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Greens propose government built 'Homes for Life' that occupants can progressively buy back; also rent limits and rental 'warrants of fitness'

Property
Greens propose government built 'Homes for Life' that occupants can progressively buy back; also rent limits and rental 'warrants of fitness'
24th Jan 13, 5:09am by Bernard Hickey

By Bernard Hickey

The Greens have proposed a housing policy designed to work with Labour's 'KiwiBuild' plan to build 100,000 government-built new homes in 10 years.

The Greens plan to allow occupants of these new homes to buy them back progressively from the government, using the government's low borrowing costs to help first home buyers in who can't afford a deposit or higher interest rates. This would be similar to the State Advances scheme used from the late 1930s to fund large scale state housing.

"Progressive Ownership is affordable for the government and offers smart stimulus to the economy. Because the families cover the Crown's cost of capital, there's no net cost or debt servicing to the Crown," said Greens co-leader Metiria Turei in announcing the policy at the Ratana Pa near Whanganui.

"This policy echoes the State Advances scheme that saw former governments, both National and Labour, use the low sovereign borrowing rate to help young families to buy homes in the post-war period, which led to high levels of home ownership and a fairer society," Turei said.

Under the proposal, families would live in a government built home, making a basic weekly payment to cover the government's investment cost and making flexible payments on top of that to buy the equity in the house back off the government. No deposit would be required and if a family moved out a home before owning it outright the government would pay out that equity, the Greens said.

The interest costs on NZ$300,000 of government debt with the current 3.5% interest rate amounts to NZ$201 a week. The scheme would be open to first home buyers with children and 'Progressive Ownership' homes would not be able to leased out to tenants. Any family in a NZ$300,000 state house would be able to own the home within 25 years by paying the NZ$200 a week in interest costs and 'topping' that up with NZ$100 a week in equity.

"The Green Party is offering low and middle income New Zealanders a real shot at owning their own home," Turei said.

Opinion polls show a Labour/Greens/NZ First coalition would beat National in a general election, given the lack of coalition partners for National after slumps in support for current partners ACT and the Maori Party, which faces fresh leadership turmoil this weekend with talk of a challenge to co-leader Pita Sharples and a potential merger with Hone Harawira's Maori Party. National Prime Minister John Key has said Harawira could not work with National, "and the feeling is mutual."

The Greens said the plan would not increase the government's net debt because the extra borrowing to build the homes would be offset by a similar valued asset. They said there was currently NZ$700 million to NZ$900 million of unallocated capital spending in future budgets, which would be enough to build around 3,000 houses a year. The Greens also pointed to budget surpluses totalling NZ$80 billion that are forecast from 2015 to 2025.

"Future governments will have to choose how much of that surplus should be spent on paying back the NZ$50 billion of debt National has amassed and how much should go on smart investment such as our housing policy," the Greens said in a Questions and Answers sheet released with the policy proposal.

'Warrant of Fitness for rentals'

Elsewhere, the Greens proposed writing a 'Warrant of Fitness' for rentals into law. It would set basic criteria for rentals, including for insulation, weather tightness and amenities such as hot and cold water and a stove.

Also, the Greens are proposing a 'Secure Tenancy' law ensuring rent increases were limited to once a year and be based on a formula specified in the tenancy agreement. Under this law, tenants would have the right to renew fixed term leases when they expired.

Prime Minister John Key rubbished the policy in comments to media at the Ratana celebrations.

"The Greens haven't announced a housing policy, they've just announced the next version of Monopoly," he said.

"They want to print money, now they want to build houses - what's next?"

(Updated with comments from Key)

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121 Comments

by  steven  |  24th Jan 13, 7:38am 1358966308

My first thought is OMG my party is in la la land.

Warrant of fitness, where is the self-warrant a tenant can do? ie if its not warm/good enough move out....It costs tax payers nothing the police....If the answer is "this is all I can afford" then where does the landlord get the $ to say insulate?  If the landlord cant recover / justify that investment then the property gets sold and the tenent has no where to live at all...so homeless...

Then the idea that the tenant has a purpetual right to renewal....

Now if  the idea is to collapse the housing market this is 2 good ways.

congrats.....my last thoughtt is they are drugged to the eye balls, they should cut back.

The first idea actually has some merit....if its executed properly, fat chance.

So the Govn buys agricultural land at the going agricultural rate, converts it to residential.  It then farms out the construction to independant builders who quote a fixed amount and using std designs and materials which can be bought in bulk. that might actually work quite well, of course the overseaing could be bloated and in-efficient. 

Of course when house prices drop the Govn is left with the debt.

Yes, drug induced la la land.

regards

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by  Kate  |  24th Jan 13, 1:07pm 1358986071

The WoF for rentals is a great idea. 

Point being - many of these run down and poorly maintained properties should be put on the market - as resident owners are far more likely to upgrade/improve them than non-resident owners.  The whole RE market benefits by a higher turnover of these lower end (i.e. first home) priced homes.

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by  Wolly  |  24th Jan 13, 1:22pm 1358986973

Kate just loves anything with a hint of govt control in it....WOF on rentals....not a great idea...a stupid idea yes.

The cost of the WOF would be passed on to the tenants.

The WOF would quickly become a govt or council cash cow.

Within the blink of a socialist eye, the WOF would be extended to every private property.

A bureaucratic monster in wgtn or in every council would result.

WOF on rentals........A stupid idea.

 

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by  Kate  |  24th Jan 13, 1:38pm 1358987881

Nah, I just love anything with a hint of lowering the socioeconomic cost to me of treating all these notifiable, infectious and asthmatic/respiratory diseases in our public hospitals.  Poor housing conditions being THE prime contributor to that cost - and it is enormous. 

If you think the state of our low end housing stock in NZ is okay - then you're simply in denial, Wolly.  Regulating the rental housing market is long overdue. WoFs needn't be difficult or cumbersome and I would assign the responsibility to the valuation sector (QV) given they should be visiting these places in terms of valuation updates anyway - as many of them are way over-valued given their deteriorating condition isn't taken into account in the three-yearly desk-based valuation reviews.

It's time these government valuations began to reflect the actual state/condition of the housing stock.

 

 

 

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by  Wolly  |  24th Jan 13, 3:48pm 1358995696

I deny being in denial...your problem Kate is you want to increase the cost of rental accommodation....yes you do....that is the certain result of your socialist agenda...landlords who comply with the red tape and meet the standards measured and judged by a whole army of officals in the new fangled dept of rentals with a new Minister and a swag of bureaucrats....would have every legal justification to raise the rents..

Many landlords would sell up..boot their tenants out as soon as the pinky green mob ousted National.

The right way to raise the standard of rental housing is through the vast public media system whereby the  'bad' landlords can be identified and rubbished for all to see....

We note kate, that you say nothing about the damage done to landlord property by bad tenants....why is that Kate!

 

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by  Kate  |  24th Jan 13, 4:10pm 1358997042

How can wanting to lower the cost of low income housing - while at the same time lowering the cost of hospital admissions be a "socialist agenda", Wolly?

You really need to change the record.  The Greens are offering solutions to the housing predicament we presently find ourselves in - much due to the slum landlord culture that pervades the rental industry at the moment. 

And I'm happy to say something to the landlord who constantly finds him or herself in the position of renting to bad tenants - well, sell up or spend the money necessary to upgrade the place to attract better tenants!

How hard is that, Wolly???????

Even a wolly should be able to figure it out.

 

 

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by  Wolly  |  24th Jan 13, 4:44pm 1358999082

Here is a suggestion kate. Don't put your faith in the Greens. They are just hunting out votes on the back of easy promises. You get in there and become a landlord...nothing stopping you Kate....

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by  Kate  |  24th Jan 13, 5:00pm 1359000015

Don't you worry, Wolly, I put my faith in good ideas and a population sensible enough to recognise one when they see it.  Nats are good too in that they usually adopt such good ideas when they see them as well - and Nick's reapptment to Cabinet with this specific nut to crack is a signal that working with the Greens is on the cards.  What other choices do the Nats have?  Time to build the relationship before the next election.

 

Why would I want to become a landlord now, Wolly?  There's presently no profit to speak of in it and the writing is on the wall for the bottom to fall out much further - both in capital gains and operating returns.  Accommodation supplements are for the chop in the not to distant future and the rental price correction will be severe. Dumb industry to be a new entrant in - good industry to get out of now if highly leveraged.

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by  Wolly  |  24th Jan 13, 5:40pm 1359002427

"..no profit to speak of....and there in can be found the reason many rentals are run down kate. So it's nice to know you are supporting a rise in rents...extra cash for the landlords so they can meet the new WOF BS standards set by whom?

I doubt very much that Tweak or Fiddle will opt to sleep with Norman.

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by  Kate  |  24th Jan 13, 6:29pm 1359005355

Wolly - my assessment presently is that there's little profit to speak of in it for any type/bracket of rental property because generally (in the areas/regions with good rental prospects) house prices are at the moment over-priced.  Even upmarket houses purchased recently are struggling to make an attractive return on capital. The only reason to buy a rental that's showing a poor return is based on the hope of a capital gain.

Landlords can go right ahead and try to increase the rent charged - the reliable tenants who pay on time and look after the place will simply go elsewhere.  Plenty of good tenants asking for and getting rent decreases at the moment.  The landlords who bought their properties years ago can afford to lower their prices - and will squeeze out the new entrants. 

Who do you think the Nats will opt for?  Not many options for opting remain.

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by  steven  |  24th Jan 13, 6:56pm 1359006981

and if this low cost get sold off? just who buys them and improves them anyway? The so called tenants on low incomes wont be able to, they will have huge mortgages to pay.

