If the bath is overflowing the first thing you do is turn off the tap. You don’t waste time trying to make the bath bigger. Yet when it comes to housing, our government has spent all its efforts trying to do just that. It needs to wake up and urgently turn off the migration tap.
For some years now, demand has continually outstripped the capacity of the New Zealand market to construct extra housing. Yet the government has focused almost solely on trying to increase supply. They have steadfastly refused to meaningfully address the reality of excess demand. Instead they have allowed it to grow. In the year to June 2016 there has been record migration of 70,700. Even Treasury has been raising questions about the consequences of such high levels.
Now the bath has overflowed and done serious damage to the structure of our economy. We have a huge debt-equity problem. The debt problem is as reported by the NZ Herald today – national indebtedness approaching half a trillion dollars. Most of this is private mortgage debt. We also have a huge social equity problem. When large numbers of Aucklanders can’t even afford to be tenants in their own city – let alone homeowners – there are real questions about social justice that need to be asked. Is this the country we want?
It is certainly not the country envisaged by previous National Party administrations. As noted in a previous blog – a Holland or Holyoake government would never have sat on its hands and let such a situation develop. So why has this one ?
Surely it is not because, as some have suggested, many MPs own investment properties and hence are happily making untaxed wealth from the boom. There is still basic personal intergrity in New Zealand politics. Only last week we heard how National Party President Peter Goodfellow absents himself from caucus discussions on fisheries due to his own interests in this sector.
No the issue is probably not integrity. It is fear. The fear of being labelled xenophobic. In the eyes of the liberal media anything that hints of xenophobia is a serious crime. The inevitable criticism that would come from cutting back migration is probably what is paralysing our current political leaders into doing nothing. This is what holds them back. But for all our sakes they need to find some courage. Be brave – turn off the tap.