Owen McShane: Housing Affordability – A right wing Plot?

The Government has announced the formation of the promised Productivity Commission. Some people have criticised Finance Minister Bill English and Regulatory Reform Minister Rodney Hide, for declaring that one of the Commission's first two inquiries will be into housing affordability. However, the topic is squarely on target. A collection (still in progress) of the negative impacts of excessive land use regulation on productivity currently contains well over twenty items such as:

• Increased inequality and reduced social mobility.
• Loss of international competitiveness.
• Reduced “churn” of land use.
• Diversion of capital from productive uses, to land-price bubbles.
• Reduced business start-ups.
• Reduced efficiency of urban form and transport patterns.

Why would any Government want to inflict such damaging policies on its people?

Peter Saunders: Faith in free trade

Should a country really be content to see its core manufacturing base disappear? Free trade is an article of faith for economic liberals.

The arguments that favour it are well known. The theory of comparative advantage tells us that all countries will be better off if they specialise in doing the things they can do most efficiently and then trade their products with each other. And history tells us that when nations start erecting barriers to trade, it can trigger recessions and even lead to wars. And yet ...

David Round: Hone thumbs nose at establishment

I have a perhaps surprising amount of time for Chris Trotter, regular columnist in, among other places, the Christchurch Press. Sometimes he is horribly off beam, but he can be very perceptive and sensible; and sometimes he is a mixture of both. Recently (as an example of the last category) he wrote a column on the subject of Hone Harawira, just re-elected as the Te Tai Tokerau M.P and leader of the Mana Party. Harawira caused a flurry a couple of weeks ago when he appears ~ it is all a little blurry by now ~ to have refused to take the oath of allegiance which the Constitution Act 1986 requires all elected Members of Parliament to take. The oath is spelt out in the Oaths and Declarations Act 1957 ~

I,  N. , swear that I will be faithful and bear true allegiance to Her Majesty Queen Elizabeth the Second, Her heirs and successors, according to law. So help me God.

Roger Kerr: Are Warnings About Minimum Wages Dickensian?

Responding to a recent article of mine on minimum wages, a correspondent to the ODT wrote, “Reading Roger Kerr’s position on the minimum wage I am left wondering if he is a real person or a character from a Dickens novel.”

My article warned of the dangers of legislating for minimum wages above market rates, and discussed the devastating effects of the abolition of youth rates. I decided to regard the feedback as a challenge: how does one get across the potentially harmful effects of minimum wages to those who see them as self-evidently beneficial?

Owen McShane: Let's build on Auckland's brand

The Auckland Policy Office, led by the Ministry of Economic Development, has released the nine reports generated by its three-year research programme on Auckland’s social and economic development.

These reports openly challenge many of the assumptions behind the discussion document “Auckland Unleashed” and provide substantial data in support of the Ministry of Transport’s skeptical response to the current proposal for a mono-centric, high-density, public transport dependent, Auckland Council.

Roger Kerr: Productivity Commission Should Examine Kiwifruit Monopoly

Every Econ 101 student learns that monopolies are bad.  They maximise profits by restricting output and raising prices.  Consumers are exploited and national income is lower than it would otherwise be. Note that it is not just a matter of a monopoly producer raising prices (above some competitive level) and reaping higher profits.  The normal supply and demand factors that determine prices continue to operate.  To be successful in raising and maintaining higher prices the monopolist has to be able to restrict supply as well.

In today’s open and competitive economy, opportunities for monopoly behaviour are few and far between.  In addition, we have laws – in particular the Commerce Act – aimed at curbing such behaviour.

Karl du Fresne: The changing TV landscape (sorry, media ecology)

“Appointment viewing” is the fashionable television industry term for programmes that people can’t bear to miss. Readers of a certain age will remember when the entire nation stayed home to watch shows like The Forsyte Saga or Upstairs, Downstairs. It was even said that borough councils changed their meeting nights to avoid missing an episode of The Avengers in its “Mrs Peel, we’re needed” heyday.

Back then, television was still something of a novelty and we had only one channel, meaning everyone watched the same shows and talked about them the next day. In an unexpected way, television served as a national unifier. It was as if we all shared one big living room.

Oliver Marc Hartwich: The PC empire strikes back

Former career civil servants and central bankers seldom have star potential. Their work rarely excites the public and their pictures do not usually appear on front pages. This would have been Thilo Sarrazin's fate as well. A former state treasurer in the city of Berlin and director of the German Bundesbank, Sarrazin was mainly known to political insiders.

All of this changed last August when he published the book Germany abolishes itself (Deutschland schafft sich ab). Within months the provocatively titled tome of 464 pages, laden with statistics and footnotes, became the best selling non-fiction book in German post-war history. More than 1.5 million copies have been printed to date. Its author developed into an unlikely media star whose name recognition in Germany now surpasses the Pope and the chancellor.

Roger Kerr: Teach Your Children Well

A young family friend completing her general practitioner training at a South Auckland medical centre recently told me of a difficult task: she’d had to break the news to a 15 year-old schoolgirl that her pregnancy test was positive.  To the young doctor’s great surprise, the girl, on hearing the result, punched the air with her fist and shouted elatedly “Yes!”

How could she be so pleased? Perhaps a welcome escape from an education that was going nowhere? A chance to be ‘independent’? Something to love?  Or a way of meeting a requirement to pull her weight in a benefit-dependent household? Who knows.

Mike Butler: Rivers of money to greedy iwi

Cash payments to the five tribes in the Waikato River co-management deals total at least $400.8-million over 27 years, according to the deeds of settlement between the Crown and Waikato-Tainui, Te Arawa, Ngâti Raukawa, Ngâti Tuwharetoa, and Maniapoto. The settlements combine to dwarf the 1995 Waikato-Tainui raupatu settlement of $170-million. Other $170-million settlements were to Ngai Tahu in 1997, and the Sealord deal in 1992. The Waikato River tribes are also recipients of the central North Island forestry or “Treelords” deal of $161-million in 2008.

