Monday 28 February 2011

GUEST POST: Make Christchurch an Enterprise Zone not a Ward of the State.

In this timely Guest Post, Peter Osborne questions the conventional wisdom that “the gummint” must rebuild Christchurch, and suggests instead it remove its shackles that restrain New Zealanders rebuilding themselves.  It involves something sometimes called an Enterprise Zone . . .

Thought is already being given to the recovery of Christchurch, and the repercussions that this disaster will have on the New Zealand economy.

The direction taken now will set the tone for generations to come. Rather than proceed with the standard taxpayer bailout for Christchurch, we should pause and question whether this is efficient or even effective.

Rather than provide an adrenalin shot, bailouts have proven to be expensive placebos.

The situation with Christchurch has thrown us all into a higher level of vulnerability. Even before the earthquake, New Zealand industry had slowed and looked to be settling into stagnation. We were already feeling the pressure of higher costs across the board, and with events in the Middle East rising fuel prices will compound our problems.

New Zealanders can ill afford increasing taxes or forced levies to help its second biggest city back on its feet, as if it were just another welfare case. Such a drain of individual resources would finish us off as a first world nation, and deny the industry and expertise contained and presently lying shackled within the city itself.

The Prime Minister has already hinted how “the government” is going to inject some financial life into Christchurch’s recovery. However, in actuality, this makes it a taxpayer-sponsored injection—taking money from one group trying to build their own economic recovery to sacrifice to another trying to build an earthquake recovery.

It is a recipe for long-term and possibly permanent stagnation. It is also quite possible that many New Zealanders will regret having being so generous in voluntarily donating money and resources in the last few days, when the government will force them to pay again further down the road.

If we factor in the reality that Christchurch is already experiencing an exodus, be it more from trauma than economic strife, the struggle for recovery is compounded.

It is my opinion that for the good of Christchurch and New Zealand, our government must readdress their thinking on state-mandated economic “stimulus.” It has already failed everywhere it has been tried, and with the unique problems that Christchurch faces not only will it fail again there but it will take the rest of New Zealand with it.

If we are to make the best of a bad situation I can only see that government take a massive rethink and consider that neither rebuilding nor recovery requires any sacrifices from anybody. What that requires is that government reconfigure itself more into a moral boosting and motivating force only.

As we have already seen, when put to the test, New Zealanders are very resourceful and are very quick to help when others are suffering. In the long term, this is our chance to shine. We do not need our government to shine at our expense.

Rather than simply expanding the machinery of wealth redistribution to another round of “soak the rich,” and rather than expanding and raising again all the existing hurdles to growth and economic progress, I say it would be far better to remove hurdles altogether, and allow wealth to transfer freely and voluntarily.

What I’m talking about is making Christchurch an Enterprise Zone instead of a ward of the state.

  • Christchurch must attract resources. Grant Christchurch a complete 3-year tax-free status, to be extended at discretion. Do this and the problem of attracting resources will disappear. The object is to change our view away from a coercive patch job to a freewheeling environment of entrepreneurial opportunity.
  • Christchurch must have thousands of new and rebuilt homes. Our government should make immediate steps to remove  the bureaucratic hurdles that have stifled growth and rebuilding, and made building affordable houses completely unaffordable. This includes the existing regulatory system of permits and inspections.
    Let those who own their own property determine between them and their insurance company what they wish their building standards to be. Such a system can be set up very quickly as it already exists in reports.
    Building is productive. Letting things lie idle while waiting for permission from people who have no genuine interest is not.
  • Cantabrians don’t needs the grey ones breathing down their backs. Make Christchurch an ETS and RMA free zone.
  • Cantabrians don’t need to be told where and how they will rebuild their city—they don’t need another centrally-planed “worker’s paradise.” Bus town planners out of Christchurch permanently and allow the city to reinvent itself spontaneously. This would be a wonder to see.
  • Cantabrians don’t need barriers to employment. Remove the minimum wage. In a situation like Christchurch’s it is better to be earning something than nothing at all. And it is better to be achieving something with the diminished resources available than achieving nothing at all.
    We must trust that consenting adults can come to their own voluntary financial agreements.

We have two polar directions in which to take things from here: either central planning, or the unleashing of “spontaneous order.” I fear however that vested interests will instead prevail and take us down a road to third world status. For all concerned this would be a grievous mistake for which all New Zealanders will pay dearly now, as will generations that follow.

After every tragedy our preconceptions about human nature are re-evaluated. We realise the benevolence and strength of the average human being—and we’ve seen the power of voluntary cooperation even in the face of disaster, and of overbearing authority.

If the disaster experienced by Christchurch has bought out the reality of the average Kiwi, then we have already begun moving forward.

PS: What Peter is talking about in essence is this: Instead of impoverishing New Zealanders by rebuilding Christchurch from the top down in the image of the central planners (Galt forbid!), let’s unleash the power of spontaneous order and produce a new city the likes of which no-one presently thinks possible. The sort of spontaneous order John Stossel talks about here:

Kaiser Wilhelm Memorial Church

During the Blitz, when Germany was trying to bomb Britain into surrender, the survival of St Paul’s Cathedral became a symbol of British resistance.

st-pauls-blitzThe survival of the Christchurch Cathedral after the first quake similarly lifted spirits—just as its wounding in this last, more destructive, shake, has dashed them.

Talk has already turned reflexively to rebuilding the cathedral as it was before, as a symbol of Christchurch’s own hoped for regeneration after the disaster.

But building as before would not acknowledge one of the most painful periods in the city’s life.  It would efface the memory of the tragedy.

Berlin, too had the its landmark Kaiser-Wilhelm-Gedächtniskirche damaged during the war, yet instead of rebuilding as before the otherwise uninspiring church was left damaged as a memorial, and a new contemporary tower constructed alongside. The damaged tower that remained was itself “a symbol of Berlin's resolve to rebuild the city after the war and a constant reminder of the destruction of war.”

3040242823_ee047673a8 ts Assuming it is to be rebuilt using donations and insurance, and not by the government sticking its hand in everyone’s pocket for them, something similar in Christchurch must surely be contemplated. It would be a much more meaningful restoration than simple emulation of what was there before?

