Friday, 18 April 2014

Sorry Lord Turner but it's planning not technology that's driving up urban land values

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It does make me rather cross when the great and good - doubtless living is a splendid multi-million pound home that benefits from rising urban land values - completely fail to understand that it is planning restrictions that causes the problem. Just that, nothing else.

Here's Adair Turner doing just this:


In many countries, the majority of that wealth – and the lion’s share of the increase – is accounted for by housing and commercial real estate, and most of that wealth resides not in the value of the buildings, but in the value of the urban land on which it sits.

That might seem odd. Though we live in the hi-tech virtual world of the Internet, the value of the most physical thing – land – is rising relentlessly. But there is no contradiction: The price of land is rising because of rapid technological progress. In an age of information and communication technology (ICT), it is inevitable that we value what an ICT-intensive economy cannot create.

This is arrant nonsense. Land is expensive in London because it is scarce and it is especially scarce because we've put all sorts of restrictions on using that land including identifying large tracts of land around the city where you can't build. Another bunch of folk want to make it even worse by stopping tall buildings, banning basements and preventing changing use from commercial to residential.

Planning reforms won't make London's land cheap but it would stop that mad rise in values Lord Turner speaks of. For sure you could 'fix' the problem his way - put up interest rates, make it harder to buy and beyond the means of all but folk like Adair. Except that wouldn't solve the problem because the problem is planning. It really is that simple.

If you want to read a better written, better informed and thoughtful piece on this problem turn aside from Turner's ignorant wibble and read this piece by Kim-Mai Cutler about San Francisco's housing problems. I don't entirely agree with Kin-Mai's assessment but at, unlike Lord Turner, she appears to know what she's talking about.

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In many countries, the majority of that wealth – and the lion’s share of the increase – is accounted for by housing and commercial real estate, and most of that wealth resides not in the value of the buildings, but in the value of the urban land on which it sits.
CommentsView/Create comment on this paragraphThat might seem odd. Though we live in the hi-tech virtual world of the Internet, the value of the most physical thing – land – is rising relentlessly. But there is no contradiction: The price of land is rising because of rapid technological progress. In an age of information and communication technology (ICT), it is inevitable that we value what an ICT-intensive economy cannot create.

Read more at http://www.project-syndicate.org/commentary/adair-turner-explains-how-a-fresh-wave-of-automation-is-transforming-employment-and-much-else#krA8CFrE7IHDSafr.99

On the marketing of politics...

In the 1950s, with the expansion of television into every household, mass marketing was born. Clever blokes at companies making what became known as fmcg (fast moving consumer goods) found that they could pull customers into demanding brands using TV to advertise bold, brash and colourful brands.

Before this time marketing was as much directed to the shopkeeper as to the consumer. What marketers did was get the shop to display the brand and, in many cases, provide a financial incentive for the store to push the brand to shoppers. If you want to understand how this works, look at how pharmaceuticals marketing works today - the company can't use direct-to-consumer brand marketing and relies instead on direct sales efforts targeted at doctors.

Brand marketing helped transform our society (for the better I would argue), contributed to better quality, greater choice and lower relative prices. And along the way, it also provided a load of pleasure - we reminisce as much about the ads of the '60s and '70s as we do about the TV programmes those ads were wrapped around. Promotion was broad, sweeping and general rather than precise and targeted - ads reached out to broad chunks of the population: "C1C2 women in the Granada TV area". The once dominant sales people became mere order takers as the heroes of fmcg became marketers.

Looking in awe and wonder at this brand marketing was the world of British politics. It's not stretching the metaphor to say that, until 1979, British politics was stuck with that pre-war model because the law wouldn't let political parties advertise on TV. Politics worked at the local level where professional agents organised local parties to push the party message - that familiar method of canvassing to identify support and 'get-out-the-vote' to make sure that support materialises. In 1979, two young ad men (and brothers) changed how we campaigned with one poster.

Today this approach - a big, bold brand message poured repeatedly into promotional channels - dominates our political campaigning. That old 'sales-led' approach has atrophied - we still canvass, we still ask people for voting intentions and we still knock up on the day but these activities are marginal to the outcome of a general election. And it is the general election that matters - it is to politics what Christmas is to turkey breeders and Easter is to chocolatiers.

So political parties have turned to the marketing men for inspiration - to get the message honed to perfection, to get that message constant and consistent in every promotional channel. The party machine has been replaced by a team of experts pulled together so as to direct those channels. The leadership doesn't put its effort into policies and ideas that would improve the nation but into enforcing the message.

