NZ POLITICS DAILY: Will immigrants become the housing scapegoat?

Housing affordability is shaping up to be a key election issue, and one that currently favours the opposition parties over a government that is perceived to be doing nothing about the problem.

But will this fight descend into a populist campaign against immigrants and foreigners? And are any of the political parties actually taking the housing crisis seriously?

Leftwing xenophobia?
Recently opposition parties have been talking about slashing immigration numbers. As John Armstrong says, 'Labour is now talking of a net annual intake of between 5000 and 15,000, rather than the current level of around 31,000', and this appears to be based on electoral calculation and competition amongst the parties - see: Getting to the bottom of bottom lines.

According to National blogger David Farrar, this is 'the politics of xenophobia. Blaming migrants for the change in net migration is scapegoating' - see: Labour says we should have 35,000 fewer immigrants a year. Farrar's post includes detailed research about migration numbers, which he says shows that 'blaming economic problems on migrants' are incorrect. He points out, for example, that 'the number of permanent migrants to NZ gaining residence is lower than it was six years ago'.

See also, his post How will Labour stop Aussies from coming here?.

It's not only the political right criticising the opposition's focus on immigrants. Blogger 'Fundamentally Useless' has a caustic response, accusing the left parties of populist 'dog whistling': 'When did the Left turn on the taxi drivers and cleaners in this country? Only Act called it xenophobic. My god, what has happened to us? How did the Right get to claim to lead the fight against xenophobia? I don't mind Labour getting down in the dirt - they just need to be clearer about their anti-racism. But the Greens and Mana? Good god, no' - see: When did the Left turn on foreigners?. He says 'Xenophobia is not merely a matter of strategy and tactics; it has implications for the safety of non-white New Zealanders. The Left in New Zealand needs to be much clearer about it's anti-racism'.

In another post, he says 'The Winston-isation of the Left has got me thinking. What do Left parties actually stand for? Here's my completely serious and not-at-all-joking take on the party names' - see: What Left parties now stand for.

It's certainly the case that immigration is - after a long absence - once again becoming a key election battlefield. Partly this relates to sensitivities brought about by recent political finance scandals involving Chinese immigrants to New Zealand. In response to this and rising Sinophobia, Andrea Vance wrote We must talk about China. She called for a sophisticated debate about the issues of Chinese influence on New Zealand politics, 'not the dog-whistle immigrant-bashing that NZ First choose to indulge in'.

Then with Labour's fresh new monetary policy announced, it appeared that Labour was also seeking to bring immigration policy back into the debate, even if only in a subtle way. As I commented recently, Labour's immigration cutback started off quietly in the monetary policy: 'It was almost a footnote so they could quite plausibly say to their Left-wing supporters that they are not making a big deal of this, it's only an option, and they are not suddenly turning xenophobic and anti-immigrant. At the same time other voters, especially natural supporters of Winston, will pick up on the detail and the message' - see Steve Kilgallon's Wealthy Chinese knock on NZ's door.

Labour's language has become bolder since then. Although 'Labour would not cut new immigration numbers to zero', according to Vernon Small Labour is pointing the finger at immigrants for pushing up prices: 'Cunliffe said there was no point in having such levels that took up 80 per cent of all new homes in the Auckland market' - see: Labour keen to manage new arrivals.

Vernon Small writes again today about how 'housing will be a big - maybe the biggest - election issue', and the related immigration debate will be intense and heated, although perhaps short-lived - see: Migration could be one-election wonder. Small also reports that Cunliffe and Labour are suggesting that the cuts to immigration can be done in a 'race and ethnically blind' way.

Of course it's been pointed out that Cunliffe himself was a Minister of Immigration under the last Labour Government, and immigration numbers hit 52,000 - but as Barry Soper reports, Cunliffe not keen to discuss immigration on his watch.

And if Labour seems vague about the details of the immigration cuts, that's for good reason according to Tova O'Brien: 'Labour is clearly loathe to set a target at this point - it is treading very carefully because while a call to curb immigration could be both practical and popular, it also runs the risk of being accused of dog-whistle politics or xenophobia' - see: Immigration figures pose tripwire for Labour.

Legitimate leftwing solutions?
Some on the left have sought to justify campaigns against foreigner investors and immigrants. John Minto suggests that we yell 'Bugger off' to more unnecessary foreign investors and workers wanting to get into NZ's borders. He says that this is about national 'self-respect' rather than reactionary populism: 'It's not xenophobic or racist to stop foreigners coming to New Zealand to bid up house prices out of the reach of New Zealand families and neither is it xenophobic or racist to demand New Zealand employers take on New Zealand workers for training and up-skilling before going overseas to recruit' - see: A word on foreigners, xenophobia and racism. Minto also registers his concern about 'the close and growing symbiotic relationship between the National Party leadership and wealthy foreign investors. These are National's kith and kin'.

Similarly, The Standard argues that it is 'National's natural instinct is to protect the interests of foreign money' - see: National don't know and don't want to know about foreign ownership of housing.

The Dominion Post newspaper is in agreement about reducing immigration and foreign ownership, saying 'Some restrictions could arguably still form a useful part of a broader package of policies, however, and nobody can plausibly call this xenophobia. Every country has the right to put the housing needs of its own citizens before those of foreigners. Plenty of countries restrict foreign ownership of housing' - see: Housing problems no easy fix.