Honestly kate its a no winner in economic terms....all it is is a conveinient vote winner and bash those nasty landlords.

regards

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by  Kate  |  24th Jan 13, 7:15pm 1359008112

Well if they get sold off at realistic prices then in many cases the existing tenants could buy them.  You'd be surprised the number of people renting presently by choice because the numbers to purchase just don't make sense in comparison to the rents they are paying.  Meaning it's cheaper to rent than buy in most cases if you are a good tenant.  Take Matt in Auck who moved to Adelaide as an example.  Not all renters are cash strapped or low income - and lots of the houses needing renovation are in good areas... they're just over-priced.  Putting a WoF on these properties will serve to spurn that correction.    

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by  steven  |  24th Jan 13, 9:38pm 1359016696

All house prices are frankly un-realistic. So what you are saying is by changing the law you dis-advantage one section of the population in favour of another for no real good reason.  im sorry but I just dont see that as fair.

regards

 

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by  Kate  |  24th Jan 13, 11:39pm 1359023955

Who gets disadvantaged other than slum landlords?

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by  steven  |  25th Jan 13, 7:22am 1359051772

Kate, now you are being emotive and un-realistic with slum "landlords"  Like I said much of my house is mostly un-insulated (ceiling and some walls done), the old opening windows (which Im replacing at $300 each made by me) are/were badly drafty....We heat using electric radiators which a zero asthma problem btw.  So heat source is $100 a room and 100% efficient and clean.

I dont have a high income, do you care about me? no just these mysterious renters who some how deserve better than me (ie typical families with a mortgage).  So say the landlords seeing this legislation coming sell and they would be stupid not to whos buying? ppl like me or worse ppl like me with zero DIY skills so cant make a window for $300 worth of parts (like my neighbours).  So OK the landlords houses drop in value, anyone who has bought something similar recently also ends up in neg equity.  Have you figured all that through? no.  What happens is then the bank insists you pay extra and/or pay an insurance premium to cover their risk of loss.   What happens to the low end rental market? it disappears, tenants are on the streets and thats even worse than having a "sub-standard" house or they are forced to pay more.  

Standard un-insulated walls btw are a U of 1 (loss factor) so OK heating costs, good walls get to about 0.3~0.5 you still use energy, just less.  The other factor is air loss, but actually you need ventilation so what we want to control is excessive loss.

regards

 

 

 

 

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by  steven  |  25th Jan 13, 7:22am 1359051778

Kate, now you are being emotive and un-realistic with slum "landlords"  Like I said much of my house is mostly un-insulated (ceiling and some walls done), the old opening windows (which Im replacing at $300 each made by me) are/were badly drafty....We heat using electric radiators which a zero asthma problem btw.  So heat source is $100 a room and 100% efficient and clean.

I dont have a high income, do you care about me? no just these mysterious renters who some how deserve better than me (ie typical families with a mortgage).  So say the landlords seeing this legislation coming sell and they would be stupid not to whos buying? ppl like me or worse ppl like me with zero DIY skills so cant make a window for $300 worth of parts (like my neighbours).  So OK the landlords houses drop in value, anyone who has bought something similar recently also ends up in neg equity.  Have you figured all that through? no.  What happens is then the bank insists you pay extra and/or pay an insurance premium to cover their risk of loss.   What happens to the low end rental market? it disappears, tenants are on the streets and thats even worse than having a "sub-standard" house or they are forced to pay more.  

Standard un-insulated walls btw are a U of 1 (loss factor) so OK heating costs, good walls get to about 0.3~0.5 you still use energy, just less.  The other factor is air loss, but actually you need ventilation so what we want to control is excessive loss.

regards

 

 

 

 

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by  steven  |  24th Jan 13, 6:53pm 1359006785

So employ lots more pen pushers when in fact the tenant can do it themselves, I vote with their feet. What we are looking at is a vote buy by the greens.

Ive been in my home for 15 years, Im slowly doing it up as I can afford it, really if you think that first time buyers are not stretched with 95% and 30 years already you are in la la land.

 

regards

 

 

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by  Kate  |  24th Jan 13, 7:45pm 1359009933

Are you referring to the WoF for rental houses being a vote buyer?  If so, then basically you are saying that folks paying these market rents should not expect to live in healthy homes.

Are we a society that believes low income families should have to live in houses with no insulation and no heating source, drafty doors and windows, dodgy wiring, leaky roofs, moldy ceilings and inadequate drainage/guttering?  As all these simple to fix issues are common characteristics of much of our low end rental property stock.

 

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by  steven  |  24th Jan 13, 9:50pm 1359017417

Kate really I think you are going off the rails.  The tenant can move to a healthy home, by simply paying more, or even heating the house, then they get to live in healthy home. Lets get passed some of the frankly craziness, eg if its leaking the tenant can go to court to get it fixed or like I said go find somewhere else.  Now the outragious descriptions you are suggesting is franky not representative of most of NZ housing stock. Say its <5%, there is 6%+ vacancy rates in most places or more, so move. 

I have bad news for you taking out the roof leaks and mouldiness and guttering what you describe as low income housing is pretty close to my house actually.  So what you are saying is renters deserve better protection and accomodation than a person with a mortgage and you expect that person with a mortgage whos paying a lot of tax to yet again pay more, sorry makes no sense.

regards

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by  Kate  |  24th Jan 13, 11:34pm 1359023659

You're the one making no sense, steven.  Like this statement, ".. you expect that person with a mortgage whos paying a lot of tax to yet again pay more".  Where does tax come into this? 

We're simply talking about a WoF to run a rental accommodation business.  It's not a tax - it's an additional business expense - an added cost of compliance with respect to being in that kind of business.  And the cost of compliance would be minimal - say, one inspection every three years.  There are many existing businesses (for example home inspection services) that presently do similar work with respect to property purchases.

You're the one making a mountain out of a mole hill.

And if you're living in your own home and allowing it to deteriorate by failing to repair/maintain the roof, guttering and weather-tightness generally - then you either paid too much for the place and hence took on too high a mortgage - you're lazy and can't be bothered doing some simple repair work, or you're not earning enough money.

So, how about I suggest you take your own advice - and move - either sell the house and buy one you can afford to maintain or move jobs to one where you earn more money.

It's not that easy, is it?

Well neither is it for a person renting.

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by  steven  |  25th Jan 13, 7:39am 1359052798

Kate you are an idiot. who pays for the army of inspectors? who employs them? at some point I will pay either as PAYE or through rates. 

Ive done all my essential work to the house, things like guttering etc.  Roof needs doing in ten years or so despite my best endevours to look after it.

Lazy, LOL, yeah right...just ordering $2ks worth of bamboo to start replacing my kitchen by hand....the difference is Im avoiding debt like the plague.

Yep Ive moved jobs, Ive trained myself at my cost to get where I am at and stay there.

Move no, Im in the low cost sweet spot in terms of energy use overall...ie I walk, bike and use public transport as Im fairly close to anything I need day to day.  I thought and planned that out.

The point of your "advice" points to much else. What happens to the renters when petrol is $4 a litre? or un-available? you want me to subsidise them at that as well?  I mean to what limits should some ppl be taxed to support someone else? to the point they collapse financially as well? 

Cost of a Wof is a tax under another name....its compulsory call it what you will...that cost gets passed onto the renters in the end.

If you think its a molehill why do it?  unless of course its a party political broadcast to buy votes, which frankly it is IMHO.

Hence why I resigned my Green party membership last night and cancelled my standing order to them....and told them why.

They have really been failing to address the real issue, over-population. With this they are trying to mask the problems like everyone else with bandaids so really have descended to the common Pollie level, I wont support that.

regards

 

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by  Kate  |  25th Jan 13, 8:12am 1359054725

If you think its a molehill why do it?  unless of course its a party political broadcast to buy votes, which frankly it is IMHO.

 

The issue is not a 'molehill' - it's a very serious problem. Fixing it with a WoF for rental property is the easy part - which you seem to be making out to be in the 'too hard' basket.  And to say addressing the issue is just a 'bribe' to buy votes - well, then I assume these folks are politically motivated as well, are they?

http://www.nzcphm.org.nz/news-events/news/2012-01-23-media-statment-housing

 

 

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by  steven  |  25th Jan 13, 8:53am 1359057214

Kate, Im not saying its too hard, and thats just it. Im saying there are consquences and not good ones. Now these are either unseen, unconsidered and unexpected, in which case the Green's are incompetant. Or its part of a game plan, which really is not honest.

Thats the problem I have with the Greens now. I joined them because I though they held the moral high ground and had true Green ideals and vision. That over the last two years is proving not to be the case and this was thelast straw, out and out vote buying.

The water melon label is starting to turn into a tomato with green mold frankly.

Take a look at that statement,

"Dr Peters said New Zealand has seen devastating epidemics of infectious disease, such as the Meningococcal B disease in the 1990s, that were closely linked to over-crowded housing, and which took a very expensive vaccination campaign to resolve."

Next you want to mandate so many Sqm per person?  Is that over-crowding something a landlord can control?  Would the landlord know if a second family moved in?  If say my wife's sister's family moved in with us due to circumstances are you going to prosecute me for looking after my extended family?

There are reported instances of families living in garages. Garages dont have (as a rule, my one does I put 2 layers in) damp proofing. Is that better than living in an un-insulated house? I'd suggest not.

My critisism of the Green's 3 part policy is addressed at the last parts and not their wish to build good basic affordable accomodation, the first part.  Thier policy (and indeed Labour's is similar  to my thoughts with and what I agree with.  (The devil of course is in the detail). Building at cost would solve the "slum problem" over time.  My worry is that so many landlords are making little or even losing money that this would drive them out of the market leaving poor ppl in a worse situation.

