So, what about that RMA replacement then?

So in the next day or two the Labour Government's RMA replacement will have been repealed. Abolished. Extinguished. Labour's two replacement bits of law -- the Natural and Built Environment Act and the Spatial Planning Act -- will be gone by Christmas. 

Yippee!

In their place, we're back to the RMA.

Damn. And blast.

Labour's two replacement acts were as unworkable as they are unsayable. The RMA is just unworkable (as the three-decade long housing crisis has established). But that's what we will be back to -- along with faster consents for government projects (little help there for you and I and your friendly house-builder) and the as-yet un-detailed dangled carrot of some kind of "better" replacement to come.

When will we get it? Some time.

What will it look like? Who the hell knows.

There's nothing like opaque promises to create expensive uncertainty in a market, like housing, in desperate need of cost cutting.

Anyway, I have a solution. It seems to me that one way to create certainty, stifle NIMBYs, effect a more rapid transition, and begin the restoration of property rights -- a simple way to kill four birds with the same stone -- would be to give legislative impetus to a thing called the Coming to the Nuisance doctrine. 

The Coming to the Nuisance Doctrine is a little-known but highly effective principle that was a feature of common law jurisdictions until partially killed by statute, and all-but euthanised by the judiciary. (See for example Sturges v Bridgman – the case of a confectioner and a busybody doctor.) It lives on, partially, in Lord Denning’s famous dissenting opinion against a couple bewailing cricket balls coming through their greenhouse after moving next to a cricket oval. 

Conveniently, there are a few posts already written to help you read up on the doctrine. As the first one explains, the Coming to the Nuisance Doctrine is the antidote to what the planners have done to our cities ...

** “The Coming to the Nuisance Doctrine is the only objective means of determining who has the right to continue using his property in the event of a nuisance. If zoning is to be replaced, therefore, it must be replaced with the Coming to the Nuisance doctrine.”

    ~ The "Coming to the Nuisance" doctrine: The antidote to zoning – CAPMAG

** "I refer you again to a simple book that’s been on my shelf for well over thirty years. Its solutions are comprehensive – one simple solution being to outlaw zoning --

"'If … there were no zoning or land-use control laws, there would be considerably more housing at considerably lower prices and in areas considered more desirable.'

"Both common law and the systems set up in un-zoned cities like Houston protect freedom and property owners far better than zoning, which has only been imposed for a few decades. The problems are evident, the solutions are known, yet zoning of every New Zealand city continues."

"Men are born free but nearly everywhere in zones. Why? Because (as my well-annotated copy told me so long ago) so many cronies benefit from it."

    ~ Zoning for Special Interests

** “… it’s practical to remove the RMA overnight… Here’s how it could be done. FIRST, ENACT A CODIFICATION of basic common law principles such as the Coming to the Nuisance Doctrine and rights to light and air and the like. 

“Second, register on all land titles (as voluntary restrictive covenants) the basic 'no bullshit' provisions of existing District Plans (stuff like height-to-boundary rules, density requirements and the like).
“Next, and this will take a little more time, insist that councils set up ‘Small Consents Tribunals…”
    ~ What would 'Party X' do about the environment? - PART 3: Small Consents

** “What sort of person moves next door to a chicken farm and then complains about the smell?
The sort of people who live in Inglewood in Taranaki perhaps, who come to the nuisance and then seek to make windfall profits from someone else's destruction.”

    ~ "What nuisance?" And who came to it?

** "What I propose is another simple modification to law that would allow New Zealanders to once again repair to the common law protections that 'The Hammer' had made possible. In particular, the codification of the common law principle of Coming to the Nuisance  ... which, on its own, would be a powerful antidote to the zoning that the RMA has entrenched -- perhaps the strongest possible antidote to zoning there is. Supplementary to putting property rights in the Bill of Rights, then, ‘Party X’ could promote the reintroduction of the Coming to the Nuisance doctrine for use as an absolute in neighbourhood disputes."

    ~ What would 'Party X 'do about the environment? Part 2: 'A Nuisance and a BOR'

** “The principle of ‘coming to the nuisance’ was established (and then sadly in some jurisdictions dis-established); as was the principle of a ‘bundle of rights’ being associated with land, and some of those rights being acquired over time by ‘prescription.’”

    ~Cue Card Libertarianism -- Common law

What would 'Party X 'do about the environment? Policy #2: Scrap the 'License to Pollute'

So there's a gap in the market for a political party representing what I'm calling "ethical environmentalism" -- and even Simon Bridges will want a part of it come coalition time (Whether it would want him is a whole other story). 
By ethical I mean policies that remove some existing political coercion without introducing any new coercion. By environmentalism I mean today's fashionable environmental tropes. And by some innate cunning involving preternatural judo I propose a Party X that uses those tropes to kickstart both some real environmentalism and a true movement towards liberty. Let me explain how with today's example of a policy that such a party could promote... 

Today, two proposals to propel property rights towards the heart of New Zealand life, while solving several major environmental problems:


A few years ago we woke to the news that  the world-famous famous penny-divers at Rotorua’s Whakarewarewa were being told by the authorities not to swim in the Puarenga River if they value their health. It seemed the stream was becoming seriously polluted.

    Tests over the years have shown poor results for water quality and [authorities] says companies like the Red Stag Timber Mill could be doing much better.
    But Tim Charleson, the mill's environmental manager, says the company carries out regular chemical tests on its effluent and it's meeting the conditions of its resource consents.

I have no doubt Red Stag et al were and are  “meeting the conditions of [their] resource consents,” as do farmers, mill owners and waste operators all around the country. But as this story and others clearly demonstrate, these consents merely formalise their pollution instead of protecting against it.