The Waikato-Tainui settlement attracted attention last year as enabling legislation went through Parliament, partly because the tribe regarded the river as it's ancestor. I have seen no comment on the total cost to the taxpayer of the five settlements regarding the Waikato River.

Steve Baron: New Zealand's democratic deficit

Democracy is a much-used word that few give much serious thought to. It can mean many things to different people. The word democracy derives from ancient Greece and means 'rule by the people'. Many have come to accept that whenever this word is used it must be a good thing, and as New Zealand is considered a democracy by international standards, this too must be a good thing.

While most may be familiar with the above description of democracy, many would be less familiar with the term democratic deficit. British political scientist David Marquand first used the term when discussing the politics of the European Union. Since then many people have written about democratic deficits, even though the term has not been clearly defined.

Mike Butler: CGT or sell assets?

Time to do the right thing for New Zealand, Labour Leader Phil Goff asserted as he tried to sell his unpopular capital gains tax proposal on Radio New Zealand on Friday morning. Why an extra tax? Because government spending exceeds income by $16.7-billion this year. Why has the spending ballooned? Partly because of expensive and poorly thought-out policies of the 1999-2008 Labour-led governments, of which Goff was a senior minister.

Goff tried to sell Labour’s new economic policy that would levy a 15 percent capital gains tax on the sale of assets excluding the family home, remove GST from fruit and veges, create a new tax margin of 39 percent on earnings above $150,000, and have the first $5000 of earnings tax free.

Mike Butler: Objecting to the Maorification of NZ

Separatists described this week’s ACT Party advert featuring the headline "Fed up with pandering to Maori radicals” both “deeply offensive” and a “dog whistle back to the 19th century”. But ACT Party leader Don Brash told Radio New Zealand the ad reflected a "very deep frustration on the part of many people that successive governments, Labour and National, have been trying to appease a group of quite radical Maori, who have a view of New Zealand that is not only fundamentally different from what most New Zealanders want, but fundamentally different from any reasonable interpretation of the Treaty of Waitangi."

Poles apart after 171 years of living in the same country. How have we come to this? Part of the reason is that there are two opposing interpretations of the treaty. The view Brash takes is that by the first article, tribal ancestors had transferred their chiefly authority to the Queen forever, and the second article confirmed rights of possession. The separatist view is based on the second article’s guarantee of complete ownership, the Maori phrase “tino rangatiratanga”.

Karl du Fresne: Not a good week for free speech

New Zealand has been stricken by the most serious outbreak yet of the highly contagious condition I call acute sensitivity disorder.

Not all women were blinded by fury at what Alasdair Thompson said about menstruation affecting women's productivity. Some thought the outcry was grossly disproportionate to the supposed insult. But few people of either sex were prepared to stick up for Mr Thompson - not because they thought that what he said was indefensible, but because they were intimidated into silence by the howling of the lynch mob.

Owen McShane: New Layers of DURT (Delays, Uncertainty, Regulation and Taxation)

One of the main reasons for unaffordable housing, and an overall shortage of supply in New Zealand, is the multitude of planning documents that have to be dealt with by applicants even when making the simplest of applications. 

There is a natural tendency for these layers to grow because the environment is essentially infinite and hence finally requires an infinite number of plans. So we need to check out any set of proposals as to whether they will require further layers by legislative fiat. Similarly, if we want to encourage innovation we need to keep the patent, copyright, and trademark processes as simple as possible and compatible with international intellectual property law.

Roger Kerr: Property Rights, Regulatory Takings, and Compensation

Sleeping with elephants is a risky business.  Australian car manufacturers learned this lesson again recently. In October 2008, industry representatives negotiated a $1.3 billion Green Car Innovation Fund with the Rudd Labor government.  This would have provided $1 in taxpayer money for every $3 in investment from multinational car companies, with the aim of accelerating production of locally made hybrid cars.

Last February, barely two years later, with only $400 million of the Fund spent, Julia Gillard’s government pulled the pin on the scheme – by way of a media announcement, not even a call to the companies concerned.

Frank Newman: Capital gains tax back on the political agenda

Property investors are again being pilloried by self-serving politicians. This time it’s the Labour Party promising to impose a capital gains tax on investment properties should they become the government after the next election (presumably with support from the Greens).

The proposal was to be announced next week but has already been leaked to the media (which actually does not give one a lot of confidence in their ability to keep private the information it holds about individuals).

Roger Kerr: A Ban-Happy Country

An ingrained New Zealand characteristic is the urge to ban things that some people don’t like. Part of the urge may stem from our propensity for knee-jerk reactions to social problems. Rather than live and let live, or face the fact that the problem might be a matter of encouraging people to take responsibility for themselves, we look to the ‘gummint’ to pass a law against it.

Or it may derive from what the American journalist and humourist H L Mencken defined as Puritanism: “the haunting fear that someone, somewhere, may be happy.” Today we might call this paternalism or wowserism rather than Puritanism.

Owen McShane: The Gender Wage Gap and Communication Connectivity

The gender wage gap may seem unconnected to development economics, the RMA and local government. But the connection is real, if only because the recent debates remind us that when society experiences a rapid rate of social change, then many individual attitudes are likely to depart to some distance from reality.

While the gender wage gap may not be closing enough for some, the very idea of a wage gender gap has been a matter for social concern only since the sixties. And indeed I feel as though I am trapped in a dinner party of some forty years ago. Of course, gender wage gaps do exist.