However this is really arguing over who gets to wield the knife on a shrinking cake and not  how to address the shrinking cake fairly and equitably and much of that is population reduction. 

Go back to over-crowding, is that because pacific islanders (say) have large 5+ families? and the typical home has 3 bedrooms? Just whos responsibility is it to care for children the parents cannot afford? My wife teaches in a decile 1 school from choice, apart from the odd child most have 3 to 10 brothers and sisters how is that responsible parenthood?

regards

 

 

 

 

 

 

 

 

 

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by  powerdownkiwi  |  24th Jan 13, 8:03am 1358967796

Shades of Jack Lee and 'ol Nordy.

 

Methinks they're on a winner - it's probably as far as you can push the populace without scaring the horses, and it's in the right direction.

 

Watch for the bleatings of 'Nanny State'  and references from the dementia-afflicted to Auntie Helen, light-bulbs and showerheads......   which will ignore the throwing of money at the Dunedin Stadium and at irrigation.

 

And for the put-downs from those whos profit-taking would be diminished.

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by  steven  |  24th Jan 13, 8:42am 1358970123

pork barrel politics? lets face it this is aimed squarely at their [prospective] voting block. I agree on the (maybe silent) wailing from the profit takers, no biggee.  I suspect silence because they claim to be for poor ppl which is pure b****cks its a front and nothing more for their greed..

regards

 

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by  Andrew R  |  29th Jan 13, 8:54pm 1359446062

No it is recognition of a system that worked for people getting first homes -- the old state advances system, just modernised a bit.  Goes back before your time here Steven.

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by  notaneconomist  |  24th Jan 13, 9:15am 1358972133

When Poiticians use phrases like "SMART INVESTMENT" I always cringe.....This is not "smart investment"......it is a vote buying strategy using other people's money.  Any surplus any Political party manages to obtain actually comes from Private Enterprise who generate all the income to allow you idiots in Parliament to exist.  

And have the Greens actually thought about what would happen if interest rates went up?  Do they not think that the Government would be affected by higher interest rates as well? Get your greedy little eyes off the Nats intended surplus!!!!!

 

 

CAN THE NEW zEALAND SURVIVE.... GIVEN THE FOLLOWING?

 

The folks who are getting free stuff, don't like the folks who are paying for the free stuff, because the folks who are paying for the free stuff can no longer afford to pay for both the free stuff and their own stuff.

 

The folks who are paying for the free stuff want the free stuff to stop, and the folks who are getting the free stuff want even more free stuff on top of the free stuff they are already getting!

 

Now...  The people who are forcing the people to pay for the free stuff have been told by the people who are RECEIVING the free stuff, that the people who are PAYING for the free stuff, are being mean, prejudiced, racist and committing environmental atrocities.

 

So...  The people who are GETTING the free stuff have been convinced they need to hate the people who are paying for the free stuff by the people who are forcing some people to pay for their free stuff, and giving them the free stuff in the first place.

 

We have let the free stuff giving go on for so long that there are now more people getting free stuff than paying for the free stuff.

 

Now understand this: all great democracies have committed financial suicide somewhere between 200 and 250 years after being founded.  The reason?  The voters figured out they could vote themselves money from the treasury by electing people who promised to give them money from the treasury in exchange for electing them. 

 

Thomas Jefferson said it best:  “Democracy will cease to exist when you take away from those who are willing to work and give to those who would not”.

 

The number of people now getting free stuff outnumbers the people paying for the free stuff.  We have one chance to change that at the next election in 2014 will we?   Failure to change that spells the end of New Zealand, as we know it.

 

A Nation of Sheep Breeds a Government of Wolves!

 

"The problem with socialism is that eventually you run out of other people's money."  -- Margaret Thatcher

 

If the Greens want "Smart Investment" stop formulating legisaltion and Policy that prevents REAL smart investment......a hint smart investment......provides a Return on Capital. So don't go squandering my taxes on Poor Investments and start empowering people to be able to take care of themselves. If you don't know how to achieve that....I'll give you a hint.....remove your Political and Bureaucratic butts from Parliament.

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by  powerdownkiwi  |  24th Jan 13, 9:35am 1358973300

What a telling wee rant. Laughed so much I almost choked on my HP sauce.

 

The problem with the Thatcher approach is that you run out of Natural Capital, and you don't see it coming because you weren't valuing it properly. Then, in attempting to defend your chosen course of action (and not having the maturity to admit you'd misjudged) you have to indulge in ever-increasing denial.

 

'Striking a balance' (the Familton approach) is denial. Dodging an ETS (read; dodging responsibility - the FF approach) is denial. Assuming that a magic elixir will always appear is denial (and not understanding that exponential growth is an impossibility isn't so much denial - it's just plain old-fashioned ignorance).

 

I look forward to Notane putting-down the irrigation wealth-transfer, The SOE sell-off wealth-transfer, and their privatisation-of-the-commons wealth-transfer, but suspect patience will be required.

 

The Greens would be better upgrading the existing housing-stock, though. There isn't the lead-time either to do a meaningful build, or to pay it off (alle same irrigation). We're into 'triage aprez le wave-break', at this point. There's a serious question as to what happens to all debt, post peak energy-flows. Induced inflation is about the only way of avoiding a mass default, although some will no doubt be calculating that they will stay on the board after the first pawns are cleared - that they can be bigger winners in a smaller system. Long-odds bet, you'd have to think.

  Colin James rightly pointed out that the Greens are looking like the 1980's, Labour are lost, and the Nat's are the last of the old, not the beginning of the new. Pity the STEM thing wasn't applied earlier; we might have had smarter 'pollies. And smarter pollie-hacks.

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by  Stephen Hulme  |  24th Jan 13, 9:45am 1358973903

Laughed so much I almost choked on my HP sauce.

 

PDK consuming food with air miles - well I never!

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by  powerdownkiwi  |  24th Jan 13, 9:51am 1358974306

Nah, just had a hankering to go fishing. Probably no point - chances are it was undersize.

 

Nonetheless, I've always had a philosophical/structural engineering soft-spot for these guys - they never lost a passenger:

 

http://en.wikipedia.org/wiki/Handley_Page_H.P.42

 

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by  notaneconomist  |  24th Jan 13, 10:10am 1358975416

PDK - I think you need to re-think.

You State the folllowing 

"The problem with the Thatcher approach is that you run out of Natural Capital, and you don't see it coming because you weren't valuing it properly. Then, in attempting to defend your chosen course of action (and not having the maturity to admit you'd misjudged) you have to indulge in ever-increasing denial".

 

Have you actually considered the reverse side to the Thatcher approach? I think not. You have exactly the same problem with Socialism in that you run out of Natural Capital and you don't see it coming because you weren't valuing it properly. 

The real vaue of the Capital actually comes from those who have the ability to make it. 

Without this ability there is no value. Wealth is actually generated. Redistribution of wealth does not work as those who are receiving the redistribution don't have the foggiest idea of how to do it.  Your statement above tells me you want to keep people dumb....which makes me think you somehow benefit from this. So what are you hiding PDK? 

 

 

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by  steven  |  24th Jan 13, 1:52pm 1358988735

Thatcher made it quite clear that the North Sea oil and gas was to be pumped out as fast as possible to support her Govn. Indeed the loony left like the rabid right are indeed just as bad, hence why I say the Green party cannot be true to both being Green and red. 

Ability to make capital, well that shows you do not or cannot understand PDK's and my argument. You do not make capital. Capital is the accumilation of existing resources or energy into the hands of a  few.  The quantity of "wealth" ie energy does not change just who claims to own it.

Dumb, well no you total lack of understanding is what is mis-guiding you.....

Hiding? what is there to hide?

LOL

regards

 

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by  Ms de Meanour  |  24th Jan 13, 10:20am 1358976034

PDK, why do you think it sustainable to encourage people to expect to be given ever more free stuff?  Do you think people are more inclined to take proper care of possessions - land, houses, knowledge, food - if they don't have to pay for them?

 

 

 

 

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by  powerdownkiwi  |  24th Jan 13, 11:04am 1358978657

Wow, they are coming out of the woodwork.

 

Pot calling the kettle, relatively. A representative of a set who don't value the real (Natural Capital, mostly finite) properly, worrying about others not valuing things correctly?

 

Spare me.

 

But you're right - nobody respects things if they are gotten without effort. (Your "pay for them' is a red-herring - a currency-trader can  'pay for them', but hasn't made any productive effort). That mis-cue of yours reflects the bigger malaise; that the idea of wealth has been transferred from the currently-buyable resource-based item, to the proxy itself. It's inevitably a fatal delusion; you take your eye off the physical supply, something specialisation exascerbates.

 

And those who 'take proper care', often consume more of the planet in the process than the hand-out-takers. The oh-so-essential 3rd ensuite, makeover and 2nd (or 3rd) car. It's essential to keep perspective.

 

I don't fully approve of the Greens suggestion, as I've made clear. Sinclair on Nash is a good read, for a perspective of how close it is to history repeating itself. They fail to acknowledge the slope of the deck, while advocating efficient deck-chairs. It's worth noting what Metiria's partner is/was studying. I regard that particular discipline with as much respect as I have for Torquenada's mob.

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by  notaneconomist  |  24th Jan 13, 11:56am 1358981802

Sorry to burst your bubble PDk but regardless of whether one is a currency trader, a welfare recipient, a Greenie, Soicialist or Capitalist......They are all making an effort to produce something which they desire or value. What actually matters is whether the activity or function being undertaken has a negative or positive impact.

 

It is the direction of their effort that is applied which brings different outcomes/movements. Hmmmmm....and I thought you said you inderstood physics......well.....well.....well.....apparently NOT.

