fbpx

Month: June 2022

EU Chemical Policy Could Undermine Semiconductor Manufacturing Efforts

A new report published by the Consumer Choice Center highlights how heavy handed chemical policy could undermine Europe’s efforts for semiconductor manufacturing.

The Consumer Choice Center’s David Clement, co-author of the report explained, “In February the EU announced the European Chips Act, with the goal of increasing supply chain resilience and boosting domestic production from 9% to 20% by 2030. Unfortunately, if the EU gives in to efforts calling for a ban, or phase out of PFAS, the goals of the Chips Act will be impossible to achieve.”

“PFAS, a grouping of 4000+ man-made chemicals, are vital for the production of semiconductors. If the EU seeks to ban their use then increasing domestic chip manufacturing will be incredibly difficult. Europe will ultimately end up failing to meet it’s chip production goals, or it will become almost entirely dependent on China for these chemicals. Both of these scenarios are problematic. If the EU is serious about increasing domestic chip production they have to also work to secure the key inputs involved in the production process, and PFAS are one of those key inputs.” said Clement

“In fact, we know that this is what will happen if the EU opts for a phase out. This is exactly what happened when Belgium paused production at a PFAS chemical plant in response to the tightening of environmental regulations. Reporting done by Business Korea highlighted that semiconductor producers have only 30 to 90 days of coolant inventory left before they will encounter serious production problems.” said Clement

“A clean drinking water approach to PFAS is entirely appropriate, but getting there cannot, and should not, result in outright production bans. If the EU can narrow its sights on proper production processes to avoid water contamination, they can protect European citizens without the chaos of an exacerbated semiconductor shortage,” said Clement.

Originally published here

The demand continues – will supply ever catch up?

In April, the Canadian federal government announced its budget for 2022 with a much-needed focus on building homes over the next decade. Initiatives in the proposal included the launch of a new Housing Accelerator Fund of $4 billion to aid in speeding up housing development, which highlights the obvious demand for homes in this country.

Canada led the G7 in percentage population growth over the last five years (the 5.2% population growth is double that of the United States’ 2.6%). Canada added 1.8 million citizens between 2016-2021 and the federal government has plans to welcome 1.3 million immigrants over the next three years. This population growth is being achieved against the backdrop of a chronic housing supply shortage.  It was reported this year by Consumer Choice Centre that among the G7, Canada has the lowest average housing supply per capita with only 424 units per 1,000 people nationally, a ratio that is lower than it was five years ago. Of all the provinces, Ontario leads this disparity with only 398 units per 1,000 people – requiring 650,000 units to be built just to meet the national average.

With the recent increase in interest rates and construction cost inflation, some developers are taking a pause on launching new products, which will only exacerbate the supply imbalance and contribute to upward pressure on prices in the coming years. Whether for rent or for sale, Canada needs to build more houses, and quickly.

Read the full article here

RYANAIR CONTESTE LES AIDES ÉTATIQUES, ET AVEC RAISON

Si les aides étatiques sans limites ont bénéficié à certaines entreprises, d’autres ont totalement été mises de côté… ce qui pose la question d’une concurrence déloyale, par exemple dans le secteur du transport aérien. 

La compagnie aérienne low-cost Ryanair a passé la majeure partie des deux dernières années à s’attaquer à des cas d’aides d’Etat dans toute l’Europe. La compagnie aérienne estime que les aides gouvernementales accordées aux transporteurs nationaux pendant la pandémie de Covid-19 étaient injustifiées et créaient des avantages concurrentiels injustes.

Avant de commencer, il convient de noter deux choses : tout d’abord, je conçois que de nombreux lecteurs aient pu avoir des expériences négatives avec les compagnies aériennes mentionnées. En tant que grand voyageur moi-même, il m’est arrivé à plusieurs reprises d’être retardé, de rester bloqué dans des aéroports éloignés et d’être totalement ignoré par le service clientèle.

C’est une réalité malheureuse des voyages aériens – parfois pour des raisons météorologiques, parfois à cause de la négligence totale de la compagnie aérienne – mais je ne laisse pas cela influencer mon jugement lorsque j’écris sur les relations louches du gouvernement avec le secteur aérien.

Deuxièmement, pour ceux qui ont lu mon précédent article sur la question de l’aviation : si je pense que le secteur est souvent injustement réglementé et taxé par le gouvernement (comme nous le sommes tous), cela n’exonère pas les grandes entreprises.

En fait, de nombreuses grandes entreprises recherchent spécifiquement des subventions gouvernementales et font pression pour obtenir des politiques désavantageuses pour leurs concurrents. Ryanair elle-même a bénéficié pendant très longtemps de subventions gouvernementales pour les aéroports régionaux en Europe, ce qui lui a permis de proposer des tarifs inférieurs au prix du marché conventionnel.

