Chris Johns: Solutions to health and housing issues are beyond our political leaders
More public spending funded by somebody else’s higher taxes simply does not add up
British prime minister Boris Johnson and Labour Party leader Jeremy Corbyn. “In the UK, badly-managed abundance has generated political chaos.” Photograph: Jonathan Hordle/AFP
The housing crisis is a global phenomenon. Yet you’d be forgiven for thinking that expensive, scarce accommodation is something peculiar to Dublin. Or San Francisco, New York, Toronto, London, Paris, Sydney or Shanghai.
While there are one or two truly local drivers of this very common problem – national vagaries of the planning process, for example – there are many common causes. Most of which are well rehearsed and, most importantly, researched.
We know a lot about housing and its associated problems because a lot of very smart people have been studying the issues for a long time. We know enough to be be able to describe “solutions”. They are sometimes partial and often politically very difficult. By and large those solutions are rarely implemented because of the political constraints.
At its most simple, governments interfere in the housing market to increase demand rather than supply. Help-to-buy schemes proliferate, as do tax subsidies for mortgage interest payments.
People like me have been writing articles mocking these sorts of policies for decades, with very little effect.
It’s common to describe an intractable policy problem such as housing as “the third rail of politics” – touch it and you die. It’s not just difficult policies are never even tried. There are also simple truths known by insiders but kept forever secret, mostly because of their political toxicity, not just difficulty.
One of the dirty secrets about house-building is the observation that the land where most people want to live is currently occupied by other houses. Often other houses that were shoddily built in the first place, are energy inefficient, space inefficient and poorly maintained. Houses that contribute to density ratios that no sane planner would ever agree to.
Houses are different to other types of property. Commercial property is usually depreciated to nothing, at least on the books of its owner, over two or three decades. Modern office blocks are built to be dismantled and replaced relatively quickly.
Try applying that to housing. A rational response to the quantity and quality of the current stock of housing in many countries would be to raze large swathes of it to the ground. And then rebuild in a completely different way. As I say, political constraints are everything.
Just because something is politically impossible doesn’t mean we shouldn’t at least air it now and again. We might at least educate ourselves about the real reasons why problems persist.
Take taxation. The same issues over public provision and who pays recur everywhere. It’s a lively debate in the UK right now following the publication of the main party manifestos.
But the same questions are asked here: given the pressures on health, housing, education, infrastructure and all the rest, who is going to pay?
As far as I can tell, the Conservative party is promising to lower personal taxation and substantially higher public provision, funded mostly by a decision to cancel a planned small decrease in corporate tax.
Labour is also promising one of the biggest ever increases in government spending, funded by increases in taxes on companies and rich people.
That all of these promises are dishonest is almost beside the point. Truth is not something we demand from our politicians. Neither, it seems, do we require the ability to do simple arithmetic.
More public spending funded by somebody else’s higher taxes might be what we want but, for the country as a whole, it simply does not add up. Jeremy Corbyn promises that his spending can be financed via tax hikes on anyone earning more than £80,000 (€93,000) a year and some other tax increases, mostly again on higher earners.
None of it makes sense, but no politician ever tries to say that all our taxes need to go up if we are to pay for better health and education and broadband. Just because they can’t say it doesn’t mean it isn’t true. And until somebody says it, we will forever be moaning about the state of the health service.
All of this reveals many a paradox. We know how to solve, or at least seriously mitigate, the housing problem. And provide a health service that doesn’t require emergency funding every single year. Yet the solutions are beyond the capacity of our political system to deliver.
It used to be the case that absolute resource constraints were at the heart of many of these issues. But in counties such as Ireland and the UK, those lack of resources have to a considerable extent disappeared. It’s not often mentioned, but the modern problem is now how to manage abundance, not scarcity.
The resources necessary to house, feed and care adequately for everyone are available. Even framing the problem in this way is beyond the scope of most political systems, let alone trying to manage it.
In the UK, badly-managed abundance has generated political chaos. The two main political leaders are the opposite sides of a much-devalued coin: one of them believes in nothing at all, the other has not changed his mind about anything since 1973.
Thanks in part to abundance, the economic and financial consequences of these two inadequates have been light: few have paid a price, those that have suffered don’t have much of a voice. And it looks like the chaos will have to get much worse before anything changes.