Here's my Top 10 links from around the Internet at midday today.
As always, we welcome your additions in the comments below or via email to bernard.hickey@interest.co.nz.
See all previous Top 10s here.
My must read is #7 on some academic research showing increases in minimum wages don't actually hurt jobs that much.
1. 56.1% - That's the percentage of Spain's youth that are now unemployed.
It's worth thinking about what that means over the long term, and more broadly for the likes of New Zealand.
Luckily for New Zealand, we're not dependent on either Spain or Europe for our economic future.
If youth unemployment in Australia or China was anywhere near that level we'd be in deep trouble.
But at some point the political unsustainability of the depression in Southern Europe is going to blow up again in the European (and therefore Global) financial system.
With close to six million Spaniards out of work, unemployment is so entrenched that there was no political reaction to the latest figures, neither from government nor the opposition. Indeed, mentioning the economy at all has become virtually taboo across the political spectrum. Meanwhile, Spaniards and recent immigrants are deserting the country in search of work, with 500,000 leaving in 2012, 60,000 of them Spanish nationals, most of them to Latin America and Europe.
The total number of unemployed across the eurozone is 19.2 million, 15,000 fewer than in June. Across the EU the figure was 26.7 million, down 33,000 from June. However, it has remained at a record rate of 12.1% for the fourth months. The overall rate across the eurozone is 11%, half a percentage point up on last year.
2. Firms of Endearment - In covering the Living Wage debate yesterday, I got to thinking about the Warehouse's move to pay the Living Wage.
The inspiration may have been a growing number of companies trying to look beyond just pursuing short term profits.
This book called 'Firms of Endearmnent' describes how companies such as Whole Foods and Costco are bucking the trend to make more profits over the longer term. It turns out it's better for them in the long run to pay their workers more, to pay their CEOs (relatively) less and to care about their customers and suppliers as much as they care about shareholders. HT Snodgrass Throg in yesterday's thread.
3. China's corruption crackdown - China's new leader Xi Jingping is now consolidating his power and shuffling aside any rivals. He's also cracking down on all sorts of corruption. Bloomberg reports the latest is causing a real sensation in China.
By pursuing Jiang, the leadership is widening graft investigations after Xi warned that corruption threatened the Communist Party’s six-decade hold on power. Focusing on the state-owned companies Jiang oversaw and China’s oil industry may give Xi, who became president in March, and Premier Li Keqiang greater impetus to push through changes at a key party economic policy meeting in November, said Willy Wo-Lap Lam of the Chinese University of Hong Kong.
“Xi probably emerges more powerful than ever,” Lam, an adjunct professor of history, said by telephone. “Xi and Li will subject these huge conglomerates to more intense scrutiny, -- this is a way to impose some sort of discipline.”
Jiang Jiemin , the latest in a string of top mainland officials detained for corruption investigations, was last year questioned by party officials in relation to a Ferrari crash in Beijing, though the cases appear unrelated. The accident claimed the life of the only son of Ling Jihua , a top aide to then party general secretary and president Hu Jintao .
Sources had told the Post that the probe over Jiang focused on a large sum of money - several tens of millions of yuan - that was transferred from state-owned China National Petroleum Corp (CNPC) to the families of two women injured in the single-vehicle accident.
The driver killed in the accident was Ling's son, Ling Gu. He lost control of a black Ferrari on Beijing's North Fourth Ring Road in the early hours of March 18 last year and slammed into a wall. He was found dead at the scene, half-naked. Two young women - one naked and the other semi-clothed - who were with him in the car were seriously injured.
5. Singapore's latest 'speed limit' - Last week Singapore further tightened its rules around property ownership and home lending to try to slow its property market. The new rules included a block on new residents buying existing state owned flats (HDB flats) and a reduction in the portion of a salary used for mortgage repayments to 30% from 35%. Yet somehow, any attempts to block access to non-residential purchases of existing homes in New Zealand is somehow xenophobic and left wing.
It would be hard to accuse Singapore of being either (or unsuccessful for that matter...)
Aimed at ensuring greater financial prudence and to discourage speculation, the maximum tenure for HDB housing loans has been reduced from 30 years to 25 years. Borrowers are now only allowed to use 30 percent of their monthly income to service their HDB loan. Previously the cap was set at 35 percent. The Monetary Authority of Singapore (MAS) has also introduced similar measures for HDB borrowers.
Singapore permanent residents (PRs) have also been targeted by measures which will see newly-minted PRs having to wait three years before they are able to purchase a resale HDB property. Previously, they were able to buy a resale HDB property immediately after obtaining their PR status.
