Why Don Brash is wrong about property rights…and most other things
Don Brash’s latest attempt at relevance is a new tirade against the “creeping erosion of property rights” by evil town planners and tree huggers. According to Dr Brash, this phenomenon is the “single biggest hurdle facing New Zealand’s economic future”, and a “serious threat to NZ’s continued existence”. Sounds nice and juicy and hysterical doesn’t it. So, to the magic cure: Dr Brash wants to amend the Bill of Rights to include individual property rights. Unfortunately his arguments are full of holes – so many that I need to rant for a whole blog post about it.
Brash is fundamentally opposed to local government plans. He argues that land owners should be allowed to do anything on their land, providing that “baseline environmental conditions are met”. The problem with Brash’s argument is that he has essentially described the Resource Management Act’s approach to environmental management. Brash never misses an opportunity to berate the RMA as a handbrake to economic growth. Yet if he actually read it, he’d see that it advocates an effects-based approach to environmental management. While the Act does give local government the power to write plans, these plans are reactive rather than prescriptive – they exist to enforce the “baseline environmental conditions” that Brash is advocating here. Everything in the RMA is geared to enabling development while minimising environmental effects.
Indeed, if Brash looked beyond the opportunity to make a good sound-bite out of the RMA, he’d see that he in fact agrees with it. He might have a point if the old Town and Country Planning Act was still in force. This was certainly a nasty prescriptive piece of legislation that gave the planners too much power and stifled development. Unfortunately for Don’s argument, the Town and Country Planning Act was replaced in 1991 by the RMA. It’s worrying when politicians don’t understand the legislation they talk about, even more so when they’re essentially arguing against a legislative approach that is 20 years out of date!
As if that wasn’t enough, Brash then went on to blame planners for our housing affordability crisis. Planners are apparently responsible for creating a society of “haves and have nots” by limiting development beyond urban limits. The argument is standard Tory fare – urban limits create a land shortage which pushes house prices up. Consequently according to Brash, planners are responsible for creating a society of inequalities in which only the elite can own property. Now first off, I can’t resist a dig at the irony of this sudden awareness of inequalities from a man that advocates tax cuts for the rich, and opposes the minimum wage and a capital gains tax. But I digress. His argument that urban limits inflate house prices is a myth that deserves busting.
The first point is that land shortages do not cause house prices to increase. Housing shortages do, and yes, there’s a difference. Intensifying within an urban limit satisfies housing demand in the same way that allowing a new peripheral subdivision does, helping to keep house prices in check without having to consume any more land. It’s funny how the pro-sprawl zealots like Brash, Steven Joyce and Owen McShane always babble on about how urban limits making housing unaffordable, yet don’t mention the costs of the sprawl they advocate – all those new roads, all those new pipes, all those new schools to service all those new houses that house all those new people that all need to budget $400 a week to run their three SUV’s. Somebody pays for all that. Auckland’s traffic congestion cost us billions each year, and it’ll get worse with more sprawl. And who benefits?? Does Don Brash seriously think that allowing land-owning aristocrats on the urban fringe to subdivide their land is going to help provide housing for the poor? I didn’t think so…
The second point is that speculation is far more responsible for house price increases than any land or housing shortage. A capital gains tax is one way to disincentivise excessive property speculation, but alas, Don Brash opposes that idea. So, really, Brash couldn’t give two hoots about affordable housing. He just wants rich urban fringe-dwelling property owners to be able to make a quick buck out of subdividing their land. Any coincidence that Don owns a large Kiwifruit orchard in Pukekohe?? Or that Steven Joyce lives on an Albany lifestyle block…
Towards the end, Brash’s subtle digs at planners become a full-blown attack – “cities should grow according to the wants of people, not the dreams of planners”. Again, a great sound bite, but not a great argument. He’s implying that what people “want” is more sprawl – more houses stretching ad infinitum as far as the eye can see. However, if Brash were to look at Auckland’s rather archaic (soon to be replaced) planning rules, he might realise that sprawl is not a natural outcome or an active choice made by people. Rather, the existing planning rules actively encourage sprawl by imposing rules around density, building height etc. The assumption that left to their own devices people would choose to sprawl is a silly one to make. With today’s increasing petrol prices, decreasing family sizes, and increasing numbers of young singles and couples, suburban paradise is far less relevant than it was fifty years ago. We need to be giving this increasingly diverse population choice. Auckland’s current planners don’t propose to densify the entire city – rather, just provide housing choice. Not everybody wants a 5-bedroom house on a quarter-acre section any more, yet it’s what the planning rules generally provide for. If Brash thinks that sprawl is a natural outcome that everybody would actively choose, then he’s dead wrong. Housing choice is surely right up a libertarian’s alley – we shouldn’t be forcing everyone to live on a quarter acre.
So thus far, we’ve established that Brash is arguing against a legislative approach that is 20 years out of date, and in favour of a sprawling development approach that is increasingly irrelevant to today’s New Zealanders. But the fundamental problem with all of Brash’s arguments is that they’re based on the idea that anybody should be able to do anything on their own land. Such an approach would have huge ramifications. As much as Don Brash hates the idea, we all share this country and we share its land collectively. One person undertaking an activity on his land affects another person on their land, whether that activity is building a block of flats or polluting streams with cow shit. Individual actions have externalities that cost the country in myriad ways. This is why we need planning regulations.
Don Brash effectively denies the existence of externalities… And yep, life would sure be easier without them. None of this pesky planning bullshit. None of this sustainability claptrap. But to base one’s argument on denying the existence of externalities is stupid. Shit happens. Actions have consequences. A bitch of a thing to have to argue around I know…but it’s the truth Don.