Friday 25 February 2011

A random Ramblette

There’s really only one piece of news that matters in New Zealand this week.  And it’s not the Census.  Other things have been happening too . . . but for most NZers the tragedy in Christchurch overwhelms everything.

  • Before and after photos of the former Garden City at the 3News site here.
  • Google has developed this people finder for the Christchurch earthquake. http://bit.ly/hNpWMZ
  • The Christchurch Recovery Map has turned into a good resource.
    Christchurch Recovery Map
  • Donate:
    New Zealand Red Cross 2011 Earthquake Appeal - R E D   C R O S S
  • Great piece in the Herald by Hamish Campbell from GNS Science explaining the earthquake
    Hamish Campbell: Technically it's just an aftershock – N Z  H E R A L D
  • The earthquake damage to modern buildings in Christchurch caught many experts by surprise and suggests the city was more prone to destructive tremors than local planners realised…
    New Zealand earthquake: buildings failed when ground turned to liquid 
    – G U A R D I A N
  • Accusations mass media are overly intrusive are not surprising when wounded or grieving people tell cameramen to please not film them but they are ignored. [Hat tip Mediamum] With the latest Herald front page however, isn’t  it time to reconsider the media’s rapid & disgusting descent into grief porn?
    Dear @nzherald: – Craig Ranapia
  • “Don't bother donating voluntarily.” That’s the message being sent by the Government, because  John Key might be about to put his hand in your pocket for you.
    Earthquake levy possible - Key – N Z   H E R A L D
  • Many are already leaving a city without power, water, sewerage, shelter or jobs. Rebuild it, but will they come back? What will they come back for?
    As Christchurch earthquake death toll rises, will the city itself be a victim? 
    – G U A R D I A N
  • Apparently the earthquake was God’s wrath being visited upon the people of Christchurch for allowing lesbians and poofs to live while foetuses are dying. True story.
    Christchurch Tennis  - M A C D O C T O R
  • People are running short of petrol in and around Christchurch. There is a case for petrol price gouging, says mild-mannered economist Eric Crampton, who’s just evacuated Christchurch for Golden Bay.
        “Everybody is panic buying petrol. Double prices. Announce they drop in two days. Queues would disappear, folks who could wait would.
        “Why should petrol go only to folks with hours to waste? Gas stations could donate excess to recovery.
        “Am curious why two-day gas price doubling is evil for the poor,  while the ETS, which is permanent, isn't…”
    “Double petrol prices. Do it now,” says Crampton.
    (Any press that wants to call Eric for quotes on this, Twitter reply @EricCrampton for his cell number.)
    Double petrol prices. Do it now. - Eric Crampton
  • The Census of 2011, an expensive exercise in minding other people's business, has been cancelled. As it should be. As it should be permanently. BUT $42 million has already been spent.  That would have gone some way to rebuilding some of Christchurch.
  • Good to see some in Christchurch haven’t lost their sense of humour.
    Screw you Mother Nature! – Three Chairs, F L I C K R
  • Some good news out of Christchurch: The award-winning Three Boys Brewery starts its cleanup.
    Some photos of Three Boys cleanup  - S O B A
  • Lets not call the quake stimulus please:
    Reminder: Quakes aren't stimulus – T H E   V I S I B L E   H A N D
  • Some more good news? Seems some alleged economists are finally getting the idea that destroying shit is not good for the economy. Maybe they’re finally discovering the Broken Window Fallacy?
     Christchurch quake: One-two punch for the economy -  N Z  H E R A L D
  • Of course, there are some people who welcome death and destruction. The Malthusians will always be with us.
    The definitive guide to modern-day Malthusians – S P I K E D
  • Having just seen my mother discharged from a NZ public hospital after spending four weeks in pain there with an undiagnosed spinal fracture, while being told to “get moving,” this story really caught my eye.
    NHS shamed over callous treatment of elderly – T E L E G R A P H
  • The end of the IT department? Let’s hope so.
     http://bit.ly/hP2OQB
  • Some more good news—a sign of human achievement when it’s most needed: Space Shuttle Discovery is airborne on its final mission a few minutes ago.
    Some good news – PM of NZ
  • “Where the revolts in Tunisia, Egypt, Libya, Yemen and Bahrain will lead remains a wide open question. But this perceptive NYT story weighs the plausible — and grave — scenario in which the Islamist regime in Iran may come out a big winner.”
    Post-Mubarak, a (more) emboldened Iran? 
    – Elan Journo, V O I C E S   O F   R E A S O N
  • Track day-by-day events in the countries facing unrest in North Africa and the Middle East with this handy interactive graphic.
    Middle East Turmoi -  W A L L  S T R E E T  J O U R N A L
  • The Onion of course has its own take:
     Saudi Arabian King To Populace: 'Don't Even Think About It -  T H E   O N I O N
  • Michael Lynch, President of Strategic Energy & Economic Research, talks to Alex Epstein about about the widespread theory of Peak Oil. Do the arguments stack up? What is the future of oil production around the world? Why do people keep confidently predicting “peak oil,” even though such predictions have been failing for decades? And what role do politics and economics play in determining rises and falls in oil production? Good listening.
    Power Hour Episode 2: Peak Oil with Michael Lynch 
    – Alex Epstein,  V O I C E S   F O R   R E A S O N
  • Thanks to the U.S. Fed, world price inflation is already upon us.
    Inflation Is Here, and It Is Going to Get Worse – Frank Shostak
  • Music this week appropriate for the sombre week:

Have a good weekend.
And stay close to those you love.

PS: They’re feeling our pain over there. This from Connecticut’s ‘Hartford Courant’ daily newspaper [thanks Sus]:
Kiwi_cartoon (2)

NOT PJ: Quake II

0vZbDPhoto by EJ Mathers 

Bernard Darnton was in the centre of Christchurch on Tuesday lunchtime. Here's his story.

_BernardDarntonGuess the Magnitude” has become an office sport in Christchurch, with four thousand aftershocks  over the last six months—hundreds big enough to feel. Many of us had got quite blasé about aftershocks. They just become a part of daily life. Wobble. Was that one? Maybe a three point eight. Rattle. Could have been a four point five.