6. Baby-boomer NIMBYs win again - Len Brown yesterday capitulated to the whinging NIMBYs of Auckland and dropped clauses in the unitary plan designed to increase density of housing, which is the one way younger people will be able to afford housing anywhere near the centre of town.
Here's the NZHerald with the story:
Officers have argued strongly against plans to scrap 'no density limits' in the zone, which covers 40 per cent of residential Auckland, on the grounds it will provide for better design and housing choice.
The Auckland Plan committee put the issue off twice last week after councillor Ann Hartley sought to scrap the 'no density limit' and have a minimum density control of one house her 250sq m on sites greater than 1200sq m with a 20m street frontage.
This resulted in another compromise being put forward by Mr Brown for a 200sq m minimum house sites greater than 1200sq m, and no density limits on sites greater than 2500sq m.
The reason why the only things being built are huge standalone houses is because the density controls mean a minimum amount of land needs to be set aside for each dwelling, leading to effectively a minimum size of house in order for the developer to make a profit and therefore a minimum sale price that’s often well north of $500,000.
The frustrating thing about density rules is that the urban form above does not necessarily result in more greenspace or less building bulk or a more spacious urban environment. Those aesthetic outcomes are controlled through the use of regulations like height, site coverage, yard controls and the like.
Sadly, yesterday the Council effectively banned the provision of affordable housing in the widespread Mixed Housing Suburban zone by requiring a density controls to be applied for all developments in that zone. Supposedly they did it to protect the character of the suburbs, but as explained above, density rules don’t affect the bulk, scale and location of development.
The employment effect of the minimum wage is one of the most studied topics in all of economics. This report examines the most recent wave of this research – roughly since 2000 – to determine the best current estimates of the impact of increases in the minimum wage on the employment prospects of low-wage workers.
The weight of that evidence points to little or no employment response to modest increases in the minimum wage. The report reviews evidence on eleven possible adjustments to minimum-wage increases that may help to explain why the measured employment effects are so consistently small.
The strongest evidence suggests that the most important channels of adjustment are: reductions in labor turnover; improvements in organizational efficiency; reductions in wages of higher earners ("wage compression"); and small price increases. Given the relatively small cost to employers of modest increases in the minimum wage, these adjustment mechanisms appear to be more than sufficient to avoid employment losses, even for employers with a large share of low-wage workers.
8. Not so bad - SRA's Rodney Dickens has written a useful 'Raving' pointing out Japan's real per-capita GDP actually did slightly better than America over the last decade. Japan's real problem is a population decline and an ageing population.
9. Winners and losers - Tyler Cowen writes at the New York Times about who will be the winners and losers in a new world where machines replace many people in work.
He makes the good point that political radicals may be among the losers, in large part because of the ageing of the population.
A mechanized, computer-driven, highly unequal future is sometimes viewed as a recipe for rebellion. But the Edward J. Snowden saga shows this won’t be easy, as tech is at least as much an instrument for surveillance and control as it is for revolt.
We’re also aging rapidly, and that tends to make society more peaceful, less violent and less extreme in all directions. It was the 1960s, a peak era for manufacturing jobs and the American middle class, that brought so much social turmoil and unrest.
10. Totally The Daily Show on the departure of John Oliver. I enjoyed his short temporary reign.
75 Comments
therein lies a problem. If your original site is under 1200 sq m, then the minimum site areas need to be 300 sq m, and that won't be dense enough to get developmnet viable in many locations.
The intent for having the 1200 sq m minimum is understandable (development impact can be more readily internalised with a larger site), but overall it is daft because in most areas two sites will need to be amalgamated, and this is an obvious barrier to development progressing. That's why such a policy has been dumped in many Australian cities.
So I vote the plan a failure and it will struggle to achieve meaningful intensification.
Good for the investors, again!
The perennial problem here is that in property markets without the "vent" to land values that uninhibited fringe development supplies, all existing land and sites are not regarded any longer as merely a resource in a market that allocates those resources to efficient use.
They are now a speculative commodity that does not need to be put to more efficient use at all, just as gold can be traded indefinitely without being actually used for anything.
There is a clear correlation in real life, between market distortions (by plannning) and unaffordability, and unutilised and under-utilised sites. Look at the UK. The planners claim there can't be a shortage, because there are so many sites unused and under-developed.
But the freakin' prices are all the evidence needed to show there is a shortage. That, and the fact that the average age of a first home buyer has risen to 37 years.
1. 56.1% That's the percentage of Spain's youth that are now unemployed.