In short, resource consents are not a form of environmental protection. They are a license to pollute.

In cases like this one and all over the country, from the Tarawera River (into which the paper mill has a license to dump chlorine and worse) to Akaroa Harbour (where the council has given itself a license to dump nearly raw sewage), a resource consent full of mealy-mouthed conditions has granted to these producers full license to sully the places and rivers that people value, and that property owners would cherish -- if they were still allowed to.

The RMA, under which resource consents like this are issued, is hopeless at protecting the environment precisely because it’s hopeless at protecting property rights. Contrast this with common law, which has seven-hundred years of sophistication at protecting both, and you realise how far from ideal NZ’s so-called “environmental legislation” really is. 

With strong property rights under common law, for example, the tourism operators along the Puarenga River—and the former fishermen at the head of the Tarawera River; and the aquaculture operators in Akaroa Harbour—would all have had legal standing to take action against polluters damaging their property right. 

And taking and winning these actions against big polluters is the best signal to other would-be polluters not to start.

As Elizabeth Brubaker writes

The age-old common-law maxim 'use your own property so as not to harm another's' has provided the foundation for the resolution of disputes about farming practices [and pollution] .... Under this maxim, the rights of farmers [and other producers] -- like those who own or occupy land -- are tempered by their responsibilities. While they have a right to use and enjoy their property, they have a responsibility not to interfere with their neighbour's rights to use and enjoy their property.

Recognising and protecting that right  has been at the heart of common law "as early as the thirteenth century," explains Brubaker, "when one legal scholar wrote that 'no one may do in his own estate any thing whereby damage or nuisance may happen to his neighbour.'

In cases over the following centuries dealing with everything from pigsties to cattle to railway lines to sewage systems -- and from Britain to Canada to the US and New Zealand -- courts frequently cited and affirmed the principle in providing environmental protection through protection of neighbour's rights against a polluter.

Historically and in principle that’s the best protection the environment ever had – both for the natural environment and for the human environment. Property rights in streams and rivers for example coupled with common law systems of protection would at a stroke solve the ‘dirty dairying’ problem about which so much is said, but so little achieved. Property rights in flora and fauna and land is the best means of ensuring a genuinely sustainable nation. 

Yet the Resource Management Act instead protects polluters. 

Overshadowing all other legal defences [of a polluter] is ... that a statute has authorised a disputed activity. Government statutes take precedence over the common law [explains Brubaker]. If a government approves a nuisance therefore, a court loses its power to enjoin it.... At enormous cost to the environment, governments of all times and all political stripes have overridden the common law to protect favoured industries... Farmers now benefit especially from statutes affording some of the country's clearest and most sweeping protections.

While ignoring the property rights the law is supposed to protect. Fortunately, there are many solutions. I have two:

Method No. 1. Putting Property Rights in the Bill of Rights Act

We know that common law protection of property rights has been buried by statute and regulation and by the Foreshore and Seabed Act and its later replacement--but it’s not too late to resurrect it. Placing property rights in the Bill of Rights Act would be a start—a politically possible start—repairing an omission that Bill of Rights architect Geoffrey Palmer has publicly conceded was a mistake.

It should be simple enough to insert a new clause in the Bill of Rights adding property rights to the rights protected. (And a responsible ‘Party X’ would know they would need to add pressure to make the Bill of Rights  superior to all other law, as it always should have been.) 

After all, the principle of property rights simply promises the protection of the right to peacefully enjoy that in which one has property. What reasonable objection can be brought to a law that protects an individual’s right to peaceful enjoyment? (Let me stress the word "reasonable.") 

Let’s place on the back foot those who object to that right by challenging them to say for what reasons the right to peaceful enjoyment should not be made superior to all other law. 

Why should that right not  be put beyond the vote? That is, put well beyond the power of any politician to tamper with -- for that is surely a power beyond any right!

Our putative ‘Party X’  may not be immediately successful in this goal, of course, but it could at least flush out the bastards who oppose such peaceful rights, and expose the reasons they do. 

In the meantime, you might like to consider what would happen if property rights ever actually were placed at the heart of the likes of the Resource Management Act . . . would it be something like the meeting of matter and anti-matter ?

Method No. 2. Coming to the Nuisance

Planners like nothing more than than telling you where and how you may live.  The RMA gives them that power in spades, and the country is infested with the well-fed bastards writing and administering District Plans empowered by the RMA to boss you and your family around -- and with the utopias they have created and are all their own work ... like Albany and the Manukau City Centre. 

It wasn’t always that way. Back when common law was being invented, the English king was becoming increasingly frustrated at having to fix issues about the damage that someone’s chickens did to someone else’s crops.  Keen to stop his castles being overrun by defendants’ chickens, the king quickly realised the three important questions that could quickly solve these issues:

1. Whose chickens (and whose crops) are they?
2. What damage did they do? (And how to remedy it?)
3. Who was there first?

Such was the birth of common law—and right there in those three questions the English king had hit on the three ingredients that have been at the heart of common law ever since:

1. Property rights.
2. Damage.
3. Nuisance (and who came to it?).

Once these principles were established, the English king was able to solve these problems rapidly, to cleanse his castles of chickens, and to head north to invade Scotland—which is what the king known as “The Hammer of the Scots”  he’d been trying to do when he got bogged down in these disputes. 

What I’m going to propose here is another simple modification to law that would allow New Zealanders to once again repair to the common law protections that “The Hammer” had made possible. In particular, the codification of the common law principle of Coming to the Nuisance (seen in palimpsest in point three above), which on its own would a powerful antidote to the zoning that the RMA has entrenched -- perhaps the strongest possible antidote to zoning there is. Supplementary to putting property rights in the Bill of Rights, then, ‘Party X’ could promote the reintroduction of the Coming to the Nuisance doctrine for use as an absolute in neighbourhood disputes.