On Tuesday lunchtime I was in Pak ‘n Save on the corner of Moorhouse Avenue and Manchester Street. There was a rattle and I looked at the pallets stacked metres into the air. I walked round to the end of the aisle without real urgency. We get a magnitude five aftershock about once a month and were due one after Boxing Day and January 20th. No big deal. The shaking intensified and produce cascaded off the shelves.

My one “flashbulb” memory of the September 4th earthquake is running into my daughter’s room, screaming her name, and hitting the light switch. The light was on for less than a second before we lost power. In that moment of light the door frame leapt into me and the books exploded off the bookshelf into the middle of her room.

In contrast, on Tuesday a lot of produce came off the shelves but it shook and tumbled like objects that still obey the laws of physics. The alarms wailed and we dutifully strolled out of the building.
Outside it became more obvious that this had been a bigger than normal aftershock. Earthquakes do strange things to soft ground. The ground turns to liquid and sloshes around and then it solidifies again and the waves remain frozen in place. The tarmac had been ripped up and the pieces shoved around. The tectonic forces unleashed were writ tiny in the car park.

Bewilderment struck me as I stepped into Manchester Street. I was on a movie set, in the Blitz, a dream. I walked down the centre line of the road to avoid falling masonry and still had to pick my way through rubble. Every single building—as far as my fallible, malleable memory can tell me—was destroyed. Awnings and façades spilled into an ocean of bricks, concrete, and timber. The only spaces free of rubble were the sites of buildings demolished since September.

Crowds gathered around crushed cars and used makeshift tools to shift tonnes of debris. I joined one group and ripped the windscreen out of a car. I grabbed a piece of collapsed veranda to help lever the roof off. After a few moments of spontaneous, undirected teamwork a dog climbed out of the tiny gap. Behind me cheers went up as a woman was pulled free from another car.

I think your mind protects you in times of shock by not working properly. The landscape and skyline had changed so dramatically in just a few seconds that things didn’t quite register. I looked down one street and thought it looked odd. It was like when my wife gets a new haircut. I know something’s different but I don’t know what. Then it struck me: Oh shit … no cathedral.

I crossed the Avon, swirling with water from burst mains and the grey liquefied earth we all now recognise. The pancaked Pyne Gould building made it obvious that it wasn’t just the pre-1931 buildings, so badly affected in September, that had suffered this time.

I trudged the length of Manchester Street home to St Albans through rubble and sewage, my awesome blue pimping shoes from Maher ruined.

My street was flooded, our garden was full of sand, and our conservatory had moved two centimetres away from the back of the house. A friend texted to check that I was OK and tell me that the quake was a 6.3. In my daze, I thought, “That’s not so bad then,” as if 6.3 being less than 7.1 somehow made up for the destroyed business district, the missing cathedral, and the unknown number of crushed bodies I had just walked past.

The mood after the September quake was strangely upbeat. Despite the massive property damage, the lack of casualties allowed us to think of it as a bit of a jape. Having gone through it marked the insiders from the outsiders. Surviving the disaster—as everyone did—was a badge of honour and gave bragging rights.

Today the mood is sombre. The heart of the city is gone and its spirit is flagging. The names of the dead are not yet known and terrible days beckon as temporary tombs reveal their secrets.

Bernard Darnton is not PJ O’Rourke, but he writes regularly for Not PC nonetheless.
Read his archives here.

Thursday 24 February 2011

MACHINE OF THE DAY (RE-POST): Inflatable Jacks—the perfect thing for earthquake rescue

I first posted this in January last year after the Haiti earthquake. With the fanning out around Christchurch today of specialist urban search-and-rescue crews, we might see some of these beauties being used to save human lives.

Our ‘machine of the day’ today has to be the amazing rescue air bag. An inflatable jack.  So simple, yet such an effective way to rescue people trapped under wrecked cars or buried under tons of rubble. Haiti_5__671906a

Just like they are in Haiti (where the only good news today is that their tax office now lies in ruins).

capt_photo_1263417015962-1-0Inflatable jacks are especially effective when a building’s floors have “pancaked”—i.e., when the columns have collapsed in a quake letting the floors fall, sickeningly, in sequence, one on top of another.  With people trapped in between.

Just like that pile of rubble on the right that used to be a six-storey building.

But you’re no less trapped under the collapsed two-storey below.

capt_eef7439a8ab54a728e1d6f634dc6dc67_aptopix_haiti_earthquake_xra110Instead of using your regular hydraulic or scissors jack to lift the rubble (with their point-loads creating problems and their inherent instability) or the agony of carefully (and slowly) hacking through layers of rubble with pick and hammer, these inflatable babies can be slid underneath and inside the layers and easily inflated: safely spreading the load as they lift so they don’t  disturb the debris any father or set up dangerous new load paths to endanger other folk who are trapped. 

You can lift gently and simply, with the lift always controlled and stable—even during aftershocks.  The bag is always its own “safety mat.”

Brilliant!  The mind’s ingenuity applied to the rescue of human life.

I hope there are truck loads of ‘em on their way to Haiti Christchurch right now.

NB: I can’t finds any clips showing the inflatable jacks in use in earthquake rescues.  I guess everybody’s always too busy.  But here’s a few clips showing ‘the power of the bag’ for lifting vehicles.  You’ll have to extrapolate.

As you see, they come in all sizes, large and small. And they can be used so delicately, they’re also just the thing for moving your Polaris rocket:

image

RELATED POSTS:

Wednesday 23 February 2011

TANSTAAFL [update 2]

TANSTAAFL: There ain’t no such thing as a free lunch.

You wouldn’t have thought a tragedy like Canterbury’s to be a time for politicking. But then you wouldn’t have been thinking about Chris Trotter or Catherine Delahunty.

Delahunty tweeted last night (Tuesday night) on the events of the day:

_Quote_Idiot A grim day with the horror earthquake and
welfare report came out worse than I ever imagined

Thank goodness the sour old witch was restricted to just 140 characters since, as Liberty Scott points out, it takes a special kind of person to equate the government's welfare report as being equivalent to an earthquake that killed scores of people and left thousands more homeless.

