'Nature-al’ Entrepreneurship: Being Green Without the State | Timothy Terrell

If you want to go green, you should do so without the state’s coercion, says Timothy Terrell at the Mises Institute conference in Oklahoma just last week. In this guest post, based in a lightly edited transcript of the talk, he explains how entrepreneurs and property rights can protect forests, wildlife, and open spaces better than bureaucracies, using real-world examples of “enviropreneurs”....

'Nature-al’ Entrepreneurship: Being Green Without the State

by Timothy Terrell

I subtitled my talk being green without the state, but I'm not trying to put some sort of free-market twist on a lecture about how you need to use an electric lawn mower or recycle or something like that. I'm in fact going to try to avoid pushing my preferences about uses of the environment altogether. That's not really my point here. 

People have different ideas about what is good and about what is useful. And I like the many useful things that we can make with the resources we extract from the environment. 

Many people like me also enjoy wilderness land and views of wildlife. I like forests and rivers. I like knowing that some species of antalope or rhinoceros are still with us, even if I'm not actually going out and looking at it myself. 

What I want to do is show that entrepreneurship is compatible with those goals. 

Entrepreneurship and the environment

An entrepreneur is a person who anticipates a future consumer demand and tries to adjust the factors of production to accomplish that, for the consumer, in search of a profit. For many people, this seems just diametrically opposed to the idea of solving problems related to the use of the environment. I'm going to suggest it's not only not incompatible, that it's essential that we think of things this way. 

We tend to think of entrepreneurship as being separate from the natural world, or at least just making goods that require extracting some substances from the world and then manipulating them into some product. What I'd like to do here is make the case that entrepreneurs can do this with nature as well, creating goods in a sense that have nature in its natural state, or at least something close to it. 

Environmental resources have value that is determined by the goals of the customers. The entrepreneur must satisfy those customers to earn a profit. So we say that environmental value is imputed -- that is to say that the value of the resource in the environment is derived from the value of the product that's made from that resource. 

An environmentalist of the anti-capitalistic type however, which is a very common type, might protest. Um, wouldn't we say that elements of the environment have some sort of value apart from whether they can be turned into a toaster or turned into a fur coat? And uh, you know, they might say, well, do we have to make everything uh into some kind of raw material for a factory? And I would say, well, certainly not. We have to think more broadly about what customers really want. 

Entrepreneurs respond not only to people who want goods that are manufactured out of the environment. They respond to people who value the natural world as more than just a source of calories, minerals, or fibre. 

Many people want goods and services that are the products of factories. We all do that to some extent, but we also value goods and services that are best provided by an environment in its natural state. So, people want the same kinds of things I want when I head out to the wilderness, as I like to do and don't get to do as much as I'd like. 

Maybe some people just want the knowledge that there is a place where land and wildlife exist without human contact. Even if that means we're not necessarily going to go and visit that place. Many of us just like knowing that there is such a place and providing those things is not outside the realm of entrepreneurship. 

Value? Whose value?

But I think we need to clear up something first. Some environmentalists want to separate the idea of value from a valuer. And I think that's a that's a serious problem. 

Price controls, rationing, and war. I'm pretty sure Chris Trotter doesn't want those either!

UNFORTUNATELY CHRIS TROTTER, WHO OFTEN writes so well, can be found peddling another dangerous historic myth. This one, this time, about the Great Depression. (about which there are many, many myths, most of which would be destructive if believed.)

If were to be believed — if his recommendations were to be followed, on the back of his myth-making — it may well cause another.

Writing to advocate that the Luxon government be more spendthrift, Trotter says 

When the 1929 Wall Street Crash sent the economy of the United States into a tailspin, the experts of the day called upon the administration of Herbert Hoover to apply the accepted remedies. Accordingly, Hoover’s Treasury Secretary, Andrew Mellon, responded with his now infamous instruction to:

“Liquidate labour, liquidate stocks, liquidate farmers, liquidate real estate. It will purge the rottenness out of the system.”

In following this advice, however, the Hoover Administration inflicted extreme hardship on millions of Americans, and in so-doing not only liquidated itself, but also came alarmingly close to liquidating the whole capitalist system. It took an American aristocrat, Franklin Roosevelt, with more intelligence and a bigger heart than Hoover and his conventional wisdom, to rescue American capitalism from itself.

Mutatis mutandis, the response of successive New Zealand governments to the Great Depression mirrored the conventional economic thinking of Mellon and his advisers. Saddled with obligations it could no longer afford, the Reform and United Parties cut, cut, cut, and cut again – unleashing massive deprivation and misery across the country. This time it was Labour that came to capitalism’s rescue.

He could not be more wrong.

And wrong in virtually every sentence.

LET'S START WITH MELLON'S alleged "instruction" to "liquidate labour, liquidate stocks, liquidate farmers, liquidate real estate" —liquidate all monetary assets in summary, at whatever price may be gotten for them, in order to "purge the rottenness out of the system."

Fact is, it would have, if that programme were followed — as it had been following the much greater crash in 1921. (Sometimes called "the forgotten depression," or "the crash that cured itself.") But the “quote” was not Mellon's but Hoover’s, his president, and it was him contrasting the “liquidationist” programme of the type successfully followed in 1920 with the “interventionist programme” he intended to follow instead. 

It didn't work. 

The more Hoover tried to carry out his interventionist programme from 1929 to 1932— inflating wages, trying to raise falling prices, spending like a drunken merchant-man, adding enormous debt to a government all but crippled by the inability to pay it down — the more things spiralled down into the mire.

From 1929 to 1932 Hoover did the exact opposite of sitting on his hands as he should have done. Instead, he was virtually Keynes-Lite, as he himself boasted in his 1932 presidential campaign:

We might have done nothing [said Hoover]. That would have been utter ruin. Instead we met the situation with proposals to private business and to Congress of the most gigantic program of economic defense and counterattack ever evolved in the history of the Republic. We put it into action.... No government in Washington has hitherto considered that it held so broad a responsibility for leadership in such times.... For the first time in the history of depression, dividends, profits, and the cost of living, have been reduced before wages have suffered.... They were maintained until the cost of living had decreased and the profits had practically vanished. They are now the highest real wages in the world.
    Creating new jobs and giving to the whole system a new breath of life; nothing has ever been devised in our history which has done more for ... "the common run of men and women." Some of the reactionary economists urged that we should allow the liquidation to take its course until we had found bottom.... We determined that we would not follow the advice of the bitter-end liquidationists and see the whole body of debtors of the United States brought to bankruptcy and the savings of our people brought to destruction.

Featured in Hoover's plan were increased taxes, lowered interest rates, huge deficits, public dams, public works, restrictions on immigration and trade, and government regulation of banking, finance, industry and labour markets.

Hoover's heavily interventionist programme — doing everything to raise prices when demand had already collapsed — failed miserably. Unlike the solution found in 1921 (to lower prices to meet lower demand), which saw things turn around within eighteen months, things were still dire four years after the 1929 crash when Trotter's hero Franklin Roosevelt took over.

And then, with even less intelligence and much less honesty, Roosevelt doubled down. 