Des dizaines de milliards pour quelques entreprises

Toutefois (je me rends compte que c’est un grand « toutefois »), la compagnie aérienne irlandaise a tout à fait raison dans son analyse des cas d’aides d’État.

Les contribuables européens ont ainsi payé plus de 30 Mds€ pour soutenir des compagnies aériennes durant la pandémie… Cliquez ici pour lire la suite.

Lufthansa : 9 Mds€. Air France : 4 Mds€. British Airways : 2,5 Mds€. Alitalia : faillite complète (après les sauvetages gouvernementaux des années précédentes) et reprise par l’Etat. Les contribuables européens ont payé pour ces aides, soit directement, soit par le biais de l’inflation provoquée par l’utilisation délibérée de la planche à billets par la banque centrale.

Ryanair conteste 30 Mds€ de ces fonds, en s’appuyant sur le principe juridique de l’Union européenne qui interdit les subventions publiques si elles faussent la concurrence loyale dans l’union. Dans certains cas, notamment ceux de la compagnie aérienne publique portugaise TAP et de la compagnie néerlandaise KLM, la Cour européenne de justice de Luxembourg a estimé que les gouvernements néerlandais et portugais n’avaient pas suffisamment justifié les mesures d’aide.

Toutefois, la Cour n’a pas exigé des compagnies aériennes qu’elles remboursent les prêts « pour l’instant ». Comparez cela à la façon dont les particuliers sont traités lorsqu’ils doivent de l’argent à l’Etat… Malheureusement, dans de nombreux cas, le tribunal de l’UE rejette les affaires engagées par Ryanair en se basant sur le fait que Covid-19 représentait une urgence extraordinaire pour ces compagnies aériennes.

La compagnie irlandaise à bas prix poursuit également des compagnies aériennes, telles que la TAP, pour conserver leurs créneaux horaires dans les aéroports. Les créneaux aéroportuaires en Europe sont organisés selon les règles du « use it or lose it ».

En pratique, si une compagnie aérienne ne dessert pas une certaine route, elle peut ainsi perdre le droit à la connexion, et l’aéroport peut donner le créneau à un concurrent. Cela explique pourquoi, tout au long de cette pandémie, certaines compagnies ont fait voler des avions vides entre certaines destinations… simplement pour conserver leurs créneaux.

Pour contrer cet effet, l’UE a décidé d’exempter temporairement les règles relatives aux créneaux horaires, ce qui a permis aux grandes compagnies aériennes de conserver leurs créneaux et de ne pas les donner à leurs concurrents. De façon perverse, ces compagnies aériennes ont utilisé l’argent des contribuables pour faire pression en faveur de leur avantage concurrentiel, dans les aéroports de tout le continent.

Des difficultés avant le Covid

Voici pourquoi Ryanair a raison : même si les Etats européens n’avaient pas introduit les confinements, le Covid-19 aurait tout de même eu un effet sur le secteur de l’aviation. En effet, dès avril 2020, les compagnies aériennes étaient en difficulté financière. Si des compagnies établies qui opèrent depuis des décennies sont incapables de faire face à une réduction temporaire des tarifs passagers, se pourrait-il qu’elles ne devraient pas opérer sur le marché en premier lieu, et que de nouvelles compagnies améliorent les erreurs commises par leurs prédécesseurs ?

Ryanair est la plus grande compagnie aérienne d’Europe, et bien qu’elle ait reçu du gouvernement irlandais des fonds reliés au Covid, ses aides sont dérisoires par rapport à l’argent empoché par une compagnie comme Lufthansa, qui exploite un réseau de compagnies qui ont toutes reçu des sommes importantes des contribuables autrichiens, suisses ou belges.

Les compagnies aériennes devraient se faire concurrence sur un marché véritablement libre. Oui, elles devraient être exemptes de taxes et de réglementations punitives, mais elles ne devraient pas non plus attendre des contribuables qu’ils paient la facture de leur mauvaise gestion. Lorsque les Européens ont payé pour l’aide Covid, ils ont souvent aussi financé la mauvaise gestion de ces compagnies, comme des acquisitions mal calculées et des projets secondaires.

L’exemple de la compagnie allemande Condor vient à l’esprit (qui a également été attaquée en justice par RyanAir, sans succès) : en septembre 2019, la société mère de Condor, Thomas Cook, s’est effondrée, et pourtant Condor a reçu un prêt du gouvernement allemand pour la sauver de la ruine financière. Maintenant que Condor a reçu une aide d’Etat pendant la crise du Covid-19, juste un an plus tard, l’Etat allemand peut-il démontrer de manière fiable que les dommages subis par la compagnie ne sont dus qu’à la pandémie, ou se pourrait-il que la compagnie aérienne ait déjà fait faillite auparavant ?