Then there was dear old Chris Trotter, who burst into print less than two hours after the earthquake to inform readers:

_Quote_IdiotThe implications for the New Zealand economy are daunting. [Ya think, Chris?]
    Rebuilding Christchurch cannot now be left to the Market’s invisible hand. It will take all our hands, working through the public instruments of our common purpose, to make good this tragedy.

Let me re-read that for you.  “Rebuilding Christchurch cannot now be left to the Market’s invisible hand. It will take all our hands, working through the public instruments of our common purpose…” The “public instruments of our common purpose” being of course Chris’s beloved State, the very visible mailed fist of threats and pocket-picking, which would (if the delightful Mr Trotter had his way) choose “our” purpose for us all.

All Hail the State. (And don’t miss a chance to worship it.)

“The implications for the New Zealand economy are daunting.” They sure are. There ain’t no such thing as a free lunch. Those who perished in this disaster will never and can never be replaced. But there’s a bill of around $16 billion or so to be picked up by someone if Christchurch itself is to fully rebuild. 

If it is.

If people want it to.

If EQC and private insurance is sufficient, and individual savers and investors and wager-earners value its rebuilding enough to want to put their savings and resources towards it.

Because, let’s note, these “public instruments” Mr Trotter wishes so blithely to redistribute are not un-owned, or just lying around waiting to be tapped. They are people’s private property, some of which is already winging its way to Christchurch through the wires of NZ’s private banks; more of which will heading that way in coming days; and much more of which will be heading that way in the longer term voluntarily if Mr Trotter and people like him don’t poison the well.

The “invisible hand” of Mr Trotter’s  nightmares is simply a metaphor for people voluntarily buying and selling, in which process is discovered who values what the most—who is prepared to put their money where their values are, and how much that makes resources worth. 

And contra Trotter, that is the only real place and process in which to discover exactly how much (or maybe how little) the rebuilding of Christchurch is worth to those whose resources he would have taken by force to rebuild it.

Because in the end, it properly comes down not to “common purpose,” but to the same sort of individual choices that built Christchurch in the first place.

How many home-owners will want to use their insurance cheque to fully rebuild?

How many commercial property-owners?

What will the owners of damaged buildings do with their cheques? Will they see reinvestment in the Christchurch CBD as a good proposition for them?

What will those who chose to be uninsured do without theirs—will they see using their savings to reinvest in Christchurch as a good proposition for them?

And based on choices like these, which then is the most important infrastructure to begin building or rebuilding with the insurance cheques incoming to pay for this? 

And which regulations that stop or stall recovery should be relaxed? (This is a National Emergency; if homeless home-owners can’t have regulations relaxed now that make home-building so expensive, then when can they?)

The knee-jerk reflex to look to the State in times like this is not going to pull people through. Looking instead to what people really do value (especially at a time of diminished resources) and allowing those choices to happen just might.

In his piece sent to me for his regular weekly column (with which I conclude) Dr Richard McGrath writes:

It is perhaps timely to remind readers that although it is almost a reflex action to expect assistance from the state when a natural disaster occurs, the proper role of constitutionally limited government is to maintain the rule of law and thus allow agencies trying to assist the displaced and distressed victims of disaster to do their work with minimum interference.
    It is not appropriate for a government to use coercive force in transferring wealth from taxpayers to victims of the earthquake. On the other hand, it is appropriate for people to act out of concern for others to pitch in with their time and money, to whatever degree they wish, to help those affected by yesterday’s earthquake.
    Here is a link to an interesting webpage called ‘
Natural Disasters – Destructive Statism Versus the Heroic Free Market.’
    It explores the possibility that:

  1. Statism (i.e. government intervention) perpetuates poverty, stifles progress
        and creates
    unintended consequences);
  2. Theft is always wrong, even if it under the pretense of government “aid”;
  3. Free market capitalism creates the means and the ability to help others.

There are links to several articles on various websites that discuss the U.S. government’s response to Hurricane Katrina and the tsunami in Asia a few years back. And if you thought John Lott was only interested in guns, he has written a piece on why the free market should be allowed to work even – and especially – in times of disaster, so that limited resources can be allocated to those who need them the most.
   
To all those involved in the rescue efforts in Christchurch, thank you for the tremendous work you are doing.

"The only freedom deserving the name, is that of pursuing our own good
in our own way, so long as we do not attempt to deprive others of theirs,
or impede their efforts to obtain it." 
- John Stuart Mill

UPDATE 1: Sadly, Mr John Key is already floating the idea of raising taxes to stifle recovery  make the rebuild too expensive  make taxpayers stump up yet again.  And some people say it’s too early to start shooting down balloons like this.

UPDATE 2: And more nasty politicking in the Trotter/Delahunty vein, this time at The Sub-Standard.

Tragedy [updating . . . ]

It's a dark day for sure, perhaps New Zealand's darkest .

A city already brutalised by quakes and aftershocks, and buildings already weakened by the quake on September 4th and the Boxing Day shake and every aftershock between here and there finally succumbed under a new shock which was lesser in magnitude than the first one, but closer to home and greater and much more tragic in its in its effect.

The ground movement in the first quake imposed a horizontal force on buildings roughly equivalent to 8/10ths of the building’s gravity load. The one-minute shake at lunchtime yesterday imposed a horizontal load roughly equivalent to gravity. It’s as if for one minute each building was picked up and turned on its side, and held by its “foot” just to see what happened—that’s the sort of load, one whole gravity load, that was imposed on the Cathedral tower, on the Pyne Gould Building, on the CTV building, on the Old Arts Building, on the Crowne Plaza hotel, on The Press building, on the Provincial Chambers Building, on sundry new, near-new and frankly ancient buildings that had finally been given more than they could handle.

No wonder they gave up the ghost.

The columns in the Pyne Gould Building and the CTV building gave up, leaving the floors to pancake on top of each other and on the poor folk within. The roof and large parts of the top floors of The Press Building detached themselves from what held them and headed earthwards, while folk within were left sheltering under their desks.  The Forsyth Barr Building maintained its structural integrity and protected the people within, but the stairs (which may have been fixed in such a way they acted as structural bracing) were so mangled as to be unusable. The Cathedral, whose survival in the first quake gave the city the sort of heart the survival of St Paul’s gave Londoners during the Blitz, finally crumbled at the point where base met tower and tower then collapsed in on itself—taking the aspirations of many Cantabrians with it and, it’s feared, many people who were visiting the tower when the shake started.

