I’m somewhat embarrassed to say that 5 1/2 years after graduating from the University of Canterbury, I’ve got myself embroiled in student media/politics again. But this time, instead of contributing to Pun Network News or trying (unsuccessfully) to bring down the UCSA status quo, I’ve responded to a face-palm-worthy Canta article defending inequality. I take aim at all-too-common, evidence-free, essentially religious arguments for inequality and capitalism. You can read it here.
I’m not embarrassed to have my article appear in a new alternative publication, Counta, set up by a group of students fed up with the anti-intellectualism and political illiteracy of mainstream student politics/media at Canterbury at the moment. Counta were happy to publish the response when Canta declined.
I’m also not embarrassed to say I was inspired to respond by a lot of evidence and research suggested by friends in MarxSoc, which enabled me to put together a well-researched response I’m pretty happy with.
So, although there’s plenty of disturbing, disappointing and depressing stuff happening in student politics at Canterbury, there’s also some encouraging signs in informed student resistance, and awesome groups like Students for Participatory Democracy, FemSoc, MarxSoc and UC POLS. These groups make me want to get embroiled in student politics again. If you’re at Canterbury (as a student or a staff member, like me), I recommend you check them out.
Graph from The Press
A quick recap on the NZ and Christchurch housing affordability crises:
– 80s-present: NZ housing affordability worsens throughout the neo-liberal era (p. 13-14, 68-70).
– 24/1/2011: Auckland, Christchurch, Wellington and Tauranga house prices assessed as “severely unaffordable.”
– 2010-2012: Canterbury earthquakes reduce housing supply and increase rental housing demand.
– 20/3/2012: National and Gerry Brownlee decide to leave the market to sort out the Christchurch housing crisis.
– 18/6/2012: Brownlee suggests rent rises in Christchurch aren’t “astronomical” compared to other cities.
– 29/6/2012: Brownlee and John Key deny there’s a housing crisis in Christchurch.
– 7/7/2012: Brownlee says he can only see positives in Christchurch’s skyrocketing rents.
– 29/10/2012: John Key rules out a capital gains tax like most countries have, simultaneously showing just how out of touch he is.
– 27/8/2013: Housing is now less affordable in Christchurch than Wellington.
– 14/5/2014: Christchurch rents projected to hit Auckland levels in January 2015. Housing Minister Nick Smith suggests “the real problem” is not enough rental accommodation for tourists.
– 15/5/2014: The Budget offers a pittance and cuts for housing, and worse for Chch.
– 19/5/2014: An OECD report finds New Zealand has the most over-valued houses in the developed world. Key, true to form, disagrees with the OECD, and tries to spin the news as a positive as more people are entering the “housing market.”
A consistent theme emerges in the current government’s attitude to these developments: (a) there’s no crisis – if anything it’s a good thing, (b) if there is a crisis, the market will sort it out by itself (because dog-eat-dog individual selfishness systems are great for the vulnerable, eh).
It’s tempting to say they’re simply idiots, but it’s better to ask which groups in society are they representing, and which aren’t they?
For most groups in society, the above information amounts to a housing crisis nationwide, and particularly in Christchurch. But for one group, rapidly rising rent and house prices doesn’t amount to a crisis, but an opportunity for increased profit. This is the group that treats housing as an investment, not somewhere to live: rental property investors.
Gerry Brownlee and many other National MPs are in this group of people. Most of Brownlee’s rental properties are in his own Ilam electorate, where rents in one suburb (Aorangi) rose by 51% in a year. I think this is a pretty important conflict of interest at the best of times, but even more so amid the housing crisis Brownlee and his party are determined to ignore.
I recently wrote to Brownlee, essentially asking him to clarify the question I asked in an earlier blog:
If you’re interested, here’s Brownlee’s response. My attempt to name-drop the Official Information Act backfired – it turns out this info isn’t available under the OIA because it’s not government info. So the public don’t get any more detail than what’s listed on the register of pecuniary interests. I asked if he’d answer my questions anyway, as a goodwill gesture to one of his constituents… I’ll let you know if he replies.
If National win this year’s election, it will be because of personality and PR. If they lose, it will be because of housing. It’s the biggest issue in Brownlee’s electorate and the country. While National are denying, blaming and doing nothing, Labour are making supply-side and demand-side action on the housing crisis the centre of their campaign.
They’ve also hinted that at some stage before or after the election campaign, they may announce what makes all our hearts instinctively leap, at least before we think about it: tax cuts. This would mark the first changes to tax since 2010, when they shifted the tax burden from the rich onto poor and middle-income earners.
