Wednesday, March 16, 2022

Why politicians must pretend to want cheap housing

UQPPES Statecraft Autumn Lecture, March 2022

Let me start with my thesis.

Much of the contemporary debate about housing affordability is a distraction; promoted by vested interests and reinforced by political incentives. The proposed solutions are usually policies that favour property owners, not renters and buyers.

The first way we know something is off is the language. Affordability is a beautifully vague word. It’s a word that works nicely as a covert signal—that is, a word that means something different to your target audience compared to others.

Aspiring homeowners can be led to believe that the word implies cheaper prices to buy homes. Maybe also cheaper rents. They feel their concerns are acknowledged. It appears like something is being done for them.

For homelessness and public housing advocates, the word affordability can imply a boost to public housing investment to provide non-market housing options to the neediest. The word makes it appear that something is being done for them too.

But the beauty of a covert signal is that the true meaning is known only to the target audience. In this case, large property owners and developers. They know that affordability means that absolutely nothing will be done that puts the value of their property assets at risk. To them, the word is an invitation to participate in the next great property scam.

They know that to appear to be doing something about affordability, their political mates will simply ask them what policies they want. Whatever tax break, rezoning, or subsidy they come up with will then become the nation’s new “affordable housing” policy.

It is no leap to say that these outcomes are in fact the real objective of pretending to care about cheap housing by distracting us with the word affordability.

In his 1946 essay on Politics and the English Language, George Orwell wrote:

When there is a gap between one's real and one's declared aims, one turns as it were instinctively to long words and exhausted idioms, like a cuttlefish spurting out ink.

Affordability is a long word that hides the real aim of boosting the asset portfolios of major property owners behind the declared aim of making housing cheaper for residents.

So why must politicians play this Orwellian game of pretend at all? There are three political economy issues at play.


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