Chris Trotter has argued that such nationalism in New Zealand has a leftwing character - see, for example, his column, New Zealand's Progressive Nationalism. But for an even more striking discussion of the issues of Chinese immigration to New Zealand and what it might mean for politics, see his blog post A Different Address: Mai Chen assesses Auckland's future. Referring to such immigration and investment, Trotter says, 'Billions of investment dollars will accompany these new residents, conferring upon them a disproportionate amount of national power and influence. From whatever perspective it is viewed: economic, cultural or political; New Zealand's future development seems certain to be seriously, and quite possibly dangerously, distorted by immigration'.

Trotter also ponders whether the city of Auckland 'like that of so many other cities in the Asia-Pacific region over the centuries, is to become a Chinese financial enclave and entrepot dominated by local agents of the vast (and globally expanding) Chinese diaspora?' For a similar argument by Trotter about potential Chinese neo-colonial domination of New Zealand see his earlier blog post, A World Of Strange Design: What Williamson's phone call tells us about New Zealand's political class.

The response from the National Government has been to challenge the idea that immigration is a 'significant' problem for housing affordability. Economist Shamubeel Eaqub backs up this view, saying the recent OECD report which compares house and rental prices, shows that it's not about immigration: 'If it was mainly about immigration we would see both rents and house prices spike up but in Auckland rental inflation was 2 -1/2 per cent while house price inflation was in double digits' - see Adam Bennett's Housing crisis worse under Clark's Government.

An immigration expert has come out today to challenge the assumptions about migration and housing, saying that 'Restricting migration could help lower house prices, but doing so would be extremely difficult and have little impact' - see the 5-minute TV3 interview and story, Migration will have little impact on house prices - professor.

Others have even come out in favour of more immigration. Mike Hosking argues: 'We don't have enough people. We pay too much for a lot of stuff because our market is too small. Britain is the same size as us geographically and they fact 60 million into it. Singapore has the same population as us, but it's the size of Lake Taupo. We have room for a mile more people and people bring money and culture and growth' - see: More people is good.

Is there a housing crisis?
John Key is claiming that there's 'no housing crisis'. But there certainly could be a major 'political crisis' over housing for the Government. For a sample of this, see Tova O'Brien's 2-minute TV3 report, which includes details about the first homes brought by Key and Cunliffe in 1987 - see: Key plays down housing crisis. O'Brien says, 'Housing biffo has become an election year fixture, but today it got plain weird with Mr Key daring Labour to support its Resource Management Act reforms in full'.

According to the Dominion Post, there are sharp differences between Labour and National on this issue: 'Housing is one area where there is a real election debate to be had. The two main parties offer starkly different policies. Labour promises strenuous government intervention: a capital gains tax, a big government house-building programme, and the use of the KiwiSaver scheme to dampen demand. National concentrates more on the supply of houses, hoping that removing barriers to house building and development will solve the issue' - see: Housing problems no easy fix.

Other items of interest that provide some evidence of a crisis are Radio NZ's Price of a new house at six-year high, Michael Fox's Overvalued houses could force rents up, and Metiria Turei's A house with no land to put it on is not an affordable first home. For a different critique, see Scott Yorke's There is no housing crisis.

Part of National's defence on housing has been to point out that housing affordability got much worse under the last Labour Government, and that Labour refused to recognise any 'crisis' too. Financial journalist David Hargreaves unpacks this argument, bringing greater clarity to the comparison, and shows that 'house prices went up at a rate of $18,388 a year under Labour. Under National that's running at about $17,500'. What's more 'in the past 24 months the national median price has risen by $67,250, or 18.4% - and at a rate of increase of $33,625 a year' - see: John Key is a commanding leader - until he starts talking about houses.

Labour's response to housing crisis is also under scrutiny at the moment. Chris Trotter is most criticial, saying Labour is offering only mild changes, which he suggests is just as 'depressing' as National's failure - see: Housing The People: Will the next Labour Government be as economically inventive as the first?.

Trotter points out that Labour's Kiwibuild policy 'is a Public Private Partnership, in which the State facilitates the private sector's construction of houses which it will then sell at "affordable" prices ($300,000 to 400,000 in Auckland) to first home buyers. In other words, Labour is promising to help the sons and daughters of middle-class New Zealand into their first home. Twyford may talk in emotive terms about coming to the aid of people living in garages in South Auckland, but the houses that he, Labour and an army of grateful property developers are proposing to erect are not intended for them'. Trotter proposes a possible solution for funding a more extensive building programme.

In the lead up to the election we should expect much more debate about immigration and foreigners. The debate over foreign farm purchases will soon be in the arena, too, with Phil Goff's private member's bill on this being debated soon - see Craig McCulloch's Xenophobes worry think-tank.

Regardless of where this heated debate goes, there's a growing consensus that the public needs greater information about the issues - which is well argued by Fran O'Sullivan in Facts needed about foreign ownership. And today economist Brian Fallow helps out with Balancing immigration a tricky task.

Finally, for more on National's 2014 Budget, and the various responses to it, see Steve Braunias' The secret diary of...The Budget. See also, Cartoons about housing affordability.