Free Press: ACT’s regular bulletin
Free Press: ACT’s regular bulletin
Bad Economists Make Bad Environmentalists
The Green Party is all over the map this week, threatening to sabotage capitalism while capitalists are saving the planet.
Have Electric Cars Finally Arrived?
The
Nissan Leaf is no longer sold new in New Zealand, the Holden
Volt appears to be a flop, and reports are in that the BMW
i3, in many ways an impressive vehicle, has a disappointing
range. Is the weekend announcement by Tesla the game
breaker?
The Tesla 3 by the Numbers
Serial
entrepreneur Elon Musk launched the Tesla 3, saying it will
be available in New Zealand. It is an electric car for
$35,000 USD that has a range of 350km and can steer itself.
250,000 people put down a $1,000 deposit for one in the
first 48 hours. If they come through, the total order may
be worth $13 billion with extras.
Experiments in
Living
In his launch video (link) Musk explains how he
funded the Tesla 3 by selling the Tesla Roadster and Tesla S
(each over $200,000). Air travel was once a luxury, now many
airfares are cheaper than getting to and from the airport.
As economist F.A. Hayek said, rich people fund experiments
in new technology by paying a small fortune to do things
first.
Which would the Greens Fund?
The
all-electric Leaf, and the petrol-electric Volt and i3 all
seemed as revolutionary on launch as the Tesla 3 does now.
Which one would the Greens have funded?
Trick
Question
Last election the Greens were promising to give
cheap loans to people installing solar power, not buying
electric cars. Then a report pointed out that solar
doesn’t have much environmental payoff. The sun shines
when electricity use is low, and demand is already met by
base load from renewables such as hydro dams whereas
electric cars are more efficient regardless of power
source.
The Use of Knowledge in Society
A Green
government would have put taxpayer money into early edition
electric cars that didn’t quite make it (they called for
subsidies because the Leaf bowed out of New Zealand), and
into solar panels that did even less. That is, the taxpayer
would have played the role of decadent experimenter.
Meanwhile a capitalist entrepreneur may have just
revolutionised transport. How many Green MPs have put down
the $1000 deposit for a Tesla?
Winston Could be
Safer!
The Greens have tried on a pro-business gloss but
are as dangerous as ever. They want to give Kiwibank $100m
of taxpayer money to drive down mortgage rates. What would
happen?
If the Competition’s Colluding
What if
the big four banks and every other mortgage provider, that
is everyone except Kiwibank, are all colluding to hold rates
artificially high? First, the Greens really should tell the
Commerce Commission. Second, Kiwibank has an extraordinary
opportunity. Just offer lower mortgage rates and increase
market share.
But They Can’t Get Capital?
If the
bank needs equity capital then the simple way to achieve the
Greens’ goal is to float Kiwibank on the share market.
They could sell 49 per cent as a Mixed Ownership Model
company and retain Government control.
If They did
Force Down Interest Rates
With no increase in housing
supply (there’s little on the horizon), lower interest
rates will translate into higher house prices. A Government
gift to existing homeowners. (And you thought ACT was the
party of the rich?)
If They’re Not Colluding
On
the other hand: If the mortgage market is already
competitive, then Kiwibank cannot force interest rates down
because lenders are already offering their best deal. The
Greens’ policy would amount to giving $100 million in
mortgage discounts to Kiwibank customers, that is to
homeowners, a group wealthier than the average. How is this
fair?
Opportunity Lost
Nick Smith failed to show up
and defend his Building (Earthquake-prone Buildings)
Amendment Bill in Parliament last week. The House voted
down David Seymour’s amendments to exempt areas of low
earthquake risk such as Northland and make earthquake risks
comparable to other risks Kiwis face. See David speaking on
the amendments here.
The Squeeze of Private
Schools
David Seymour spars weekly with Jacinda Ardern in
the Sunday Star Times. This week David explains how the
government could expand choice and save the taxpayer money
by funding private schools slightly more. Jacinda just says
she wants to make every school better without explaining
how.
What Jacinda Could Have Said
Free Press has
decided to help Jacinda with friendly suggestions. She
could have said: “Labour is first and foremost committed
to the dictum of the second Labour Prime Minister, Peter
Fraser: Every child should be extended to the best of their
ability. Second, we are committed to the strongest possible
state education system. We all know there is never enough
education funding. If increasing independent schools’
funding might mean more parents choose them, in turn freeing
up even more resources for state education, then it is
something a pragmatic Labour Government would consider.”
Alas.
School of Practical Politics
ACT is committed
to improving the standards of political campaigning in New
Zealand. If you’d like to learn about cutting-edge
campaign techniques, you can express your interest in
ACT’s School of Practical Politics here. It is open to all
but there is a significant discount for ACT
members.
ends