It's worth thinking about what that means over the long term, and more broadly for the likes of New Zealand.
..........................
that reminds me of a comment on Public Address. Professor Paul Spoonley muses as to why the Auckland Council doesn't deem diversity to be absolutely essential to economic well being:
Russell Brown -
If you’re going to “be honest”, look up some numbers. Canada has the highest per capita net immigration rate in the world and still manages to be quite admirable. Spain, which has absorbed more than three million immigrants since 2000, is flourishing. Immigration to Norway is at record levels.
And really, even in New Zealand, where a dizzying 23% of the population was born elsewhere, I can’t see the social fabric tearing, let alone any “cultural genocide” going on.
http://publicaddress.net/speaker/what-diversity-dividend/
a fail for social engineering?
The adoption of the Euro saw a marked reduction in interest rates to historic lows. The growth in the Spanish property market, which had begun in 1997, accelerated and within a few years had developed into a property bubble, financed largely by the cajas (regional savings banks under the oversight of the regional governments) and fed by the historically low interest rates and a massive growth of immigration. The Spanish economy was credited for having avoided the virtual zero growth rate of some of its largest partners in the EU.[90] The country's economy created more than half of all the new jobs in the European Union over the five years ending 2005.[91][92]
http://en.wikipedia.org/wiki/Spain#Property_boom_and_bust
Your second #7. This evidence comes from the US. It is based on US research into US data. It is not legitimate to assume that it translates directly into the NZ context. The economic and social context, employment law, the employment market, labour mobility and the relative level of the minimum wage are all different in the US.
yes they are, there would not be a reader here who does not know this. and there is not a single country on earth that translates directly into the NZ context. we know this as well, still perhaps it is useful to at least look at what other people are thinking once in a while
Maybe they actually understand in this day and age of access to historical information, that revolutions don't actually create jobs or make anyone better off.........?
Are employers meant to take on workers and be forced at gunpoint to pay them? What with? If the business is already making no money?
Or is the government meant to provide meaningless jobs and print the money to pay them? Perhaps people's common sense radar is alerted about this; I was encouraged by the backlash in NZ over Wed Wussel's advocacy of money printing.
#8 Japan is loosing it's job to China. My view is that countires develop their potential whereas countires such as Japan are the exeption. We can't have too many Japans at one time. I don't see Japan's problem as demography so much as rapid changes in demography.
I was watching CCTV (Chanel 9) An interviewee from an American immigration pressure group (when discussing changes to the make up of the population) said: "America is economy" (by implicaion not people). By that thinking you could replace the Japanese with Chinese and Japan would still be Japan.
Funny how planners think they know more than builders and developers not to say economists. Do the planners have economics degrees and years of experience in the private sector? What is the point in employing experts if you are just going to tell them they are wrong?
A lot of Ponsonby, Eden Tce, Epsom and Parnell should be replaced with a modern efficient version of terrace housing. Get the density and efficiency right up and bring another 200k people close to the cbd. That might give Auckland a chance at being a world class city.
Also send the port ops to Whangarei and make public all that prime real estate.
How would you persuade the people who own the land on which those 200k people are meant to be resettled at high density, to sell it to developers of high density, at prices that mean the 200k people could afford the resulting rents?
I say by all means nationalise the land if this outcome is so vitally important. This is what they did in Curitiba's famous "Transit Oriented Development" in the 1970's, something that the advocates of such stuff out here conveniently forget. Otherwise, land owners "holding out" for top dollar, means that there is no way 200k people will be able to afford to live there.
And what jobs would they all do? Is Wall Street going to relocate to Auckland from Manhattan? Would Detroit be rejuvenated by building skyscrapers? Was Detroit's economy based on skyscrapers when it was the highest-income economy in the USA? Is Silicon Valley, or Hartford? Or Wolfsburg, Germany's highest-income city?
It is stuff like this that "planners" have not been taught one single thing about, and what is more, seem incapable of ever learning it from real life. There are one or two honourable exceptions, but not one of them remains actually doing central urban planning for local government. It is simply untenable for anyone who has seen the light, to co-exist with the faithful who run these bureaucracies. Alain Bertaud, for example - the Saint Paul of urban planning. Look him up.
The academic term for this kind of thinking among "planners", is "physical determinism". It ignores decades and centuries of process to focus on form that is endogenous to the process; and assumes that the local economy, which is also actually endogenous to the process, can be replicated by replicating the form.