The Coming to the Nuisance Doctrine is an enormously powerful principle protecting pre-existing rights, and quickly establishing rights in situations of apparent neighbourhood conflict. Move next door to a clean and well-run chicken farm or pig or mushroom farm for example (even if the place has been re-zoned since the farm opened), and under this doctrine you have no right to have them thrown out. 

Move next door to a speedway track, for another well-known example, and you have no right to complain about excessive noise. 

I assume you see the difference with how things presently work. If the farm or the speedway or whatever it is was there before you chose to buy next door, then that’s probably why you got your land so cheap.

And if the track (or farm) is well and properly run, then those pre-existing rights should and can be protected in law; and if they were you then have a strong incentive to either make a more careful choice in future (whereas now the incentive is there to move in and force them out), or to buy out the speedway or the farm, or buy easements or covenants over the neighbouring land. 

Either way, when the coercion is removed from all parties and bargaining is all that’s allowed, the tendency is for property to end up in its highest value use. This is not something planners can ever claim to have achieved. 

Furthermore, what this principle will demonstrate over long use is that zoning is not only coercive, but unnecessary. It will on its own provide a daily demonstration that sound property rights work for everybody except the grey ones and the looters.

Not only that, at the same time as undercutting the zoning law established under the RMA, if  introduced it would have ensured that if neighbours of Western Springs speedway weren’t prepared to stump up enough for the bikes and midget cars to go elsewhere, then the noise of fast cars and motorbikes would have continue to annoy the luvvies for some years to come. You can’t do better than that.

Coming To The Nuisance then is THE pre-eminent antidote to zoning, the best way to pull the planners' teeth, and the single-best way to silence the NIMBYs who move in next to a circus and then complain to the grey ones about the noisy tent next door.

And what could be better than that?

Conclusion

So you can see the power that this measure would have, and I hope I've shown that it should be politically possible. 

I hope too that I've given you a few other ideas, like how to solve the problem of dirty dairying .... and we will, later in this series.

In the meantime, you can tune in again tomorrow to discover a very simple way to use pressure to solve the housing crisis to solve the problem of property rights in land ...

* * * * *

THE SERIES SO FAR: 
INTRO: 'The Time is Ripe for a 'Party X' for the Environment' 
PART ONE: Eco un-taxes 
THE SERIES IS BASED ON THE PRINCIPLE DEVELOPED HERE: 'Transitions to Freedom: Shall We Kill Them in Their Beds?'
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RMA: After 25 years, time to euthanase it

 

A fellow called Roger Partridge reminds us that the Resource Management Act is 25-years old this month, a shocking realisation for those opposed – and a timely reminder for everyone appalled at rampant housing unaffordability what is most behind the iniquity: this planning law that shackles the supply of new houses.

Yet over that time few voices have been strongly and consistently opposed. To paraphrase Ayn Rand, “When for a quarter-century the productive have been forced to seek permission from the unproductive in order to produce, with nary a word raised in opposition to that iniquity, then you may know that your culture is doomed.”

Mr Partridge’s headline says what his op-ed only hints at, that this Frankenstein Act must be slayed, but his conclusion at least is sound: that more tinkering will never tame this Frankenstein.

What can be done? The answer lies in the RMA’s great conceit: that planners and politicians are better placed to decide how resources should be used than their owners. As that approach has clearly failed, we need to start afresh.
    It is true that private property rights regulated by the common law will not always lead to acceptable outcomes. [Acceptable to whom, white man? – Ed.]  But that does not require a regime that places all decision-making in the hands of government. 
    The urban planning component of the RMA has been handed to the Productivity Commission for a reappraisal.
     We can only hope this will be a well-considered assessment of planning law that should have preceded the enactment of the RMA 25 years ago. [Cough, cough.]
    Where property is in private hands, the review should ask “what is wrong with letting private owners make their own decisions?” For centuries the law of property, contract and tort – with their focus on harm to third parties – did just that. And great cities were built on this basis.
    Indeed, our own cherished Victorian suburbs with their gracious villas were built with minimal help from town planners. Contemporary planners can learn from this.
    In Mary Shelley's masterpiece, though torn by remorse, Victor Frankenstein refuses to admit to anyone the horror of his creation, even as he sees it spiralling out of control.
    A quarter of a century on, let's hope Sir Geoffrey's heirs can do better.

I remain convinced this monster needs a stake through its heart – and that common law protections of environment and private property must be recognised again, starting perhaps with small consents, or perhaps with a codification of basic common law protections culminating with a re-statement of the Coming to the Nuisance Doctrine.

I remain unconvinced however that in the heirs of Geoffrey Palmer we should harbour any hope of anything whatsoever, except for much more of the same.

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#HousingCrisis | Zoning for special interests [updated]

 

In not being able to pay its own way, Labour's cure for affordable houses is unaffordable -- and in planning to confiscate private property both National and Labour plans are immoral. Yet even in their intentions (and politicians actions are judged not on results, but only on intentions) then even then, neither party are actually proposing producing houses that are actually affordable.

Affordable houses are generally considered to be houses with an average selling price of only 3 times average income for that area (a house price-to-income ratio met by Auckland as recently as the early 1990s).* Labour’s stated aim is to produce houses of around $500,000 to $600,000 – and National’s plan lacks even that paltry ambition. Yet at that price, that would still make a house price-to-income ratio of around 5 or 6.

So Labour’s seriously unaffordable plan is to make houses that are severely unaffordable.

