Monday, 30 April 2007

Unaffordable housing: Another tell-tale collision

A great quote can sum up a whole human debacle in just a very few words, as this one does:
A traffic jam [says Andrew Galambos] is a collision between free enterprise and socialism. Free enterprise produces automobiles faster than socialism can
build roads and road capacity.
It's true, isn't it -- and still the socialists blame capitalism for 'overproduction' when the problem is the failure of socialism to produce. Forty years ago, for example, plans were drawn up for the expansion of Auckland's motorway system, plans only being brought somewhat to completion now, forty years later.

And still people demand that socialism produce our infrastructure.

That same collision of capitalism and socialism we see in our daily traffic jams is there too in NZ's severely unaffordable housing markets: a bubble inflated by the freewheeling demands of prosperity and credit and immigration colliding with a simultaneous suffocation of supply by the socialism of the state. Based on international comparisons, to meet demand New Zealand's annual build rate should should move between 28,000 to 36,000 residential units per annum. Instead it is currently around 24,000 and falling, restricting supply and exacerbating the bubble. At a time when greater supply is desperately needed to mop up exploding demand, 'planners' -- those throwbacks to socialism -- are throttling the supply lines we do have.

'Planners' -- who labour under the illusion that free people can be planned -- who have ring-fenced our major cities (which represent only 1.4% of the country's land), outside which they have prohibited real growth -- these stranglers of growth who infest local government will frequently wheel out the exhortation that housing must wait for 'infrastructure'; that house building should be severely resricted until roading, watermains and sewerage is built -- and the construction of this infrasructure is to be built (eventually) by this economy's luxuriating remnants of socialist planning. They insist that ratepayers and developers pay for 'new capacity' through levies, impositions and compulsory contributions, coupled with the same barking insistence that this 'capacity' will only be built when the socialist machine is good and ready, and meanwhile house builders and home buyers can go hang.

To paraphrase Andrew Galambos, "An unaffordable housing crisis is a collision between free enterprise and socialism. Free enterprise produces houses faster than socialism can build roads and infrastructure."

Free enterprise is producing houses faster than socialism can build infrastructure and capacity, and the socialists are still crying that the problem is too much free enterprise! We're back where we were in the sixties when you wrote a begging letter to ther Post Office asking for a phone line for your new house, only to be told that there was no capacity in your area, and no plans to build any. It's as if those same Post Office planners were now out there planning our cities, isn't it.

I thought of Galambos and the old socialist phone system this week when I read that in an Auckland desperately unable to keep up with the demand for new houses,
Transit New Zealand is appealing against the [3000-unit] Silverdale North residential project in Rodney, saying that the area does not have the transport infrastructure to support it... It says the development will have " far reaching adverse traffic effects" unless adequate roading upgrades are put in place.
Ask yourself who should be doing those roading upgrades? As a correspondent commented to me, how about Transit, the government's roading company, just get on and do the fucking job they're supposed to do instead of stopping those people who are simply trying to do theirs? It gets worse:
Transit has lodged an appeal with the Environment Court, despite having been aware of the development in its present form for a year.
There's nothing like socialist 'planning' to really demonstrate a lack of basic planning, is there. It took forty years to begin building the motorway extensions that Auckland's socialist planners said Auckland needed to grow -- forty years of increasing congestion while the world changed, Auckland grew up, and free enterprise kept producing cheaper and cheaper cars for Aucklanders to use to get around the city. It's those same socialists who are now demanding our cities grow only as fast as they can manage to plan and build new infrastructure.

Perhaps we should rethink how infrastructure is produced?


  1. Great quote from Galambos.

  2. The problem also being that when new roads are built, the money generated from using them (fuel tax) is not attributed to those roads, but is general road user revenue and with the exception of maintenance, it gets spent on public transport or roads that aren't so needed.

    The contrast is that the public transport users pay fares that don't even recover the cost of running the services (except for commercial bus services, but they don't excite politicians, and the ARC is lobbying government to make them illegal).


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