Death to the RMA – attacking the disease while ignoring the housing crisis symptoms

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RMA to be scrapped, Environment Minister explains new three-law plan

Environment Minister David Parker has announced the Resource Management Act (RMA) will be scrapped, but the new planning regime won’t be passed towards the end of 2022.

The replacement legislation will effectively go through the first half of the legislative process twice – with a special select committee inquiry convened to examine the draft legislation before it’s properly introduced to Parliament when it will go to select committee again.

Both Labour and National promised to replace the Resource Management Act, or RMA, New Zealand’s key planning law. National tried to overhaul the RMA in its last term of Government, but couldn’t secure the numbers in the house to do so.

The RMA has often been blamed for high house prices due to, critics say, its tendency to make land expensive and difficult to develop. The 30-year-old Act also has critics who say that it does not do enough to protect the environment.

No one liked the RMA, it was a bureaucratic nightmare that didn’t protect the environment while stymieing intensification so this is Labour getting serious about the disease of the housing crisis rather than battling the immediate symptoms.

Which is great except that the immediate symptoms are crucifying renters right now.

We have allowed the commodification of houses to be a means to make wealth and people are chasing that with all the nuance of woke activists occupying a South Island retirement village.

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If Labour wanted actual solutions, these 3 would do it.

1 – FLOOD MARKET WITH MASS STATE HOUSING REBUILD: End the scum landlord subsidy of housing allowances end putting money into the pockets of unscrupulous motel owners by rapidly building 50 000 new state homes. Scum Landlords can do as they please because the level of desperation amongst renters gives them total power. Flooding the market with 50 000 new state houses would rob scum landlords of that desperation.

2 – STATE HOUSE FOR LIFE: Allow beneficiaries to stay in their state home for life so that they can create stable communities and that their desperation is never transported back to Landlords.

3 – DEPOSIT RESTRICTIONS: I have no issue with people who own their own home, or have a batch or even a 3rd property to provide income into your retirement. What I have no time for is people who own 4 properties, 5 properties, 10 properties, 20 properties, 80 properties. If you are a property speculator, you need to turn up with a 70% deposit to counter the leverage multiple properties allows them.

If Labour want to solve the problem they have to regulate the market and re-set it so that speculation is punished while first home ownership and housing of the poor is championed.

The truth is that the under regulated free market has been warped by the wealthy for their interests and all Labour attempt is bullshit tinkering on the sides rather than challenge the dominance of neoliberal theology, by making reform of the RMA a priority Labour are at least signalling they are serious about having that discussion.

The problem remains however of the intolerable present for entire generations cut out of the housing market.

What this also signals is that the Government must almost be finished with ownership of water if David Parker is being moved to the RMA so expect that issue to erupt mid year.

 

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38 COMMENTS

  1. My fear is Labour are going to try and punt this crisis as far down the road as they can using the RMA then look all innocent and wide eyed and say “look we’re doing things”, whilst leaving everything just the way it is. Just so they can get it off the front pages.

    They MUST confront this crisis NOW and do it properly! We have had years of smoke and mirrors and tinkering and look where it’s got us.

    Nothing short of declaring this matter an emergency is going to suffice nor will it save Labour when tinkering or postponing real action some time off in the never never is their go to.

    And get a Housing Minister who actually wants to fix this!

    • ‘Nothing short of declaring this matter an emergency is going to suffice nor will it save Labour when tinkering or postponing real action some time off in the never never is their go to.’

      Like the wankers declared a ‘climate emergency’, and then did nothing to address ANY of the fundamentals but did propose some bullshit non-solutions, to be implemented over the next few decades.

      Would you expect anything other than bullshit from Ms Adern? -acolyte of Tony B Liar.

      I wonder how much Jacinda’s personal wealth has increased since the election.

      It’s a dangerous game Jacinda is playing because, whereas when Tony B Liar was in power there was a degree of stability, now there is no stability anywhere, nor on any front.

      • I do not think Jacinda is doing this for personal gain nor do I think she is a liar.

