Nick Smith’s government land-grab [updated]

 

If you ever thought the National Party was committed to proptecting your property rights (maybe because you read the National Party constitution once and thought they meant a word of it) then if you hadn't had that illusion shattered by their confiscation of private property in Christchurch after the earthquake -- if you hadn't already had it shattered by their introduction of the Resource Management Act (RMA) back in 1993 -- then Nick Smith’s announcement at his party’s conference over the weekend that he might seize property to “fix”the problem caused by his RMA should disabuse you.

Compulsory acquisition of your property if your own plans doesn’t fit the planners’ plans.

The taking of private land by the state, to be given (no doubt) to cronies who suck up to them.

Taking a hammer to the hampered housing market, with property owners being the nut.

Perhaps the most damning thing about his threat to seize your property for his own ends is that reports say the announcement, made to a hall packed with National Party supporters of all ages, was received not with the abuse it deserved but with applause – and that the only voices speaking loudly in ‘opposition’ this morning are Maori who realise from experience what land confiscation actually means who want to be first in line to receive confiscated property today!

It is a theft based on earlier theft. Perceptive housing analysts would understand that it was that confiscation of property rights by the Resource Management Act twenty-three years ago that has made it all-but impossible for property owners now to act rationally (or at all) to the market signals created by the housing crisis. (See for example 'Why “releasing” land doesn’t necessarily make land cheaper.') Indeed, the very  crisis itself, now almost universally accepted as a crisis of supply, was essentially created by the Resource Management Act throttling the rights of land-owners and giving over their on powers of planning to the so-called planners of the state.

Another demonstration of the dictum that controls necessarily lead to further controls, and on ad infinitum.

So a theft of property rights now to “fix” a crisis almost wholly caused by their previous and ongoing theft of property rights! What could be more ingenious!!

Perceptive property rights watchers will know that this threat is not new. They will have observed that John Key promised this very thing back in 2007, to steal your property if you don’t do on it what John and Nick want (see point 2a of his very first "four-point plan"). But, of course, none of you were listening. It was the sledgehammer solution they kept coming back to – against which none of you bothered to raise your voice.

So here it is.

And here’s the thing: It’s neither right nor necessary. Instead of compounding the earlier iniquity of the RMA’s theft of property rights by a yet further theft (and once started, where do all these successive thefts end?) how about recognising the error and overturning it? How about that? Nowhere in what passes for Nick Smith’s thinking is there any realisation whatsoever that stopping planners zoning people’s fricking land—one important key to avoiding boom and bust, and a very important key to recognising land-owners’ property rights, would be the very best way to begin getting sanity back into what was once a housin market.  A simple way to do it almost overnight would be to place firmly in the Bill of Rights a presumption in favour of property rights, and set up a system following common-law rights I call speedy Small-Consents Tribunals, to rapidly okay any project under a value of, say, $400,000.

It would be a start. A decent start. A much better start than a kneejerk move to confiscation. We are not yet Venezuela…

[Original cartoon by Mike Lester.]

RELATED READING:

• “But it’s in “the public interest” you say!
      Bollocks. As Michael Reddel summarised the Commission’s draft doggerel: “there seems to be a too-ready sense that government is the source of on-going solutions, rather than the source of the underlying problems.”
          At one level, the claim that “compulsory acquisition of property by the state can be justified if it is in
      the public interest” is circular.  What is “the public interest”?  The public interest might, for example,
      involve the protection of private property rights, including the right to hold property undisturbed.
      This is another example of the Commission’s apparent reluctance to grapple with pervasive government
      failure and abuse of regulatory powers.
      The abuses of eminent domain powers in the United States should be a salutary warning here….
  And so they should be.
  Productivity Commission dumps on land-owners – NOT PC, 2015
• “Forcing developers to build on their own land when it's not economic to do so is hardly consistent either with National's supposed principles of individual freedom and individual responsibility, -- with the principle that government underpins our society without dominating it -- or even with good economic sense. It's just dumb.
  What currently chokes off the supply of land is not tardy developers, it's zoning, zoning restrictions, and the council-mandated erection of urban zoning walls around cities. I want to hear from the Nats how these are going to be removed, not that hard-pressed developers (who will need to become less hard-pressed if houses are to become more affordable) are to become even more hard-pressed under a National Government. Sheesh.
  Key on housing affordability and elsewhere – NOT PC, 2007
• “So everyone hates “land banking,” but no-one apparently knows how to stop it.
  But what if, with one hit, you could stop land banking and provide affordable housing? Guest Poster Phil Hayward reckons it’s a snip. You just stop ring-fencing the city …”
  How do you stop land banking? – NOT PC, 2013
• “I’m astonished.  The last two decades have seen attack after attack on New Zealanders’ property rights….”
  Property rights are human rights: let’s protect them say NZ academics! – NOT PC, 2009
• “It’s true that the highly-restricted supply of land is one of the three major reasons whay young people can’t afford a house. But you can’t build an affordable home on a $500,000 section – so unless land costs drop savagely, simply ‘releasing’ some planners’ chosen land by rezoning it doesn’t on its own transform it into land that can be built on affordably.”
  Why “releasing” land doesn’t necessarily make land cheaper – NOT PC