Mana’s John Minto has an interesting reaction. He says tax cuts are a great idea, and suggests shifting the tax burden back again: abolishing GST and tax on the first $27,000 of income, and paying for this by finally taxing the unproductive untaxed income of the 1% – capital gains and financial transactions.
Something tells me a party of property magnates and investment bankers is not going to propose those kind of tax changes – any recovery-era tax cuts will presumedly be along similar lines to their recession-era tax cuts.
Does this strike anyone else as a little strange? Not just because they’re promising tikka masala before the chickens have hatched (the surplus is tiny, and only a projection based on fudged numbers, disguised cuts and abandoning Christchurch).
The main reason it’s strange is that when we were heading into rough financial times, they thought the appropriate thing to do was to cut taxes on the rich. And now in healthier financial times, they again think the appropriate thing to do is to cut taxes (presumedly again on the rich). Never mind the fact that they haven’t paid off their debt from the last tax cuts and tough economic times yet.
The truth is that they’re not responding to the economic climate at all. In tough times or healthy times, they’re pushing a philosophical agenda to let the rich continue getting richer while paying lower taxes, and reduce the social safety net to pay for it. Bill English recently let this agenda slip in a recent speech to the party’s Southern Region conference. They’ve already let public goods and services drop from 35% of GDP to 30% – one of the lowest rates in the OECD – and they intend to reduce that even further, to 26% over the next six or seven years. This is not what NZers want.
The obvious solution is not to let them rule for the next six or seven (or three) years.
But their own numbers show that’s working about as well as Brownlee’s “let the market sort it out” worked for the Christchurch housing crisis. Yes, the economy is growing again, but that growth isn’t making its way into the pockets of ordinary workers. From 2014-2018, they’re forecasting 14.2% GDP growth, but only 4% wage growth.
In fact, this supports Thomas Piketty’s inequality thesis quite nicely: the natural and inevitable movement of capitalism is for wealth to accrue to the already-wealthy. In other words, you can’t solve inequality and poverty just by growing the economy. You need more radical interventions, as Piketty suggests. Mana’s tax policy – shifting the tax burden from poor and middle-income earners to the unproductive, untaxed income of the 1% – is a good start. Another much-needed policy is a minimum wage that allows people to live with dignity in society – the calculated Living Wage. This would mitigate against inequality across the board and end working poverty.
We can no longer use tough economic times as an excuse. We can afford these measures; we just need to decide to prioritise them, instead of letting our economic growth accrue to the unproductive parasite 1%.
You might think tough economic times are a good time to do some study, but that hasn’t been true under this government. This week my union showed clearly and simply the damage Steven Joyce and National have done to tertiary education since 2009:
Step 1) They’ve made tertiary institutions “fund more people for less money while costs rise,” and there’s no sign of funding keeping up with inflation, let alone increasing student numbers, any time soon.
Step 2) Therefore, staff:student ratios have worsened at all our universities.
Step 3) All our universities have decreased their world ranking scores, and these drops are “closely related” to the worsening staff:student ratios.
Steven Joyce supposedly has a master plan for tertiary education – but it’s basically just funding cuts, along with shipping in more international students to make up the funding, more postgrads (but no more student allowance for postgrads), making governance corporate rather than democratic and making tertiary study less a critic and conscience of society, more a skills factory for the economy. The above stats clearly show it’s not working. Lincoln University has followed Joyce’s formula more closely than any other university in NZ. They’re not included in the above data because there’s not enough information available – but they’re in deep trouble economically at least.
The national students’ union, NZUSA, suggests a very different approach – funding full fee scholarships and support services for the first in any immediate family to get a degree. It would cost $50 million a year, surely a bargain in terms of the benefits it would bring: obviously it’d be great for the students and their families, and for building a fair and socially mobile society, but it’d also reap huge dividends for the economy by utilising people and talents that usually fall through the cracks. What Steven Joyce claims to want – tertiary education to benefit the economy – would be better achieved by this than by his exactly opposite approach.
PS: The obvious objection is “but money has to come from somewhere! If they didn’t cut tertiary education funding, something else would have lost out!” To which I say: correct… Perhaps anti-democratic irrigation schemes or anti-environmental motorways or anti-poor tax adjustments should have lost out.
PPS: I wrote the title of this blog before I found the above picture on critic.co.nz. Surely there’s something wrong with your tertiary education policy when it leads at least two people to independently describe you as chowing down on universities.