Politics is beefing up its brand management just as brand marketing begins to falter, as marketers respond to the challenges of a fragmented media market, to aggregation and choice-making systems. We are watching political parties applying the ideas of a past marketing age - relying solely on the power of their brand to achieve success. And it will work (for one or other of the parties) since the heuristic of those big party brands (we often call it 'tribalism' but it's essentially the same as always buying Persil) means that most people will vote for one or the other. Plus, of course, Britain's electoral system makes it hard for new parties - there hasn't been a successful, sustained new party since the Labour Party overtook the Liberals in the 1920s.

The problem (and people from all sides and none in politics have noted this) is that the fastest growing 'brand' in the market isn't a political party but what we might call 'anti-politics'. We watch as brand marketing is used to promote what are essentially hollow shells - things painted to look like large, thoughtful and ideological political organisations but in reality contain little but but ambition.

This isn't to say that there aren't thoughtful, creative and ideological people in politics or to suggest that there isn't a critical and fundamental difference between the politics of 'centre-right' and 'centre-left'. Rather it's to point out that the marketing of politics remains a child of 1950s mass marketing, something done to the public not with the public. And, as Douglas Carswell quite bluntly points out, 'anti-politics' is here to stay:

It's just a phase, many MPs think. Voters are angry over expenses or Iraq or more expenses. But the mood, they presume, will pass.

No, my friends, colleagues and opponents. This anti-politics thingy is not just a phase. It will not abate. We are witnessing a permanent change in the relationship between the governed and the governing.

The big brand politics will carry on for a while - our electoral system guarantees that - but at what moment do we start to worry? When turn out in a general election falls below 50% maybe? In 2010 that already happened in Glasgow NE, Leeds Central and Manchester Central - plus there are another 120 constituencies with turnout below 60%. And none of this accounts for the estimated 20% of the population that don't even bother registering to vote in the first place. Or do we wait until other parties and independents soak up a third or more of the vote in return for a handful of seats? In 2010 in England the two big parties got less than 68% of the vote and all but 57 of the 616 seats.

When I learnt about marketing all those years ago, they told about the 4Ps - promotion, price, place and product. Our political marketers - fresh from running campaigns in Australia or America - seem to have lost sight of these fundamentals and especially any attention to the politcal product. Marketing has become mere promotion leaving behind an etiolated, weak political product. Sound and fury has replaced the idea that politics is a shared enterprise between politicians and the people they represent.

For now nothing will change except that a few more disillusioned folk will turn away from politics. But something will give in the end. With luck what will emerge from that change will be a more conversational politics, one not shaped by the demands of a big brand and its message but by a desire to create the best possible political product.

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Thursday, 17 April 2014

Forget housing problems - it's tombs we're short of!

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Britain's cities are running out of burial places:

There’s been concern for some time that the UK might be on the verge of running out of burial space, particularly in large cities like London. A combination of population growth, existing cemeteries which are at or nearing capacity, the custom in the UK (unlike some of our continental neighbours) that graves are considered to be ‘occupied’ in perpetuity and development pressure are at the root of the problem.

And the problem has, of course, been added to by the arrival of adherents to religions that insist on burial (rather than the altogether tidier and less land intensive cremation). Still worse when those religions also oppose 'stacking' (where each grave can hold 3 or 4 burials).

However, compared to a lot of other uses, cemeteries are planning friendly. And with burial charges running at up to £3000, what better use for a three acre site:

Back in 2001, a couple in North Wales had been trying to develop the 3 acre plot next to their house for years. After numerous rejected planning applications for the site, proposing everything from a caravan park to a fish farm, they finally lighted on the idea of a cemetery. The planners were initially surprised, but went on to grant permission. The couple are now looking for further investment to support the construction of the necessary access roads, parking and planting.

Now, about that large garden of mine!

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Wednesday, 16 April 2014

So much for equality, eh!

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Paul Krugman, lefties favourite Nobel laureate economist, has a new source of income - researching inequality. And a nice little earner it is too:

According to a formal offer letter obtained under New York’s Freedom of Information Law, CUNY intends to pay Krugman $225,000, or $25,000 per month (over two semesters), to “play a modest role in our public events” and “contribute to the build-up” of a new “inequality initiative.” 

Yes folks, quarter of a million bucks moaning about how the world is unequal. There's a word for this sort of hideous explotiation - hypocrisy. Krugman is getting ten times what poor Americans pull in a month simply to turn up to a few events and help with the PR.