Table from 12th Annual Demographia International Housing Affordability Survey: 2016

Nice.

And meanwhile, the current state of the law ensures that the housing crisis will continue.

It’s like neither party actually has any genuine solutions to the crisis their laws have caused. Yet the answers have been known for decades.

I refer you again to a simple book that’s been on my shelf for well over thirty years. Its solutions are comprehensive – one simple solution being to outlaw zoning --

If … there were no zoning or land-use control laws, there would be considerably more housing at considerably lower prices and in areas considered more desirable.

Both common law and the systems set up in un-zoned cities like Houston protect freedom and property owners far better than zoning, which has only been imposed for a few decades. The problems are evident, the solutions are known, yet zoning of every New Zealand city continues.

Men are born free but nearly everywhere in zones. Why? Because (as my well-annotated copy told me so long ago) so many cronies benefit from it.

         

These are just a few of the interest groups who benefit from zoning – to them these days we might add the councillors and politicians whose campaigns are part-funded by the beneficiaries, the bankers who get to lend in an over-priced market, the increasing sea of well-remunerated resource consultants (who will become even richer come the dawn of Auckland’s new Unitary Plan), the older owners of rapidly inflating inner-city property, and the circle of land-owners around the outer ring of NZ’s cities awaiting and lobbying for re-zoning; all of them  making hay out of other people’s misery.

Nice.

But it doesn’t need to continue …

NOTES:

* “The Median Multiple (this house price-to-income ratio) is widely used for evaluating urban markets, and has been recommended by the World Bank and the United Nations, and is used by the Joint Center for Housing Studies, Harvard University. Similar house price-to-income ratios (housing affordability multiples) are used to compare housing affordability between markets by the Organization for Economic Cooperation and Development, the International Monetary Fund, international credit rating services, media outlets (such as The Economist) and others.” [Source: 12th Annual Demographia International Housing Affordability Survey: 2016, p. 6]

RELATED POSTS:

• “The winners in this equation are those who already own property in the inner suburbs, mostly older generations. Restrictive land-use regulations have severely constrained the supply of housing in most Australasian cities, pushing prices up.
      “It is, in effect, a massive wealth transfer from the young to the old.”
  'Regulations that limit the stock of housing suitable for younger people, such as height restrictions and view shafts, need to be axed and pronto' – Jason Krupp & Alex Voutratzis, INTEREST.CO.NZ
• The Coming to the Nuisance Doctrine is the only objective means of determining who has the right to continue using his property in the event of a nuisance. If zoning is to be replaced, therefore, it must be replaced with the Coming to the Nuisance doctrine.”
  The "Coming to the Nuisance" doctrine: The antidote to zoning – CAPMAG
• “’When the productive have to ask permission from the unproductive in order to produce,’ said Ayn Rand, ‘then you may know that your culture is doomed.’ That’s true. Just ask anyone who has waited in line for a resource consent.”
  What would 'Party X' do about [affordable housing]? - PART 3: Small Consents – NOT PC
• “Here is how the housing market works under John Key’s crony capitalism: he and his housing minister and the council’s planners have between them just made around half-a-dozen land-owners around Auckland rich beyond their wildest dreams.
      “Announcing out of the blue some land allowed to selectively slip through the council’s zoning net, the land-owners quickly discovered their land formerly zoned rural by planners now had the politicians’ and planners’ tick to build houses – and the value of said land immediately went through the roof.”
  Windfall profits for some at the expense of affordable housing for others – NOT PC, 2014
• “Is zoning and urban planning racist? Are environmentalists guilty of racial injustice? Are planners the new segregationists? Yes, says Randal O'Toole of the Thoreau Institute.”
  Zoning and 'Smart Growth': The New Segregation? – NOT PC, 2006
• “Here's a lesson that town planning advocates everywhere should note.  While most of the American housing market has experienced boom and bust in the face of expansionary Federal Reserve policies, housing in Houston has remained relatively immune -- even though it's been at the epicentre of rapid economic growth due to the commodities boom.
      The reason?  While most of the western world is under the thumb of town planners, with the result that housing in much of the western world has become seriously unaffordable, the city of Houston remains unzoned, and its housing among the most affordable anywhere.”
  Why Houston housing has avoided boom and bust – NOT PC, 2008
• “Kip's Law:  "Every advocate of central planning always — always — envisions himself as the central planner.”
  “Planning” to stop Aucklanders plan – NOT PC, 2011
• “What do town planners mean when they talk about things like ‘affordable housing’ and ‘community’?
  What they don’t mean is making houses affordable, or about any ‘community’ other than their own.
  The weasel words of “planning” power-lust – NOT PC, 2010

‘Coming to the Nuisance’? What’s that about?

 

After reading Eric Crampton’s superb piece on solving the Auckland housing crisis, a few commenters here were asking about the Coming to the Nuisance doctrine, mentioned by Eric, that was a feature of common law jurisdictions until partially killed by statute, and all-but euthanased by the judiciary. (See for example Sturges v Bridgman – the case of a confectioner and a busybody doctor.) It lives on, partially, in Lord Denning’s famous dissenting opinion against a couple bewailing cricket balls coming through their greenhouse after moving next to a cricket oval.  Conveniently, there are a few posts already written to help you read up on the doctrine:

