yourself. Can you blame them? It’s the only avenue your approach leaves available to them. It is better for YOU as well as them to give them an alternative.

    Why is looking after myself and my family immoral?

    It’s not. Freely sacrificing the wellbeing of everyone else on the altar of looking after your family is immoral.

    This should be obvious, but lets say there are two children born. One is born in your house, and one is born in some gang house. Why should your child have any more right to a happy life full of opportunity than the one in the gang house? Obviously that’s the way it’s going to work out, but you don’t think perhaps you should at least make something of an effort to help the child who’s up sh*t creek?

  67. G 67

    Okay, Rob, I see your problem: you’re having trouble with subject and context.

    If you read the sequence of our discussion again you’ll see that the context is, ‘Why should I have to suffer the consequences of people who make bad choices for themselves – like smoking, gambling and voting for dictators?’

    The subjects to whom I’m referring are the ‘unfortunates’ (who smoke, gamble, vote for dictators) whom the Left pity, i.e. the ‘poor unfortunates‘ — as opposed to the ‘poor’ who are ‘unfortunate’, or the ‘unfortunate poor‘.

    So, without changing the subject or the context: are you saying I’m greedy and infantile because I don’t want to be forced into suffering the consequences of someone else’s bad choices?

  68. r0b 68

    I see your problem: you’re having trouble with subject and context

    Well one of us is, yes. If you’ll look back further you’ll see the context is socialist and capitalist economic theories, the absurdities of the extremes of both.

    The subjects to whom I’m referring are the ‘unfortunates’ (who smoke, gamble, vote for dictators) whom the Left pity, i.e. the ‘poor unfortunates‘ — as opposed to the ‘poor’ who are ‘unfortunate’, or the ‘unfortunate poor‘

    Yup well that’s about as clear as mud. Whatever gets you through the night I guess.

    So, without changing the subject or the context: are you saying I’m greedy and infantile because I don’t want to be forced into suffering the consequences of someone else’s bad choices?

    As above, the answer has to be yes, because you are sweeping too much under the rug of “bad choices”, using it as an excuse not to care. It’s OK G, plenty of people do, you have heaps of company.

    Anyway, whatever, I’m away for a few days now, so why don’t you wind this thread up for us. Knock yourself out. Goodnight.

  69. G 69

    I asked T-Rex why I would have to erects walls to protect myself if I refused to support another man’s life?

    T-Rex replied: ‘Because eventually all the people who you’re refusing to make any effort for, and are not acknowledging, and are not giving any opportunity to, will become pissed off and try to take what you have for yourself. Can you blame them? It’s the only avenue your approach leaves available to them.’

    T-Rex, your sequence of causality goes like this…

    1) If Mr. A supports himself and his family, but refuses to make an effort to support Mr. X, or give Mr. X an opportunity to support himself, or even offer some acknowledgement of Mr. X’s existence, it will lead to:
    2) Mr. X getting pissed off with Mr. A, which will lead to:
    3) Mr. X robbing Mr. A, which will mean Mr. A has to:
    4) Build a wall to stop Mr. X doing it again.

    What about your system of morality…?

    1) With whom do you sympathise? The man who stands with his terrified family in their ransacked house? The man who’s sense of security suddenly went out his broken window? The man who had his property stolen — and then had to go to the great expense building a wall to protect himself, his family, his belongings?

    ‘Can you blame [the Mr. X’s]? It’s the only avenue your approach leaves available to them.’

    You feel sorry for the robber.

    2) Whom do you blame? The man who gets pissed off with the working man for not giving him more money in his benefit? The man who doesn’t have the skill to dig with a spade, but knows how to use them to break into homes?

    ‘Freely sacrificing the wellbeing of everyone else on the altar of looking after your family is immoral.’

    You think I’m the immoral one.

    And what’s your advice to me? Ask for justice? Ask for more cops? Ask for order to be restored and law to be upheld?

    ‘It is better for YOU as well as them to give them an alternative.’

    You think I should give Mr. X what he wants now before he has to steal it from me.

    What you have here, T-Rex, is a moral inversion of the most contemptible kind.

