A brilliant article by Bryan Gould in the NZ Herald (http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10862381):
It actually deals with the real reason for housing unaffordability in NZ.
A free market is supposed to match need with resources, but it’s pushed up house prices to insane levels.
The huge increase in the money supply caused by inflated bank lending for non-productive housing seriously skews the whole economy.
The contrast between 1960 and today in terms of housing affordability is the result of a fundamental shift in policy.
Yes, that says it all.
In 1960, decent housing for all was seen as a social responsibility to be discharged by the community through its government or through co-operative arrangements. Today, confidence is reposed in the market to achieve this same outcome.
The evidence as to which is the better approach is surely conclusive; the market has – in this respect at least – failed.
He is quite correct when he says that the banker PM’s Government blames everyone but the real culprit.
In the case of unemployment, in other words, the fault is said to lie with the trade unions, notwithstanding their “small influence” – described by the Prime Minister as a principal reason (together with a tax gift of $67 million) for Warner Bros deigning to come here to make The Hobbit.
In the case of affordable housing, the villains are supposedly the local authorities. Again, the Government – and “free-market” theory – cannot, it seems, be blamed. In both cases, not only does the Government deny responsibility but they have conveniently found a scapegoat in those who do not share their political view.