• “The Coming to the Nuisance Doctrine is the only objective means of determining who has the right to continue using his property in the event of a nuisance. If zoning is to be replaced, therefore, it must be replaced with the Coming to the Nuisance doctrine.”
  The "Coming to the Nuisance" doctrine: The antidote to zoning – CAPMAG
• “… it’s practical to remove the RMA overnight… Here’s how it could be done. FIRST, ENACT A CODIFICATION of basic common law principles such as the Coming to the Nuisance Doctrine and rights to light and air and the like.  
      “Second, register on all land titles (as voluntary restrictive covenants) the basic “no bullshit” provisions of District Plans (stuff like height-to-boundary rules, density requirements and the like).
      “Next, and this will take a little more time, insist that councils set up a ‘Small Consents Tribunals…”
  What would 'Party X' do about the environment? - PART 3: Small Consents
• “What sort of person moves next door to a chicken farm and then complains about the smell?
  The sort of people who live in Inglewood in Taranaki perhaps, who come to the nuisance and then seek to make windfall profits from someone else's destruction.”
  "What nuisance?" And who came to it?
• What I’m going to propose here is another simple modification to law that would allow New Zealanders to once again repair to the common law protections that “The Hammer” had made possible. In particular, the codification of the common law principle of Coming to the Nuisance (seen in palimpsest in point three above), which on its own would a powerful antidote to the zoning that the RMA has entrenched -- perhaps the strongest possible antidote to zoning there is. Supplementary to putting property rights in the Bill of Rights, then, ‘Party X’ could promote the reintroduction of the Coming to the Nuisance doctrine for use as an absolute in neighbourhood disputes.
  What would 'Party X 'do about the environment? Part 2: 'A Nuisance and a BOR'
• “The principle of ‘coming to the nuisance’ was established (and then sadly in some jurisdictions dis-established); as was the principle of a ‘bundle of rights’ being associated with land, and some of those rights being acquired over time by ‘prescription.’”
  Cue Card Libertarianism -- Common law
.

“How to fix a crisis: An Auckland housing manifesto” [updated]

 

There’s no excuse for it, but the housing crisis has now badly affected people’s brains. This morning on air, for example, the supine Bill English was attacked by Guyon Espiner, a sadly-impaired thinker apparently under the illusion that the finance minister decides how all the money in the country is spent, and who personally goes round putting children into cars every night. (You should listen [from about 6:10] -- it’s sadly and unintentionally amusing.)

Fortunately, some clearer thinking about the crisis has emerged this week from the unlikely pen of an economist. A fellow called Eric Crampton. He’s overlooked two legs of the whole cause-of-the-housing crisis trifecta – the fact that two-thirds of new money in New Zealand is borrowed into existence by the billions just to buy existing housing – and that the law (the RMA) removes property rights from home-owners who do know their own desires to give powers to planners who don’t -- but this explanation of who and what to blame for Auckland’s escalating housing crisis is otherwise authoritative.

Just look at the mess in Auckland where a developer wanting to build housing for 1500 households in an old gravel pit at Three Kings, turning much of it into parks and open spaces, has bought almost a decade’s worth of objections and processes and hearings. How can anybody build anything to scale under those conditions? In the middle of a housing crisis, with daily news stories about the number of children having to live in cars with their parents because there are not enough houses to go round, NIMBY activists block new construction.
    Every time a NIMBY cries, an angel has to sleep in a car, or in a garage.

All other explanations need to answer his first, including his two reasons for NIMBYism – because the law as it is gives home-owners no other protection apart from complaining very loudly, and because high infrastructure costs mean council gets no financial boost from new development – which means no real incentive.

So, to make things very simple: 

Q: Why is there a crisis?
A: Because Auckland is adding houses less quickly than it is adding households.

But why isn’t the housing market working properly? Good question.

    Avocado shortages aside, high migration figures haven’t led to shortages of anything else that people buy – and I would not blame migrants for the avocado shortages either. Auckland doesn’t have a barber crisis induced by the tens of thousands more people who need haircuts every month as compared to the same time last year.
    Fundamentally, the problem has to be constraints on supply: either the building industry simply cannot keep up, or the council isn’t zoning enough land for either building up or building out.
    The constraint, so far, has not been the construction industry. When I was at the University of Canterbury, you couldn’t walk between two buildings during the earthquake rebuild without meeting Irish accents in fluoro vests. Markets can scale up to meet demand if they expect that demand to be sustained. Builders can come in from overseas. Cement plants can be expanded and upgraded. Unexpected housing demand can then cause price blips, but you shouldn’t get the years-long rolling maul we’ve seen in prices.
    The series of three reports the Initiative released in 2013, our reports since, and the Productivity Commission’s reports, point pretty strongly to council-level constraints on new building. Pro-density activists made it too hard to expand at the outskirts of town; Not In My Back Yard activists made it too hard to build apartment towers or terraced housing close to downtown. When a city can’t go out or up, prices can only go one way when population increases.

Read that again with one important change in wording: “When a city can’t go out or up, prices can only go one way when population demand increases.” And all the incentives people have make both sides of the equation many times worse (with billions in new money borrowed into existence for new mortages turbocharging demand and making that whole equation even more potent).

There a several red herrings raised against this simple argument that are frequently floated by those who, for reasons of their own, would like to complicate the causes – empty houses, capital gains tax, those darned foreigners, a dearth of state housing, a too-small construction sector; all are thoroughly explained and all summarily dismissed.

So the obvious conclusion is: to flip things around, we must have ourselves much better incentives. Eric suggests six quick-fixes to the law, all of which caught my eye, and a fundamental and necessary change in mindset:

Fundamentally, the country is not going to solve Auckland’s housing affordability problems without building more houses at a much faster rate. That will not happen without changes in zoning allowing both building up and building out. And getting durable changes to town planning likely requires changing the incentive structures within which councils operate. Part of that can involve financial incentives. Part of it should involve changes to the Resource Management Act making it easier to subdivide, easier to change district plans, and harder to block new developments.
    And some of it has to involve a change in mindset. When you buy a house, you aren’t really buying a right to stasis, locking all of the neighbours under thick clear plastic wrap like your grandmother’s living room set. Neighbourhoods and cities have to be able to change and move to meet changing demand. The formal planning structures the government has built, and the financial incentives facing councils, create far too much bias towards stasis, and stasis is the enemy of growing, vibrant cities.
    We are at a crisis, and hopefully a crisis in the best and proper sense of the term: a time for change. Let’s hope that local and central government can make the most of it.