In the 1932 election campaign, Franklin Roosevelt accused Hoover (accurately) of “reckless and extravagant” spending, of thinking “that we ought to center control of everything in Washington as rapidly as possible,” and of presiding over “the greatest spending administration in peacetime in all of history.” 

And that was all true.All of it—all the spending, all the alleged “stimulus”—all an attempt to keep up wages and prices and keep the engine ticking over in the manner to which Trotter et al suggest we do today with far less reason, and much less room to manoeuvre. . 

And it had failed. It had failed spectacularly.

it failed just as monumentally when Roosevelt tried it.

By 1933, when Roosevelt took over in the States, nearly 13 million Americans were unemployed. Yet when the Second World War began, after eight years of further intervention by Mr Roosevelt (whose advisers conceded their New Deal was based on the “Hoover New Deal”), nearly 12 million were still unemployed (unemployment had never dropped below 20% for the whole of the decade) and Roosevelt was to embrace a world war as a way to get the unemployed out of his hair.

We do NOT want any sort of repetition of that!

BUT WHAT ABOUT TROTTER'S  argument that the Reform and United Parties here had followed the liquidationist programme and failed, and had to be rescued in 1932 by Michael Savage's Labour.

Well, Trotter has finally hit on the one fact in his screed in which he's right. Gordon Coates's and George Forbes's  Reform and United Parties did inadvertently follow a semi-liquidationist programme. Despite their own interventions, and despite the US's disastrous Smoot-Hawley tariffs, they did allow prices to fall, which (along with Australia and the UK adopting similar programmes) did eventually allow green shoots to appear here by 1932. So that by 1935 when Savage's Labour was elected ... well, things were already on the upswing.

It wasn't at all that "Labour that came to capitalism’s rescue," as Trotter alleges. 

It was, instead, that capitalism, even in the muted form allowed to it, allowed Labour to take the credit for a job already done, and to spend up heavily — helping poorly-informed writers like Trotter to confuse effect for cause.

Fat is: the First Labour Government simply reaped the benefits of the recovery that was already under way. As economic historian John Gould outlines:

From 1934 overseas prices were recovering and the country [New Zealand] could not help but be better off. The [Labour] Government benefited, too, from a balanced budget, a buoyant public revenue, and a healthy reserve in London, inherited from its predecessor. It made good use of these propitious circumstances. Its initial step was simply a Christmas bonus for the unemployed – a symbolic if small pledge of humanitarian readiness to cut corners. 

It went on, in the busy session of 1936, to restore wage and pension cuts, to bring in a basic wage, a 40-hour week, and a major programme of public works; it built up the unions by bringing back compulsory arbitration and adding to it compulsory membership of unions; it embarked upon a great housing construction programme; it brought in a price scheme for dairy products which guaranteed the farmer a reasonable income; it tried, without notable success, to encourage secondary industry so that there would be more jobs for wage earners. 

The Government's opponents never tired of inquiring, “Where will the money come from?”; the Government's answers were never explicit, but in fact a good deal of the money came from State credit created by the Reserve Bank. This institution, by an Act of 1936, had become a fully governmental body; where these expensive programmes could not be financed out of current revenue or overseas funds, the Government simply borrowed from its own bank. Neither the housing programme nor the guaranteed price could have been financed without such credit. Labour had collected most of the Social Crediter's votes in 1935, and this, which was far from their desires, was their reward, a policy a good deal more Keynesian than Douglasite, however.

The cornerstone was set in the arch in 1938. Already the government had shown its concern with public health and welfare; in 1938 the two were integrated into a “social security” system by which the State guaranteed medical advice, medicines, hospital services to all whatever their means, and a wide range of pensions to all likely to suffer hardship. In part the scheme was financed by special taxation, in part from general revenue. It was, among other things, a ready vote winner in 1938; its attractiveness, together with the Government's energetic record and the National opposition's general nervelessness, proved irresistible.

But the spending, while just as irresistible, proved too much. The Labour boom ended in another bust, confusing later writers who were less than careful at their economics. Because the Labour victory in 1938 came just in time ...

Hard on the heels of the victory came tribulation. Thanks in part to public works construction ... draining overseas reserves, in part to a flight of private capital from the country, scared by a government that still seemed “socialistic”, in part to a sag in prices for exports jeopardising the guaranteed price system, and in part to the unsympathetic attitude shown by London financiers to some £16 million of debt shortly falling due, things looked ominous in 1939. The debt was converted on rather stringent terms; exchange and import controls were applied. 

But the real saviour [for Labour] was the war that broke out in September. Once again farm exports were at a priority and the mobilisation of resources for the war effort permitted the introduction of more thorough controls than would have been tolerable in peacetime.[1]

From 1929 to 1935 the United/Reform programme was semi-liquidationist, and it semi-succeeded.

It succeeded to such an extent that from 1935 to 1938, Labour could take the credit, apportion blame elsewhere, and deliver profligacy as from a horn of plenty.

And then, as Margaret Thatcher observed so sagely many years later, like all socialists they began to run out of money.

What saved Labour however was price controls, rationing, and war. 

I do trust that Mr Trotter does not want any of that either.

---

[1] John Gould, ‘1935-49: The Labour Regime,’ in An Encyclopaedia of New Zealand, ed. A.H McLintock, 1966

Helen Clark is now *against* corruption!

 

Helen Clark's eponymous foundation has come out against corruption in politics, which is a bit like coming out in favour of apple pie with cream.  

As I outline below, you'd think an organisation using Ms Clark's name might stay quiet on the subject of corruption. What her foundation's report calls corruption however included in one neat package deal the putrid practices of political lobbyists, and the act of people donating to their favourite political party.

These are two very different things.

One has the stench of cronyism. Of peddlers of political relationships forming a parasite class that Ayn Rand once called an "aristocracy of pull." The other is, well, for the most part it is just people donating to a political party because they like the party's policies and/or people.

Yes, cause and effect sometimes goes the other way. There are parties who do sell policies to donors. The ACT party's pathetic capitulations to Auckland council amalgamation and on abolishing the RMA has for years been predicated upon the many consultants who donate to and infest the party, and who never see a trough they don't like. The National Party's silence on China's many misdeeds may be connected to large donations from organisations like the Inner Mongolia Rider Horse group. The link between Winstons First's racing and fishing policies and his racing and fishing donors is oft ignored simply because major parties seek a sweetheart deal with him every three years,  but is tangible, not to mention the link between Labour's policies (education policies for example, favouring teachers unions) and trades union donations of time and money to Labour's campaign. And not to mention all the "green" projects subsidised with taxpayer money to help out the businesses and of Green donors.

But for the most part, donations are small beer. And are fairly transparent. It's the hole-and-corner parasites of political pull who are the biggest evil. And they're everywhere.

PJ O’Rourke used to delight in pointing out that this corruption, the buying and selling of political favour, is simply the price of Big Government — the sort of government that Clark herself has always favoured. Favours for cronies. Jobs for the boys (and girls). Big Government's power and money on sale to the highest bidders.