To convey the fallacy more simply, "cargo cults" sprang up among primitive tribes on contact with civilised people building airstrips in their location, following which aircraft landed and unloaded lots of useful "cargoes". So the primitive tribes constructed facsimiles of the airstrips, believing that the gods would send the magic flying monsters with their cargoes down to them too.
I hope some Council urban planners read this. You guys really are this stupid. But in your defence, your mis-education is highly responsible.
Planners did a great job in Communist economies, didn't they? Urban planners now are no better. The very discipline itself is pure charlatanism. The actual training and qualification institutions were set up in the first place to make an end run around the objectivity of the disciplines of engineering, architecture and urban economics, which were doing a proper job of it.
Philbest,
Nobody's objective, everyone's got their agenda and personal drives which influence their belief, decisions and actions.
Engineers, architects, and urban economists are as prone to mistakes and poor judgement as planners or government bureaucrats. The difference between the planners is that their influence was all-emcompassing, while in the Wester mixed market economies, power is spread around. Its concentrated more than we like to think, but still much wider than in the former Communist bloc.
You are right. But have you worked out how much power to distort whole economies, is wielded by Council Planners? Bill English was spot on when he said a few weeks ago, "we are not going to stand by idly while a dozen urban planners in Auckland hijack the macro-economy".
I see a very definite unhealthy nexus with the interests of the overly-powerful FIRE sector, especially the "finance" part.
The "planners" and indeed the local body politicians are mostly too economically illiterate to realise whose useful idiots they are.
For sure. I agree. I made voluminous comments on that subject last year. I'm a great admirer of the late Colin Ward who wrote extensively on the subject.
What we need to do is to put more effort into supporting the work of Hugh Pavelitich and getting the awareness of these issue into the forefront of people's consciousness.
Economic growth promotes greater youth employment, not low wages. And National has a poor record on that front.
Consistent economy performance under a Labour government was far better than when the National Party held the reins, including Real GDP Growth, per capita GDP, and employment.
http://www.rbnz.govt.nz/statistics/key_graphs/real_gdp/
Economic policy which undermines labour and constrains wages won't produce GDP growth, only greater spending power in the hands of consumers paired with capital investment which improves productivity will.
anarkist - that sounds like Bob Semple, just before he drove the bulldozer over the weelbarrow.
Sorry, but you're living a long way in the past.
Growth - real growth (you can desperately throw things like intellectual property in but even GDP - flawed as it is - can't be kept up) has stopped now, globally. When was the last time the Fed was so out of options, rates near zero, printing money? Ever? Why did the Euro leaders go on a charge to 'bring down oil prices'? (gone strangely quiet, notice?) The Chinese are either tanked more than they're letting on, or they've stockpiled coal, because, like some of us, they've worked out that peak coal will probably be before 2030 (and the quality will decline before that.
Productivity - if you remove the pushing-down of wages - is only efficiencies. That won't offset the decline.
here's a wee thought-provoker, for any who need to re-define their political direction
http://www.resilience.org/stories/2013-09-02/campfire-towards-homo-sapiens-a-movie-script
I don't have the space nor the time to engage you about the merits of the peak oil theory, which I find thoroughly questionable, given that its underpinned by dubious, sketchy, or unavailable data and propounded by folks with suspicious affiliations and backgrounds.
I'm willing to acknowledge there is a necessity to transition to a more energy efficient way of living than today if only due to the very real problem of Global Warming, but I don't believe the urgency is as pressing as you Peak Oil believers would lead us to believe.
The United States and Europe's troubles are due almost purely due to socio-political factors related to their elites wishing to wipe out the gains made by labour since the Great Depression and rewind Europe's Mixed Market Economy back to the economic structure that prevailed prior to that.
Anarkist - it's nothing to do with 'belief'. All finite resources, when chewed into, graph from a zero start, to a zero finish. Somewhere in the middle, they must 'peak' - it's geometrically impossible to draw te graph any other way. The area under the graph is the URR.
Try overlaying a y+2x graph over the left-hand side of a Gaussian. Where they diverge, if you try to deliver, you have to be taking resource (area) from the right-hand side. It becomes a Seneca event. Very quickly.
Just remember that something which has 10,000 years available resource at present rates of consumption, has 69 years to go at 10% pa increase in rate of consumption. Even at 3% pa increase, that 10,000 years just became 190 years.
In the face of that, if we are early, it - increasingly confidently - can't be by much,
Anarkist, the problem with GDP measures, is that they say nothing about the fiscal sustainability of the GDP level at any one time. It is all very well to have a higher GDP, but if it is based on debt heading to maxxed-out levels, it is hardly fair to blame the next government for a decline when everyone's ability to take on more debt still, hits its limit.
