Hard News by Russell Brown

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Hard News: The Boom Crash

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  • Sofie Bribiesca, in reply to Jack Harrison,

    The world is your Oyster. Be it what you make. :)

    here and there. • Since Nov 2007 • 6796 posts Report

  • Jack Harrison, in reply to Sofie Bribiesca,

    Oysters would disagree.

    Having a ruling body that can handle poverty without judging the fuck out of the isolated participants of that class is what I want to make.

    wellington • Since Aug 2014 • 296 posts Report

  • Sofie Bribiesca, in reply to Jack Harrison,

    I hear you Jack.

    here and there. • Since Nov 2007 • 6796 posts Report

  • BenWilson, in reply to WH,

    Our political parties have had more than a decade to get their heads around the issues yet not a lot seems to have happened.

    Well to be fair, they are extremely complex issues. I wouldn't expect our political parties to have got their heads around dark matter either. But at least on dark matter we can be pretty sure what kind of people are going to crack it, whereas I don't have the least confidence that those charged with solving economic issues have either the skills or even the intention to actually come up with anything useful to anyone but those they perceive as their allies.

    I don't think it's something we should just hand over to experts, any more than I think we should do that with questions of morality. Indeed, economic fairness IS a question of morality, rather than a question of science. It goes to what you actually believe is fair, not some objective facts about what is fair. There are no such facts. We decide what is fair, we don't discover it.

    We may not, even if we understood it perfectly, have the power to significantly reduce house prices. But we certainly do have the power to build houses and give them to people who are in need. As a society, the question should not be around what effect that will have on house prices, and be found wanting if the effect is not enough. It should be around whether we think that kind of poverty alleviation is righteous and efficacious. It should be about who should get that alleviation and why, and who shouldn't and why. Of course it should be about how much it costs, and how the money could be better spent to the same ends.

    But it should also be about the ends themselves.

    I think we do have the power to affect prices, but only through measures that are quite extreme. They're macroeconomic, and they're just not on the table. We could seize control of the money supply itself. But this would be an extraordinary move, not something that any need short of catastrophe could motivate the public to back. Our conversation is limited to the tiny incremental movements possible under our inherently conservative system. Which means that we will never move beyond our local extremum without crisis.

    As an analogy, we progress by moving uphill in small steps. But we reach the top of a hill, and there's nowhere up to go, only down. But we can see a bigger hill some way off. Unfortunately, the move to get to it is much more than a single step. So we're trapped. This is my problem with incrementalism as a complete solution. As a partial solution, it's great. Get us to the bottom of that other hill, and incrementalism will get us to the top very efficiently.

    Auckland • Since Nov 2006 • 10657 posts Report

  • WH, in reply to BenWilson,

    I suppose I prefer to talk about specific proposals (such as house building plans and restrictions on residential property investment) in part because it helps to avoid very personal and ultimately unresolvable differences in the way we would each characterise fairness and morality. I do think a determined Government would be able to effect meaningful change, even if it only served to slow the rate of increase in prices.

    Having said that, politics is the art of the possible and our choices are to some extent constrained by current orthodoxies and the existing political consensus. If you don't have a electoral mandate for expansive change I think you need to be a little cautious. Incrementalism has its place.

    When I mentioned the Reserve Bank, I was trying to convey that it has certain powers and responsibilities under the Reserve Bank of New Zealand Act 1989 that it can exercise independently. I may be proved wrong, but think it's unlikely that National will introduce legislation that directly disadvantages those who own residential investment property. If the Reserve Bank doesn't take action, we may be stuck with the status quo.

    Since Nov 2006 • 797 posts Report

  • BenWilson, in reply to WH,

    If the Reserve Bank doesn’t take action, we may be stuck with the status quo.

    Well both they and the government could do a lot to change things. But I don't think they will. The reasons are different, but connected. The government won't because they're inherently mean. The Reserve Bank won't because they're inherently deluded.

    Auckland • Since Nov 2006 • 10657 posts Report

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