Everyone in New Zealand is struggling unless you've been there for 10-20+ years (when you could still afford a house) or you're an immigrant who sold a house in your home country and thus you can afford a house.
The average wage in NZ is NZ$61k and the average house price is NZ$908k. This is absolutely unsustainable.
This same pattern is playing out to various degrees in Australia, the UK, pretty much anywhere in Europe (certainly Western Europe), Scandanavia any any large city in the US.
And as far as I can tell there's absolutely no serious political opposition to any of this happening in any of these countries. None. Your political choices are between the extreme neoliberalism with lots of racism and the slightly milder neoliberalism with slightly less overt racism.
This is all capitalism working as intended. Every part of this is a series of intentional policy changes designed to transfer wealth from the poor to the ultra-wealthy. Housing is being hoarded and artifically constrained in supply. People are being loaded up with student debt, medical debt and mortgage debt where we careen ever closer to the South Asian brick kilns.
> Every part of this is a series of intentional policy changes designed to transfer wealth from the poor to the ultra-wealthy.
No, it is a transfer from those who don’t own land to those who already own land. Roughly correlates to young/poor/immigrant classes transferring wealth (or maintaining wealth disparity) to older/richer/beneficiary classes.
That is why it is politically popular. Low and flat land value tax rates have always enabled this, but their effects were temporarily masked by the population boom allowing a lot of upward movement in the lower (non land owning) classes due to broad economic growth.
It's got little to do with the ultra-wealthy, who have their wealth in equity. The problem is the upper middle class who have their wealth in land. They are 30% of the population and command election outcomes against anyone who tries to change the status quo. To them, the housing crisis is a housing bonanza and they plan on keeping it that way.
I also take issue with buzzword "neoliberal", as if leftists would be any better with their rent control, NIMBY tendencies, and ideological hostility to supply-side policy (see Dean Preston in US, Zohran Mamdani in US, Adrian Ramsay in UK, Chandler-Mather in AU). In my estimation, they would be worse than any "abundance neoliberal", who at least have Austin, Texas as a successful case study they can point to, and who have ideas that make logical sense. The problem is not their policy ideas but the political reality they exist in where they're constrained in what they can do by a politically active plurality (landowners) that wish to persist the status quo.
There’s some truth to that, but I think it’s even broader. Here in Sweden there’s a widely understood term (”bostadskarriär”) that roughly translates to ”housing career” and refers to building wealth through home ownership. It’s often more important to your financial success than your actual career, even for the working class.
All this is due to regulations of course. In Sweden its a combination of tax rules, laws around borrowing, zoning regulations and construction standards that has kept the gravy train rolling.
It’s a bit hard to see how it could continue though. Feels like it could come crashing down at any point. On the other hand: I’ve had that feeling for 15 years.
So tired of people talking about the housing crisis as if megacorp is the one buying all the houses to drive up prices. Yes, commenter, they do buy homes, but by far the single biggest player is regular people. They both are getting rich of the system and voting to keep it in place.
Even worse though...houses are still being sold at these insane prices. There are still fresh dual income high earning non immigrant non billionairs childs non megacorp investor regular people still coming up with the money.
I don't know whats worse, never being able to afford a house or seeing people you know (or thought you knew) somehow getting into one. And then voting down any build out initiative that would weaken their investment.
NZ did too little too late. There’s a bunch of Chinese who bought a lot… a LOT of houses in NZ. It’s one way of transferring money out of China is to use it for business. And they don’t need to leave China to do it. That was stopped but too late when they own 100s of houses.
First, the very idea of the "middle class" is capitalist propaganda. It's meant to divide the working class. It serves no other purpose. It serves to be aspirational for people to participate in a system they won't benefit from while allowing the slightly well off to blame the less well off for their own circumstances.
Second, the voters are absolutely complicit in this sytem because they think they're benefitting. But they're not. The ultra-wealthy are reaping the rewards.
Example: you buy a house for $200k. Because of house horading and constrained supply and policy changes you vote for that house is worth $800k after 15 years. You think you've made money so you support everything that's going on. But you haven't. Why? Because you still own exactly one housing unit's worth of wealth. You have to live somewhere and every house costs $800k now.
So then you think "maybe I need to own multiple properties" but you're barely better off.
As for the rest, you're confusing a whole bunch of different things. "Abundance neoliberalism" (as per Ezra Klein) is just repackaged Reagen-era trickle down economics, designed to make status quo Democrats somehow feel good about being indistinguishable from Republicans.