This has happened all over the western world. And it is a non-partisan problem. GW Bush presided over the boom in the USA, Obama is struggling with the fallout. Howard presided over the start of it in Aussie, Rudd and Gillard kept it going, and they haven't had their "peak" yet. Blair/Brown presided over it in the UK, and the Conservatives are coping with the fallout. Clark/Cullen presided over it in NZ.
Powerdownkiwi gave you his opinion about the "resource" sustainability aspect. He is a single issue nutter on that, you may have noticed. Everything in the world is explained by resources running out. Monopolies, regulatory distortions, rent seeking, system gaming, capital intensity, malinvestment, monetary inflation and cyclical volatility, and so on, are all closed books to him. A monetary cycle's bust is explained by "resources running out". A house price bubble bursting is explained by "resources running out". Land prices being 20 times higher inside a UGB than outside, is explained by "resources running out". Finance companies going bust - "resources running out". Bernie Madoff: "resources running out". High unemployment in Greece: "resources running out". Civil war in Syria: "resources running out". Miley Cyrus misbehaving on TV: "resources running out".
"Anarkist, the problem with GDP measures, is that they say nothing about the fiscal sustainability of the GDP level at any one time. It is all very well to have a higher GDP, but if it is based on debt heading to maxxed-out levels, it is hardly fair to blame the next government for a decline when everyone's ability to take on more debt still, hits its limit."
Government debt does little harm and even a lot of good. Specifically without government debt the Reserve Bank would lack a crucial tool in managing monetary policy. And the old time honored assertion of public debt is pure hokum. Government deficits constitutes capital investment. promoting economic growth. It adds spending power to the economy.
Note don't mistake me for advocating government activity, I may have moderated my vews but I'm hardly a supporter of big government. Just arguing on the basis of how the world works not how I wish it to.
The United States and Europe's troubles are due almost purely due to socio-political factors related to their elites wishing to wipe out the gains made by labour since the Great Depression and rewind Europe's Mixed Market Economy back to the economic structure that prevailed prior to that. 100% Agree
I'm not sure if Philbest meant just public debt fuel GDP growth. Many of those countries the problem was private sector debt fueling GDP growth -that was certainly the case under Cullen/Clark. A housing /mortgage fuel binge that if not encouraged was certainly not discouraged.
At the time I wrote to Cullen about my concerns re housing bubbles, I know MIA also wrote to Cullen. Nothing was done and we all know where that led.
IMHO our current government is all mouth no action regarding housing bubble and mortgage fueled growth too.
Begs a simple question:
What will all that economic growth buy?
Dig into that complaint about 'resources running out' - note, peak is not 'running out'; running out is a linear term - and it very quickly morphs into denigation by name calling (malthusian etc) and rapidly falls back on the 'there are no limits' mantra - the planet is finite, in other words.
If you can't divorce 'economic growth' from physical resources - and every move of the current Govt is about physical resources, it wouldn't be needed if you could 'get rich' without - then you can't have it forever. Only a stupid person (or I'll accept 'illogically cranially wired) could think you can.
#2. The Warehouse et al didn't set out to pay the 'living wage' as such. They made sensible decisions about who and how they wanted to employ. And what is best for the business. And good on them for that.
The trouble I have with the living wage employer advocates is that they are the likes of city councils and school boards of trustees. Not their own money firstly. And specifically setting up another two tier system, where the employees on the inside of councils etc, have better conditions than many of the people who pay for it, specifically the minimum wage taxpayers.
Actually, we need to remember that the Warehouse sells largely stuff from slave-labour-level-wage places. Offshoring of inadequate reimbursement doesn't eliminate the fact that the 'business model' relies on it. How many folk in the sweatshops of China, to one NZ,er getting 'the minimum wage'? They are 'minimum wage taxpayers' too. If we paid them 'properly' - the concept behind 'fair trade' - then local wages would in much worse shape.
I have found a way to knock about $22.5 million out of Development Contributions today. If Zanyzane is right councils are charging GST on top of the DC’s. To my mind a development contribution is just that: an injection of capital to be applied at a later date to new capital works. There is no difference between a DC and injection of capital into a private business. As we all know GST is not applied to financial transactions including capital payments.
Bernard, next time you see Peter Dunne stalking the corridors of power could you ask him to ensure equal treatment across the sectors for financial transactions? It would be nice if the government weren't ripping us off with one hand while wringing the other in torment over the misdeeds of councils.