And that was just the major building disasters. Outer walls in older buildings everywhere peeled off and just collapsed, leaving people inside huddling together for safety. Bridges collapsed. Water, gas and sewerage mains burst. Ground liquefied. The sky cried. And everywhere there was falling masonry, any one piece of which can kill.

It was a disaster.

There was a jolt that threw people off their feet and a sound like a hundred rushing trains. After the shaking stopped, there was a moment of silence. Then a wail of ambulance sirens

In hindsight you could say that these buildings and many others should probably not have been occupied.  The structure of modern buildings are designed economically—designed to withstand an earthquake and allow the occupants to get out, and to be strengthened thereafter.  But these buildings and their occupants had already endured much more than one earthquake without ever being re-strengthened.  Reconstruction had been proceeding at such a snail’s pace that few if any structures had been repaired as they should to take new shakes.

One of the few blessings of yesterday was that the shake happened at lunchtime. Not as good as a shake happening after hours, but at least in some buildings some of the occupants had stepped outside for lunch.

Another was that a medical conference was happening in Christchurch, putting 400 Australian urologists right on the spot to help out (not exactly the speciality you’d order up in the circumstances, but skilled and on the spot nonetheless).

And another is that specialised search and rescue teams from around the world are already hard at work an on their way you help out uncover and rescue the many folk still trapped in the rubble of dead and dying buildings.

It’s hard to feel blessed when there are already 65 people confirmed dead, and talk last night already started about that number reaching 200, or even 400.

In a city with nearly $12 billion of damage, so much at such a time that you’d wonder whether it will be able to rise again.

It’s a dark day for sure. Perhaps New Zealand’s darkest.

PS: For overseas readers concerned about yours truly, I thank you for your concern and can tell you we folk up here in Auckland are all fine and untouched and undamaged. We’re about a thousand kilometres from the quake. But they're not doing so well down in Christchurch.

NZ-quake-web-2_1832504c

Source: UK Daily Telegraph

UPDATE 1: Check out the Christchurch Quake Map to get a feel for what hit Christchurch yesterday.  Select Tuesday 22/2/11 and press play, and  just see what hit it.

UPDATE 2: Important news from Christchurch brewers: Brewers okay, breweries mostly not so. I’ve heard similar news from our friends at Third Man Wines.

UPDATE 3: Just up and running: Quake Help, “a web-based entity aimed solely at helping the people of Christchurch city.”  And looks like the UC Volunteer Student Army is back up and running.

UPDATE 4: Christchurch-based bloggers Trevor Loudon, Eric Crampton and Bernard Darnton report all well with them and theirs (and thanks for asking)—Bernard just needs to shovel his house out of the silt and bring a disobedient concrete slab back into line.

UPDATE 5: Not good looking news: “A temporary mortuary to deal with Christchurch earthquake victims has been moved to the Burnham Military Camp ‘for capacity reasons’ . . . ”

UDPATE 6: Mayor Bob Parker says now 79 75 confirmed bodies, and up to 300 people still missing [via Barry Soper].

UPDATE 7: A camera thrust into rubble at the CTV building discovered a pocket in which around 15 people are still alive. 7 are believed to be still alive at the Pyne Gould Guinness Building. Around 20 are believed not to be at the Cathedral.

Tuesday 22 February 2011

Another huge earthquake in Christchurch [updated . . .]

Another huge earthquake in Christchurch: major damage to already weakened Christchurch buildings; power down, water, sewerage and gas mains broken; the hospital evacuated [UPDATE: not completely back online]; brand new council building failed (again); the tower down on the Cathedral; and unlike the original quake which hit when everyone was at home, this time everyone is at work—or was.

This is going to be bad.

Keep up on Twitter and Twitpic with the #eqnz tag:

Word is that if you have friends or loved ones in Christchurch you’re better to text than phone. [UPDATE: Please don’t clog up phone lines unnecessarily. Vodafone & Telecom want people off mobile network across ALL NZ.]

Feel free to post what you know in the comments.

UPDATE 1: This is how the Cathedral looks:

245876552 (1) Source: Twitpic

UPDATE 2:

  • TV3 is showing a four-story building collapsed into one: the columns having given way, and the building pancaked. Complete disaster. [Confirmed as the Pyne Gould Guinness Building on Cambridge Terrace, in which up to 200 people were inside—many being rescued as we speak.]
  • Provincial Chambers Building also thought to have collapsed.
  • 2 buses in the CBD crushed. Casualties unknown.
  • Vodafone wants people off mobile network across ALL NZ.
  • Photo stream of quake damage from the Herald website:http://bit.ly/eTSioT
  • GNS says ground acceleration was a full 1G, against 0.8G for Sept = 25% higher speed of movement at ground level. 1G of acceleration is akin to turning a building on its side and trying to support it by its “feet.”  This is why columns collapse.
  • From TVNZ, Pyne Gould Building appears from about 2:00 in:

The Welfare isn’t-Working Group [updated]

The Welfare Working Group reports today, and already rumours have been leaked about what it’s going to recommend.

What it needs to recommend is something drastic. In a country of four million people, there are 356,000 working age people and 220,000 children existing under the state’s welfare umbrella. Well over half-a million souls! than

That is unsustainable economically, culturally, and just in basic human terms.

But will the Working Group offer anything to change it?

I doubt it.

They won’t be changing the notion that the government is our brothers’ keepers—and our wallets are the governments to do with what they wish.

They won’t be changing the idea of “charity” by compulsion.

They won’t be challenging the idea that people should be responsible for their choices.

In other words, they won’t be challenging the system responsible for more than half the money government (over) spends.

But they might do something. They might do something to wean some children off welfare, and arrest some of the culture of intergenerational dependency.

They might.

They might, for example, as has already been leaked, require that solo parents on the DPB start work once their youngest reaches three—a good first start.

But the opponents of this recommendation, and of every other recommendation, have a point—and it’s not something the Welfare Working Group can do anything about, and nor is it something the government will do anything about.

Opponents say that there are no jobs, there is no affordable day care, and that costs to low-income folk are going through the roof.