Not sure why you're associating NIMBYism with leftism. They're diametrically opposed. For one, trust leftists would abolish private property (as distinct from personal property). You get to own your house. You just don't get to hoard land.
I do partially agree about Texas though. Texas's property tax system, at least up until recent years, is significantly better than California's (as one example). In Texas, seniors can defer property tax increases until their death (when they'll be collected from the estate) giving people a choice to downsize or not. In California, you can inherit preferential property tax rates because the voters voted in Prop 13 that allows Disney to pay property tax rates set in the 1960s on the backs of seniors not getting kicked out of their homes.
I'm not sure what your objection to the "neoliberal" is. If you support the hoarding of private property and are pro-capitalist then, by definition, you're a neoliberal. That's definitional, not a perjorative.
> Example: you buy a house for $200k. Because of house horading and constrained supply and policy changes you vote for that house is worth $800k after 15 years. You think you've made money so you support everything that's going on. But you haven't. Why? Because you still own exactly one housing unit's worth of wealth. You have to live somewhere and every house costs $800k now.
I agree with you on this.
> Not sure why you're associating NIMBYism with leftism. They're diametrically opposed.
That may be your interpretation of the underlying philosophy, but in practice, leftist politicians turn out to be more NIMBY than center-left liberal politicians. I'm not so interested in No True Scotsman type appeals on this point.
> "Abundance neoliberalism" (as per Ezra Klein) is just repackaged Reagen-era trickle down economics
It's laughable to equate "social democracy and targeted industrial policy but with less red tape when you try to build something" with Reaganite policies.
> I'm not sure what your objection to the "neoliberal" is.
The deployment of the word "neoliberal" is almost always a slur and a misunderstanding. People use it as a catch-all category to mean "status quo thing I don't like", wrongly bundling up heterogeneous things that are vastly different. It's the left's version of "uniparty". A thought-terminating rhetorical device, not to be used in any serious analysis.
I suspect you might be confusing "leftism" with "liberalism with progressive aesthetics". This isn't a "No True Scotsman" type situation. If one supports private property, one is definitionally not a leftist. People love to call themselves "progressive" (moreso than "leftist", which has nasty socialist overtones; thank you Red Scare) because it makes them sound and feel tolerant and caring. But leftism isn't about social issues directly. It's economics.
The leftist solution to housing is social housing, meaning the government builds, maintains and supplies a significant percentage of the housing to ensure that everyone has a roof over their head. Vienna is an excellent example of this where the majority (61% IIRC) of all housing is "social housing". 50+ years ago the UK almost entirely got rid of landlords [1] and then along came Thatcher.
"Abundance" is indistinguishable from trickle down economics. The core tenet of "Abundance" is that if there is so much then everybody will get something, basically. How is that not trickle down economics [2]? "Abundance" doesn't challenge the status quo. It reinforces it. So Ezra Klein gets a ton of media and invited to all the good parties and allows liberals to feel good about supporting fundamentally right-wing policies.
And "red tape" here is just another way of saying "deregulation". The defining characteristics of neoliberalism are "free market capitalism" and "deregulation". I don't really care if people misuse "neoliberal". It still has meaning. It sounds like you just don't like being (correctly) labelled as such. That's really no different to people saying things like "the far Left" or "the radical left" about the Democrats, which is beyond laughable.
It's not trickle down economics because social democracy is not trickle down economics. Industrial policy is not trickle down economics. Increasing taxes on the wealthy is not trickle down economics. Funding public goods is not trickle down economics. Taxing externalities is not trickle down economics. Subsidizing supply is not trickle down economics. This is the problem with the leftist worldview where everything is either "neoliberalism" or "not neoliberal ism". It's an overly coarse worldview that doesn't facilitate useful analysis, it impedes your ability to disambiguate between different things. If you think cutting bad regulations as part of the policy mix is by definition Reaganite and therefore bad, then you really need to reevaluate things because not all regulations are good by virtue of them being regulations!
"But leftism isn't about social issues directly. It's economics."
I am talking about people like self styled socialist Dean Preston (the guy you linked, who is a NIMBY that made California's housing crisis worse) or the various Greens parties across the anglosphere who occupy the leftmost end of the political electorate. Whether we label them as leftists or not isn't a hill I'm going to die on. The point is that the leftmost end of the spectrum are more likely to be NIMBYs and have some very wacky and economically illiterate ideas about housing policy than the center left. And I'm someone who supports social housing as part of the mix like what Carney is planning for Canada.