There will certianly by something shaken out of the event we are going into. Houses will have to be way simpler and largely energy and self-sufficient and they will have to be on enough land to assist in supporting the family if not supporting the family. The changes are going to be profound IMHO.
regards
".....These days there would be a "For Sale" sign outside the cottage and it would be a bargain....."
Possibly a foreclosure sale, with the previous occupant's purchase price and mortgage debt load "anything BUT a bargain".
I have heard stories that people in Ireland who went round for years telling everyone what a wonderful prospect property was, have had to be in hiding for the last couple of years. Not that anyone anywhere else in the world ever learns anything, regardless of how many re-runs of this movie there are.
Check out this New Zealand eco -village shown tonight on TV3.
PDK I am sure Hugh doesn't mind how he is paid -profit, salary, up front fee, rent... But I doubt he gives away skill and expertise for free and you shouldn't either. Except to us here, which goes to show, you both in your own ways have a community spirit.
If you are doing something for your livihood you would want a decent payback for it.
The problem is the people who want ever larger profits, that they extract from abusing some flaw in the market -lack of competition, transferance of environmental and other costs to someone else etc.
Fair comment.
But the margin is thinner than most folk realise; I've thought about the tragedy of the commons, and come to the conclusion that we can only survive as an altruistic society, in the long run. In a limits scenario (you realise that if we first-worlders grew activity at 3% pa, and the 3rd-worlders came up to our level, then by 2070 we'd be doing 60 times as much? Yet the planet can't support us at the present rate?) individual wealth-grabbing just exascerbates the problem.
Happy to advise, but it's not rocket science. Hughey should spend a weekend (I'll rephrase that!) Hughey should visit Robyn Allison at Earthsong. She knows much more than me re eco-village establishment. My expertise is in low-cost, energy-efficient housing.
But - we go into this period (starting now, when was the last time we ever needed QE?) with the vast majority of existing houses, still existing. We go into it with the vast majority being urban dwellers. The majority of those houses are not up to scratch, and we have neither the resources nor the time to make them all so.
My feeling is that the best bang for our buck in the time remaining, is upgrading the existing stock, lowest-hanging fruit first. The best tool for ascertaining where an existing dwelling is at, is:
and this is of Chch interest
I recommend everyone putting their existing home through that - it's free and doesn't take long. It quicklty identifies where you can make the best improvements. Old villas etc will score about 2, maybe 4 if they've been intelligently upgraded. Newer houses will score 4-6. Mine scores 8, and I think there's a 9 in Golden Bay or somewhere.
Brendon was making the point about some class of people gaming the system to get something for nothing, and as you have done thousands of times before, you ramble off onto a totally different subject.
I would love to see the results of a meeting between Hugh and the "Earthsong" entrepreneurs. I wonder how aware they are already, of the difference that land prices, the result of planning and zoning, make to their final product hitting the market. Presumably they would be interested in getting land cost down at under $100,000 per hectare rather than $2,000,000 plus?
I would be very surprised if they were as intransigent as you are on the subject.
Brendon was making the point about some class of people gaming the system to get something for nothing -yes that's what I meant.
I find both Hugh and PDK have tendency to ramble. Maybe they have reasons for this, but I find that shorter is sometimes better if you want to have a proper dialogue.
Earthsong link good though : )
Mate, do keep trying to get through to PDK, with your patience and succinctness and graciousness. Good for you if you don't end up getting a bit ratty like I have so often.
I suppose at least the casual observer of these discussions can glean some sense out of them somewhere. But I am struck by the absence of anyone quite as intransigent as him, even on FrogBlog and the Auckland Transport Forum and "The Standard" and "Planetizen" and sites like that. Interest.Co.NZ is a much less likely place to find it being tolerated. I even wonder whether other Greenies and science buffs and "peakists" regard him as an embarrassment, and a site with a completely unrelated focus, like here, is the only place he can get away with acting all pretentious while spouting nonsense.
Philbest I know you have struggled with this site because it lacks academic rigor but I find the strength of this site is it allows 'every man' a voice, a chance to have their say. I suspect it has high degree of readership because of that.
I believe many ideas, such as yours, which would be ignored by MSM are able to traction because of this.
But then I believe the problem here in NZ is not our fellow kiwis, but the powers that be, who allow the gaming of the system that we discussed earlier....
P.S The kiwisong link had lots of financial information on how the community bought and developed the land in the 90s? Someone with a head for figures should look into how possible/impossible that would be today with current inflated land prices.
I will try to read the Mason Gaffney article tomorrow but I think it will put me to sleep now.