And they’re right.

They’re right there is no affordable day care—there is no affordable day care because the occupational licensing of day-care providers and their staff has sent the costs of day-care provision through the roof. (Not to mention the cost of building a day-care facility.)

But the government will not be doing anything to change that.

They’re right that food prices are going through the roof—and they’re going through the roof because of the ridiculous sponsorship by international governments of so-called biofuels (which takes valuable land out of food production) and because of the US government’s stimulus packages, which have inflated international commodities (like milk and oil).

But the government will not be doing anything to change that.

They’re right that there are very few jobs around at the moment—and there are very few jobs around at the moment because the cost to businesses of creating an unskilled job is too high, much higher than the amount an unskilled staff member can produce.

But the government will not be doing anything to change that either.

They won’t be doing anything to change anything fundamentally.

They won’t be changing the government schools that continue to pump out youngsters who can’t read or write, and will never gain the skills to be anything but an unskilled employee at best.

They won’t be changing the Resource Management Act or the occupational licensing requirements that mean day-care providers must satisfy rigorous regulations and Resource Management Act requirements to open (restrictions that don’t come cheap), and to be staffed with degree-holders in order to stay open (and degree-holders don’t come cheap either, if you can find them).

They won’t be challenging the idea that “economic stimulus” is good, even though worldwide it is inflating the prices of everything from food to building materials. (It’s not just a local problem. What do you think started the rioting around the Middle East?)

They won’t be changing the pro-union legislation, occupational licensing and minimum wage laws that both push up the costs of employment and push down the productivity of those employed—and that between them raise the barrier for entry to the work force for everyone, especially the unskilled and semi-skilled; that virtually guarantee that labour markets will never clear; and essentially ensure that a huge pool of permanently unemployed will be permanently with us.

And they won’t be removing the handbrake of red tape, regulation and taxes that strangles every single business in this country (not to mention that big red handbrake called the Emissions Tax Scam), and at the moment means every business is focussed on its own economic survival rather than helping to create new jobs.

They won’t be removing the handbrake of red tape, regulation and taxes because the government itself needs them, because it needs the people who needs them (it thrives on them!), and because people keep voting for them—even the people whom it harms. They keep voting for a system that strangles businesses, stifles new jobs, discourages saving and new investment, keeps down real wages … and sees government consuming nearly half of what local businesses produce—even though that system itself is what keeps so many of those voters themselves in poverty.

So in the end, whatever is recommended today, the government won’t be doing anything to change anything. Not fundamentally, they won’t.

Why would they?

UPDATE: Can’t say I disagree with this prediction by Dim Post’s Danyl:

_Quote Like almost everything this government does, ‘welfare reform’ will be a political advertising campaign and nothing more.

Doesn’t mean they won’t be lapping up the do-nothingness in No Minister circles.

Botany

If you live in the Botany electorate and you're NOT part of the "Give Me Something For Nothing" Brigade, then you have only one choice on voting day: Don’t encourage them, don’t vote.

Well, maybe two choices.

Raymond Carlson House – Frank Lloyd Wright

DSCN0211_Raymond_Carleson_House Source: Flickr.Com

A highly unusual plan for a 1951 house.

Penfield1 Source: SaveWright.Org

It should be noted, of course, that Frank Lloyd Wright wasn’t legally an architect . . .

Carlson-Plan

Source: The Natural House

4462327386_685aef294c_z Source: Flickr.Com: Thompson Photography

Monday 21 February 2011

Fawning Report

There are very few places in the New Zealand media that politicians go to get a grilling. Radio NZ’s Morning Report used to be one of them. Sean Plunket wouldn’t always ask the right questions, but when he did sniff an opening he’d go after it like a dog after a bone—and occasionally that bone would yield up a whole skeleton in a place you didn’t even know there was a closet.

This year, however, Morning Report has failed to come back after the summer—and politicians seem to enjoy showing up to read their latest press releases in front of regular presenter Geoff Robinson and new presenter “seasoned broadcasting journalist” Simon Mercep.

Robinson of course has been there for decades, and it shows. These days being interviewed by Robinson is like being gummed by an old man without his teeth. But it’s with Mercep that the problems really start, since it’s as Plunket’s replacement that this youngster (which is unfortunately how he sounds) has been brought it in.

And frankly, after several weeks of giving him the benefit of the doubt, he’s not up to the job.

Instead of giving politicians a hot seat in which listeners can hear the politicians having their feet held to the fire, Mercep offers them a hot chocolate and a place to toast their own egos.  Where Sean Plunket would pounce like a bulldog on any politician whose answers were beginning to err, his “replacement” is more likely to bounce around them like a puppy dog—and rather than showing his teeth he can be heard instead licking their hand.

As radio, it’s bad drama. As current affairs, it’s bad theatre. As interviewing, it’s just pissweak fawning.

Bring back challenging interviewing.

Our body politic needs it.

And so does Fawning Report.

Friday 18 February 2011

A house designer by any other name …

As you might have seen, the Architects Registration Board has been going off recently at real estate agents who describe houses as having been designed by architects when instead those houses have just been designed by, well, by people who design houses.

The difference is immense, and it amounts to this: One group of people have paid a lot of money to join the Boys Club with the name “Architects” on the door, and the other haven’t. 

That’s about the size of it.

It’s therefore quite appropriate then that those who have paid the money to join the club (which club, as anyone knows, has been set up to protect its members) should be entitled to exclude the riff raff who haven’t. (Because if paying a lot money and knowing the right people doesn’t entitle you to set barriers to entering your profession, I don’t know what would!)

And it’s quite appropriate that they should be able to throw around threats of fines and jail time should anyone, especially real estate agents, confuse the low life riff raff who design houses with the real toffs who have paid to join the Boys Club.

And the Real Estate Institute’s members are now running scared. So much so that an Advisory Note sent out yesterday to members warns to tread very carefully indeed “if you are intending to describe a building in terms involving use of the word ‘architect’ in any form.”

This all just protectionist nonsense.

There is no justification for laws protecting the use of the word “architect” in any form except with the word “registered” in front of it.

