Monday's Early Bird: Land & infrastructure costs at the margins behind our ruinously expensive housing

Here’s my curation of the day’s top news, analysis, commentary, charts and cartoons from around Aotearoa and elsewhere about our political economy on housing, climate and poverty. This is only published in full for paying subscribers.Firstly and briefly, here’s my summary and analysis of this morning’s top news:* An analysis by the NZ Herald-$ of land sales data for a now-delayed highway in South Auckland shows over $131 million of the project’s budget was spent buying land to enable greenfields development at the fringes. See Chart of the Day below* Housing & Infrastructure Minister Chris Bishop has been forced into an embarrassing U-turn on infrastructure funding for fast-tracked developments after a protest letter from the Mayors of Auckland and Queenstown.* The back-track on the fast-track rules is symptomatic of the major driver of the biggest problem in New Zealand’s political economy: the cost of the next plot of land in greenfields developments is usually the marginal housing cost that translates into higher housing costs across the market. The massive costs of new water infrastructure are now increasingly being loaded into those land costs through development contributions paid by developers, which further inflates housing costs right across the market. Developers eyeing an opportunity to lower those costs jumped on the Fast-Track bandwagon* It didn’t use to be that way. Before the era of user-pays and a structural drive to small Government and low taxes from the late 1980s onwards, these infrastructure and land costs of the ‘marginal’ home were smeared across the entire population through the Government paying for it directly, and recouping the costs through higher taxes.* Also symptomatic of that structural drive to put a sinking lid on health costs in order to keep taxes low, New Zealand’s hospital system is now in the middle of a winter flu crisis. Also see Top Newspaper article of the day* The Opportunity Party got the jump again on other parties over the weekend, launching a policy to regulate lobbyists and stop large political donations. The extra focus came as the Talbot Mills/Enacta poll showed Opportunity over 5% and in the kingmaker position. See Chart Pack of the day below after updatePlease join us as a paying subscriber to get my full daily curation of the news, analysis, commentary, links, charts, front pages and cartoons below, and to support this work I do sorting the signal from the noise in our political economy.I have decided to open this one up to all immediately so the video above is available to all. It includes a backgrounder on why high development contributions are inflating all house prices. Many thanks in advance to paying subscribers. My Top ‘Pick n’ Mix’ Six Today* Deep-dive by Anna Rankin for Sunday Star Times-$: The cosy corporate club holding New Zealand’s economy back* Nona Pelletier for RNZ: Time to rein in power of big tech, Auckland professor says From Auckland Uni’s Susan Watson and her paper: Reining in Big Tech Corporations: Why Platform Governance Requires Structural Regulation* Scoop by Pokere Paewai for RNZ: Unreleased review of Waitangi Tribunal sitting with ministers* Interview with IAG CEO Phil Gibson by Ella Somers for Interest: ‘There comes a point where there’s no price you can charge that can cover the risk’ ‘IAG NZ warns it may have to withdraw insurance from NZ’s flood-prone areas in the future if the Government doesn’t speed up natural hazard risk reduction.’ ‘I absolutely don’t want insurance to become unaffordable,’ IAG NZ CEO says* Deep-dive by Marty Sharpe for Stuff: ‘I would live here, insured or not’: Their house is gone, but this family won’t give up their land* Column by Gareth Morgan for Newsroom: Who’s the fiscal blowhard, Mr Luxon? ‘National’s dirty big secret is that it has been $17 billion out on its 2023 promise to fix the Government’s books, writes Gareth Morgan.’Scoops elsewhere this morning* Hanna McCallum for Newsroom: Climate change omitted from new science and social science curriculums ‘A search of new school curriculum documents reveals no mention of greenhouse gases, fossil fuels or human induced climate change.’* Marty Sharpe for Stuff: ‘Goalposts have shifted;’ Dairy farmers face fines of up to $1 million for farm pollution* Amelia Wade for The Post-$: $106m and counting with no crossing to show for it: Spending on consultants on Auckland’s next harbour crossing revealed* Harriet Laughton for The Post-$: Government ignores advice to repay retirement village residents within nine months* Amy Ridout for The Post-$: ‘Your nemesis’: IRD staff mocked business owner in private messages* Sam Sachdeva for Newsroom Pro-$: UK pitches military tech role and navy frigate deal to NZ Op-Ed by Reuben Steff for Newsroom Pro-$: Navy frigate decision looms as Pacific security threats escalateChart or Map of the Day: $131m on land for a roadFront page or key newspaper article of the DayCartoon of the Day : Short Cut? Timeline-cleansing nature pic: RootedcheersBernardPS: I update this post online later in the morning, including my full more detailed Picks n’ Mixes on housing, climate and poverty, a full chart pack and more cartoons. It is only available to paying subscribers, who are able to comment and use The Kākā’s chat room. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit thekaka.substack.com/subscribe