No one should be surprised. As O'Rourke used to remind us, when legislation proscribes what is bought and sold, the first things to be bought will be the legislators -- and the more legislation is written the higher the demand, and the higher the price.

The answer of course is a separation of state and economy, in the same way and for much the same reasons as the separation of church and state.

But that is not what Clark's foundation prescribes. 

It's not what Clark herself is after.

Helen Clark and her followers have long favoured direct payment of political parties by taxpayers. That's what this is about. Taxpayers forced to donate to parties whose views they may abhor. To political parties whose power would only become more entrenched by the regular involuntary AP from taxpayers' pockets. Clark favours this because her own Red Team suffers by comparison with donations to the Blue Team. (Not that money on its own can win elections, otherwise the ACT Party would have been in power for the last three decades.)

This was the impetus behind then-Prime Minister Clark's infamous user of illegal taxpayer money for her own election campaigns — "illegal" was the Auditor-General's word — passing retrospective legislation to legalise what commentator Chris Trotter called "acceptable corruption." ("Acceptable" because it was his own favoured political regime ransacking the public purse.) And for then-Prime Minister Clark's subsequent passing of the Electoral Finance Act to muzzle her opponents during election campaigns.

Corruption? If there's anyone in New Zealand politics who knows about corruption it's Helen Clark. When I read that Helen Clark's Foundation is "targeting corruption," I immediately searched here at NOT PC for "Helen Clark corruption." It's quite a trove. It runs for three pages. if you feel like diving in, start with the post near the top: ' Cancerous and corrosive and un-democratic and, and, and ...

Or of you want a fuller story, download this PDF copy of The Free Radical from 2006 explaining, as the cover story describes 'How Labour Stole the Election.'

 

MMT = Modern Monetary Theory, aka Marxist Monetary Theory. It's the ancient idea, now promoted by modern-day empty heads, that you can get something for nothing — in its MMT guise it's the notion that its power to print dollar bills gives governments a horn of plenty from which to buy votes. In this guest post Jonathan Newman explains to MMT promoter Stephanie Kelton that despite her earnest wishing to the contrary, money still doesn't grow on trees ...

MMT and Boiling Frogs

by Jonathan Newman

“Why do we borrow our own currency in the first place?”

MMT promoter Stephanie Kelton poses this question in her new documentary Finding the Money, and a clip of Jared Berstein’s fumbled response to the question has gone viral on social media. Bernstein is the Chair of the Council of Economic Advisers to Biden, and so we would expect that he would have an articulate answer to Kelton’s question. He didn't.

Instead of trying to parse his response or explain why he fumbled, I want to provide an answer: the State borrows to expropriate real resources from the private, productive part of society.

When I made this claim on Twitter, one MMTer responded (somewhat) approvingly: “We all agree on this part. The question is how they do it and what the effect is. MMT gets that part right [and] Austrians get it wrong.”

So let me go into a bit more detail. The reason the State borrows money (money that it also has the power to tax and print) is so that it can balance the negative political consequences of its various methods of expropriation.

Murray Rothbard would take issue with the original question as soon as the third word, “we,” is uttered:

The useful collective term “we” has enabled an ideological camouflage to be thrown over the reality of political life. If “we are the government,” then anything a government does to an individual is not only just and untyrannical but also “voluntary” on the part of the individual concerned. If the government has incurred a huge public debt which must be paid by taxing one group for the benefit of another, this reality of burden is obscured by saying that “we owe it to ourselves.” (Anatomy of the State, p. 10)

Rothbard was responding to those who downplay the burden of government debt by over-aggregating the groups of winners and losers into one “we.” MMTers, on the other hand, go many strides further by claiming that public debt isn’t a burden at all. For them, public debt is private savings—they literally flip public debts and deficits upside down.

While they describe their framework as providing the “full picture” of government finance, they do not proceed in their analysis (at least not in sufficient detail) by asking what happens when the government pays the people holding the bonds. The money used to pay back the bondholder ultimately comes from taxing and printing, both of which involve expropriation from the private sector.

So MMT’s public-debt-as-private-savings falls apart with just one additional step of analysis. The closest Kelton gets to this insight in her book The Deficit Myth, is this: “In truth, paying interest on government bonds is no more difficult than processing any other payment. To pay the interest, the Federal Reserve simply credits the appropriate bank account.” Later, she describes that the only potential constraint is price inflation: “Every dollar that is paid in the form of interest becomes income to bondholders. If those interest payments become too large, the risk is that total spending could push the economy above its speed limit.”

And that’s the end of it. 

Paying bondholders might have negative consequences in the form of excessive price inflation. 

MMTers don’t connect debt service to their prior claims that public debt is actually private savings because it negates the alleged aggregate benefits of government bonds held by the public. Paying bondholders requires an expropriation from the productive part of society in the form of either taxes or diminished purchasing power, which means that in the aggregate public debt is not private savings.

They employ an individual bondholder’s perspective when it suits them, and employ an aggregate perspective when it suits them. They see, correctly, that holding a bond means that you can receive payments from Uncle Sam in the future, but then gloss over the costs of Uncle Sam servicing this debt. It’s a perfect example of a violation of what Henry Hazlitt described in 1946 as the art of economics: “The art of economics consists in looking not merely at the immediate hut at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.”

In his seminal book Economics in One Lesson, Hazlitt relied on the work of Frédéric Bastiat from 1850. Despite its name, Modern Monetary Theory is full of old errors. The only thing new about it is the jargon they use to do something people have been doing for millennia: disguise the true costs of government expropriation.

Since the State has nothing and produces nothing, everything it does involves expropriation and distortion. The reason it employs a variety of methods of expropriation is because each one has negative political consequences. If any one method is employed “too much,” the politicians and bureaucrats who wield that particular weapon get blamed and can lose their position. Using one particular weapon “too much” makes the State’s expropriation obvious and risks revolt in either soft or hard forms.

Heavy taxation is unpopular. High interest rates are unpopular. Price inflation is unpopular. But if the State can blend taxing, borrowing, and printing in just the right amounts, then they can boil the frogs without them jumping out of the pot.

This insight reveals something about MMT. As much as its proponents brandish accounting tautologies and purely descriptive claims about government finance, in the end it is 100% political. Their framework is about giving the State maximum power—power to expropriate and power to override what would prevail in unhampered markets. This is on full display in their writings and in their new film. They want to revolutionise the way politicians and voters view money and debt for the sake of their progressive agenda. When it comes to climate change, inequality, healthcare for all, and all the other 'Green New Deal' issues, they want a world in which nobody asks about the costs.

* * * * * 

Dr. Jonathan Newman earned his PhD at Auburn University while a Research Fellow at the Mises Institute. He was the recipient of the 2021 Gary G. Schlarbaum Award to a Promising Young Scholar for Excellence in Research and Teaching. Previously, he was Associate Professor of Economics and Finance at Bryan College. He has published in the Quarterly Journal of Austrian Economics and in volumes edited by Matthew McCaffrey and Per Bylund. His research focuses on Austrian economics, inflation and business cycles, and the history of economic thought. He has taught courses on Macroeconomics and Quantitative Economics: Uses and Limitations in the Mises Graduate School. He is the author of two children’s books: The Broken Window and Ludwig the Builder. 