House-buyers are buying houses, not names. They visit houses and walk around them—they judge them for themselves, by their own standards—they don’t just rely on an agents’ blurb. And having inspected them, if buyers decide that houses designed by registered architects are so much better than those designed by others, then those houses will attract a premium.

And if they don’t, they won’t.

No more protection is needed then than to allow buyers to see what they’re buying before they buy it. And which buyer wouldn’t?

There is no argument in justice for law protecting the members of this particular cartel.

If the houses they design do attract a premium that will be because, on the judgement of those who buy them, they deserve to—and if so the members of the Boys Club won’t need a special piece of protectionist law to protect them.

If however they don’t attract a premium that will be because, on the judgement of those who buy them, they don’t deserve to—and if so there is no justification in law for protecting people  who the market has decided are no better than their competitors.

And that fact is, whatever nonsense the various heads of the Boys Club over the years have maintained—former NZRAB chairman Ron Pynenburg for example, who says claiming a property was designed by an architect can push up its price—or his successor Paul Jackman  who claims “these false references add lustre and market value to the properties being sold”—there are no figures in existence indicating that the mere claim that an architect has designed a house is enough to push up its price. This is just self-serving nonsense.

Indeed, when challenged by Mary Wilson the other evening, Mr Jackman couldn’t even produce figures showing that houses designed by his members attracted any premium at all.

Damning evidence, I would have thought, that not even the barriers to entry created by Mr Jackman and his organisation are enough to jack up the prices the market is prepared to pay for what his members produce.

The fact is, there is no honest argument to protect the word “architect,” and five years ago when the Architects Act was rewritten the Select Committee agreed unanimously with the half-dozen of us who pointed that out.

We pointed out that all that needs protection are the words “registered architect,” since to say one is registered when one isn’t would be fraud—and if registered architects transpire to be so much better than unregistered ones, why then the market would beat a path to their door.

Our half-dozen did our best--we had persuaded every one on the Select Committee--but when it came to the final vote in Parliament, it transpired the Boys Club under Gordon Moller had paid Mai Chen thousands of dollars to whisper protectionist nonsense in the MPs’ shell-like. And I’m afraid, my friends, that that was that.

Which is why we end up where we are today with threats of fines and jail time hanging around folk for the inadvertent use of the words “architect,” and Advice Notes being sent around the country to real estate agents about the use of the aforementioned word—and about future meetings on the matter thereon.

Be aware however that words and phrases like "architecture," "architectural," and "architecturally designed" are still legal...

PS: Here’s an interesting and related fact for you to ponder: One in four Americans now needs the state’s permission to work, either in the form of a state license or being on some sort of register—which means one out of every four workers is not permitted to work without begging permission from a bureaucrat.

What proportion do you think we might “enjoy” here in NZ?

A retiring Roger Douglas

Roger Douglas is retiring from politics. Again.

At the age of 74, this time it’s probably for good.

His record isn’t anywhere near as good as his supporters would seem to believe—and because the reforms for which he was responsible were done in part by stealth, and the architects of the Rogernomics revolution never bothered to foster a parallel revolution inside people’s heads, it was a record which led many to believe that the free market itself operated on stealth—and it poisoned a generation on the very idea of free-market reforms.

In that respect, he and his colleagues helped bring the ACT Party’s ever-worsening fortunes on themselves.

But on the other hand, his record is nothing like as bad as his critics would have you believe.  The structure of political economy in which we live today is still the house that Douglas built, and even his harshest critics did nothing to alter his floor plan. And without his reconstruction, there would be many more grandparents than there are now around New Zealand mourning the loss of their children and grandchildren to richer pastures overseas.

New Zealand is a richer place today than it would have been without him. For that he deserves thanks.

As a politician he really only had four years in the sun, four years when he found the courage to admit to himself all he had previously thought was wrong—four years when, for all the blundering, he and his reforms (let’s admit it ourselves) rescued New Zealand from becoming the Polish shipyard it had almost become. Whatever else he did before or since, it will be those four years of crisis on which history will judge him. (And the best judge of that history in my estimation was not written by a bitter David Lange, but by the man who as the country’s “go-to” interviewer at the time saw it all up close: Lindsay Perigo.)

There are two great tragedies in Douglas’s late career.

The first is that a National Government facing another economic crisis and with no answers to meet it could not find it in their embittered souls to make use of his ability. There he sat for the last two years doing almost nothing while his coalition partner fiddled. What a waste.

The second tragedy is that he didn’t just sit quietly and do nothing for those last two years.  Instead he was jetting off round the world to see his grandchildren, and charging to to the taxpayer’s tab—and when he was sprung for it he compounded his error by telling us to our face that he is “entitled” to dip into our pockets.

A sad final act for a man whose performance in his short time in the sun makes him a once-legendary player.

The irony now is that he plans in his final retirement to spend more time with his grandchildren.

My worry is that it will be us picking up the tab for all the frequent trips to see them.

Nothing ‘Super’ about winter in February

Here’s a serious philosophical question for a Friday morning:

Isn’t February too frickin’ early to be interested in Super Rugby?

True, it’s not like we have a cricket team competing for our interest. But I was under the impression rugby was supposed to be a winter sport. And it’s fricken February fer chrissake.

The Great Upheaval at The Guggenheim!

184330_10150108100973501_7640348500_6294640_3304324_n

Check out Frank Lloyd Wright’s Guggenheim Museum in New York, all set up ready for a new exhibition. “Our ramps are now covered,” says the museum, “with over 100 works by 48 artists, including Marc Chagall, Robert Delaunay, Vasily Kandinsky, Fernand Léger, Kazimir Malevich, and Pablo Picasso.”

What do you think: Does the building overpower the exhibits?

185989_10150108100743501_7640348500_6294635_1795159_n

More photos here.

Thursday 17 February 2011

Who’s getting richer? The poor, or the rich?

Hayek Prize winner Steve Horwitz peers behind American figures to examine the notion that the rich get richer while the poor get poorer.  The key concepts on which to focus are “income mobility,” and the total size of your pizza …

Of course, these statistics occurred before the arse fell out of the world economy—although this Op Ed explaining everything more succinctly did not.

PS: For an extra point, see if you can work out any statistical errors he’s made. You know, the sort to which journalists and Gordon Campbell are often prone. Fortunately, they’re being offered the chance to get schooled.

