Tuesday, August 15, 2006

Can the UN be any more useless?

Miloon Kothari, the UN Special Rapporteur on Housing (that is seriously his title) has spent the last fortnight in Australia evaluating the adequacy of housing. (I can't seem to find his report online but there are news reports here and here.)

Now he has some pretty bad things to say about outback Aboriginal housing. I don't know much about their conditions, but Miloon does not seem to recognise that it's a free country and they can move to the cities if the outback is such a raw deal. Instead, Miloon just wants us to give Aboriginal communities more handouts with no obligations: yeah that's really worked a treat for the last 30 years.

His other policy suggestions are similarly loopy. He thinks we should establish a "human rights-based national housing policy." What does that mean? He wants rent controls seriously considered. And I thought his grand title meant he was an expert on housing! Even Paul Krugman's against it, as he sums up, "Rent Control is a textbook case of Economic stupidity."

Kothari also wants the government to remove negative gearing and discounted capital gains. But these policies make it easier for people to buy and rent. Sure we could target them to low-income people but how is that going to engender a sustainable increase in affordability. Or should we be happy keeping people on welfare from cradle to grave?

More importantly, in the face of restrictive land release policies, such demand stimulants will simply raise the price of housing. A seemingly more useful report was released by the IPA recently playing up the importance of releasing land. I haven't had a chance to look at it in detail yet but at least it seems to have a basic handle on the concepts of supply and demand.

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