His post first appeared at the Mises Wire.

"By any measure, the 'School Strike for Climate' was a disaster" [update]

"On Friday, March 15 2019, an estimated 170,000 New Zealand secondary school students took to the nation’s streets. RNZ still ranks that turnout as the 'second-largest' protest in New Zealand history. ... [Last] Friday morning (5 April 2024) RNZ was carrying the School Strike for Climate protest organisers’ predictions of a turnout in excess of 100,000. Protest rallies were scheduled from Whangarei to Invercargill. ...
    "By the end of the day, however, it was clear that something very serious had gone wrong with the plan to unite the Left’s fragmented movements by, in effect, piggy-backing on the huge numbers formerly responsive to the SS4C’s summonses. Rather than a turnout in the range of 100,000: across the whole country, and by the most generous estimate, the organisers of the 'Strike' turned out a derisory 5,000 people.
    "By any measure, the 'Strike' was a disaster ...
    "Certainly, the dismal turnout must have given Green co-leader, Chloe Swarbrick, considerable pause. After all, she has staked a great deal of her political credibility on the proposition that she and her party can mobilise, electorally, the young, the alienated, and the disenfranchised. After Friday, however, transforming the 2026 general election into a people’s crusade would appear to be a much taller order.
    "Contrariwise, the failure of the 'Strike' offers Messers Luxon, Seymour and Peters considerable cause for celebration. Their coalition is described on the SS4C website as: 'the most conservative government in our history' – a claim that would doubtless bring a wry smile to the lips of Bill Massey, Sid Holland, and Rob Muldoon. Still, if Friday’s flop is the best the New Zealand Left can set against the Great Strike of 1913, the 1951 Waterfront Lockout, and the 1981 Springbok Tour protests, then our Coalition Government can breathe a huge sigh of relief."

~ Chris Trotter, from his post 'Something Important: The Curious Death of the School Strike 4 Climate Movement.'

UPDATE: This chimes with news from the States "that just 3% of 18-to-34-year-old voters named climate change as their top issue, with most citing the economy, inflation or immigration." (Not that the latter is anything about which to be concerned either.)

"Let’s not forget, [notes Jo Nova] all these surveys are done on people who never see a skeptical expert on TV or a real documentary ... They don’t hear that carbon dioxide was higher for most of the last half billion years, or that 'climate change' causes record grain yields, and saves 166,000 lives a year. Most of the 18 to 35 year olds have been fed the climate diatribe from school — but even they don’t believe it. ...

"So the good news that the young can see through this, despite the wall of propaganda.."

BOOK REVIEW: 'The Capitalist Manifesto: Why the Global Free Market Will Save the World,' by Johan Norberg

The IEA's Kristian Niemitz reviews Johan Norberg's important new book.

I first came across Johan Norberg almost exactly 20 years ago, when the German translation of his book In Defence of Global Capitalism came out. The book argued that globalisation was a success story. In large parts of the developing world, poverty, infant mortality and illiteracy were falling, life expectancy was rising, nutrition was improving, and democracy was spreading. These positive trends were, according to the younger Norberg, likely to continue, and they were not a product of chance. They were a result of the spread of capitalism.

At the time, this was considered an outrageous thing to say.... The almost universally accepted conventional wisdom of the day was that “globalisation” meant the exploitation of poor countries by multinational corporations, and that the world was going from bad to worse. ...

With his most recent book The Capitalist Manifesto: Why the Global Free Market Will Save the World, Norberg goes back to the beginning.... The era of “globalisation” is generally said to have started around 1990, so when In Defence of Global Capitalism came out, it was still in its relatively early stages. We now have three decades to go by. What happened in those three decades?

Quite a lot. 

• Extreme poverty fell from 38% of the world’s population to less than 10%, 
• child and infant mortality fell from 9.3% to 3.7%, 
• global life expectancy increased from 64 years to over 70 years, 
• illiteracy dropped from 25.7% to 13.5%, 
• child labour decreased from 16% to 10%, and so on, and so forth. 

The countries and regions which performed best are the ones which did precisely the opposite of what the anti-globalisation movement wanted them to do, while the most spectacular counterexample is the movement’s erstwhile poster child of Venezuela. ...

There are genuine problems, though. In some Western countries, NIMBYism is driving up the cost of housing. This makes it harder for people to move to where the best job opportunities are, and it gives younger generations a worse deal. In addition, the extension of occupational licensing is erecting market entry barriers. None of this has anything to do with “neoliberalism” or “hyperglobalisation”, though – quite the opposite....

But have classical liberals benefited from this, in any way? Has being right made us more successful in winning over hearts and minds? Are there more people now who embrace free-market capitalism, or who at least accept that, even if they don’t like it, it is the most powerful motor of economic and social progress known to man?

Very far from it ... in addition to the anti-capitalist Left, we have also seen the rise of an anti-liberal Right. ... Where In Defence of Global Capitalism was able to concentrate on one enemy, The Capitalist Manifesto has to fight a two-front war. Some chapters are primarily aimed at the anti-capitalist Left, others are primarily aimed at the anti-liberal Right, and some could apply to both in roughly equal measure. ...

• Chapter 3 concentrates on the ... misplaced nostalgia for the economic structure of the postwar decades ... Norberg shows that automation and productivity improvements have contributed far more to job losses in the manufacturing industries than free trade, and that ... the same processes that make some jobs redundant also lower consumer prices and thereby make us richer, [creating] demand for new jobs in other sectors ...
• Chapter 4 addresses the old Marxist idea that wealth must be built on exploitation, but also some of the more recent literature on inequality, such as Thomas Piketty’s Capital in the Twenty-First Century and The Spirit Level by Kate Pickett and Richard Wilkinson. In market economies, people do not get rich by exploiting others. They get rich because they offer something that lots of people are prepared to pay for. Left-wing celebrity authors like Michael Moore and Bernie Sanders understand that perfectly well when it comes to their own book sales, but they are not capable of extending that logic to entrepreneurial activities. ...
• Chapter 5 picks up another perennial Marxist theme: the idea that capitalism supposedly leads to greater and greater industry concentration over time. ... The best antidote to worrying too much about market concentration, though, is to read an article from 20 or 30 years ago that was worrying about the same thing. This is because a lot of the behemoths of yesteryear have since faded into obscurity. ...
• If there is one thing those of us on the pro-globalisation side were wrong about 20 years ago (and in Chapter 7, Norberg is very open about that), it was our belief that freer trade and freer markets would lead to the spread of Western liberal values, and Western-style liberal democracies. In China, this has clearly not happened. Under Xi Jinping, China has gone into reverse, both in terms of economic and political liberty. However, none of this means that economic nationalists, who seek to decouple Western economies from China, are right.... 
• One of the weirder phenomena of the past five years or so was the rise of a new wave of militant, anti-capitalist eco-movements: the Greta Thunberg movement, Extinction Rebellion, Just Stop Oil, and their various offshoots and counterparts in other countries. It is weird because it happened after the environmentalist side had already won the debate on climate change. ... On green issues, anti-capitalists are as wrong as they are about everything else. As Norberg shows in Chapter 8, market economies can and do address environmental problems very effectively.

