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Making housing affordable

“Making housing affordable” is a new contribution on housing policy produced by Policy Exchange (PE), which describes itself as “an independent, non-partisan educational charity, working with academics and policy makers from across the political spectrum, and particularly interested in free market and localist solutions to public policy questions.

Every single one of the assumptions on which the PE proposals are made can be shredded. Housing is affordable. The cost of bricks and mortar is no more than the price of building materials and the builders’ wages. It is price of the housing land that is pushing up the price.

PE advocate building more housing and enabling young people to get on the housing ladder. But estimates of vacant housing range from 700,000 upwards. This indicates a market that is not functioning. Building houses in itself is useless. They have to be in the right place, with supporting infrastructure so that people can get to work, have their sewage treated, send their children to school, get out into the countryside for recreation, get into town for entertainment, etc. Land values in places that have the most advantages, and where people really want to live, are inevitably going to be high, no matter how many are built. Or is the idea that the houses are going to be put up far from work and urban amenities and the occupants left to fester.

The very concept that there should be a “housing ladder” needs to be debunked. Housing is for people to live in and that is the end of the matter. The fact that there is a housing ladder is itself an indication that there is something very wrong with the land market as it currently operates.

Policy Exchange may well be not quite what it seems. With expensive offices within a stone’s throw of the Houses of Parliament, who is paying for their show? It states of itself that “Support for the wider use of market forces and the promotion of individual responsibility are ideas traditionally associated with the centre right. But we are interested in how these tools could be used to achieve progressive ends – to give new opportunities to groups that don’t have them today. For example, our work on the pupil premium looks at how education funding can be reformed to help the most disadvantaged pupils.

This sounds like a disinfected version of the kind of statements that emanate from followers of Benson, Rothbard & Co. In other words, the basis of their agenda is Anarcho-Capitalist. This should be no surprise, since it is one of the few contemporary bodies of political theory with a semblance of coherence, and it also happens to suit powerful entrenched interests. It is making the running at the moment. Right wing think tanks such as PE are springing up and driving the A-C agenda with plausible sets of proposals that do not stand scrutiny. Expect any one of the UK political parties to pick up their ideas, fiddle about with them and present them as their own.