        What I believe is she needs good people around her to point her in the right direction. She knows housing is a festering sore. But all she knows is communication and politics and so far its her way of dealing with it. Her conservative nature is to leave sleeping dogs lie, but this is no sleeping dog anymore, its a sick wandering dog and she cant ignore it.

        Jacinda needs a decent housing minister who has plenty of life experience and from the bottom of the heap of life too and with a passion to fix this problem. She had a dud in Twyford and Woods is at best a fill in, but who appears to be out of her depth in this portfolio.

        I do not think Ardern is beyond better or listening or guidance. It just needs that right person in her government to get her there!

        Thing is, she cannot bat this crisis off using political tools of future promises and distractions. It’s far too serious for that.

        • Okay, let’s be generous.

          Let’s say Jacinda has the mind of a 10-year-old and has no idea about finance or economics or energy or the environment, and says things that are untrue but doesn’t know they are untrue because she was told say them by an incompetent bureaucrat who has no idea about finance or economics or energy or the environment.

          However you look at it, NZ is totally screwed with such a person as PM. Especially when she is surrounded by no-hopers in parliament who also don’t know the first thing about finance or economics or energy or the environment. And don’t want to know.

          I don’t watch much ‘news’ on NZ television because it isn’t news; it’s infotainment. However, whenever I see Jacinda, I see a nervous wreck who is completely out of her depth and just gets by by smiling a lot.

          As everything gets made progressively worse by the government, I’m sure the point will soon be reached where she does a runner, ‘for family reasons’.

        • ” Jacinda needs a decent housing minister who has plenty of life experience and from the bottom of the heap of life too and with a passion to fix this problem ”
          Well that mythical person won’t be coming from the third way Social Democrats.
          They have a cast iron majority to do as little as possible without annoying the facets of free market compassionate capitalism and a large chunk of their new found conservative voting base. They can not and will not solve this problem without taking an emergency response to it. Neoliberal orthodoxy will not allow them to do anything except small inconsequential actions to make it look like they are on top of ” lets do this ” and my favourite ” build back better ” what ever the hell that means, just like the much vaunted ” brighter future in 2008. Ruling out at the very least a CGT last year sent the signal that they are in no way serious about levelling the playing field.
          The current parliament is a FPP parliament and for their to be any real change to force the neo liberals on both sides into action we need a new movement who will bring pressure on a minority Social Democrat government to act because they need the new movements votes to govern. That is 2023 and there is a lot to of time to waste in the meantime over this issue and many other free market disasters including the climate catastrophe.

        • Jacinda leaves these matters up to Grant Robertson, who is better at neoliberal doublespeak than Bill English ever was, and he is directed in turn by treasury and MBIE.
          That is why he sounds more competent and compelling than Bull ever did.
          I agree you are both right about Jacinda, but Grant is the problem.
          So then the question becomes, how does Jacinda recognise he is the problem, and who is best qualified to take over the finance minister role.
          Not one MP in parliament is qualified to face the challenges confronting us.

          • ‘Jacinda leaves these matters up to Grant Robertson, who is better at neoliberal doublespeak than Bill English ever was’

            Spot on

            Takes us back to Tony B Liar, for a while the master of neoliberal doublespeak (and absolute fabrication spoken with authority).

    • Well do you want it done now, or do you want it done properly. These things by their very mature are slow moving

      • House prices going up 20% in a year is slow? Really?

        And doing nothing much but ever so slightly tinker in 2018 just wasted the better part of their first 3 years that they could have used to address it.

        Excuses, symbolism and pretence solves nothing.

  2. I think that what one ought not do is introduce a CGT, which would “punish” those who, having carried the burden of high interest rates at an earlier date, now find the value of their properties rising as interest rates fall. I think interest should not be a tax deductible expense but perhaps, rather than make interest non deductible, introduce an interest “clawback” when a property is sold. Such a measure would not affect landlords during their tenure of a property, but would act as a fairer substitute for CGT when they sell up.