UPDATE: From 2008 … shame nobody was listening.

Three Simple Remedies for Housing Affordability

Wednesday, 13 February 2008, 10:21 am
PolicyRelease: Libertarianz Party

Housing Policy: Three Simple Remedies for Housing Affordability

Since neither of the two main parties appear to have any actual concrete ideas of how to solve the problem of increasing housing unaffordability -- a problem they've only even noticed now its election year -- Libertarianz housing spokesman Peter Cresswell has some policy solutions that can be introduced tomorrow "that will neither destroy property rights as the policy suggestions of the two main parties will do, nor frighten the horses timidly residing in the electioneering stables of the main parties' respective campaign teams."

"The problem of housing unaffordability is one of undersupply caused by over-regulation," reminds Cresswell. "To state the problem is to begin to cure it," he says.

Libertarianz has three simple solutions that can be effected tomorrow to bring cheaper rural, urban and suburban housing.

1. ENTERPRISE ZONES: THE URBAN SOLUTION

The Clark Government's 'Army Surplus approach to housing' in which the bottom of the Crown land barrel is scraped to provide spare land for public-private partnerships on which to build is neither sensible nor sustainable -- "and will do little to seriously address affordability concerns," says Cresswell, "and much to reward the Clark Government's favourite developers."

Libertarianz suggests instead that selected urban 'brownfield sites' be simply designated as Enterprise Zones of maximum freedom in which taxes and compliance costs have been slashed, and landowners be left free to promote whatever projects they can put together without the restrictions of either National's Resource Management Act, Labour's Building Act or Roger Douglas' GST -- all of which regulatory relaxations potential house purchasers and insurers will be made fully aware.

"We would expect to see an explosion of innovation and choice in such zones," says Cresswell, "and the rapid provision of the affordable urban housing people are crying out for."

2. $30K PER HECTARE: THE RURAL SOLUTION

Genuinely affordable rural homes will only be built if, in principle, everyone can go to a farmer, buy a hectare of land for $30,000, and freely build a house there at a cost, perhaps, of just $100,000. That kind of transaction would lead to significantly lower prices than the $390,636 average asked for a home in NZ today. Instead of preventing such deals being done the state should step back, and instead provide (and allow) the infrastructure to let that house-on-a-freely-bought-hectare thrive. "That such deals still can't be done and won't be done as a result of either Clark's or Key's recent announcements is a measure of how the overbearing powers of the state will still restrict the supply of land," says Cresswell, "whoever the public elect into power next November."

3. SMALL CONSENTS TRIBUNALS: THE SUBURBAN SOLUTION

Every project large and small must presently navigate the polluted waters of the Resource Management Act while project champions await permission to do what should be theirs to do by right. The long delays associated with every step mandated by the RMA adds significant costs to projects -- cost that can only be recovered by raising the price paid by purchasers at the end of every development.

As a simple means by which to make it easier to produce the affordable housing all major parties now agree is required, Libertarianz suggests the setting up of 'Small Consent Tribunals' for all projects under $300,000 which can deal with all low-cost projects swiftly and objectively. Instead of considering projects on the basis of the 'sustainable management' nonsense of National's Resource Management Act, the Small Consents Tribunals should refer instead to basic common law principles such as rights to light, air and support, and to existing basic District Plan provisions such as height-to-boundary and basic density requirements. [More details here: http://pc.blogspot.com/2007/09/what-would-party-x-do-about-environment_15.html]

Cresswell concludes that any of the three solutions proposed here would on their own revolutionise the issue of housing affordability, and begin the means whereby a permanent solution to the problem may be cemented in: the total removal of the state from the issue of housing supply. "Until that finally happens," says Cresswell, "these three solutions would at least begin to effect the start of that necessary process without introducing any new coercion of existing property owners."

ENDS

 

.