  70. G 70

    Seeya, Rob 🙂

  71. Kevyn 71

    T-rex, “Why should your child have any more right to a happy life full of opportunity than the one in the gang house?”

    It’s a shame G hasn’t answered because nothing in his earlier posts suggests that he thinks his children have any more right to a happy life full of opportunity than the children born in gang houses. His argument, as it reads to me, is simply that his children are the only ones who have right to depend on his efforts to provide them with a happy life full of opportunity. Are you seriously trying to tell a parent that to reduce the well being of their own child in order to increase the well being of someone else’s child? I doubt that you actually intended that but with no solid evidence that your approach actually enhances the well being of both children when implemented by the state that is what you are in effect arguing.

    There is a simple rebuttal to your assertion that Freely sacrificing the wellbeing of everyone else on the altar of looking after your family is immoral.
    Freely sacrificing the wellbeing of your family on the altar of looking after everyone else is immoral.

    Somewhere between these two extremes is a common sense and practical approach. But it isn’t the one that you are advocating. G didn’t seem to be advocating one, all of the above being my words not his.

    PS, is a child actually worse off in a gang house or in a two-income consumerists household. I have no personal experience of either. All my neices and nephews are raising their children in small town defacto marriages, very traditional thing I suppose since none were raised in cities. Just thinking of the close-knit community values that exist in those small towns. It is rather rare for state “intervention” to be regarded as helpful. State assistance through the likes of plunket, a local school etc are appreciated. But that’s the middle approach I was referring to. Available to all who need it and not just “the needy”.

  72. T-rex 72

    Will reply later – don’t think I’m ducking out of the conversation.

  73. G 73

    I didn’t answer T-Rex’s hypothetical, Kevyn, because I wanted first to tackle his disgusting moral inversion, which makes victims of robbery immoral, and the robber a victim of those he robs.

    Second on the agenda is the mafia-like extortion racket he’s advocating, which advises me to give the robber what he wants now or else he’ll smash my window and take it anyway.

    By comparison, his hypothetical is small potatoes.

  74. T-rex 74

    G – you’re completely distorting what I said. Both of you are taking a bewilderingly binary view of the situation.

    To make sure that doesn’t happen to my response, I’m not going to rush it. I’ll reply later this afternoon, when I’ve got time to write it properly.

  75. r0b 75

    I’m in transit for a few days, so sorry this is a hit and run contribution.

    Re the discussion with T-rex, “Moral Inversion” is a terribly cute phrase. Was it moral inversion when the French peasants stormed the Bastille and put an end to the aristocracy? Is it moral inversion when the people rise up and throw off an oppressor? As ever, one person’s terrorist is another person’s freedom fighter. Kind of depends on your point of view.

    Now to the general topic, G’s claim that other people’s “bad choices” absolve him of the responsibility to care:

    Here’s an analogy. Ten poor people in a race. One person wins and gets a big prize, the other 9 carry on living in poverty. Did the 9 losers make bad choices? Any one of them could have trained better, and raced harder, and won the race. One could argue that they each chose to fail, and that we have no responsibility for them because they chose to fail. I hope that you agree that this would be a ridiculous conclusion. The race is structured so that only one person can win. Any one individual might be the winner, but the game is set up so that there must be 9 losers.

    Here’s an economy. Lots of poor people in an economic race. A few win and get big prizes. Did the other losers make bad choices? Any one of them could have worked harder, and got ahead. One could argue that they each chose to fail, and that we have no responsibility for them because they chose to fail. I hope that you agree that this would be a ridiculous conclusion. A capitalist economy is structured so that only a few people can win. The entire system is predicated on a big pool of cheap labour, the game is set up so that there must be many losers.

    Political philosophies in a nutshell: Right wingers blame the losers, Left wingers blame the system.

    TTFN

  76. higherstandard 76

    r0b

    ‘Political philosophies in a nutshell: Right wingers blame the losers, Left wingers blame the system’

    Complete poppycock.

  77. Phil 77

    Theres a truly delightful dog-whistle in there r0b… your little analogy makes the free market system sound like SPQR, with the fat-cat Senators watching the slaves partake in gladiatorial combat – very well done.