All in all, the slightly older Norberg skewers the bad of ideas of the 2020s as effectively as the young Norberg skewered the bad idea of the early 2000s.

>> FULL REVIEW HERE: PART ONE  AND PART TWO.

"Many so-called climate change activists are not really concerned about the climate and the environment. No, for them, these are merely instruments in the fight against capitalism."

"The thesis that many climate activists and supporters of a Green New Deal are less concerned with the environment than with exploiting this issue to abolish capitalism and introduce a planned economy is by no means a malicious insinuation. Rather, the climate activists themselves admit it. You just have to read what they write and listen to what 'activists' like Greta Thunberg are saying....
    "For the last three years, Greta Thunberg has said that her life’s purpose was to save the world from climate change. Now she told an audience in London that climate activists must overthrow 'the whole capitalist system,' which she says is responsible for 'imperialism, oppression, genocide… racist, oppressive extractionism.' The 'activists' of the doomsday cult 'Last Generation' also say quite openly that their goal is the abolition of capitalism.
    "Examine the standard work of anti-capitalist climate change activists, and you will quickly see what I mean.... To anti-capitalists, climate change activism is just a pretext for an authoritarian 'planned' economy."

~ Rainer Zitelmann, from his post 'Climate Change Activism as a Pretext to Abolishing Capitalism'

First published in 1966, when the world situation was different -- but not that different -- to today, Ayn Rand argues in this essay that if nuclear weapons have made war too horrible to contemplate, and they have, then there is a horrible ideology that we can no longer afford to support ...

The Roots of War

by Ayn Rand

Reprinted by permission; originally published in the June 1966 issue of The Objectivist. Copyright 1966 by The Objectivist, Inc. Reprinted from the Foundation for Economic Education.

It is said that nuclear weapons have made wars too horrible to contemplate. Yet every nation on earth feels, in helpless terror, that such a war might come.

The overwhelming majority of mankind — the people who die on the battlefields or starve and per­ish among the ruins — do not want war. They never wanted it. Yet wars have kept erupting through­out the centuries, like a long trail of blood underscoring mankind’s history.

Men are afraid that war might come because they know, con­sciously or subconsciously, that they have never rejected the doc­trine which causes wars, which has caused the wars of the past and can do it again — the doctrine that it is right or practical or nec­essary for men to achieve their goals by means of physical force (by initiating the use of force against other men) and that some sort of "good" can justify it. It is the doctrine that force is a proper or unavoidable part of human existence and human societies.

Observe one of the ugliest char­acteristics of today’s world: the mixture of frantic war prepara­tions with hysterical peace prop­aganda, and the fact that both come from the same source — from the same political philosophy. The bankrupt, yet still dominant, po­litical philosophy of our age is statism.

Observe the nature of today’s alleged peace movements. Profes­sing love and concern for the sur­vival of mankind, they keep screaming that the nuclear-weap­ons race should be stopped, that armed force should be abolished as a means of settling disputes among nations, and that war should be outlawed in the name of humanity. Yet these same peace movements do not oppose dictator­ships; the political views of their members range through all shades of the statist spectrum, from welfare statism to socialism to fascism to communism. This means that they are opposed to the use of coercion by one nation against another, but not by the government of a nation against its own citizens; it means that they are opposed to the use of force against armed adversaries, but not against the disarmed.

Consider the plunder, the de­struction, the starvation, the bru­tality, the slave-labor camps, the torture chambers, the wholesale slaughter perpetrated by dictator­ships. Yet this is what today’s alleged peace-lovers are willing to advocate or tolerate—in the name of love for humanity.

It is obvious that the ideological root of statism (or collectivism) is the tribal premise of primordial savages who, unable to conceive of individual rights, believed that the tribe is a supreme, omnipotent ruler, that it owns the lives of its members and may sacrifice them whenever it pleases to whatever it deems to be its own "good." Un­able to conceive of any social prin­ciples, save the rule of brute force, they believed that the tribe’s wishes are limited only by its physical power and that other tribes are its natural prey, to be conquered, looted, enslaved or an­nihilated. The history of all primi­tive peoples in a succession of trib­al wars and intertribal slaughter. That this savage ideology now rules nations armed with nuclear weapons, should give pause to any­one concerned with mankind’s sur­vival.

Statism is a system of institu­tionalised violence and perpetual civil war. It leaves men no choice but to fight to seize political pow­er — to rob or be robbed, to kill or be killed. When brute force is the only criterion of social conduct, and unresisting surrender to de­struction is the only alternative, even the lowest of men, even an animal — even a cornered rat —will fight. There can be no peace within an enslaved nation.

The bloodiest conflicts of his­tory were not wars between na­tions, but civil wars between men of the same nation, who could find no peaceful recourse to law, prin­ciple or justice. Observe that the history of all absolute states is punctuated by bloody uprisings—by violent eruptions of blind des­pair, without ideology, program or goals—which were usually put down by ruthless extermination.

In a full dictatorship, statism’s chronic "cold" civil war takes the form of bloody purges, when one gang deposes another — as in Nazi Germany or Soviet Russia. In a mixed economy, it takes the form of pressure-group warfare, each group fighting for legislation to extort its own advantages by force from all other groups.

The degree of statism in a country’s political system, is the degree to which it breaks up the country into rival gangs and sets men against one another. When individual rights are abrogated, there is no way to determine who is entitled to what; there is no way to determine the justice of anyone’s claims, desires or inter­ests. The criterion, therefore, re­verts to the tribal concept of: one’s wishes are limited only by the power of one’s gang. In order to survive under such a system, men have no choice but to fear, hate and destroy one another; it is a system of underground plot­ting, of secret conspiracies, of deals, favors, betrayals and sud­den, bloody coups.

It is not a system conducive to brotherhood, security, cooperation and peace.

Statism — in fact and in prin­ciple — is nothing more than gang rule. A dictatorship is a gang de­voted to looting the effort of the productive citizens of its own country. When a statist ruler ex­hausts his own country’s economy, he attacks his neighbors. It is his only means of postponing internal collapse and prolonging his rule. A country that violates the rights of its own citizens, will not re­spect the rights of its neighbors. Those who do not recognize indi­vidual rights, will not recognize the rights of nations: a nation is only a number of individuals.

Statism needs war; a free coun­try does not. Statism survives by looting; a free country survives by production.

Observe that the major wars of history were started by the more controlled economies of the time against the freer ones. For in­stance, World War I was started by monarchist Germany and Czar­ist Russia, who dragged in their freer allies. World War II was started by the alliance of Nazi Germany with Soviet Russia and their joint attack on Poland.

Observe that in World War II, both Germany and Russia seized and dismantled entire factories in conquered countries, to ship them home—while the freest of the mixed economies, the semi-capitalistic United States, sent billions worth of lend-lease equip­ment, including entire factories, to its allies. [For a detailed, doc­umented account of the full extent of Russia’s looting, see East Minus West = Zero by Werner Keller, New York: G. P. Putnam’s Sons, 1962.]