I urge you to read the whole piece: How to fix a crisis: An Auckland housing manifesto.

And I urge that necessary and long-overdue change in mindset – and in law.

.

UPDATE: A few commenters have asked about the Coming to the Nuisance doctrine, mentioned by Eric, that was a feature of common law jurisdictions until partially killed by statute, and all-but euthanased by the judiciary. (See for example Sturges v Bridges.) It lives on, partially, in Lord Denning’s famous decision against a couple bewailing cricket balls coming through their greenhouse after moving next to a cricket oval.  A few posts here on the doctrine:

• “The Coming to the Nuisance Doctrine is the only objective means of determining who has the right to continue using his property in the event of a nuisance. If zoning is to be replaced, therefore, it must be replaced with the Coming to the Nuisance doctrine.”
  The "Coming to the Nuisance" doctrine: The antidote to zoning – CAPMAG
• “… it’s practical to remove the RMA overnight… Here’s how it could be done. FIRST, ENACT A CODIFICATION of basic common law principles such as the Coming to the Nuisance Doctrine and rights to light and air and the like.  
      “Second, register on all land titles (as voluntary restrictive covenants) the basic “no bullshit” provisions of District Plans (stuff like height-to-boundary rules, density requirements and the like).
      “Next, and this will take a little more time, insist that councils set up a ‘Small Consents Tribunals…”
  What would 'Party X' do about the environment? - PART 3: Small Consents
• “What sort of person moves next door to a chicken farm and then complains about the smell?
  The sort of people who live in Inglewood in Taranaki perhaps, who come to the nuisance and then seek to make windfall profits from someone else's destruction.”
  "What nuisance?" And who came to it?
• What I’m going to propose here is another simple modification to law that would allow New Zealanders to once again repair to the common law protections that “The Hammer” had made possible. In particular, the codification of the common law principle of Coming to the Nuisance (seen in palimpsest in point three above), which on its own would a powerful antidote to the zoning that the RMA has entrenched -- perhaps the strongest possible antidote to zoning there is. Supplementary to putting property rights in the Bill of Rights, then, ‘Party X’ could promote the reintroduction of the Coming to the Nuisance doctrine for use as an absolute in neighbourhood disputes.
  What would 'Party X 'do about the environment? Part 2: 'A Nuisance and a BOR'
• “The principle of ‘coming to the nuisance’ was established (and then sadly in some jurisdictions dis-established); as was the principle of a ‘bundle of rights’ being associated with land, and some of those rights being acquired over time by ‘prescription.’”
  Cue Card Libertarianism -- Common law

RMA: From back when abolition wasn’t just a pipe dream… [updated]

“Every law that was ever written opened up a new way to graft.”
    - Robert Heinlein, 1949

“Landscape consultants, registered arborists, architects, environmental
consultants, iwi consultants, lawyers, planners … the number of snouts
in the trough is huge, and all with a vested interest in retaining current
practices under the [Resource Management] Act.  These parasites will
continue to proliferate and raise costs to all until the Act is abolished.”
- Peter Cresswell, 1996

Last weekend I stumbled across a few things back from the days before the Resource Management Act became a sacred cow, reminding me as I re-read them that the more things change in this world of benighted political restraint of rights and trade, the more they stay the same.

Moving my archives from one place to another, I stumbled on an old folder from the late 90s with RMA/Common Law on the spine – and when I blew the dust off, top of the pile inside was a report from 1996 titled “The Impact of the Resource Management Act on the ‘Housing and Construction’ Components of the Consumer Price Index.” It could have been written yesterday, and would have been read just as little.

Commissioned by a Reserve Bank concerned about rapidly rising house prices, especially in Auckland (stop me if you’ve heard this before), it found that the impact of National’s recently-introduced RMA was already severe:

The Principle Findings of this Report Are:

It’s time to put a stake through the heart of the RMA–and time a politician finally said that [updated]

“When the productive have to ask permission
from the unproductive in order to produce, then
you may know that your culture is doomed.”
- Ayn Rand

It’s taken twenty years for a mainstream politician to finally say this:

ACT wants to repeal the Resource Management Act, new leader Jamie Whyte told the party's annual conference in Auckland.
    Mr Whyte said if  part of the next government, ACT would try to scrap the 826-page law, which he says infringes on New Zealander's ability to use their property…
    "People have tried to fix it, fix it, fix it - but it is inherently an ill-conceived piece of legislation."
    The only justification for law of its kind would be to address a serious market failure and if there was no remedy through the common law, he said.
    Details of what regime would replace the RMA were sketchy.
    There needed to be environmental protections in the law, but they shouldn't violate property rights, Mr Whyte  said…

It’s not just details of the regime to replace the RMA that are sketchy – so too are details of Jamie Whyte’s speech delivered Saturday. (Old ACT would have had the speech up on their party website even before it was delivered; not so New ACT, who have still not got speeches posted at the time of writing [and have at the time of this update posted the wrong speeches.]

But on radio this morning, Whyte was outlining his view that the replacement for the twenty years of failed RMA law – law that has delivered property rights abuse, greater local government control of land and sky-rocketing land and housing prices – should be the several hundred years of common law laws of nuisance.

Glory be! A politician finally acknowledging that!