 

 

A currency trader is actually very productive and it is their activity which assists in keeping currencies trading at value in the market.  The long and short positions they hold depending on their technical and fundamentals maintains a stability range aligned to fair market value. 

 

 

 

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by  powerdownkiwi  |  24th Jan 13, 12:30pm 1358983857

To 'economist, add  'intellectual heavyweight'.

 

A currency trader does nothing productive - he/she are 100 parasitic, and they're not alone in that. All my current income is parasitic, but I'm aware of the fact, and of the fact that it can't continue.

 

Your middle sentence suggests that it's YOU who has a problem with physics. I'll get you sent the programme for this years ECON lectures (might be giving one myself, yet). No dollar ever raised any weight, any height, over any timeframe. That takes work, which requires energy. None of the Laws of Thermodynamics mention currency-trading, as I recall - but feel free to enlighten me, always keen to learn.

 

Your last sentence is sheer horseshit. Sorry, but it is. It is exactly what I was talking about - the instinctive transferral of the concept of 'wealth' (which is nothing more than the ability to own bits of the planet - food, fuel, land, infrastructure, consumables) to the proxy itself. That mental transfer is what casued you to make that middle-sentence mistake.

 

Even having been told of it, you didn't question whether it applied to you? That's a cranial failure - whichever way the answer went.

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by  Alex13  |  24th Jan 13, 12:46pm 1358984797

What is your definition of a "productive activity"?

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by  powerdownkiwi  |  24th Jan 13, 1:22pm 1358986943

Good question, although I smell a smart-assed agenda.     :)

 

Think it through.

 

Anyone can claim any kind of 'wealth'. A lawyer can charge xyz dollars an hour, a currency-trader can skim xyz % per whatever. That expectation may be traded several times in a non-physics way - the trader may pay the lawyer, for example.

 

Sooner or later, though, they expect to cash-in. House, car, something from the supermarket. Those are all 'bits of the planet' (there is no other source). They are all there because work - in the physics sense - has been done, and that means energy must have been expended in the doing of it.

 

So ultimately, wealth is only underwritten if energy is expended (and as I've stated here ad infinitum, we can debate efficiencies and the time-remaining, but they're the only variables).

 

It follows, that  'productive' in that sense (actually, 'underwriteable' is the better term), is something related to that physical delivery. All else is parasitic. If there is nothing on the supermarket shelf, or no Beamers in the yard, then it matters not what numerical bill the lawyer presented to the trader - they won't be buying.

 

Note that this applies to interest charged, and profit ditto. They were un-causally underwritten while there were fewer people, consuming fewer bits of the planet per head and per-time, and earlier in the resource-depletion process.

 

Which is why we see zero (and less than zero) interest rates, wealth destruction, and flight-to-supposed-safety. (Amanda points out the Nat Radio bit on shares being overblown - I think he said 'herd mentality' at one point). One manifestation of this inability to underwrite, is the inflating of the 'value' of existing items - most obviously real-estate. (You can triple a house price, indeed all house prices, but if the supply of bits of the planet is unaltered, the collective ability to purchase has risen not one jot).

 

Some things may well be 'socially useful' - my own endeavours fall into that category currently - but that doesn't guarantee they're resource-underwritten. Essentially, massive amounts of fossil energy skewed the game for a short period (2-300 years) and that included enough life-time experiences that we lost sight of the long-term reality.

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by  Alex13  |  24th Jan 13, 1:52pm 1358988770

I knew that a vague answer would be coming - and you did not fail to deliver that - but you failed to clearly answer the question. Try again; think more/better/deeper about the question itself and you might eventually get both the answer and my "agenda" :-)

I'll give you a hint: can any activity be considered "productive" within the framework of your outlook wherein the finiteness of resources is the dominant premise?

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by  powerdownkiwi  |  24th Jan 13, 2:36pm 1358991400

a13 - yes, but bugger-all.

 

Which reflects what our planetary paddock can support, on a relatively indefinite basis.

 

Best studies suggest 2 billion at subsistence-level, 1 billion at our level - but there's a caveat:

 

If we 7 billion chew it to pieces in our overshoot, that carrying-capacity won't stand up.

 

Is our monetary system capable of reflecting, anticipating, or easing us into, that?

 

No.

 

So why do we insist on using it?

 

The Greenland Norse ended up withdrawn to the one site, gnawing on the raw hoof-bones of next-years herd - and died out. They must have seen the firewood being depleted, the soil degraded, and the Inuit surviving in the same habitat. You gotta wonder.

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by  notaneconomist  |  24th Jan 13, 3:49pm 1358995753

PDK - come on read some of your history.  Eric the Red went to Greenland during the Medieval Warm Period. And what followed the MWP was the mini ice-age. 

 

Radiocarbon dating records of the organic remains indicate the ice-cap was smaller during the MWP. 

 

Have you ever considered what happened to Greenland Norse when that Ice Shelf didn't melt and the occupants couldn't trade as they had previously. They possibly have got stuck there and couldn't adapt and died, integrated with the Inuits or they managed to leave. 

 

The trees for firewood were being frozen. Where's your evidence on over-farming depleting soils? 

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by  powerdownkiwi  |  24th Jan 13, 4:14pm 1358997261

You can sail back in less than a month, and the cooling took a tad longer.

 

You can anticipate that need, and hold a ship. Heck, you can build one, rather than burning it as firewood (or burning a rival for your lady, in one instance - didn't do much good, she went nuts....) Instead, they chose to build churches, import stained-glass for them, and to import the latest European fashions.

 

Sounds like a standard denial trip, to me. Or ignorance. Either way, the Inuit example was there - the only logical explanation for not copying them - and dying instead - is arrogance. Social superiority.

 

Show me where they fertilised, in such a cold (therefore slow-replenishing, slow microbial-action) environment. If they didn't - and they didn't - then it was depletive. Same as grazing our high-country without t-dressing.

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by  notaneconomist  |  24th Jan 13, 5:16pm 1359001002

PDK - As I said read your history. 

Think you just made a mistake on the fertiliser. You said the soils were depleted.  So if the soil was depleted as you say then you must be able to prove that depletion occured and will have measurements of the nutrient status.

In regards to the High Country your way out of your depth on the grazing without top-dressing. Firstly the snow provides Nitrogen, you should know this living on the Kilmog. Secondly burning off as was regularly done provided many benefits.  

 

 

 

 

 

 

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by  powerdownkiwi  |  24th Jan 13, 5:41pm 1359002468

I served on a Landcare Committee, spent time on CC'S, and a lot of time above 3,000 ft.

 

Stop spinning, thanks. Burning-off merely releases some nutrient in a slow-accumulating environment. The down-side is that tussock - a great retainer of moisture, both out of the cloud and in terms of flood-capacitance - is lost. Michael Peak is a classic example, but there are dozens of others. It was no-input summer-grazed. Wheedled for burning. Ended up in DoC hands - economic no longer.

 

Same went for the Greenland Norse, same goes everywhere. Show me a paddock you can graze indefinitely without inputs?

 

 

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by  Alex13  |  24th Jan 13, 4:36pm 1358998587

The monetary system was not intended to address the problem.

As to the problem and the solution, you are saying: "Let's reduce consumption", others are saying "Let's improve efficiencies", yet others are saying: "Let's find ways to tap into other resources". I am saying: all of the above is required.

BUT, human nature is such that very few will follow any of above unless they see an immediate, tangible incentive, and that's where we are coming back to the monetary system and the mistake you are making by discarding it: an incentive system of some kind is necessary to reward reduction in consumption, to reward efficiency improvements and to reward efforts to explore other resources."Teaching/debating/demonstrating" by itself is not gonna cut it.

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by  powerdownkiwi  |  24th Jan 13, 4:47pm 1358999260

a13 - thanks for the considered reply, but - and it's due respect so I'll be polite - it's a tad oxymoronic. The fiscal system evolved in the growth phase - it was impossible that it could have been any other way. It was therefore unlikely that it would fit - or outlive - the reduction phase. (why invest, if the return is sequentially-smaller? - although perhaps if it's your best option....)

 

Have a good read of the last of Amanda's items today.

 

The problem is that the reward expects to do exactly what has to not-be-done. A reward would expect to be spent. Useless. Putting out the fire with gasoline, is that.

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by  Alex13  |  24th Jan 13, 5:20pm 1359001209

It is almost always about one's best option, where "best" means highest reward. Persuasion by itself won't do it. Why do you think the Soviet experiment failed?

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by  powerdownkiwi  |  24th Jan 13, 5:30pm 1359001826

I repeat - if the incentive not to buy, is the reward of being able to buy, then the only thing being freely dispensed is horseshit.

 

 

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by  Von  |  24th Jan 13, 1:55pm 1358988930

Is this what you are saying - that nobody is making anything tangible anymore; i.e. that is productive energy being spent on goods that someone can then buy and make use of; and if it doesn't work then the lawyer gets involved and the currency trader takes the money that is won in the lawsuit!  Is this why we are all in the s...!  Just want to know if I have got my head around your comment.  I enjoyed reading it. 

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by  steven  |  24th Jan 13, 2:04pm 1358989452

I wouldnt say "nobody is making anything tangible anymore" just that much of what we do or make is of no or little real value ie really needed. 

Consider the classic comment, "is the glass half full or half empty"   So you yourself as a generation have drunk half the glass by yourself and with 20 or 30 years life left want to drink the other half.  What pray do you hand to your children except an empty glass, a big smile and pee?

think they will be happy?

