Posts by Matthew Poole
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OnPoint: Election 2011: GO!, in reply to Steve Parks,
I think there’s a consensus here that cgt may well add to the pressure on rents. However, Matthew P gave reasons why this would be mitigated. Even a small rent increase would be a downside of cgt, sure. But all major policy changes have pros and cons
Not only mitigated, but also cancelled out in other areas. The effects of tax changes must be looked at over at least a medium term - in economics considered to be about three to five years.
Rents go up immediately, sure, but what's the long-term effect on the economy? Rents will reach equilibrium within 18 months, probably less, but as the speculation-discouraging value of a CGT starts to hit home the slowing or flattening of property value increases carries through to a reduction in the rate of rent increases. Longer-term, renters pay less because property values don't increase as fast.Also, as I said, a CGT only hits you if you sell. If your intent is to take the income stream not the capital gain, you have no need to capture the "loss" caused by the CGT because it doesn't affect you. If you charge a bit less rent than speculative purchasers who are trying to capture the CGT, you get more choice of tenants. That helps with the market equilibrium situation, and acts as a cap on what can be charged. But even if that doesn't happen and all landlords bump rents as far as the market can bear, it's a one-off jump and we're then back to the paragraph above where the CGT dampens price increases (or even has a one-off deflationary effect) and that restrains rent increases by both reducing inflation and by altering the calculus for an economic return on capital.
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OnPoint: Election 2011: GO!, in reply to Steve Parks,
Elliffe, not Effille.
And I'll take a taxation professor over a property lawyer when it comes to discussing matters of taxation, kthxbai.
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OnPoint: Election 2011: GO!, in reply to Lucy Stewart,
You’re also going to have to persuade the renters that they want to rent high-density infill property – of whatever quality – and that’s an entire shift in attitude about living space which is not just price-driven.
Give the renters high-quality high-density property and some will take it. NZ's big problem is that right at the time high-density started to become common it was also discovered that a lot of it was leaky. Old homes aren't leaky (at least not in the systemic manner of leaky-building syndrome), so of course people trust them. They're cold, but you know they're built well.
It's going to take a long time before the consequences of leaky building wear off the market for high-density housing. A lot of people like the idea, but the execution was typical NZ: crap.
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OnPoint: Election 2011: GO!, in reply to DexterX,
That's the best you can come up with? No concession that Labour did a hell of a lot more for the minimum wage during their last time in charge than you gave them credit for?
Do you think that, if WFF wasn't in place, wages would've risen to keep up with the cost of living? Or maybe what you've seen about labour cost trending to the minimum wage would've happened anyway and the hundreds-of-thousands of families whose standard of living is something approximating acceptable would, instead, be scratching by from week to week, trying not to get deeper into the shit?
I know which one I think would've happened, and it doesn't make a lot of business owners look very good.
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OnPoint: Election 2011: GO!, in reply to Paul Williams,
not that many people are paid the minimum wage
Unite puts the number into the 100-200k range. That's not heaps, but it's far from vanishingly tiny.
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OnPoint: Election 2011: GO!, in reply to DexterX,
The minimum wage in 1999 wasn't $6.50 - in 1997 it increased to around $8.40
My bad, it was $7.00 as of 1 March 1997 (see page 24), not $6.50. So you're way wrong with your $8.40 - that graph is inflation-adjusted to 2006 dollars.
By 1999 I was earning a hot $9.50 so the minimum wage wasn't really a focus, and I'd moved on to other things when the minimum wage got its first increase under the incoming Labour government. -
OnPoint: Election 2011: GO!, in reply to Jacqui Dunn,
It is sad, yes.
But I got a good laugh from this, where Act's candidate claims that she's left of Jami-Lee Ross. Maybe so, but the rest of her party aren't. -
OnPoint: Election 2011: GO!, in reply to DexterX,
How do you know who's paying their staff what? I have no idea what the rates of pay are for most of the people from whom I purchase goods and services.
As for Labour and the minimum wage, when I finished working at McD's in 1999 the adult minimum wage was $6.50. When Labour ended their third term the adult minimum wage was $12.
So, you were saying? -
Hard News: Book review: 'Wikileaks:…, in reply to Russell Brown,
I was thinking about this today, watching Wikileaks fire out Egypt-related cable links on Twitter. It’s actually quite a hard and unsatisfying form of news to consume – you don’t know anything about who’s writing, what the context is, what the public position was, what happened next, etc.
Even if the value added by the reporting organisation is merely to explain who the people related to the cable (author, recipient, key identified figures) are and what their role is, that's of significant value. It can be the most clinical, objective, analysis-free addition, but it still lends enormous context. Some of the cables do a magnificent job of setting the scene, explaining who the players within the cable are, but they're still bereft of context around the sender: Are they an attaché of some description? Which agency? Are they a long-service FSO? etc, etc.
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And speaking of HuffPo, AOL is buying it. Given AOL's somewhat conservative world view, I wonder how long HuffPo will survive its assimilation before being ordered to "correct" the editorial tone.