Germany and Russia needed war; the United States did not and gained nothing. (In fact, the United States lost, economically, even though it won the war: it was left with an enormous na­tional debt, augmented by the gro­tesquely futile policy of supporting former allies and enemies to this day.) Yet it is capitalism that to­day’s peace-lovers oppose and stat­ism that they advocate — in the name of peace.

Laissez-faire capitalism is the only social system based on the recognition of individual rights and, therefore, the only system that bans force from social rela­tionships. By the nature of its basic principles and interests, it is the only system fundamentally op­posed to war.

Men who are free to produce, have no incentive to loot; they have nothing to gain from war and a great deal to lose. Ideologi­cally, the principle of individual rights does not permit a man to seek his own livelihood at the point of a gun, inside or outside his country. Economically, wars cost money; in a free economy, where wealth is privately owned, the costs of war come out of the income of private citizens — there is no overblown public treasury to hide that fact — and a citizen can­not hope to recoup his own finan­cial losses (such as taxes or busi­ness dislocations or property de­struction) by winning the war. Thus his own economic interests are on the side of peace.

In a statist economy, where wealth is "publicly owned," a citi­zen has no economic interests to protect by preserving peace — he is only a drop in the common buck­et — while war gives him the (fal­lacious) hope of larger handouts from his masters. Ideologically, he is trained to regard men as sacrificial animals; he is one him­self; he can have no concept of why foreigners should not be sac­rificed on the same public altar for the benefit of the same state.

The trader and the warrior have been fundamental antagonists throughout history. Trade does not flourish on battlefields, factories do not produce under bombard­ments, profits do not grow on rub­ble. Capitalism is a society of traders — for which it has been de­nounced by every would-be gun­man who regards trade as "self­ish" and conquest as "noble."

Let those who are actually con­cerned with peace observe that capitalism gave mankind the long­est period of peace in history — a period during which there were no wars involving the entire civ­ilised world — from the end of the Napoleonic wars in 1815 to the outbreak of World War I in 1914.

It must be remembered that the political systems of the 19th century were not pure capitalism, but mixed economies. The element of freedom, however, was dominant; it was as close to a century of capitalism as mankind has come. But the element of statism kept growing throughout the 19th cen­tury, and by the time it blasted the world in 1914, the govern­ments involved were dominated by statist policies.

Just as, in domestic affairs, all the evils caused by statism and government controls were blamed on capitalism and the free market — so, in foreign affairs, all the evils of statist policies were blamed on and ascribed to capitalism. Such myths as "capitalistic imperial­ism," "war profiteering" or the no­tion that capitalism has to win "markets" by military conquest are examples of the superficiality or the unscrupulousness of statist commentators and historians.

The essence of capitalism’s for­eign policy is free trade — i.e., the abolition of trade barriers, of pro­tective tariffs, of special privileges — the opening of the world’s trade routes to free international ex­change and competition among the private citizens of all countries dealing directly with one another. During the 19th century, it was free trade that liberated the world, undercutting and wrecking the remnants of feudalism and the statist tyranny of absolute mon­archies.

"As with Rome, the world ac­cepted the British empire because it opened world channels of energy for commerce in general. Though repressive (status) government was still imposed to a considerable degree on Ireland with very bad results, on the whole England’s invisible exports were law and free trade. Practically speaking, while England ruled the seas any man of any nation could go any­where, taking his goods and money with him, in safety." [The God of the Machine, by Isabel Paterson, Caldwell, Idaho: Caxton Printers, 1964, p. 121. Originally published by G. P. Putnam’s Sons, New York, 1943]

As in the case of Rome, when the repressive element of Eng­land’s mixed economy grew to be­come her dominant policy and turned her to statism, her empire fell apart. It was not military force that had held it together.

Capitalism wins and holds its markets by free competition, at home and abroad. A market con­quered by war can be of value (temporarily) only to those advo­cates of a mixed economy who seek to close it to international competition, impose restrictive regulations and thus acquire spe­cial privileges by force. The same type of businessmen who sought special advantages by government action in their own countries, sought special markets by govern­ment action abroad. At whose ex­pense? At the expense of the over­whelming majority of businessmen who paid the taxes for such ven­tures, but gained nothing. Who justified such policies and sold them to the public? The statist intellectuals who manufactured such doctrines as "the public in­terest" or "national prestige" or "manifest destiny."

The actual war profiteers of all mixed economies were and are of that type: men with political pull who acquire fortunes by govern­ment favor, during or after a war — fortunes which they could not have acquired on a free market.

Remember that private citizens — whether rich or poor, whether businessmen or workers — have no power to start a war. That power is the exclusive prerogative of a government. Which type of gov­ernment is more likely to plunge a country into war: a government of limited powers, bound by con­stitutional restriction — or an un­limited government, open to the pressure of any group with war­like interests or ideologies, a gov­ernment able to command armies to march at the whim of a single chief executive?

Yet it is not a limited govern­ment that today’s peace-lovers are advocating.

(Needless to say, unilateral pac­ifism is merely an invitation to aggression. Just as an individual has the right of self-defense, so has a free country if attacked. But this does not give its government the right to draft men into mili­tary service — which is the most blatantly statist violation of a man’s right to his own life. There is no contradiction between the moral and the practical: a volun­teer army is the most efficient army, as many military authori­ties have testified. A free country has never lacked volunteers when attacked by a foreign aggressor. But not many men would volun­teer for such ventures as Korea or Vietnam. Without drafted armies, the foreign policies of statist or mixed economies would not be possible.)

So long as a country is even semi-free, its mixed-economy prof­iteers are not the source of its warlike influences or policies, and are not the primary cause of its involvement in war. They are merely political scavengers cash­ing-in on a public trend. The pri­mary cause of that trend is the mixed-economy intellectuals.

Observe the link between stat­ism and militarism in the intel­lectual history of the 19th and 20th centuries. Just as the de­struction of capitalism and the rise of the totalitarian state were not caused by business or labour or any economic interests, but by the dominant statist ideology of the intellectuals — so the resurgence of the doctrine of military con­quest and armed crusades for po­litical "ideals" were the product of the same intellectuals’ belief that "the good" is to be achieved by force.

The rise of a spirit of national­istic imperialism in the United States did not come from the right, but from the left, not from big-business interests, but from the collectivist reformers who in­fluenced the policies of Theodore Roosevelt and Woodrow Wilson. For a history of these influences, see The Decline of American Lib­eralism by Arthur A. Ekirch, Jr. (New York: Longmans, Green, 1955.)

"In such instances, [writes Pro­fessor Ekirch] as the progres­sives’ increasing acceptance of compulsory military training and of the white man’s burden, there were obvious reminders of the paternalism of much of their eco­nomic reform legislation. Imperi­alism, according to a recent study of American foreign policy, was a revolt against many of the values of traditional liberalism. `The spir­it of imperialism was an exalta­tion of duty above rights, of collec­tive welfare above individual self-interest, the heroic values as op­posed to materialism, action in­stead of logic, the natural impulse rather than the pallid intellect.’ "
(p. 189. Quoted from R. E. Os­good, Ideals and Self-Interest in America’s Foreign Relations, Chi­cago: University of Chicago Press, 1953, p. 47.)