Stay well : )
Internet searches reveal THIS sort of thing going on all over the USA:
http://stories.realgoods.com/ecovillages-across-the-usa/
Impossible to do in NZ thanks to urban planning.
Unless you do it inside a UGB and pay $2,000,000 per hectare. I bet those US examples are getting their land for $10,000 per hectare.
Bernard Hickey - and by extension, Matt at Akl Transport Blog -
Please point to an example of any city in the world that is high density and affordable.
Please point to any example of a city without a UGB or a proxy for one (government land ownership, rural zoning, "infrastructure plans") that does not have affordable housing (median multiple 3).
Please point to any example of a city with a UGB or a proxy for one, that has affordable housing.
Sorry, but allowing dense development does nothing for affordability if there is a UGB or a proxy for one. All that happens is that the price of land per square foot rises faster than density. This is why the UK's cities are all high density and unaffordable. The price of land per square foot is inflated literally 300 times plus now after 6 decades of growth containment. This means that a home at the market median multiple of 6 to 9 in those cities, is literally on something like one tenth of the space that the homes in median-multiple 3 cities are.
Of course the land owning rentier class and the FIRE sector love this.
The rub is this. If you don't have growth containment and hence don't inflate the price of land, people will choose fair-priced McMansions over fair-priced apartments (note that apartments in median multiple 3 cities are a fraction of our prices, as well as the McMansions). Growth containment and inflating the price of land, results in depriving people of the choice of "more space" as well as gouging them of discretionary income no matter how they choose to live.
There are other ways to achieve affordability and constrain inefficient land use and energy consumption, but they are not popular with the FIRE sector and hence never get considered. Land taxes, especially progressive ones. Pricing of infrastructure use. Congestion pricing of roads.
Prof. Mason Gaffney's 1964 essay, "Containment Policies for Urban Sprawl" said everything that ever needed to be said about this. Gaffney is 90 years old now and still one of the clearest thinkers on the planet about these issues.
High density and affordable? Perhaps Singapore?
http://www.ifhp.org/ifhp-blog/singapore%E2%80%99s-successful-long-term-public-housing-strategies
mmm, but I think there is a reasonable degree of subsidisation there.
Also I understand fertility rates and average family sizes are very low in Singapore. A 1.5 / 2 bedroom apartment for a couple and one child is typically much more affordable than a 3 bedroom apartment for a couple and two children. Even a one bedroom difference can result in a huge price difference given the very high square metre costs of building apartments
Well the government built them without expectation of a profit - not sure that's the same as a subsidy. And from the very quick read I had - it allows for capitalisation of super with a 1% interest rate on borrowing, (that borrowing being through the government as well I assume).
So it looks like they made good quality housing affordable by eliminating the private sector and the banks in the housing equation for the majority of its citizens. I wonder what the rate of emigration of Singaporeans from Singapore is? And their youth unemployment rate?
Kate, excellent effort.
I have commended Singapore on this site before, for managing to be a similar economy to Hong Kong, only with housing costs about 1/3 as high.
But bear in mind Singapore's nation-state status and the whole range of policies that contribute to what it is. It is still very difficult for anyone with less education and skills to exist there at all because it is becoming such a haven for very wealthy people, and its economy has evolved into a typical "global city" one.
One thing I will say, and that is that if Lee Kuan Yew had had a decent size nation to run instead of a city-state (say he had all of Malaysia) I bet it would be serious competition to Southern USA for affordability and range of industry types and opportunities for all skill and educational levels.
Of course Singapore is not that, and cannot be. It started a bit more like that, of course. An incredible lot of stuff was actually "made in Singapore" a few decades ago, which is amazing for such a land-scarce "nation". Japan is an example of a similarly land-scarce nation (for the size of population) but it is not small enough to evolve into the kind of economy Singapore has. Japan can't be one huge "global city". Singapore can.
Before everybody goes All Gushy and Blurry Eyes, please note the following facts of husing in Singapore :
1. What was mentioned in the above article linked by Kate is Singapore Goverment Housing aka HDB. This is highly regulated by the goverment ...
a) Only Citizens are eligible for "New" apartments..and subjected to Income Caps AND Social Conditions (eg must be married)....Demand is exceptionally high and there is therefore a 5 years waiting list...but you must get married first to start the 5 year wait.