So if you’ll excuse me quote myself from the Free Radical of 2004:

Cue Card Libertarianism -- Common law

Common law arose in England almost by accident, but much of the English-speaking world has benefited from its property-rights based solutions to otherwise complex problems.

What began in the late twelfth-century as a formalisation of existing customary law,was to become, by the end of the next century (mostly because of King Edward I, known as Edward Longshanks) a way of dealing in an ordered, uncomplicated way with the legitimate concerns of his subjects.

What Longshanks was trying to solve was what we might call ‘The Problem of the Chickens.’

Traditionally, subjects would petition the king in person over their grievances, which were mostly about their neighbours. Edward, also known to his friends as The Hammer of the Scots, preferred to be up north hammering Scots rather than sitting at home surrounded by his subject’s chickens, about which an inordinate number of complaints were commonly raised.  (“My neighbour's chickens ate my crops.” “Go ‘way with you, of course they didn’t! Just look at their innocent faces…”)

Edward reasoned that a system of courts that were common throughout the land could easily sort such complaints using principles of customary law that were common to them all. For instance, the easiest way to resolve disputes about neighbours’ chickens damaging a plaintiff’s vegetable garden was to determine 1) whose chickens; 3) whose garden; and 3) what damage. The principles established in one-such courtroom were then applied in common to them all.

Thus was born the simplicity and beauty of the common law system. Common law became principles-based and property-based, and was focussed on specific harm or damages – it focussed on determining the rights in a property, and on finding remedies to damage caused by specific nuisance or trespass. Common law held that those who had rights in property were entitled to the quiet enjoyment of that property; that a man’s land and his house were his castle, and that protecting it from harm was his right.

Common law was also case-based rather than statute-based, and was tied by precedent: decisions made in cases using these guiding principles (which were held to be the ancient and customary law of the land) were made common to all similar cases by the principle of stare decisis (Anglo-Latin pronunciation “starry dis-SIS-us; literally “Let the decision stand”), so that decisions were consistent across the country, and over time.

Common law was simple enough that the principles determined in these cases were known in advance of action, and also became codified by writs that allowed property-owners easy access to the protection of law for common causes of action, . By the eighteenth-century the laws of nuisance and trespass were already highly sophisticated, and were to become more so as the Industrial Revolution and the railway age took shape.

Rights to light, to air, and to support were widely recognised as being a part of the peaceful enjoyment of land; rights associated with water and protections against noise, smell and other pollution were clear and in place; remedies for trespass and nuisance were well-known and based on the principle that a defendant should acquire no value thereby.

The valuable principle of ‘coming to the nuisance’ was established (and then sadly in some jurisdictions dis-established); as was the principle of a ‘bundle of rights’ being associated with land, and some of those rights being acquired over time by ‘prescription.’

Easements over land and voluntary restrictive covenants that attach to land in favour of particular neighbours were also recognised, offering (as did the ‘‘coming to the nuisance’ doctrine) a peaceful way to negotiate neighbourly relations without the ruler needing to do anything other than file papers. Easements are registered with titles, and can be traded and removed: You might for instance agree to protect a neighbours’ view over your land (a ‘view easement’) in return for the neighbour keeping a large tree on his that you like (by either a restrictive covenant or ‘conservation easement’). In this way a ‘net’ of rights is voluntarily built up reflecting the values of the right-holders rather than that of the legislators.

Much of the apparent confusion in the common law was made simple by eighteenth-century legal scholar William Blackstone, who with a few simple principles explained “the mass of medieval law” in England. Blackstone’s Commentaries on the Law of England were to become the bible of English-speaking law for more than a century. In the late nineteenth century for example a young circuit lawyer in rural Illinois wrote the only law books he needed to carry in his saddlebag were a copy of the Constitution, and his volumes of Blackstone. That lawyer’s name was Abraham Lincoln.

The objection is sometimes raised that as common law is ‘judge-made’ law it is consequently somewhat arbitrary, and open to judicial abuse.  Blackstone for one would disagree.  He held that judges’ responsibility was not to make law but to find the law; that is to say that with the facts laid out before them, it is the job of judges to determine the relevant principles in the matter, and apply them. Thereafter, when the context of subsequent cases was the same or similar, the principles applied would (by the principle of stare decisis) be the same. And when the context was a new one (as was with so many cases as the Industrial Revolution took off) the job was to see how the leading principles applied in this new context.

Many aspects of common law are now regularised as a part of Tort law (and the best way to see them is to pick up an early twentieth-century book on the Law of Torts), but the explosion of statute law in the last fifty years has meant that duties imposed by statute now encumber and complicate what was once the simple but remarkably sophisticated realm of common law.

Common law is not just simpler than statute law, it is also relatively immune to political hijack – one particular reason for its  unpopularity with big government advocates. Rights are protected in practice rather than just proclaimed on parchment, and ignored thereafter.

Further, unlike statute law, common law always has a plaintiff or victim – there are no ‘victimless crimes’ under common law. Finally, it is the pre-eminent law to protect both environment and property, and unlike zoning laws, anti-pollution statutes and the Resource Management Act it has over seven-hundred years of sophistication in actually doing so.

English common law brought real property rights into the world and made all Englishmen equal before the law – in doing both it helped make England and her colonies wealthy and free. Noted Adam Smith in his Wealth of Nations: “The security of the tenant is equal to that of the proprietor.” He concluded that

Those laws and customs [of the common law], so favourable to the yeomanry, have perhaps contributed more to the present grandeur of England than all their boasted regulations of commerce taken together.

Unfortunately the “boasted regulations” of today have turned Smith’s insight on its head, and removed many of the rights that common law once protected. Not least among those rights are property rights.