  78. G 78

    Once again, Rob, who said anything about the poor? This sidebar between you and I started after I brought up the 100 million killed by socialism and you parried with the millions of smokers whom you allege were murdered by capitalism.

    I still haven’t had a straight answer to this question (modified to avoid any further misinterpretation): are you saying I’m greedy and infantile because I don’t want to be forced into suffering the consequences of someone who makes the bad choice to smoke, or gamble, or vote for dictators, or indulge in any other self-destructive activity?

  79. G 79

    BTW — “A capitalist economy is structured so that only a few people can win.”

    Not true. Everyone wins in a capitalist economy. Even the poorest person is living considerably better — and longer — than his not too distant ancestors could ever have dreamed was possible. Since the industrial revolution we’ve been blessed with the loom, the steam engine, electricity, the oil well, the airplane, the mass produced motor car, the incandescent light bulb, the telephone, the refrigerator, toilet paper, jeans, the fountain pen, the skyscraper, the tractor, the air conditioner, the photocopier, the microwave, the cell phone, the calculator, the silicon chip, the computer, the internet, and medicine that’s practically doubled all our life-expectancies – including those in undeveloped countries.

    There are no winners in socialism. I wanted to be fair and name some great advances that came out of socialist countries but I honestly couldn’t think of any.

  80. Kevyn 80

    T-rex, Thanks in advance. Considered responses are always worth reading.

    Regarding “binary”. I was aiming more for “fuzzy logic”. Using the two extremes to highlight the need for a middle ground. Perhaps a non-controversial example is in order.

    A group of trampers reach a swollen river. Do they swim the river or build a flying-fox to take them over the water? Or do they do what most trampers would do if the river isn’t dangerously swollen. Use the rope as a handrail so they can safely ford the stream.

  81. r0b 81

    Once again, Rob, who said anything about the poor?

    You did. We’ve been round this before.

    I still haven’t had a straight answer to this question

    You’ve had a straight answer at least twice now!

    (modified to avoid any further misinterpretation): are you saying I’m greedy and infantile because I don’t want to be forced into suffering the consequences of someone who makes the bad choice to smoke, or gamble, or vote for dictators, or indulge in any other self-destructive activity?

    For the third time – yes. Because you are sweeping too much under the rug of “bad choices”, using it as an excuse not to care. Those people who just “voted” for the dictator Mugabe – were they making bad choices G? Of course they weren’t.

    You keep going on and on about this – it must make you really uncomfortable. I’m sorry that I can’t grant you absolution, you will have to find it elsewhere.

    Everyone wins in a capitalist economy.

    There is no such thing today as a capitalist economy.

    Historically perhaps they had a try at it. But it turned out that merchant and industrial capitalism were not notably different from feudalism. The vast majority were losers in this system, and they expressed their dissatisfaction fairly directly – the French stormed the Bastille, the Russians overthrew the Czar, and likewise the Chinese revolution.

    Now days I can’t think of a single example of a capitalist economy, just as there are no examples of socialist ones (Cuba maybe? Not sure). Economies these days are mixed economies, containing elements of both capitalist and socialist ideas. Yes, sorry, even America, which has minimum wage law, unions, government regulation of the economy, progressive taxation, state run education, a welfare state, state run medical programmes, and state run systems such as defence, policing and transportation.

    Pure capitalism doesn’t work in the real world any more than pure socialism does, the real world is mixed, and the benefits you cite are all the products of mixed economies.

    And the capitalist forces within these mixed economies continue to work to create many “losers” (as well as some “winners”). The whole point of capitalism is to maximise returns. A major tool for achieving this is minimising costs, especially labour costs. As long as capitalism is built this way the system must rest on a large pool of cheap labour – the “losers”. Not everyone can win the race.

  82. Kevyn 82

    “The whole point of capitalism is to maximise returns” Is it? Today, the pressure on pension funds to deliver on the promises made during the baby boom has certainly created the situation you describe. but before then the whole point was to make a profit, sell something worth buying, make people’s lives easier or safer. The accountant who created General Motors to outFord Ford should take the blame for modern capitalism. For all his faults Henry Ford actually believed he was improving the lives of his workers and his customers. GM was created solely to make money. All of Brunel’s great engineering feats were financial disasters yet investors kept investing. I suspect that when you had this more inimate version of capitalism along with the concept of honourable gentlemen it tempered greed significantly. The faceless stockmarket and th anonymity it provides has bred the modern vulture culture.