Non Citizens are allowed to buy "Resale" apartments from HBD Developed Areas, but this is subject to Market Price and is not cheap as compared to New Units..(New Units can only be sold After the owner has lived in it for at least 5 years...penalty applies if this rule is broken from fines to confiscation of the unit). Every Singaporean is only allowed One Unit in his lifetime.
b ) Most of the New Apartments (and therefore the most affordable for starter families) are in the outskirt...No GUB in Singapore...The sprawl will put Auckland to shame...
c) Housing is only affordable when you look at the financing package....ALL Singaporeans pay their mortgage by using their Compulsory EPF Savings (A little like Kiwisaver but the Uber version). Since this savings is compulsory, it therefore does not eat into the mortgager's take home income and therefore makes ownership affordable...but once he loses his job, it's the end of the line...
d) ALL the land used to built the apartments are Compulsorily Acquired by the Goverment via Public Interest Legislation...The price paid by th Goverment is usually a fraction of its Market Value...Perhaps the Auckland City Council would like to try this out with their Unitary Plan dreams for higher density in Auckland Central...(sidenote: The Goverment claims "non profit" by comparing the Market Value of the acquired land (which is substanially higher than what they had paid...since it is compulsorily acquired,) to the price sold via the Goverment HDB Scheme)...ie They could have made a huge profit but didn't...
The above are only a few facts of the Singapore Public Housing situation...Do anybody still thinks it is applicable in NZ ??
Really interesting detail, kin. Point is - it looks like it works for young Singaporean nationals. Our current governance of the housing sector does not look to be working for young NZers. Not saying the likes of this scheme might ever be immaginable in NZ - but the point is their housing crisis was obviously so bad (i.e. a huge part of the population living in squalor) they did someothing and that something worked for their people.
We can as a society choose to think it will never get that bad .. but ...
What is perhaps an interesting take away lesson is the non-private sector involvement in construction and the non-private sector involvement in finance - whilst maintaining an individual ownership model. And yes, the compulsory acquisition in land.
Yeah, his logic is unassailable. I so wish some city somewhere in the world would actually take his advice. I guess Houston is closest. But there are elements of his suggestions to be found in use in other cities too, such as the pricing of water both by unit consumed, and how expensive it is to get it to that location. "Postage stamp" pricing of infrastructure, as he calls it, has all sorts of unintended consequences that we then try and ameliorate with heavy handed planning that only worsens the problems.
And why, indeed, if we want to save on "infrastructure costs", do we tax "vertical infrastructure" - that is, a building, especially with multiple levels. This saves the need for providing more "horizontal" pipes and cables - yet we penalise it with taxes.
His calculation of the "present value" of taxation on buildings, is an eye-opener. This is something that gets quoted by others regularly in urban-economics academia.
Land should be "cheap to buy, dear to hold". Shifting the burden of taxation onto land would have this effect. And this alone would result in major efficiencies being gained in the allocation of land to best use. In contrast, UGB's make the urban land market seize up with "holdouts" and 'land banking" and gaming that is nothing to do with urban economic efficiency.
the evidence is clear that crude urban containment just doesn't work. But the planners just keep doing it.
the sad fact is that planners claim to have a strong social conscious. Yet their key policies hurt the poor and benefit the landed and wealthy.
Gaffney's policy makes total sense. And what I love in that paper is Gaffney is patently not a sprawl advocate, but sees the freeing up of the fringe as releasing the potential for the existing urban area
MIA - that piece was written in 1964.
Global population was 3.2 billion. Now it's over 7 billion.
Global oil consumption was 28 mbpd. Now it's 85 (ish) mbpd.
Silent Spring had only been published 2 years ago.
Hubbert's US lower48 Peak projection was 6 years from being proved.
Keeler was just getting going at Mauna Loa.
He doesn't address energy, embodied energy, entropy, externalities, resources, degradation, depletion.
So it's an interesting document from a historical pov, and nothing else. Absolutely like 'the' bible. Interesting from a historical perspective, but you'd be silly to believe some of the stuff written in it. We simply know more, now. We know how long it took to scour clacial valleys, and it was more than a week, more than 4-5000 years.
I used to enjoy - when I was younger - 'debating' with Jehovas w's or whoever, when they came watchtower-waving. Then I realised that I wasn't going to change them; they'd abdicated reason for belief. Now I just regard them as severely misguided, and thank my lucky stars we just enough the right side of Torquenada that I won't get burnt at the stake by a bunch of ignorant witchhunters. I feel much the same, reading the docco. You have to be pretty old, pretty set in your thinking, to regard a '64 posting as gospel.
Peter Glover Snorts & sneers his way thru the latest IPCC pre-report.
This is a text book example of climate jernal ism.
Maybe he actually thinks its convincing!
We welcome your comments below. If you are not already registered, please register to comment.
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.