"all in the s"....yes and so are our children and grandchidren.  If you go with the science of AGW and the 4~6Deg C is the likely rise then there wont be any great-grandchildren.

regards

 

 

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by  Von  |  24th Jan 13, 2:13pm 1358990025

Thank you Steven, a good reply.  Not sure that I really want to drink the other half of the glass (only if its a good merlot!!!) and I desperately want to leave something for my grandchildren - they are the ones I worry about.  So what's the answer?

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by  powerdownkiwi  |  24th Jan 13, 3:27pm 1358994457

Von - sustainable levels of consumption and pollution.

 

That's the impersonal answer.

 

The 'commons' problem is that unless everyone reduces, it won't work (the remaining selfish ones will take up the slack). I doubt we will get there, but have personally come to the conclusion that being pro-active, teaching/debating/demonstrating, is the only valid approach.

 

That link Andyh put up is a cracker......

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by  steven  |  24th Jan 13, 10:03pm 1359018211

"valid" well its also sort of live with myself. As is being amply demonstrated, you can take a horse to water but you cannot make it drink. Most around me simply do not want to know, its a case of watching the shutters drop when you go near that subject.  I guess it will be down to nature to get the message through.  Just wait for the finger pointing "no one told us! oh wait you did? well you didnt shout loudly enough! so its your fault!"

blah.......

regards

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by  steven  |  24th Jan 13, 4:05pm 1358996717

A very hard to reply to Q.

From watching for the last 7 years or so even if we had a viable answer too many ppl would simply ignore it. 

The best comment I have seen on what to do is, we are talking a size of project on the scale of the build up to WW2 and the austerity (ie no luxuries) that that means.  No one (Pollie/Govn of the day)  has the guts to say out loud we should have started this in 2005 let alone we need to start right now....so more can kicking....so its being left to nature. 

Wehn you look back the warning I think was given amply in the 1970s with limits to growth (and that when re-visited is showing frigthening signs of being right) action then would have probably have seen us fine....but no.

Since its being left to nature being in NZ with only 4 million and a high % of renewable energy is our best bet.  All Im doing is trying to make myself and my family as resilient as possible, so as little debt as possible, energy efficient, as well educated/trained/practical as possible. 

regards

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by  Von  |  24th Jan 13, 5:07pm 1359000447

Thank you Steven, agree 100% with your sentiments and I too am trying my best without being too pessimistic and believing in humanity.  Biggest worry at the moment is the violence erupting after the Arab Spring.  So good to live at the bottom of the world and, listening to Radio National panel this afternoon, the only thing New Zealanders seem to be worrying about is which way is legal to park in a diagonal parking space!!!!  Front or Backwards! 

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by  powerdownkiwi  |  24th Jan 13, 5:25pm 1359001557

Von - yesterday was worse. The Attenborough statement was raised (3.50pm or so) and Brian Edwards - unstopped/challenged by Mora - deflected it. A classic wee piece of denial.  Re-raised by Susan whoever she is, it died a death. My take is that Mora has a personal fear or belief, which drives his skew. Same with Edwards. The news of the day in a different way?

 

I guess

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by  steven  |  24th Jan 13, 7:05pm 1359007523

Not just arab spring, china sea and india v pakistan.

all those nukes

:(

regards

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by  Ms de Meanour  |  24th Jan 13, 12:56pm 1358985414

On what basis do you label me a "representative of a set who don't value "Natural Capital" properly"?

 

On what basis do you equate"take proper care" with consuming more of the planet to get a third ensuite?  Consuming unsustainably isn't "taking proper care".  I did not mean that, and nothing in my post justifies the interpretation that I did. 

 

Unsustainable consumption is supported by enabling people to consume without making an effort to obtain - which is precisely what I mean by "pay for" - that which they consume.   It is the effect of subsidising consumption and handing out free stuff, which capitalism/Thatcherism opposes and socialism encourages.

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by  powerdownkiwi  |  24th Jan 13, 1:30pm 1358987408

On the basis of your last sentence.

 

Capitalism/Thatcherism have been temporarily supported by fossil fuels (stored over unimaginable periods of time, squandered in a blink), enabling them to produce/consume without making an appropriate effort to obtain. 

 

Which has had the effect of subsidising consumption.

 

Now where have I heard that before?

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by  Ms de Meanour  |  24th Jan 13, 2:02pm 1358989320

 

Do you imagine that the Soviet Union functioned without the use of fossil fuels, or that North Korea does today?   Do you think that businesses and individuals in China, where fossil fuel prices are subsidised, have a stronger incentive to use fossil fuels efficiently, and to husband resources carefully, than do businesses and individuals in economies where fossil fuel prices are set by market forces plus, in most cases, a substantial tax?

 

Your case, put in economists' terms, is that the market price, even when boosted by tax, does not properly reflect the scarcity of fossil fuels.  It can certainly happen that a market price does not reflect the full cost of a good or service - economists are aware of that as well, it's called an "externality".  Carbon emissions and other forms of pollution are one example.   

 

Even if the scarcity of fossil fuels is another example of such an externality, the market + tax price which is charged in capitalist economies is still more effective at encouraging consumers to use fossil fuels efficiently, and to look for alternatives to fossil fuels, than is the subsidised price which is charged in many non-market-based economies.

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by  powerdownkiwi  |  24th Jan 13, 2:26pm 1358990760

Ignoring physical externalities is as flawed as subsidising. Neither is better, sorry. May result in a time-line difference, but none in the effect.

 

The market is incapable of reflecting ultimate scarcity - which is why it's in trouble now. If it had been capable, we wouldn't be where we are.

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by  Ms de Meanour  |  25th Jan 13, 11:04am 1359065085

So actually your contempt for "capitalism / Thatcherism / market based economies / economists", which you seem to use moer or less interchangeably, is about as intellectually and empirically sound as a racio-misogynist who justifies himself by saying " I don't like the smell of sweat - Asian women sweat, when they take exercise - therefore I don't like Asian women".    Listen up - they're not unique in that, on the contrary they are no worse and actually perhaps even rather better than other groups.

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by  kiwimm  |  25th Jan 13, 12:37pm 1359070632

The problem with pricing is the short-term nature of the buyers and sellers versus the long-term supply.

 

Businesses typically work on a 7 year return (discounted cashflow) model. So as long as they can supply 7 years worth of oil then the price will vary from their cost plus a percentage profit to whatever the market is willing to pay. So long as they can produce a projected 7 years supply then they will happily sell under intrinsic value as long as they are making a profit.

 

Note: prices are increasing now as both supply dwindles and EROEI decreases. Once we hit peak (or probably more accureately, realise the peak has past) then prices will surge which will cause recession

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by  raegun  |  24th Jan 13, 11:21am 1358979709

"Democracy will cease to exist when you take away from those who are willing to work and give to those who would not”.

I am going to put a slightly different spin on those words, so that you may see another side to things

"Take away from those who are willing to work" let's use closing of manufacturing, outsourcing and downsizing as a means by which those who are willing to work have been taken from

Then "Give to those who would not" let's look at that as how we have facilitated the rort merchants of the world, manipulating money and making money from money,  there's plenty of us who do not see that as "work"

So you see it is not all a one way street



 

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by  notaneconomist  |  24th Jan 13, 2:08pm 1358989727

raegun - so what was taken from you? Your job? If the Company had remained operating in NZ  - would it have been able to maintain  employment for you?  A Company is in business to make profit. Time plus effort etc minus costs = profit. A job is swapping your time for wages which equals the workers profit. The worker has no Capital outlay or the responsibility of the business other than to do the job and get payment for that work.

 

So are you saying that people should only be willing to work if they get what they want as in the Company staying on-shore and that is what your definition of democracy is? 

Willing to work means willing to do any job.  I would also point out all employees are free to leave their job which is acceptable to the employee in his/her agreement but perhaps you don't consider that people operating those businesses should have the same rights as in the abiity to relocate their business etc.

I think you have perhaps misunderstood what Thomas Jefferson has said. If private enterprise business is no longer willing to work to fund those who don't wish to work then private enterprise business will find ways and other countries who do want the business. If these businesses are unable to relocate off-shore and the cost incurred upon them to great due to redistribution via taxes and the business is taken over by Government because the majority of the population wish for handouts then Democracy is threatened as we would be Communists and I don't know to many Communists who get to vote. 

Democracy is threatened when those who don't want to work but want everything given to them are a majority.  Societies contract fractures when the rights and priviledges of all the people are not on the same even platform.  That is why we have the Universal Declaration of Human Rights and the NZ Bill of Rights. 

We all have the right to employment this does not mean thist right is only in the one place - you are free to move on at any time, just as a business is free to move on at any time. The right to employment also means that the Government won't do anything that prevents employment opportunity  If their policies prevent employment in any form or capacity then they are failing the people in that country.  NZ now has a large number of Government created employment opportunities and these Govt jobs have directly prevented employment in private enterprise business in NZ.

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by  raegun  |  24th Jan 13, 2:55pm 1358992551

No I did NOT misunderstand what Jefferson said, what I have put forward is that there is possibly another way to look at it.

The free market ideology pretty much itself acknowledges that there will always be a pool of unemployed, but the only solution appears to be a shoulder shrug. I have no time for an ideology like that and I make no apologies for it

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by  notaneconomist  |  24th Jan 13, 4:22pm 1358997755

raegun - the free market is distorted by the strings of Government who control inflation. Having some unemployed frequently suits Government as it is a mechanism to control inflation. Government writes the legislaton which provisions the bureaucrats with the abiility  to place controls on the free market to curb inflation. The free market is actually an illusion and a classic example of this is housing prices.  Councils are given a free reign on just about every area of land supply, building controls, RMA etc. This is not how a free market works. When you have interference in any market the prices of those goods alter from the natural supply and demand of pricing.

