Geoffrey Lean's still not getting it about housing

It's becoming somewhat tedious to have to continually correct the misunderstandings that people have about the English housing market (and yes, it's really an English problem, not a British one). Today's example of just not getting it is Geoffrey Lean in the Telegraph:

You hear it all the time, in the mouths of developers, ministers and commentators. The reason for building over unspoilt countryside is that the nation is short of land for housing, thanks to an unduly restrictive planning system.

This mantra drives government planning policy, and – under its pressure – councils have set aside sites for up to 700,000 new homes on greenfield land. It is also the rationale for allowing, nay encouraging, speculative building that is threatening to swamp village after village across the country: its “physical harm” – even one of Downing Street's favourite MPs, Nadhim Zadawi of Stratford-upon-Avon, who sits on the No 10 policy board, has warned – threatens to become “the defining legacy of this Government”.

But it's wrong, plain wrong. For a start, developers are sitting on enough land for 400,000 houses which have already been given planning permission. That's enough for nearly four years at the present much too low rate of building – or two years of what would be needed to meet a realistic demand.

Yes, that land bank. So, how long does it take to get planning permission (by which we mean, from a standing start to actually being allowed to break earth on the project)? Two years? Four? It's most certainly not 6 months, is it?

Great, so, we would expect any responsible business to have enough, in stock, of its basic raw material to cover the lead time necessary to create more of that basic raw material. If it takes one week to get more steel then we'd expect a car plant to have, somewhere around and about the place, a week's worth of steel. So, given that we have a constipated planning system we expect builders to have a stock of their basic raw material, land with planning permission.

That these land banks exist is proof, not that the builders are hoarding, but that the planning system suffers from that constipation. Everyone would be a great deal happier if they didn't have to have vast amounts of capital tied up in such land.

Then there's brownfield land. This week a report by the Campaign to Protect Rural England concluded that there is enough of it in England alone for at least a million homes, enough to meet five years of demand, or to build that terrace from London to Cairo. What is more, it is constantly increasing as factories, hospitals and other institutions are merged or close down.

Ah, yes, brownfield land.

Developers far prefer building on greenfield sites because they make bigger profits, as they do not have to clear – and at times decontaminate – the land.

Er, yes, that means that brownfield land is more expensive to develop. To the point that, for some sites at least, the clean up costs are so high that even at current house prices a development proposal is entirely uneconomic.

More than that, what is actually being complained about is not the volume of housing available (although obviously these two are intimately linked) but the price of what is available. Meaning that yes, we want to build a great deal more housing. But we're not going to bring prices down, the aim and point of the plan, if we insist that only the most expensive to develop land can be used.

Finally – the property company Savills has just reported – central and local governments and the NHS are between them sitting on enough for two million homes, a full decade of supply and enough for a terrace from London to Caracas. Some 600,000 of them are held by the very central Government that has been so loudly trumpeting the scarcity of land.

That might well be true. But think through the implications of what is being hinted at here. Government is so inefficient, so cack-handed, that it's sitting on £200 billion's worth of development land (£100k a plot seems reasonable, at least for the SE) and yet the suggestion is that such fools should be tasked with planning the allocation of housing land.

It's doesn't work as a logical assumption, does it?

How not to read a report, brought to you by Geoffrey Lean

A lovely example of how to propagandise rather than actually report from our Geoffrey Lean over at the Telegraph. Things are terrible and only going to get worse, of course:

Ours is the first generation than can largely take plentiful, cheap food for granted. Now, report after report is suggesting it may also be the last.

Two days ago, a Ministry of Defence study of “global strategic trends” raised the spectre of global demand outstripping supply over the next 30 years. And two days earlier, a Commons committee warned that Britain’s own food security is imperilled.

Prices have been rising twice as fast as general inflation and appear to be accelerating. The MoD report suggests that they could eventually settle at twice their present level.

That's not, quite, what the report actually says. What it does say is this:

By 2045, food production is predicted to have increased by nearly 70%, to feed a larger and more demanding population13 – and it is possible that demand could outstrip supply. Some types of consumption are likely to grow particularly strongly. As affluence grows in the developing world, the demand for more protein-rich diets is also likely to increase. China, for example, has seen meat consumption increase by 63% between 1985 and 2009, and this trend seems likely to continue.14 Pollution and soil erosion are likely to adversely affect agricultural land – some estimates assess that, globally, as much as 25% of agricultural land is already degraded.15 Climate change will almost certainly have adverse effects on some agriculture, but may open up new areas for cultivation, with positive impacts on particular crops in certain regions. On balance, even though the quality of some areas is likely to have been degraded by 2045, the global arable land area is projected to remain relatively constant (estimates range from a 10% decrease to a 25% increase),16 with some potential increases in crop productivity in the high latitudes, and decreases across the tropical regions.17 Furthermore, warming, acidification and overfishing also threaten to reduce the amount of food that can be harvested from the oceans. Estimates of future food prices are highly varied and may be more volatile, although most projections indicate a general increase.18 Analysis by the International Food Policy Research Institute suggests that average prices of many staple grains could rise by 30% even in the most optimistic scenario.19 Disruption, and possibly congestion, of global trade routes may lead to sharp increases in food prices – particularly in those countries dependent on food imports. When the effects of climate change are taken into account, the price increase above present levels could be as much as 100%.

And when we go and look at that source report we find something very interesting.

If climate change is bad and population growth is high then the price of maize "might" rise by 100% in real terms (ie, after the effects of general inflation). Note, not "food" but "maize". The price, even in this worst scenario, of wheat might move by 30%.

However, note also one of the drivers of that food price rise: that people are getting richer and thus are able to have (ie, there is effective demand for) a richer and more varied diet. And whether food is "cheap" or not rather depends upon both the price of food and also the incomes of those trying to purchase said food. And even in that worst case scenario the incomes of the poor of the world (obviously, the people we're actually concerned about here, the change in the price of maize is going to make near no difference at all to rich world people like ourselves. Tuppence on a pack of cornflakes is too trivial to worry about for us.) rise faster than the price even of maize over the 2000 to 2050 time period being studied.

That is, yes, food rises in price but it also becomes cheaper, more affordable.

It makes sense that the MoD found this, that the original report found this, for it is also the same result Oxfam has found. Precisely because it is not a "shortage" of food, nor climate change, that is the major driver of future food price increases. Rather, it's that the poor will be getting rich and be gaining access to that petit bourgeois pleasure of three squares a day, some of them even with a little meat in them.

This is a problem, if you want to describe it as a problem, of the great success of the neoliberal, globalised, world economic order. Finally, for the first time since the invention of agriculture, the poor are able to eat well. This pushes up food prices, sure, but only and exactly because food is becoming more affordable for all.

We find it very difficult indeed to describe this as something we ought to worry about. More an occasion to get out the bunting and the flags really, time perhaps for Breughel-like scenes of the yeomanry feasting and drinking as we celebrate the good fortune of billions of our fellows.