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Are 20mph limits the right approach to reducing injury accidents?

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As a local councillor I have been bombarded by emails from campaigners calling for blanket 20mph limits on urban roads. The campaign run by a City of York councillor has this to say:

We quite simply campaign for 20mph to become the default speed limit on residential and urban streets. This can be done on most streets without the need for any physical calming and we accept that on some streets it may be appropriate to have a higher limit based on the road, vulnerable road users provision, etc. But any limit above 20mph should be a considered decision based on local circumstances.

This is very different from the introduction of 20mph zones (usually accompanied by traffic calming measures) in particularly high risk places such as village centres and outside schools. What the campaigners call for is a change to the default speed limit in urban areas.

While I have supported 20mph zones (we have one in Harden, for example, that not everyone is keen on), I am sceptical as to whether the introduction of a general lower speed limit will work as the campaigners suggest. The core argument appears to be the 'laws of physics' - essentially that there will be fewer casualties as a result of slower speeds and where collisions occur they cause less harm.

Campaigners also point to the case of Portsmouth where casualties reduced by 22% in the three years following the introduction of 20mph limits. However, the evaluation report (where the 22% figure is found) also showed that 'killed and seriously injured' figures rose during this period. And the reports authors also concluded that:

...overall, improvements in casualty rates were not demonstrably greater than the national trend, and that 20 mph zones were more effective at reducing average traffic speeds.

 This suggests that 20mph limits might not be the best way forward and that the current approach where zones (supported in most but not all cases by physical intervention as well as signage) are targeted to high risk areas is a better option. This reflects the fact that most of our urban roads are pretty safe with very low - even zero - rates of injury accident.

To help us understand this, if we look at the map of Cullingworth's RTAs from 2000-2010, we find that they are entirely (bar one outside the school gates) on the main roads through the village. This indicates a case for looking a 20mph zones in the village centre (although only five of the accidents involved either pedestrians or cyclists) but does not support a general 20mph limit. Looking in more detail at Bradford, we see that the inner city and especially main roads through the inner city are the most lethal for pedestrians. I would take the view that safety cameras are perhaps a more effective means of managing speeds than 20mph limits without accompanying traffic calming measures.

The proposal for 20mph limits seems to me an honest attempt to develop what we might call an 'all-population' solution to injury accidents on our roads - reduced speeds mean fewer accidents and less deadly accidents therefore reduced speed limits everywhere would achieve this end. However, the RTAs are concentrated not spread evenly across the network. So there is no need for the general reduction. Instead, we should use targeted interventions (easily enforceable, local 20mph zones with physical calming measures) in the most high risk locations. And we know these work.

A bit like minimum pricing for alcohol, blanket 20mph limits have an initial appeal. However, they do not address the problem directly and act to reduce speeds where speed reduction isn't needed and don't provide the active calming measures we know are most effective in high risk locations. Lastly, we need to consider who is causing the injury accidents and wonder whether our current enforcement system is entirely adequate:

For every fatal collision, there is a one in two chance that the driver responsible has a criminal record, according to preliminary research by South Yorkshire police.

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Monday, 14 April 2014

On research and policy...

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This is a comment on research in education (from Tom Bennett) but it could apply across the whole of social policy:

I'm sure these people are engaged in the most rigorous of science, but the area that it addresses is devilled with darkest, emptiest aspects of bad educational research: small intervention groups, interested parties, cognitive bias, short term studies, conclusions that don't necessarily follow from the data, an aversion to testing a theory to destruction, etc. This matters, because huge and enormously expensive wheels are turning in education ministries around the world. Children's lives are chained to this wheel. Poor children can't afford to fix the mistakes of state education, as middle-class children can, through tutoring and familial support.

Yet we persist with allowing ideological bias and personal preference to be presented as research by social scientists. As we keep saying, if you really want evidence-based policy you need to start with robust evidence not ideological bias.

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Sunday, 13 April 2014

How advertising works...

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Here from Rory Sutherland (who knows a thing or two about advertising):

There is no prospect of anyone paying me to advertise mattress toppers, however life-changing they may be. You see, one of the problems of hyper-efficient market capitalism is that copying products is now so fast and easy that every new market category rapidly fragments into hundreds of competing manufacturers. There is no interest in any one of them promoting the category, since their own share of any resulting growth in sales of the item would be so small. 

It would be good if the Naomi Klein fans and all those public health agitators read this and commited it to memory.

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