 

 

 

 

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by  KH  |  24th Jan 13, 9:17am 1358972247

WoF on rental houses!  What about a warrant of fitness on Tenants.  After inspection and examination of their history they could have a wee certificate to carry around and wave at landlords when required.  Landlords would find that useful.

And if they couldn't get such WoF because of some black mark in their history.  What a good thing. Or maybe it would be simpler for Metiria to just come over and tattoo an indelible cross on the foreheads of the bad ones.

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by  Happy123  |  24th Jan 13, 12:29pm 1358983746

WoF on tenants ! ! !   Brilliant, who do I vote for to get that. 

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by  waymad  |  24th Jan 13, 9:35am 1358973353

Ok.  The long list of what-abouts (houses, I dinnae care aboot the rentals).

  • Where is the land gonna come from and at what unit cost per section
  • Where is the GumNut expertise in actually Building Stuff, (or is it gonna be subcontracted out to cronies as per BAU?)
  • Let's see a cashflow projection on all this, derived from an independently audited full financial model. Because we are heading into an era of limited wiggle room for More Borrowing, and static or declining tax takes.  So neither can be assumed to be available as a source of funds.
  • What about the LG impact on costs of land (or this this gonna be swept under the nearest carpet in the name of Employment For All?)
  • What about the Materials Duopoly (or is ComCom goinna be told 'hands off'?)
  • What about the LBP and miscellaneous Certification overheads (or it this just gonna get amplified by e.g. checking potential building sites for Rare and Endangered Snails?)
  • Does the public (remember Them?) get a say as to where these potential ghettoes are gonna be plonked?

That's probly enuff for now:  I'm sure that common taters are gonna have a field day.....

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by  powerdownkiwi  |  24th Jan 13, 9:56am 1358974585

Waymad - if they were really smart, they'd earmark all the already-surveyed, often services, small-town rural and semi-rural sections. Many back on to paddocks - which is future-proofing writ large. SIP panel kitsets - 2 or 3 basic designs, it has the potential to be very appropriate.

 

 

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by  waymad  |  24th Jan 13, 10:20am 1358976004

Agreed.  Lived fer 20+ years in exactly these sort of places.  But, but.....

 

But employment prospects are practically zero, especially for the demographic the Greens are looking at:  young families, low incomes (very probably Tax Consumers, not Tax Producers), very possibly limited life and work experience.

 

One sidebar on the small-town thing is that you have to be seen as Useful to really fit in.....

 

And a caution:  small towns (e.g. Springfield in Canterbury) had a year or three where they were inundated with Tax Consumers who discovered the happy conjunction of cheap ex-Railway houses, and no bothersome jobs locally to get hounded into.  Wheee! 

 

Didn't amuse the locals much though, so the common Unintended Consequence is the cry of 'but we weren't consulted about this invasion!'.  As indeedy, they weren't. 

 

Because an All Benevolent Gumnut Knows Best!

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by  steven  |  24th Jan 13, 10:10pm 1359018608

Small town thing, well without  cheap and abundant oil there will be a need for manual labour, the carrot pullers as ive said before.  Not just the present low incomers, lots of useless degree qualified ppl, financial wizkids and lawyers etc also will be, carrot pullers. I think you'll find that home growing food will be a significant part time job for many. Hopefully there will be enough non-ge crippled seed to use.

:/

regards

 

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by  vavau.to  |  24th Jan 13, 9:52am 1358974333

the real issue is the model. govermnt needs to be in real busines. If the goverment ran a successful houseing rental business buying/ building and renting them out and the profit went back into the business. we would not have a problem. however we are told they can not be in business, it must be left to the market. but of course the market runs around chasing $$ with no regard to anything else. If the goverment can run health,police ,custom courts. One would assume it could own a small rental business for a small profit. the dynamic are channging with fewer  larger companies and the rise of robots. the Goverment must reinvent its self. If theis scheme goes ahead under the old, them and us thinking then it will be failure

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by  kin  |  24th Jan 13, 10:51am 1358977894

Wow !!! Now the "spend-other-peoples-money" Greenies are into it too.....

 

Let's see how  Labour up the stakes and put chips on the table for the next GE.

 

John Key is really lagging....no wonder he put Wonder Boy Smith in charge of housing.

Small help he can do. Me thinks the horse has bolted from the Nats ....

 

Look forward to the Great Housing Giveaway for the next GE.

 

Having said that, I think the Greenies is successful in building "saleable" $300,000 houses should be applauded. Having people staying in it for infinity and paying a pittance for it too however will make it into another state housing by stealth.....not a bad idea if you are into state housing and all it's implication a decade later down the road.

 

My only objection is to their usual "nanny state" mentality....WOF for housing, automatic renewal of tenancy etc etc.....back to our socialist future !!!

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by  Chairman Moa  |  24th Jan 13, 11:16am 1358979401

1st impression, this is a great idea from the Greens - Singapore Govt has been doing this for years with their HDB flats.  But then the govt in Singapore has untold money in their reserve fund, we don't and probbaly have to borrow to fund such scheme..  so it might not be a great idea after all!

have another go Russell..

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by  Boatman  |  24th Jan 13, 11:28am 1358980100

I will kiss Metiria Turei's backside on the steps of the Auckland City Hall, the day my 3 children can each buy a brand new 3 bed-roomed state house in Auckland all up and  all found for $300,000.

Right now a good  suitable build- able section of land in Auckland costs almost $300k

This scheme  will never happen especially where Average House prices in Auckland are already double that figure.

In the unlikely event of this ever happening , State built houses will cost more than $300,000 simply because of the state has never ever been able to do anything within a budget

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by  Chairman Moa  |  24th Jan 13, 11:37am 1358980625

Trouble is they will expect a brand new 3 bed-roomed state house in Auckland within walking distance of Ponsonby, Grey lynn, parnell and for $300,000 or less..

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by  ngakonui gold  |  24th Jan 13, 11:37am 1358980635

Have a look at some of the old state housing areas around nz and see whats happened to them.

They still look like state houses but are now rented out to the unemployable who seem to spend much of their day sittingon the porch smoking while their kids attend a decile 1 school.

Build as many of these300k homes as you like,just not near me thanks

 

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by  powerdownkiwi  |  24th Jan 13, 12:41pm 1358984472

NG - there will always be a bell-curve.

 

In the early days, society was small, close, and mixed. I seem to remember someone on Nat Radio talking of this very recently - doctors offspring with freezing-workers offspring, same school/suburb.

 

Bigger numbers and stratification are what you describe, that's all. Leads to gated communities at the other end, too.

 

But it's not the bigger problem, and the bigger problem will hit both. The gated folk may well outlast the decile 1 folk for a while, but at some point the anger boils over.

 

 

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by  steven  |  24th Jan 13, 1:19pm 1358986769

yep, though it depends on what you mean by outlast.

The odd riot can eliminate a gated ghetto pretty quickly and effortlessly....which is what the "rich" fail to undertsnad or have forgotten, they need a society and their "wealth" only lasts while enough ppl feel they have a stake in it.

regards

 

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by  steven  |  24th Jan 13, 1:22pm 1358986977

and since they are (or some of them) un-employable its better to give them enough of a stake in our society to not try and destroy it.  Decile 1 school, well my wife teaches in one and well, kids are kids generally having also taught in a 10 they are less obnoxious and spoilt, hence even better members of society then the "rich"

regards

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by  Kate  |  24th Jan 13, 2:24pm 1358990664

And have a look at some of the kids that are products of that era when those now ex-state houses were actually owned by the state; 

http://www.scoop.co.nz/stories/HL0506/S00051.htm#1

And ask yourself why we can't now similarly expect such transitional success stories from the inhabitants of our state housing sector?

I'd say 50% of my partners friends from primary/secondary school grew up in state houses - and they moved on, just like our current PM, to become educated, respectable folk with respectable extended families.  So what's changed?  Why can't we expect the same good outcomes from state housing dwellers of today?

 

 

 

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by  glennb  |  24th Jan 13, 12:42pm 1358984541

govt building houses for income families. Two issues I see here:

 

1. Low income families don't always stay low income. I would be advising everybody, as soon as they leave school/uni to apply for one of these houses, then they'll have a low interest mortgage for life regardless of their income.

 

2. Governments can't pluck the land out of thin air to build these houses, it will have to come out of the same land supply that private housing developers are currently competing to buy.

 

This scheme may allow many low income families to buy a house, but it will shut out middle-income families from the realestate market because pricing on non-subsidised housing will be squeezed higher.

 

ANY type of subsidised house building program will ALWAYS incease demand within the market overall and therefore increase pricing - quite the opposite of the intended effect.

 

The ONLY way goverments should influence the realestate market is on the supply side, not the demand side.

 

The current National goverment need to start acting on the various recommendations to increase supply of land and to stream-line the process of building a house, ie increase the supply side of the realestate market.

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by  steven  |  24th Jan 13, 1:31pm 1358987484

1. yes I agree....moral hazard, good point I had not thought of that one.

2. I would assume that the Govn would force purchase of agricultural land at agricultural prices and re-zone into residential, thus removing a huge profit rent seeker right there.

I dont agree on middle income families, quite the reverse.  From my experience the first home buyer sets the bottom of the market for all other hosuing.  Hence $300k houses in quantity instaed of $400k homes would be good in stopping rises.  My worry is that such pricing actually collapses prices.

I dont see it as subsidised just removing all the rent seekers in the chain in the new build scene. Supply v demand, well if there are lots of 300k houses that us a supply side solution.