This is part of a continuing series explaining the concepts and terms used by libertarians, originally published in The Free Radical magazine in 1993. The 'Introduction' to the series is here.

What would 'Party X' do about the environment? - PART 3: Small Consents

IMAGINE A ‘PARTY X’ that was actually committed to opposing statism ,and to advocating for free enterprise. Imagine such a party had a cabinet committing to rolling back the state, and an environment minister brimming over with ideas to do that.
    Here, in several parts, are the sort of environmental policies such a party (and such a minister) could advocate. Seven simple policies using present-day political realities to roll back the state without introducing any new coercion along the way.

No serious environmental policy can avoid the elephant in the room that is the Resource Management Act (RMA).
Today, I present for your consideration a simple solution for removing RMA pain from the little guy, and a step towards making more affordable housing.

“When the productive have to ask permission from the unproductive in order to produce,” said Ayn Rand, “then you may know that your culture is doomed.”

That’s true.

Just ask anyone who has waited in line for a resource consent.

But although it’s practical to remove the RMA overnight, it’s not yet politically possible.  So here’s one way to get that particular ball rolling using political pressures that presently exist.

For all the high-profile RMA horror stories that hit the news, as former Federated Farmers president Charlie Pederson observed, "it's little, not large, that suffers most RMA pain." So let’s start there. Let’s start by freeing up the little guy so he doesn’t have to stand around cap in hand waiting for a pimply-faced graduate of some planning school to decide if your carport extension is “a sustainable use of the earth’s resources”—which is exactly what happens now.  And let’s start in the place that will have the most impact on making new New Zealand houses affordable: by removing the delays and uncertainties involved in smaller more affordable projects.

Here’s how it could be done.

FIRST, ENACT A CODIFICATION of basic common law principles such as the Coming to the Nuisance Doctrine and rights to light and air and the like.

Second, register on all land titles (as voluntary restrictive covenants) the basic “no bullshit” provisions of District Plans (stuff like height-to-boundary rules, density requirements and the like).

Next, and this will take a little more time, insist that councils set up a ‘Small Consents Tribunals’ for projects of a value less than $300,000 to consider issues presently covered by the RMA and by their District Plans. These Consents Tribunal should function in a similarly informal fashion as Small Claims Tribunals do now, with the power to make instant decisions.

This would mean that instead of talking to a planner about your carport, about which he couldn’t give a rat’s fat backside, you decide for yourself.  And, if your carport would violate one of the covenants, you then talk about it to your neighbour—with whom you and he would have plenty of negotiating room.  And once you (and your neighbour if necessary) have made your mind up, The Consents Tribunals would consider your small project on the basis of the codified common law principles, the voluntary restrictive covenants on your title, and the agreements (if necessary) you’ve negotiated with your neighbour(s). Simple really.

You should be able to reach agreement in an afternoon, and have your title amended the next day.

So instead of cluttering up the Environment Court with minor projects that only add to the already lengthy delays there, a ‘Party X’ keen to roll back the state could start by freeing up the huge number of small projects that are either in long delay, or are stillborn due to the expense and delay of the presently unpermissive environment.

Setting up such tribunals should be sensible, relatively simple, and politically achievable. And at a stroke you’ve made lower-cost housing easier and more attractive to build.

And at some point it should become clear to most land owners that these restrictive covenants on their titles are not vague prescriptions coercively mandated by statute, but instead are ‘voluntary’ in the sense that (as with basic common law principles) they are covenants in favour of neighbouring landowners–i.e., covenants that protect your neighbours’ legitimate rights.

Furthermore, these are things over which you don’t need to go cap in hand to a planner to change. Instead you may negotiate with your neighbours to add to them, amend them, or remove all or any of them--making any reciprocal deals you may imagine. (And you’re negotiating with people whose business it really is.)

Here’s how these examples could work out in practice.  If for example you like my tree, and I like my view over a particular corner of your section, then we can negotiate at our leisure and have these interests registered on our titles as a covenant and an easement respectively. That’s how the whole process starts. With simple voluntary agreements like this.

Over time we should slowly see emerging a network of reciprocal covenants built up between neighbouring properties reflecting the voluntary agreements over land that neighbours have freely negotiated—a network reflecting not a planners’ commands, but a network of legitimate rights, interests and values.  And in time, as more of these agreements are negotiated between neighbours, the former District Plan provisions(stuff like height-to-boundary rules, density requirements and the like) would become increasingly unimportant, and it will be these voluntary agreements on which the Small Consents Tribunals will be adjudicating.

NOW AT A STROKE these Small Consents Tribunals will make affordable housing more affordable, and encourage more interest in projects at this end of the market.

At a stroke too it should free up the Environment Court and council offices for more important projects than these small ones, and depoliticise many neighbourhood disputes. Everyone kicks a goal.

Who could possibly object?

As the success of these Small Consents Tribunals becomes more evident, as I'm confident they would be, and as their own sophistication in common law increases, then public pressure should build up to raise the financial value of projects accepted by the Tribunal first to $400k, then to $500k and beyond, and eventually there should be sufficient public pressure and political will built up to abolish the RMA altogether in favour of common law protections.

That’s the secret of good judo: using simple means to rid yourself of a large opponent.

[Tune in tomorrow for policy proposal number four: “Iwi then Kiwi - a unique kind of privatisation.”]

* * * * *

THE SERIES SO FAR:
INTRO: 'What Would 'Party X' Do About the Environment?'
PART ONE: Un-taxes
PART TWO: 'A Nuisance and a BOR.'
THE SERIES IS BASED ON THE PRINCIPLE DEVELOPED HERE: 'Transitions to Freedom: Shall We Kill Them in Their Beds?'