Are you under the misconception that "Abundance" is social democracy? It isn't. It is a defense of the neoliberal status quo. It doesn't challenge authority or the economic order at all. It argues the opposite: we need to do more capitalism, more deregulation and more wealth hoarding. That's why it gets attention from the mainstream media and the Democratic Party's donors and power brokers. It's Democratic Reaganism. I cannot stress this enough.
Simple deregulation of building will not solve housing prices. Private developers will not build enough housing to meaningfully reduce housing costs. The "free market" (which isn't real) will not solve this problem. It takes government intervention.
YIMBYism is well-intentioned and I'm all for more housing. My point is simply that it will not meaningfully solve the problem. I'm sorry if you're offended by the label "neoliberal" but objectively, if you believe that deregulation and capitalism will solve the housing crisis then you are definitionally and objectively a neoliberal.
I'm not sure what Greens you refer to. You might be talking about Jill Stein, who is 100% a grifter.
As for Carney, I had a look at the supposed plan [1] and I see a bunch of demand-side policies where the private development sector is being somehow tasked with lowering their own profits. Housing in Canada needs to be cheaper. That means existing house prices need to go down. Only government intervention in the market can make that happen.
You want to see what a leftist housing policy looks like? Try this:
1. Massively increase property taxes on investment properties;
2. Tax worldwide income of anyone who owns property in Canada meaning the "beneficial owner" (so no hiding behidn LLCs and trusts). Property without a declared beneficial owner simply revert to government ownership;
3. Give the government the right of first refusal to buy any foreclosed property. Use it to build up housing stock. Banks can eat the loss;
4. Homeowners can walk away from properties that are underwater. They revert to government ownership as if they'd been foreclosed on. Again, banks eat the loss if there is one. The previous owners get to stay on essentially a perpetual lease paying affordable rent to the government;
5. A lot of development policies require a certain percentage to be "affordable" housing. There are a lot of games played with this. Ownership of all affordable units goes to the government. The government pays for these. If the price isn't agreeable, the property simply doesn't get approval to be built.
This would tank the property market. As it should. The goal should be for the Canadian government to own 30-50% of all housing units within 10-15 years.
You seem to be mixing up democratic socialism, which is against capitalism, with social democracy, a more mainstream center-left prescription playing out in various European countries that Ezra subscribes to, which coexists with capitalism but is categorically not right wing or Reaganism. Ezra is basically "social democracy but where the good regulations are enhanced and the bad regulations are removed."
> It argues the opposite: we need to do more capitalism, more deregulation
We definitely need more deregulation of bad regulations and not of good regulations. Some regulations are bad and they need to be removed. This is the non-ideological position that evaluates each regulation on its own merits. Not the ideologically possessed position that clusters every single regulation in a monolithic tent and says "deregulate it all because regulations are bad" or "maintain them all because deregulation is bad".
> Simple deregulation of building will not solve housing prices.
And you are basing this assertion on what economic theory or what empirical research?
Compare rental inflation in San Francisco which has effectively outlawed private construction with Austin Texas where construction is more deregulated and housing starts are allowed to track demand.
Get a dataset of American cities, do a scatter plot of rental inflation on the x-axis against the change in per capita housing starts on the y-axis and observe the high R-squared.
It's the left-wing parties and politicians that stand against supply-side policies informed by this reality.
I am not against a land tax and social housing as added measures but the inability to accept the efficacy of supply-side policies on purely ideological grounds will mean left-wing politicians like Dean Preston will continue to do more harm than good whenever they gain power. They don't know how damaging they are because they fail to grasp the basic facts of housing economics because accepting those facts violates the dishonest shibboleths they need to hold to (developers always bad, capital always bad, regulations always good, economics isn't real).
Like I said in an earlier comment, there are things about the Texas property tax system I like. But we can't really compare Texas housing to the Bay Area. Texas is flat with low-value land in all directions. The Bay Area is incredibly space-constrained in an earthquake zone.
I'm not defending the largely single-family home zoning of SF here. I'm simply saying that any affordability you get in Austin (which itself isn't really that affordable) is mostly by spreading in all directions, something simply not possible in SF.
If regulation was the core problem, wouldn't Houston [1] defy housing price trends having no zoning regulation? It does not (eg Austin [2]).
> It's the left-wing parties and politicians that stand against supply-side policies informed by this reality.
No, they don't. I'm sorry but you are uninformed here. You are either confusing liberal policies with leftist policies or simply haven't seen a leftist policy or you're confusing opposition to deregulation as being a NIMBY and not understanding why.