What Natioanl wants to do is zip really, its too little, which is the idea, fob off voters while protectingthe rents seekers, thier voting block.

regards

 

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by  glennb  |  24th Jan 13, 3:20pm 1358994017

like many left-wing supporters, you don't understand supply/demand - these so-called 300K houses will be built on land that would've otherwise been built on by private developers. The land that's left for the private developers will be more expensive because there's less of it.

 

and also typical of a left-winger - you say - "I would assume that the Govn would force purchase of agricultural land at agricultural prices". Wow! compulsory acquisition of private assets, that's unbelievably unrealistic and unpalatable

 

The Greens'  is definitely increasing the demand side - it's providing the ability to low income families to enter into the realstate market - a group of people that previously couldn't enter the market, therefore there will be more people in the market - higher demand

 

10,000 more every year coming into the market, while removing 10,000 sections from the land supply for those who would've entered into the market anyway - unsubsidised. Typical left wing politics, screwing middle-income Jack to house low-income Jill.

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by  steven  |  24th Jan 13, 10:24pm 1359019459

Ah right another libertarian comes out of his wee hole taking absolute rubbish, as usual.  Actually I do understand your version of fantasy land supply / demand and, its faulty...ie the real world isnt like your make believe la la land austrian world. 

In terms of land the agricultural zoned land has a price of say $500 per 1000 sqm, its only worth say 100k if its zoned residential.  So the Govn hands the owner $500 and then rezones it, the land owner hasnt actually lost out on the agricultural value, he/she has been paid in full.  All he/she has missed out on is the rent seeking he/she never would have got anyway.

The idea of the above is actually not to replace developers but to open up say 50000 sections at once at low prices so there is no possibility of rent seeking....ie competition occurs.

In terms of left winger, well if in your case you start off somewhere on the extreme right then sure just about everyone is a left winger.....

regards

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by  glennb  |  25th Jan 13, 8:36am 1359056171

if any agricultural land was available for sale, in areas where people wanted to live, it would already be snapped up for property development, particularly at the pricing you're suggesting.

 

The problem is right now, land is not available for housing development. And currently it's not central goverment role to make it available - it's local government responsibility.

 

What are you going to do? Natioalise land assets by forcibly acquiring farmers' land, and build communes for low income people where there's no infrastructure to support them, no where to (eg) shop for food, no where close for them to work. Look around Mr. Roarke, da plane, da plane is not coming anytime soon.

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by  B-Rocker  |  24th Jan 13, 12:53pm 1358985200

I can't figure this out. What does $100 x 52 weeks x 25 years equal?

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by  Chairman Moa  |  24th Jan 13, 1:31pm 1358987518

equal your tax income for 25 years..

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by  Chris_J  |  24th Jan 13, 2:50pm 1358992207

That's the least of your worries...

 

Who's paying the rates insurance and maintenance for the 25 years? 

 

Who chooses the lucky sods who get a below cost house, at below cost interest rates?

 

They do know there is are reasons why banks don't lend to a lot of people... (they have seen TVNZ "renters" haven't they?)

 

If tenants can extend leases in perpetuity, watch out when you go overseas for a couple of years and rent your home out because you may NEVER get it back!

 

Of course next they will insist you can't kick tenants out just because they are not paying their rent or trashing the property! 

 

A warm comfortable house, for no cost, no work and no effort, that's what every unskilled immigrant or local bum deserves ... according our mouldy naive political friends...

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by  steven  |  24th Jan 13, 3:43pm 1358995403

In a word, NINJA's

No income, no jobs...

So yeah go to college to get a good ed. work for 25 years paying off the loans, pay tax which you find you subsidise someone who cant get a good education or job or cant be bothered to....kind of a what? moment.

BTW Ive raised these points while having a "discusion" with the Green's via facebook....they cant answer because their pork barrel politics isnt thought out....its just a candy handout for their voters.

regards

 

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by  waymad  |  24th Jan 13, 4:07pm 1358996864

I do believe that would be termed a 'John Galt' moment for the earnest Producer, Steven.

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by  steven  |  24th Jan 13, 10:50pm 1359021002

Except I consider the writer to be an utter fruit cake.

regards

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by  Wolly  |  24th Jan 13, 4:04pm 1358996647

Me thinks Tweak and Fiddle might have woken up to the fact they face defeat next year on the back of the promises made by the pinky green mob.

Smiffy to the rescue. Throw him at the problem Fiddle. He will either solve it...or make a complete balls of trying to solve it...... and take the heat off the 9th floor.

The cost to build a new house are at silly levels...plus gst. Some companies seem to have virtual monopoly control in the market. BRANZ madness makes it worse. Peasants are way better off buying an old dunga in the sticks...and ignoring the media pressure to renovate...just keep it dry and warm...stuff the paint...ignore the rust....learn to love the oldness

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by  powerdownkiwi  |  24th Jan 13, 4:21pm 1358997664

Agreed Wally.

 

He's not the only gun brought out, eh? Someone sounds like a cornered cat. They're struggling, though, because at the end of the day, their message is a lie. No more, no less.

 

 

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by  steven  |  24th Jan 13, 10:29pm 1359019755

Unfortunately the probable replacements are just as deluded and have just as dishonest a message. Different message to a different bunch of ppl over cake division but still a lie and I suspect a knowing one.

regards

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by  iconoclast  |  24th Jan 13, 4:26pm 1358998009

Mr Green Machine. Have you thought it all the way through? All the loopholes?

 

Suppose I have 3 children in their 20's, married with children, potential first home buyers, they're all elligible for one of your $300,000 houses and they get accepted and settled into one of your new homes, each paying $200 per week etc .. and after a couple of years .. each of them is approached by an "inscrutable" person who has just lobbed into town with a lot of money, and offers to buy their houses off them for $400,000. Inscrutable person lends them the amount required to pay out the balance owing, with the remainder on transfer of title. They accept the deal, pay off the outstanding balance, obtain title, they own the house, then transfer title to buyer. Does that work?

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by  Wolly  |  24th Jan 13, 4:34pm 1358998443

No worries icono...Norman can plug that gap...with a regulation...you are not allowed to sell within twenty years unless you first offer the house to the gumnuts for a price set by the gumnut's bureaucrats...haha

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by  waymad  |  24th Jan 13, 4:23pm 1358997808

Isn't it just peachy to realise (judging by the comments on this 'ere thread) that the Greens, who oughta have a handle on things Sustainable, seem to have:

  • assumed the existence of the Magic Money Tree (foreign lenders and domestic taxpayers) in perpetuity - Unsustainable
  • created moral hazards - where's the Precautionary Principle when ya need it?

 

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by  powerdownkiwi  |  24th Jan 13, 4:37pm 1358998663

Waymad - perfectly put.

 

Now apply that to:

irrigation.

aquaculture.

motorways.

stadiums.

 

We will use up the remaining fossil fuels, and in the process extract much of the remaining solid resources. Given that withdrawing from the race doesn't change the outcome, just disadvantages you vis-a-vis the others, there is a stupid-but-valid argument for staying in.

 

In that case, you do stuff with the oil/resources, which ready you for the future. Everything I do round here is done like with that well-understood. You're storing oil, for when it isn't.  If that means self-supporting housing, particularly if it replaces existing crap,  they have an argument. Just. But asuaging population growth, unchallenged and unfettered, is simply stupid.

 

Put the average house through the Homestar rating, and I think it becomes obvious that retro-upgrading makes more sense.

 

 

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by  waymad  |  24th Jan 13, 5:39pm 1359002346

So (careful what you wish for):

we should dig up 10% of Southland's lignite, SASOL it and get ourselves 30 years of transport fuels to buy us the transition we're gonna need there???

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by  powerdownkiwi  |  24th Jan 13, 8:49pm 1359013760

Only if you have a proven method of sequestering 110% of the CO2.

Did you hear Christine Lagarde this evening, on Climate Change? Wasn't mincing words.

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by  steven  |  24th Jan 13, 10:46pm 1359020764

Yes, Ive just cancelled my party membership in disgust.

However the other parties are no better, just the Green's have now sunk to that level....

regards

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by  Happy123  |  24th Jan 13, 4:45pm 1358999115

Smart politiking by the Greens, this will win them votes. 

 

This policy has been well in truly chewed up and spit out already but I want to wade in on one point:

 

"the plan would not increase the government's net debt because the extra borrowing to build the homes would be offset by a similar valued asset"

 

Who came up with the expression "net debt"? ?  Last time I checked, borrowing several hundred million dollars will certainly increase government debt.  They will have an asset but they are assuming that they will be able to sell these ghetto houses.  If they sell them they will have a mortgage security but that's not worth much if the ghetto tenants don't pay, or the P-lab in the back room blows up.  Why would someone spend $300k for 60sqm on the outskirts of Auckland when they can get 60sqm for $300k in the CBD right now. 

 

Will the Greens be doing the evictions when the mortgages are not up-to-date?  Doesn't look good to evict your voter base. 

 

What's truly terrifying is that these people are likely to get in at the next election. 

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by  korual  |  24th Jan 13, 5:06pm 1359000400

Gotta love landlords. Of course ALL the renters are lazy and expect something for nothing. But for hundreds of years now classical economic theory has recognised that it is precisely landlords that get the free lunch of rentier income. Psycologists call this "transference" and is often at the root of hypocrisy. You pay your landlord hundreds of dollars every week and he does nothing for it, then he complains about the unemployed. Ain't it rich? Rentier income is a burden on capitalist enterprise, working households and the economy in general.

 

I'm not really sure about this Green plan, though. At least they're thinking about it. Still, anything to lower the market (a free market free from rentier income, that is) and reward families who have to work for a living.