    Is it possible to challenge this bizarre idea that the purpose of business to maximise profits. Make a profit, of course. As Ford demonstrated, you can do that and keep your customers and workers happy, the workers well-paid at least.

    Fuedal capitalism? Cousin to crony capitalism. Capitalism must have seem like a dream come true to monarchs. So much easier to tax than peasant agriculture. And so much less likely to raise up an army to challenge your right to rule. Or so they thought. They overlooked the fact that capitalism swelled the ranks of the literate middle class. The underclass are too stupid to fight back, the working class are too stupefied and exhausted to organise a successful rebellion. But the middle class of trades peoples and traders, now you’ve got education and organisation and some leisure time in which to ponder. That is an explosive combination. One that was Loius’ undoingbut Stalin’s and Hitler’s making. They recognised it and used it, Louise denied it and died by it. But the main point is that it was the politics that was fuedal, the economics, as much as it could dodge the politics, was the purest form of capitalism – voluntary trade amongst equals.

  83. T-rex 83

    Kevyn/G

    Sorry for the delay. I’m trying to get something else finished. When my eyes burn out later on today I’ll try to reply.

  84. G 84

    It will be pointless arguing with you, Rob, if you persist in deliberately misinterpreting me. I did not say anything about the poor: as I’ve explained, patiently and comprehensively, the subject in the phrase ‘poor unfortunates’ is the group of unfortunates who, in the context of our discussion, die from bad habits like smoking. The word poor in this context is an adjective, as in ‘to pity’. It has nothing to do with poverty.

    Rob: “For the third time – yes [you are greedy and infantile because you don’t want to be forced into suffering the consequences of someone who indulges in self-destructive activities].”

    Finally a straight answer.

    Focusing on the smoker for a moment (to test the principle), I’d like to know why you think those who look after their health should have to suffer the consequences of those who choose to inhale carcinogens. Moreover, I’d like to know why you think those who refuse to suffer such an unfair and punitive burden are greedy and infantile.

    Rob: “Those people who just “voted’ for the dictator Mugabe – were they making bad choices G? Of course they weren’t.

    If by “voted” you mean “voted at the point of a gun” then I fail to see where there was any choice in your scenario.

    Rob: “You keep going on and on about this …”

    This seems to be your MO, Rob: you go off on a tangent (e.g. the poor), talking around the point, then criticise your opponent for repetition. I’d appreciate it if you would acknowledge your hand in this tiresome reiteration of a question.

    Rob: “There is no such thing today as a capitalist economy.”

    Quite right, Rob, we are indeed floundering in a mixed economy. So, in order to separate the individual merits of capitalism and socialism we need to look at those countries who have the most and the least economic freedom respectively. To that extent, America, being one of the freest countries, has quantifiably achieved the most, while socialist states have quantifiably achieved the least.

    History is replete with examples of capitalistic economies that have thrived. In England (when Adam Smith was espousing the virtues of free trade) the Industrial Revolution went untaxed for 50 years and within a century its GDP had burgeoned beyond anything the world had ever seen. During the 1900s the spread of capitalist influences saw Europe’s population grow from just 3% per century to more than 300%. It wasn’t until the Industrial Revolution that the ‘poor’ poor stopped starving to death.

    The closest the world has come to a pure capitalist system was 19th century America, whose economy gathered so much momentum it became the world’s greatest superpower – in almost every field of human endeavour. Be assured, it was not the socialistic influences that were responsible for its phenomenal and prolific advances in science and production, but rather its economic freedom.

    Conversely, one only has to look at those countries strangled by socialism, with little or no economic freedom, to see the deprivation of the human spirit, and consequently, the chronic impediment of human achievement.

  85. G 85

    * Correction – the above should read:

    “During the *1800s the spread of capitalist influences saw Europe’s population grow from just 3% per century to more than 300%.”

  86. r0b 86

    Sorry G, still in transit, later perhaps.

  87. G 87

    Rob…?

    T-Rex…?

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