KRIS SAYCE: Why Flood Levy isn’t a Drop in the Ocean

Since we're family, and families care about what’s being done to each other, Kris Sayce puts into perspective for us the Flood Levy imposed on all our Australian brothers and sisters by that nice Julia Gillard.

_Kris_Sayce But first up, last week I gave you a link to Murray Rothbard’s “A History of Money and Banking in the United States: The Colonial Era to World War II”.

Over the weekend your editor managed to get half-way through the book.

If you haven’t bought it or read it online yet, I strongly recommend you do.

In our opinion it provides concrete proof of how government and central bank interference in markets distorts the economy.

And furthermore how it is the same interference that creates inflation – rewarding those with power and influence, and punishing those without power or influence.

It also bangs on the head the argument that the gold standard caused the Great Depression.

That’s a fairly popular argument made by the statists and interventionists.  They claim the Gold Standard not only caused the Great Depression, but made it worse because governments couldn’t print money to spend the economy out of depression.

Of course that’s nonsense.

The reality is that it was manipulation of the Gold Standard by governments and banks that caused a mispricing of gold and silver, along with the determination of the banks to print more paper notes than they hold gold to back them.

This caused the credit boom thanks to the misallocation of capital.  The bust (depression) was simply the consequence of the boom.

But not only that, it highlights how government and bankers are in cahoots to line their own pockets at the expense of the general population.  As Rothbard notes:

_Quote This provision deliberately tied banks and bank credit expansion to the public debt; it meant that the more public debt the banks purchased, the more they could create and lend out new money. 
    Banks, in short, were encouraged to monetize the public debt, state governments were thereby encouraged to go into debt, and hence, government and bank inflation were intimately linked.

Ah, monetizing the public debt.  That rings a few bells.  The new Basel banking rules ensure government debt is institutionalised even further by requiring banks to hold a certain amount of government debt as capital.

The more government debt held by the banks, the more money the banks can create from thin air.

It’s a similar reason to why banks are keen to lend for residential mortgages.  These are considered to be lower risk than business mortgages and therefore the bank is able to carry less capital on its books.

The upshot is that bank capital requirements are just as much about syphoning money from the individual into the hands of the government as it is about supposedly keeping banks strong.

The fact is, the requirements weaken the banks as it allows them to create more money, while at the same time weakening the private individual as more money is taken from them and given to the government.  Plus the inflationary consequences of money creation impoverishes the individual further.

On a similar subject we noted a neat little graphic put together by one of the guys over at Crikey.com.au:

Source: Crikey.com.au

There you go.  What’s all the fuss about?  $1.8 billion is barely a drop in the GDP.

Of course, comparing the size of the flood levy to GDP by itself isn’t relevant.  GDP is supposedly the economic output of the economy, whereas the flood levy is a cost to the economy – taxpayers.

So what you really need to do is compare GDP to the amount government steals from taxpayers.

In that case, based on the 2009-10 budget, the Federal Government spent $339 billion of taxpayer money.

That’s compared to the 2009 Australian GDP of USD$924 billion (roughly the same in Aussie dollars):

Source: Google

Or to put it another way, 36 cents of every dollar spent in the economy is spent by the Australian federal government.  Another way of looking at it is that for every dollar earned by private individuals or enterprise, 36 cents is taken by the government.

Add on State and local government taxes and you’re looking at north of 40 cents in every dollar earned ending up in government hands… which it then dishes out to its buddies.

So heck, what’s another $1.8 billion?  Who cares?  You should care.

$1.8 billion by itself may not seem much, but it’s $1.8 billion on top of the $339 billion the government already takes.

By the same argument, if $1.8 billion is fine, what about another $1.8 billion after that… and then another $1.8 billion… and so on until you figure out all the money is in the hands of the political despots in Canberra and none remains in your pocket.

So if you take that into account, the same graphic would look something like this:

Source: Moneymorning.com.au

The red area comprises the amount of tax the federal government steals in taxes.  The green area is our guess at the taxes paid to State and local governments.  And the yellow area is the approximate cost for the national broadband network… that’s “only” $43 billion after all.

If you look at the graphic now you’ll see that private enterprise – including you – has a much smaller amount of blue area remaining.  That tiny blue rectangle doesn’t look so tiny in comparison now does it?

Next add in our old favourite, mortgage debt.  According to the latest numbers from the Reserve Bank of Australia (RBA), at the end of December 2010, residential housing debt stood at $999,668,904,000… or simply $999.6 billion…

Or, $331 million short of the magic trillion.

So if we say the average interest rate is 7%, that equals around $70 billion each year paid in interest by households.  Let’s colour it purple and add that to the graphic to see what it now looks like:

Source: Moneymorning.com.au

Wow!  The blue area is getting smaller by the second.

Now take out groceries, fuel, heating… and heaven forbid some entertainment expenses so that you can actually enjoy yourself, what are you left with?

Well, let’s work that out.  According to the Association of Superannuation Funds of Australia (ASFA), a retired couple who want a modest lifestyle – not including housing costs – will spend about $530.75 per week.

That works out as $27,599 per year.

If we multiply that across the roughly eight million households in Australia it equals $220 billion.  Now, granted that figure isn’t entirely accurate, in fact our guess is it’s an underestimate seeing as most households would earn more and spend more than the typical retiree.

And by the way, these aren’t extravagant items.  It includes fuel, travel, and leisure expenses.

Let’s add these living expenses to the graphic in a kind of browny colour:

Source: Moneymorning.com.au

Oops, we seem to have overshot there!  I don’t know about you, but there doesn’t seem to be any blue left… apart from that tiny little rectangle that is the $1.8 billion flood levy.

Now perhaps the folks who say the flood levy is nothing to the economy may care to think again.

Sure, on its own $1.8 billion is nothing, it’s just a drop in the ocean.  But it’s $1.8 billion in addition to the $339 billion in federal government taxes, the $43 billion to be spent on the national broadband network, the $70 billion spent on mortgage repayments…

And the $220 billion that Australians need to spend just to live a moderate lifestyle.

It all makes us think the Egyptians had the right idea.

Regards,

Kris Sayce
for Money Morning Australia