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by  Matt in Auck  |  24th Jan 13, 5:57pm 1359003422

those who bemoan the potential costs of this good idea from the Greens need to think of the costs of NOT doing something like this, because the private sector is not going to deliver Auckland's housing needs for a range of reasons 

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by  Dale Smith  |  24th Jan 13, 7:14pm 1359008047

The raw land cost per section per section is still $45,000 ie $1,400,000 per ha. It does not matter whether it’s the Greens or Labour they want to sell you the land at greatly over inflated prices. This is land that they would have no hope in obtaining this premium price for if it was not going to be put into high density housing and subsidised by low interest Government borrowing costs. It would be more cost effective for the home owner to buy a house at a lower price and a higher interest rate than visa versa. This is a social engineering exercise by the Greens, the idea is to get everyone into high density living, with housing m2 costs so expense that you can only just afford to house yourself, you won’t be able to afford a car, let alone the garage to put it in. Your only option will be to use their pet project – public transport, which of course is subsidised by the super profits they make by selling you a shoe-box at over inflated prices.  

 

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by  Wolly  |  25th Jan 13, 6:31am 1359048690

Kate....to answer your question....if NZ ended up with WOF shite on private rental property, the law would be extended rapidly to engulf every private home. The cost would very soon be raised to provide the stolen loot to fund the expanding govt and or local council bureaucracy which would result. It would not stop there. The theft would go higher...PLUS GST on top. Do you understand Kate?

Now I believe the best way to change the behaviour of the few who rort tenants by refusing to keep property standards at minimum levels of quality, is education in the public domain...by plastering the picture and details of said landlord scum on the net for all to see.

That way, tenants could identify the scum and decide for themselves to avoid them. The same can be said for scum tenants whom landlords want to identify.

You seem to believe in big govt, in massive bureaucracy. Local council fatheads have also pressured wgtn to make WOF on private homes a legal requirement before selling....they have done so to boost their own employment future and for fatter salaries...munny stolen from home owners.

Kate...you need to understand that we do not need to be managed by fatheads if we are to live in NZ. That is the socialist madness that is Europe. It is a cancer.

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by  Kate  |  25th Jan 13, 8:33am 1359056027

WOFs for cars aren't carried out by the public sector - so what makes you think WOFs for rental accommodation would need to be - that whole 'bloated bureaucracy' argument as a means to deny the need (and right) to healthy homes is just a strawman.  These type of companies would be more than capable of carrying out an inspection;

http://www.nzhouseinspection.co.nz/index.php

And healthy, affordable housing would more than pay for itself in reduced health costs;

http://www.nzcphm.org.nz/news-events/news/2012-01-23-media-statment-housing

What these folks are suggesting would imply a WOF for rental accommodation would be beneficial to taxpayers - I would assume they are in a pretty good position to judge.

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by  speckles  |  25th Jan 13, 8:54am 1359057262

Kate, I totally agree with you,  The housing stock is very poor in this country and it should be resolved, I have rental properties however I could not morally purchase and provide  many homes that are on the market to anyone. The health consquences are substantial. I think you have flushed out the slum lords..so it appears possibly steven is one..even resorting to abuse & put downs :-) Very much an all about me attitude...fess up Steven.

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by  waymad  |  25th Jan 13, 10:09am 1359061781

Haveta go with Wolly here - Kate and Speckles.

 

Neither of you have considered Quis custodiet ipsos custodes, which is why the GumNut with its massive overheads (Public-sector unions, Peter Principle,  Pensions, Patch Protection - why lookit that Alliteration fer so early in the morn!) will inevitably get involved. 

 

And the private sector watchdog aspect - well Kate - Leaky Homes????

 

It's a GumNut employment exercise, pure and simple.

 

And without a Constitution (spend a few nights recently on a secure marine facility wiv one of the Constitution wallahs earlier this month and we talked a bit about similar matters), it's almost impossible to unwind these sorts of schemes - they start with Good Intentions then take on a life of their own.

 

So ter be Perfectly Francis, it's far better not to set that snowball a'rolli' down the ski slope.....

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by  Bernard Hickey  |  25th Jan 13, 7:55am 1359053752

Updated with Key's Monopoly comments.

"The Greens haven't announced a housing policy, they've just announced the next version of Monopoly," he said.

"They want to print money, now they want to build houses - what's next?"

 
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by  Kate  |  25th Jan 13, 8:35am 1359056128

Typical of JK to make a joke about one of the most serious problems facing the country which continues to worsen under his watch.

The sign of a person without a solution of his own.

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by  speckles  |  25th Jan 13, 8:55am 1359057321

or one seeing no political fallout given the profile of his support base?

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by  waymad  |  25th Jan 13, 10:33am 1359063239

The solutions (refer Hugh P in general and my own summary here) are perfectly straightforward.

 

The blowback and human fallout is what is getting and will get in the way: 

  • the materials cartel/duopoly involves large companies who maintain legions, nests full even yer could say,  of Legal Eagles and other Birds of Prey,
  • the LBP and other regulatory madnesses are full of Good Intentions (we have covered these, above, and Wolly's comments are perfect) albeit accompanied by massive costs and economic distortions
  • the land pricing issue involves land bankers, planners, rural landowners near a MUL, bankstas, Local Gumnuts and committed developers in a Gordian knot that no one party has the slighest interest in seeing untangled
  • the building cottage industry (see Bill E's comments in the preface to the Demographia survey) involves thousands of singe traders or tiny companies, each with their busienss ecosystem, who will not wish to see a future as factory hands in QC spaces assembling great quality but cheap because mass-produced homes.
  • the bankstas do not wish to see a shift from a whole lotta mortgage slaves with massive sums owed, to a calmer, gentler and much-less-$-average loan population.  Their revenue streams and collateral, capital ratios, Basel Brush committments and the like, all depend on a continuation of the Status Quo as to price and hence hosuing loan values.

 

You are right in that this is a socio-political issue, rather than a technical one.  But ask yerself who can realistically take on all the above, and actually change things via a head-on challenge?

 

So that's why we see a consistent chipping away at the base:  RBNZ mouth operations re LVR's and the like, RMA activity hinted at, the materials duopoly getting served notice, etc etc. 

 

That's all that can be accomplshed without calling in an Army....but then the Green-Reds do have that dictatorial streak in their DNA.....

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by  Kate  |  25th Jan 13, 11:00am 1359064821

who can realistically take on all the above, and actually change things via a head-on challenge?

More and more I think perhaps it will be wealthy individuals with a social conscience and an ability to see the writing is on the wall. Its not without precedence in NZ. Bob Jones' NZ Party election spoiler. Owen Glenn's recent announcement that he's going to do some work on child abuse and violence in families/society. The PureAdvantage initiative spearheaded by the late Lloyd Morrison. Gareth Morgan and the Big Kahuna.  Just some examples.

All have/had one thing in common - they're sick of the status quo and don't share your sense of inevitability about the present state of affairs.

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by  waymad  |  25th Jan 13, 12:17pm 1359069469

Not 'inevitability' Kate, an acute awareness of the electoral-political impossibility of democratically voting For any of this perfectly sensible stuff.

 

Your 'solution' depends entirely on the benevolence of a finacial elite.  Whatever That's called (oligarchy?) it ain't remotely democratic.

 

Yet, yet....Democracy (despite Winston C's brave comments) is really only good for voting For pure self interest.  And the promise of Free Stuff will buy enough votes every dang time.

 

The corollary is that many votes are a vote Against anything remotely sensible, and this is baked in to the electoral rolls by letting folk with huge conflicts of interest, Vote.

 

A working example always helps.

 

Why should a third-generation welfare dependent, 100% of whose income is sourced from Other People's Work, be permitted to Vote?  Because if one assumes the dependency acculturation is complete, that Vote will be for the current More Goodies Party.

 

What can ever alter this equation, once the tipping point of dependents (broadly defined as > 50% net income is Gumnut-sourced)  plus Gumnut employees exceeds 50% of electors?

 

Moral hazard territory....

 

And t'would be a brave soul indeed who would suggest an alteration to electoral eligibility....

 

The money shot, as they say in - well, elsewhere:

 

"We have been voting ourselves better benefits than we have earned for decades and – sooner than later – that has got to stop. Restoring the link between contributing to society and voting about how it is run would be a sensible first step."

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by  Kate  |  25th Jan 13, 12:59pm 1359071988

I'd prefer to quote Lloyd Morrison, ""Our lives are only better off when everyone is better off ... there's a need in all of us to push ourselves harder and make things right."

I think you'd be suprised how many NZers are thinking along the lines of voting in favour of policies that benefit future generations by returning a measure of egalitarianism and intergenerational/social equity to NZ society.

Rather than hypothecising on how third-generation welfare dependents will vote, waymad - why not concentrate your efforts on what needs to be done to prevent a fourth generation.

 

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by  waymad  |  25th Jan 13, 1:19pm 1359073171

Kate, I'm still interested to see your response to my challenge:  Your 'solution' depends entirely on the benevolence of a financial or intellectual elite.  Whatever That's called (oligarchy?) it ain't remotely democratic.

 

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by  Kate  |  25th Jan 13, 1:40pm 1359074442

Sorry waymad - not sure what challenge that was? But if you mean by my 'solution' the fact that I suggested I thought the answers would likely come from wealthy individuals?  What's undemocratic about any of the things I mentioned above that those individuals are/were doing? 

I'd far rather they used their wealth transparently (i.e. as themselves as declared individuals) as a power to persuade voters - as opposed to 'donating' behind closed doors as a power to purchase parties/officials (i.e. which is effectively what wealth in America does - and is more the definition of an oligarchy).

The initiatives I mentioned above aren't about benevolence - that's a more passive type of giving - these initiatives are proactive and transparent and community based.  That's what I like about the approach. 

 

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