In regard to Woodrow Wilson, Professor Ekirch writes: 

"Wilson no doubt would have preferred the growth of United States foreign trade to come about as a result of free international competition, but he found it easy with his ideas of moralism and duty to rationalise direct American intervention as a means of safeguarding the na­tional interest." (p. 199.) 

And: 

"He seemed to feel that the United States had a mission to spread its institutions — which he conceived as liberal and democratic — to the more benighted areas of the world." (p. 199.) 

It was not the advocates of capitalism who helped Wilson to whip up a reluctant, peace-loving nation into the hys­teria of a military crusade—it was the "liberal" magazine The New Republic. Its editor, Herbert Croly, used such arguments as: "The American nation needs the tonic of a serious moral adven­ture."

Just as Wilson, a "liberal" re­former, led the United States in­to World War I, "to make the world safe for democracy" — so Franklin D. Roosevelt, another "liberal" reformer, led it into World War II, in the name of the "Four Freedoms." In both cases, the "conservatives" — and the big-business interests — were over­whelmingly opposed to war, but were silenced. In the case of World War II, they were smeared as "isolationists," "reactionaries" and "America-First’ers."

World War I led, not to "democ­racy," but to the creation of three dictatorships: Soviet Russia, Fascist Italy, Nazi Germany. World War II led, not to "Four Freedoms," but to the surrender of one-third of the world’s popu­lation into communist slavery.

If peace were the goal of today’s intellectuals, a failure of that magnitude — and the evidence of unspeakable suffering on so large a scale — would make them pause and check their statist premises. Instead, blind to everything but their hatred for capitalism, they are now asserting that "poverty breeds wars" (and justifying war by sympathising with a "material greed" of that kind). But the question is: what breeds poverty? If you look at the world of today and if you look back at history, you will see the answer: the de­gree of a country’s freedom is the degree of its prosperity.

Another current catch phrase is the complaint that the nations of the world are divided into the "haves" and the "have-nots." Ob­serve that the "haves" are those who have freedom, and that it is freedom that the "have-nots" have not.

If men want to oppose war, it is statism that they must oppose. So long as they hold the tribal notion that the individual is sacrificial fodder for the collective, that some men have the right to rule others by force, and that some (any) alleged "good" can justify it —there can be no peace within a na­tion and no peace among nations.

It is true that nuclear weapons have made wars too horrible to contemplate. But it makes no dif­ference to a man whether he is killed by a nuclear bomb or a dynamite bomb or an old-fash­ioned club. Nor does the number of other victims or the scale of the destruction make any difference to him. And there is something ob­scene in the attitude of those who regard horror as a matter of num­bers, who are willing to send a small group of youths to die for the tribe, but scream against the danger to the tribe itself — and more: who are willing to condone the slaughter of defenseless victims, but march in protest against wars between the well-armed.

So long as men are subjugated by force, they will fight back and use any weapons available. If a man is led to a Nazi gas chamber or a Soviet firing squad, with no voices raised to defend him, would he feel any love or concern for the survival of mankind? Or would he be more justified in feeling that a cannibalistic mankind, which tolerates dictatorships, does not deserve to survive?

If nuclear weapons are a dread­ful threat and mankind cannot afford war any longer, then man­kind cannot afford statism any longer. Let no man of good will take it upon his conscience to ad­vocate the rule of force — outside or inside his own country. Let all those who are actually concerned with peace — those who do love man and do care about his survival — realise that if war is ever to be outlawed, it is the use of force that has to be outlawed.

***

The Politics of Peace

What distinguishes man from animals is the insight into the advantages that can be derived from cooperation under the division of labour. Man curbs his innate instinct of aggression in order to cooperate with other human beings. The more he wants to improve his material well-being, the more he must expand the system of the division of labour. Concomitantly he must more and more restrict the sphere in which he resorts to military action. The emergence of the international division of labour requires the total abolition of war. Such is the essence of the laissez-faire philosophy of Manchester.

This philosophy is, of course, incompatible with statolatry. In its context the state, the social apparatus of violent oppression, is entrusted with the protection of the smooth operation of the market economy against the onslaughts of antisocial individuals and gangs. Its function is indispensable and beneficial, but it is an ancillary function only. There is no reason to idolise the police power and ascribe to it omnipotence and omniscience. There are things which it can certainly not accomplish. It cannot conjure away the scarcity of the factors of production, it cannot make people more prosperous, it cannot raise the productivity of labour. All it can achieve is to prevent gangsters from frus­trating the efforts of those people who are intent upon promoting material well-being.

~ LUDWIG VON MISES, from his magnum opus Human Action

Ayn Rand

**Ayn Rand (1905–1982) was a Russian-American novelist, philosopher, playwright, and screenwriter. She is known for her two best-selling novels, The Fountainhead and Atlas Shrugged, and for developing a philosophical system she called Objectivism. She corresponded with FEE's founder Leonard Read and provided a meaningful intellectual influence over free-market thought in the second half of the twentieth century. Her influence continues to expand through her fiction and nonfiction works and the educational work being done on Objectivism. 

This reprinted article was originally published on FEE.org. Read the original article. And watch this 2021 analysis of Rand's article ...

Grammarly: Government Edition

Need help with your political spin? Unable to properly prevaricate under pressure? Unsure how to redefine your words to help properly fudge them? Then has the trusted app Grammarly got news for you: 

“Whether you want to spin your way out of a recession, walk back your support of rioters, or simply rile up your donor base, Grammarly offers helpful suggestions to make your political messaging as murky as you need."

Think it's a joke? 

All the video's definitional changes are from real-life examples. For instance: A recession, long defined as two consecutive quarters of negative growth, is now something more subtle and complicated, only to be defined years after the fact by special experts. “Infrastructure,” which most people think of as roads, bridges, etc., now includes the green new deal, with tons of solar/wind subsidies. And of course views that were moderate, centrist, or even libertarian a couple of decades ago are now dangerous right-wing extremism.

An announcement about an Aotearoa Government Edition has already been announced. 

It's not really the Auckland Tram anymore, is it ...

Late last week the government announced its new plan to spend billions of dollars on the light rail to Auckland airport it had promised to have completed by 2023. It wants to place nearly half underground. So as the UnCivil Servant points out in this Guest Post, it's not really a tram anymore ...

THE WORLD IS AWASH WITH with poorly thought-out light rail/tram proposals. Some even get implemented -- in places like Newcastle, Australia. Most generally prove to be eye-wateringly expensive money-pits that look nice in glossy renderings, and increase some property values for houses and apartments near stations, but have a negligible transport impact either on traffic congestion or emissions. Auckland's proposed underground light rail is one of these. 

Like most such projects, it is less about transport impacts or economics, and everything to do with ideologically-blinkered politicians ever keen to build monuments to themselves at the expense of our children and grandchildren. 