    This measure would not hit landlords who invest their own money, when investing in a property, rather than borrow: which is as it should be since these landlords would be making more profit, during their tenure, and paying more tax.

  3. People in dire need and discord are far easier to control than people in comfort and in unity when presented with the specter of the enduring capitalist-fascist control of our democracy, and us by extension. When the banks ( Foreign ) shout “Jump!” we ask ” How high?” It’s disturbingly telling when we don’t instead say ” Fuck you! Now get out! “.
    FYI
    Discord. Meaning.
    Strife, conflict, contention, dissension, variance mean a state or condition marked by a lack of agreement or harmony. discord implies an intrinsic or essential lack of harmony producing quarreling, factiousness, or antagonism.
    Sound familiar?

  4. If anyone thinks scrapping the RMA will solve the housing bubble, they are either deluded or are a politician -which amounts to the same thing, deluded. Or a professional liar. Or both a professional liar and deluded.

    What Charles Hugh Smith says of America applies equally well in NZ. Indeed, we are in this horrendous predicament largely as a consequence of following American practices.

    The fundamental reasons for the shocking mess we are in (and some of the symptoms) are clearly laid out (yet again!).

    ‘The bottom 90% attempting to find productive assets at affordable prices now are out of luck. Consider a 900 square foot home built in 1916 in the desirable San Francisco Bay Area community of Albany, CA. The house sold for $135,000 in 1996, 3.8 times the national median household income.

    Then Housing Bubble #1 boosted the value to $542,000 in 2004, 12.2 times the national median household income. Housing Bubble #2 has pushed the value to slightly over $1 million, 14.5 times the national median household income.’

    Only item 1. on CHS’s list doesn’t apply to NZ:

    ‘2. The decline of safe, secure high-yielding investments as central banks have driven savers into risky, crash-prone speculative assets such as stocks and junk bonds.

    3. The decline of scarcity value in college diplomas that were once the ticket to middle class security. How Many Slots Are Open in the Upper Middle Class? Not As Many As You Might Think (March 30, 2015).

    4. The inexorable rise in big-ticket costs: higher education, healthcare and housing. Even as wages stagnate, these costs continue rising, claiming an ever-larger share of household incomes, leaving less to save/invest.

    5. The transition from a stable economy with predictable returns to a financialized boom-and-bust economy that wipes out middle class wealth in the inevitable busts but does not rebuild it in the booms.

    6. The regulatory and administrative barriers to self-employment, forcing most of the workforce into wage-slavery and/or dependence on the state. Endangered Species: The Self-Employed Middle Class (May 2015).

    7. The rising exposure of the U.S. workforce to highly educated, lower-cost competing workforces in a globalized economy.

    8. The decline of labor’s share of the U.S. economy: the slice of the pie distributed to earned income has been declining for decades.

    9. The share of the earned-income slice going to the top 5% is rising.

    10. The wealth of the middle class is tied up in the family home, a non-income producing asset prone to the wild swings of housing bubbles and busts. Stagnation Nation: Middle Class Wealth Is Locked Up in Housing and Retirement Funds (October 25, 2017).

    The middle class has already collapsed, but thanks to debt and bubbles, this reality has been temporarily cloaked. All bubbles pop and all excessive debt ends in default. When these inevitably occur, the reality can no longer be hidden.’

    Full article:

    https://www.oftwominds.com/blogfeb21/collapsed-middle-class2-21.html

    For the moment, low interest (close to zero) money-printing is holding it all together, and providing a facade of success.

    Anyone who hasn’t watched ‘Margin Call’ really should. Along with Albert Bartlett’s Arithmetic, Population and Energy.

    It’s the maths, you see. And none of it adds up anymore. So they fudge the numbers.

    By the way, RMA equals legalised looting and polluting of the environment -another reason we are fucked.

    Dangerously Cold Temperatures Pour Into Europe This Week

    WEDNESDAY, FEB 10, 2021 – 11:45

    While the Arctic blast over the central US is set to worsen in the coming days (see: here & here), temperatures in northern Europe are set to dive as low as -20 degrees Celsius (-36 degrees Fahrenheit), data firm Maxar Technologies said in a report on Wednesday.