All countries are if you're VHNWI ($5-7M minimum) or on a skilled visa. Plenty of options open up for skilled visas with somewhat expedited naturalization.
I suggest you read up on the history of capitalism, specifically the Inclosure Act [1]. The only difference between feudalism and capitalism is who is doing the rent-seeking.
We extend all of this to intellectual property too. It's rent-seeking all the way down [2]. Have you seen any of the documentaries (or the movie) about how Tetris came to be? Some enthusiasts in the USSR made it. The contribution of capitalism was just whole levels of sublicensing and distribution agreements.
Or maybe you think capitalism is responsible for innovation? Take drug research. Almost all novel compounds come of the education sector using government funding. The "innovation" here is for-profit companies marking that up 8000% and then lobbying for laws that forbid the government from negotiating prices or anyone from importing the same thing from overseas for 1% of the price. That's c apitalism.
Maybe you believe capitalism is about "free markets". First off, there's no such thing. Second, markets exist in every economic system and existed thousands of years before capitalism did.
I agree with 95% of what you said. The distinction between capitalism and free markets is very important - and most people conflate these two concepts which leads them to be manipulated.
The only thing I do not agree with you is a minor quibble - most of the communist economic systems actively destroyed free markets. The only exception may be Communist China.
> Supply constraint of housing by rent-seekers who have managed regulatory capture is absolutely not capitalism working as intended.
Depends on whose intentions you mean. People who believe in free markets? Then not as intended. People who stand to benefit from rent seeking? Then as intended.
I would argue the second group are far more politically influential.
NZers love to go off and do their OE (overseas experience) typically in their early-mid twenties often in hubs like London. A kiwi in their 30s who hasn't lived and worked overseas is the odd one out at parties.
Many of those people do extremely well. I know several who made millions in banking and IT.
Then they come back to NZ when they have kids and put that money into housing. These are some of the people paying $3M for a house. Others are people who have inherited wealth from their parents who invested big in NZ property last century (e.g. boomers). Others are wealthy immigrants from UK, SA, US even.
Yes that sucks for the local who has only been earning $61K but it's reality.
Add to that a weird situation where there is no capital gains tax on housing, with all political parties too scared to address that giant elephant in the room, and NZ offering an awesome lifestyle in many ways except for salaries, and and you have a perfect recipe for high house prices.
Is it sustainable? My view is that it is (not in the sense sustainable == good, but in the sense sustainable == can keep going for a long time). There's no god given right to affordable housing. There was a period in the 1950s where there was prosperity for all, but looking back, that was the anomaly, not the current state of affairs.
> There's no god given right to affordable housing.
Sure, but if you take everything and leave nothing for the masses, sooner or later they'll make your life miserable too. Whether that happens with regular ole crime, or revolution, one way or another the scales will be balanced.
If you want a comfortable life in your mansion, you'd better make sure that your butler and doorman can afford comfortable homes of their own and a decent standard of living.
You say it sucks but that's the reality. Why? It doesn't have to be this way.
Denying people shelter is violence.
We could end homelessness with a fraction of what we spend on the police and prisons. Yet we'd rather spend money on an increasingly militarized police force and the convict slavery system to protect property prices so Jeff Bezos can have $220 billion instead of $200 billion.
War and revolution are the ultimate forms of wealth redistribution. When people such as myself advocate for a decent basic standard of living at the expensive of the wealthy having slightly less, we're really trying stave off the guillotines.
Currently in many countries the social contract stipulates that the majority of the population refrains from voting for a system that confiscates the wealth of the top 5% and in exchange their lives are bearable.
Trump promised to address the problems of low wage workers, and in many places jihadists style themselves as social reformers.
Since NZ does not have the luxury to blame it on refugees or neighbours, I don’t think it is sustainable.
The average wage in NZ is NZ$61k and the average house price is NZ$908k. This is absolutely unsustainable.
This same pattern is playing out to various degrees in Australia, the UK, pretty much anywhere in Europe (certainly Western Europe), Scandanavia any any large city in the US.
And as far as I can tell there's absolutely no serious political opposition to any of this happening in any of these countries. None. Your political choices are between the extreme neoliberalism with lots of racism and the slightly milder neoliberalism with slightly less overt racism.
This is all capitalism working as intended. Every part of this is a series of intentional policy changes designed to transfer wealth from the poor to the ultra-wealthy. Housing is being hoarded and artifically constrained in supply. People are being loaded up with student debt, medical debt and mortgage debt where we careen ever closer to the South Asian brick kilns.