At least the proposal the Government has accepted, the Michael Wood Memorial Moneypit, is not the inanely stupid street-tram idea, so favoured by the Greens and urbanists, that would remove a great deal of existing road capacity -- that removal being a key reason that car-hating Greens and urbanists want trams so much: which is because they have worked out the main way to stop people driving is by making it much more difficult, expensive and inconvenient to do so, and putting a tram on the road a tram is among the best ways they can think of to make it more difficult, expensive and inconvenient. (It's irrelevant whether or not they or anyone else rides the tram, because its main purpose is not to move people about, but to block people moving about by car, taxi, or truck.)

So the proposal is not as bad as it could be. Indeed, it's even better than it sounds (who in their right mind would ever think of ordering up an underground tram to Mt Roskill?) It would be a piece of public transport that could actually travel quite fast, at least for the tunnelled segments -- but it's the cost to get those segments in which lies the catch: $15 billion!

$15 billion is an eye-watering amount of money. 

• $15 billion is three times the total budget to be spent on public transport by Waka Kotahi and all local authorities for the entire period of 2021-2024 across the entire country.(source NLTP 2021-2024) 
• $15 billion is nearly twice what is spent on transport by Waka Kotahi and all councils in a single year, that’s all road maintenance and construction, all bus and train subsidies, everything. 
• $15 billion is is 23x the cost of building Auckland's Harbour Bridge in today’s money (and don’t forget, Auckland Harbour Bridge was funded by borrowing, and then tolls that paid off the debt).

By comparison, the Waterview Tunnel on SH20 was only $1.7 billion. The sum of $15 billion (almost certainly a gross underestimate) will make even the outrageously wasteful City Rail Link (CRL) cost of around $4.5 billion look like an economical option.

Indeed, $15 billion makes this the most extensive transport project in the country’s history. (By comparison, $115 billion in today's money is what the New Zealand govt paid for the entirety of the Second World War!) Dreamed up on what seems the back of an ill-suited envelope by an ill-informed committee. It will lose money as well, as there is no way the fares collected will ever recover even half the costs of operating it.

IT WAS ORIGINALLY PROPOSED as a way to address two problems:

• demand exceeding capacity on bus routes along Dominion Road; and
• bus overcrowding in downtown Auckland.

It is a very expensive way to fix these two problems -- if indeed it ever will.

Conceived originally to fix these two problems, the "solution" has grown as inexorably as the ego of a newly-elected politician. Politicians love big, flash exciting mega-projects, and (combined with an almost fetishised ideological love-affair that urbanists and city planners have with trams), Auckland's light-rail "solution" has grown like moss, slowly absorbing and taking over more-and-more budget.

Just like the highway planners they criticise, the public transport-planners extrapolate growth in demand to be endless -- so they think they need to plan for ever-expanding capacity for their preferred transport mode. The time and willingness people have to travel within cities however is not endless and, as the pandemic has demonstrated, there is not endless demand for bus trips on this corridor. 

Indeed, there are far more cost-effective ways to increase bus capacity, such as 

• more extensive bus priority lanes and priority at traffic lights 
• pricing peak-time bus travel so that there is actually net revenue from a highly-used service that can be used to pay for more capacity. 

Furthermore, the downtown Auckland bus-overcrowding issue seems to have largely disappeared, in part because there is so much roadspace taken up by building CRL, and in part because Auckland Council has been removing cars and drivers from more and more streetspace by making driving difficult in its own way, such that this simply isn’t an issue anymore (and it isn’t an issue anyway, as trams' capacity on streets is only marginally more than having multiple buses).

I'VE REFERRED TO IT before as the Auckland Tram, but the tunnelled, grade-separated version proposed by Grant Robertson and Michael Wood (and paid for your children and grand-children) really is “light rail”; it is what in Brussels is called “Pre-Metro” -- a scaled-down metro train that doesn’t resemble the slow trams seen in Melbourne and Sydney so much as an underground-lite. This annoys the Green Party supporting urbanists who WANT slow trams to get in the way of cars, but it should annoy everyone who thinks $15 billion can be better spent elsewhere.

So what will it do? The Government press release is informative in what it doesn't say as much as what it does. Significantly for example, it doesn’t mention the cost.

Here's what it does mention:

• Auckland’s growing population will mean they need some way to get around ...  a lot of them, apparently, from the apartments along Sandringham Rd or in Onehunga or Mangere Bridge whose residents will want to travel to the CBD, or the airport, or places in between 
• without this light metro, Auckland will be gridlocked ... even though there is nowhere in the world in which building a light metro line has relieved gridlock; it might take a few buses off Sandringham Road and Dominion Road, but that’s it
• 12,000 cars will be taken off the road ... but where and over what period? total cars in a day, on what roads? Some short sections of motorway have over 100,000 vehicles a day passing over; around 35 million vehicle-kilometres are travelled on an average (pre-pandemic) day by motor vehicle on Auckland’s roads -- so at best this $15 billion boondoggle will reduce traffic by just  0.03% 
• 97,000 new jobs will be created by 2051... by whom? how? Not from the construction or operation of the light metro. Does that take into account the higher taxes on properties along the route? Would the jobs have been created anyway? We are left to guess.
• it will halve travel time for SOME people to and from the airport ... it doesn't say who those people are -- and, frankly, unless you live next to a station on the route, particularly at the southern end, it wont be fast because it will stop many, many times before arriving at your destination

So that's what it says on the tin. Here are some information we're left to work out for ourselves:

• the capital cost or the annual subsidy needed, compared to how much subsidy current services need to keep running
• expected demand, and the proportion of light metro capacity expecting to be utilised at peak (and off-peak times)
• where the people living along the light metro line are expected to be working, or getting educated? (only 1 in 8 jobs in Auckland is in the CBD, and if you add the airport and Mangere, then the line serves only 1 in 7 potential jobs of people who live along it)
• the actual travel-time impacts on existing road traffic, including freight.
• why it isn't connecting either to Britomart, or to the new and also-very-expensice underground train set whose construction is currently disrupting much of the inner-city's life?
• why the Government is proposing light-rail through a tunnel to the North Shore now, instead of heavy rail connecting it to the City Rail Link under construction, so that people from the North Shore might get a train to say Newmarket, Henderson, new Lynn, Sylvia Park, Manukau, Papakura, or Onehunga -- instead of a light metro to that place on almost nobody's list of preferred destinations: Mt Roskill.

Perhaps a clue to that last question is that the chosen route puts it in the electorates of both the Minister of Transport and the Prime Minister ... which we're sure can only be an enormous coincidence.

What’s pretty clear is that this is a huuuge project, with a very long lead time, poorly thought through, that will in no way be even begun in the next two years. Not a chance. So there's still time to get back to problem definition and analysis... What’s the project trying to do? Which people is is trying to move? Do you want value of money, or a sea of big-spending Keynesian helicopter money? Does the city really need another multi-billion dollar monument? 

Even supporters of public transport are left wondering what's going on here. Imagine, for example, if even a tenth of the budget proposed here was spent on upgrading bus services in Auckland! But, of course, that wouldn't proved any sort of ribbon-cutting moment for a politician would it.