Tuesday, April 01, 2008

When Is a Shortage not a Shortage?

When it's an "affordability crisis" of course.

After I'd looked over my selections for Missing Link today, I made the mistake of re-reading this one, and following the link to the web page of the Senate Select Committee on Housing Affordability in Australia. Then I got really stupid and looked at the committes's terms of reference:

That a select committee, to be known as the Select Committee on Housing Affordability in Australia be established to inquire into and report upon:

The barriers to home ownership in Australia, including:
a. the taxes and levies imposed by state and territory governments;
b. the rate of release of new land by state and territory governments;
c. proposed assistance for first home owners by state, territory and the Commonwealth governments and their effectiveness in the absence of increased supply;
d. the role of all levels of government in facilitating affordable home ownership;
e. the effect on the market of government intervention in the housing sector including planning and industrial relations laws;
f. the role of financial institutions in home lending; and
g. the contribution of home ownership to retirement incomes.

After reading that, I decided that I was a lot less revved up to do write up a submission to the inquiry, because the committee is basically wasting its time and I see no good reason to sacrifice any of my time on such a pointless exercise.

Calling the current state of the housing market in Australia a " housing affordability crisis" is like calling a doubling of the price of caviar in Manhattan (caused let's imagine, by a sudden die-back in Black Sea sturgeon populations) a "caviar affordability crisis*". What we have is a housing shortage, in both rental housing and mortgaged housing.

Calling the housing shortage an "affordability crisis" is simply a way of avoiding this unpleasant fact. I have very low expectations of a committee whose terms of reference avoid the real issue with a euphemism. And when those same terms of reference refer explicitly to "barriers to home ownership" it's pretty clear that the fix is in. The committee's job is to come up with a package of "reform proposals" that will appeal to "working families" without putting any of the major corporate players in the housing market off-side.

(I'll stop there if you don't mind. Enjoyable as this recent prolific posting over a wide range of topics has been, it's not a good sign when too many ideas come too easily. There'll be plenty of time for more later.)

* I could have done a whole post riffing on that concept, but April Fool's day is over. Another opportunity missed!

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