    The pattern of exceptionally frigid air blasting parts of the US and Europe at the moment is due to a disruption of the polar vortex, which has allowed Arctic air to spill south into North America and Europe. ‘

    https://www.zerohedge.com/commodities/dangerously-cold-temperatures-pour-europe-week

    That’s what messed-up jet streams [due to excess atmospheric CO2] do. We had an example here in NZ, when temperatures bounced between 37oC and 16oC in a matter of days.

  5. The biggest risk going forward is our environmental crisis…. you can’t buy back natural resources once they are lost, aka fresh air, fresh water, swimmable oceans and rivers, extinction of flora and fauna, food crisis, climate change, disasters like earthquakes, landslides, droughts, floods, volcanoes. In addition there are diseases like Covid for humans and plant diseases like PSA, Kauri dieback, Myrtle, animal diseases like mad cow, foot and mouth, Bovis, being spread though cruel animal practises, intensification and globalism.

    Humans have gone too far and the greed and stupidity of governments and officials, global media lobbying for money and super rich, gobbling up the world resources (and government subsidies for everything from wages to fast tracking their infrastructure projects). The three groups above are the worst offenders for both environment and equality.

  6. “The Reserve Bank has confirmed it will reimpose loan to value ratios (LVRS) from 1 March at 20 percent for first home buyers and 30 percent for property investors.”

    Complete Dimwits!

    To help get people into housing it should be 100% mortgages for first home buyers who are citizens of NZ and can meet a criteria (example graduate doctors who have good job prospects but no cash after studying for 7 years) and it should be 50% deposit needed for property investors.

    There needs to be a special status with more taxes for those who are ‘professionals’ in property, aka have more than 10 houses (or over 30 million in housing assets for the oligarchs ). These people (and there are not too many of them but alarmingly growing) would have to pay a stamp duty on housing they buy and capital gains on properties they sell.

    Stamp duty and taxes to pay for non resident investors in property in NZ.

    Instead of giving billionaires and rich listers tax breaks, wage subsidies and fast track resource consents (Fletchers, Lord Sleepyhead) that others don’t get in NZ for their private profits and gains – the government should actually try and help the poor, working and middle class build a house!

    If you want to solve inequity in NZ, it’s easy, stop making the middle class pay for everything and stop giving the super rich more money and equivalents in additional grants and help. Today it seems that yet another beneficiary of middle class tax grab, the super rich behind the Crimson Foundation (with John Key as shareholder) gets millions in wage subsidies (for online education not exactly effected by Covid) and are not going to pay it back.

    • First I heard about Crimson Education, but yeah, after checking it out, whoever said John Key was ushering humanity towards enslavement was bang on.

  7. If Jacinda does not immediately introduce a CGT then Labour will be finished as a viable party. Grant Robertson needs to also tell the RBNZ that it can have a DTI for landlords only. Easy to introduce. Yesterday the incompetence of Orr and his cronies was there for all to see at the select committee (Orr pops up in 50ish minute). Buffoons, but just imagine how much tax free capital gain has been made by those elites in that room. They do not care about the poor, with the exception of Chloe Swarbrick who asked good questions but kept getting cut off by the meat head adjudicator. https://www.facebook.com/FESCNZ/

  8. I agree with you the state needs to build more homes and if they met the criteria then I am happy for someone to be in a state home for life but possibly not the same house . If a person moves in as a family of four then when the family grow up and leave then they need to be down sized to a smaller home . Perhaps the family members would have first call on the family home to bring up their family but there again only if they meet the criteria of need .
    I see Wellington are going for a 14 per cent rate increase so they can build more social housing . I do not see why rate payers are doing the job of the state.

    • Local bodies are part of the state. You can pay for state houses through rates to your council, or through land taxes to the central government, but we need more state houses, and taxing non-productive assets is the way to pay for them.

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