Et dans quelle mesure l’aide liée au Covid est-elle justifiée, alors que l’entreprise venait juste de bénéficier d’un prêt pour surmonter la tourmente de l’année précédente ?

Il semble que de nombreux Etats européens financent des compagnies aériennes pour des raisons nationalistes. Le gouvernement allemand, comme tout autre, veut garder les compagnies à l’intérieur de ses frontières, afin qu’elles continuent à payer des impôts dans les caisses du Trésor public. Mais les seuls qui paient réellement les factures sont les consommateurs, et pas seulement par le biais du prix des billets.

Nous devrions plutôt laisser les mauvais acteurs échouer et permettre plus d’innovation et de flexibilité sur le marché européen de l’aviation.

Originally published here

Malaysia Towards A Vape Regulated Nation

Big Industry players are acknowledging that vaping is not risk-free, but there is growing scientific evidence that it is certainly less harmful than smoking cigarettes. Risk-proportionate regulations and taxation for vaping are being called to encourage smokers to switch to a low-risk alternative. With the Malaysian Government introducing a taxation on nicotine vapes, many in the vaping industry are exhaling a sigh of relief as the grey line lingering over nicotine taxation has loomed for the longest time. 

In relation to that, the public are commending the Malaysian government for moving in the right direction of regulating it instead of an outright ban, as vaping products play a crucial role in reducing the enormous health burden caused by cigarette smoking.

Malaysia towards regulating vape products 

The aftermath of banning vaping will only open doors for the prevalence of the black market, which poses the danger of owning and inhaling substandard products. With nicotine vapes being legal for sale and consumption, the lack of regulation needs to be addressed to prevent consumers from falling prey to black market products, perceiving netizens who are forthrightly switching to vaping as a choice. 

It is in the best interest of the nation to quickly roll out proper regulations to benefit the Malaysian economy as it could lose an estimated RM1 billion tax revenue from vape products alone, being too substantial to remain unregulated. 

Read the full article here

Pentingnya Perlindungan Hak Kekayaan Intelektual untuk Industri Kuliner di Indonesia

Indonesia dikenal sebagai salah satu negara dengan kekayaan kuliner yang sangat beragam. Dengan wilayah yang luas dan suku yang sangat beragam membuat berbagai wilayah di Indonesia memiliki ciri khas kulinernya masing-masing, yang sangat bervariasi satu sama lain.

Tidak hanya makanan yang bervariasi, industri kuliner di Indonesia juga merupakan salah satu bidang usaha yang sangat umum, yang dapat kita temui di berbagai kota hingga perdesaan di seluruh nusantara. Bila kita mendatangi berbagai pusat perbelanjaan, tempa wisata, hingga gedung-gedung perkantoran, dengan mudah kita bisa menemukan berbagai pedagang yang menjual berbagai hidangan yang sangat bervariatif.

Pada tahun 2019 misalnya, berdasarkan laporan dari Badan Pusat Statistik (BPS), ada sekitar 3,9 juga usaha mikro dan kecil di Indonesia yang bergerak di industri kuliner (databoks.katadata.co.id, 23/8/2021). Angka ini tentu merupakan jumlah yang tidak kecil, dan merupakan bukti bawa industri kuliner merupakan sektor yang memiliki pengaruh yang sangat besar sebagai sumber penghidupan bagi jutaan orang di Indonesia.

Melalui angka yang sangat tinggi ini kita bisa melihat bahwa industri kuliner di Indonesia memiliki modal dan potensi yang sangat luar biasa untuk dikembangkan. Bila dikembangkan secara maksimum, industri kuliner di Indonesia tentu dapat memri sumbangsih yang besar untuk meningkatkan kesejahteraan di Indonesia, dan juga semakin memperkenalkan nama negara kita di dunia internasional.

Untuk melakukan hal tersebut tentu merupakan sesuatu yang tidak mudah. Ada sangat berbagai proses yang harus dijalankan dan juga regulasi yang perlu dicanangkan. Hal ini tentunya meliputi berbagai aspek, mulai dari pendanaan, hingga bagaimana kita bisa membantu memberikan pelatihan usaha kepada para pemilik usaha kuliner yang tersebar di seluruh Indonesia.

Salah satu regulasi yang sangat penting misalnya, yang terkait dengan kemudahan berusaha. Tentunya bila pemerintah memberlakukan regulasi yang sangat ketat kepada para pemilik usaha kuliner, seperti perizinan yang ketat dan lain sebagainya, hal tersbeut akan semakin mempersulit para pemilik usaha tersebut untuk mengembangkan usaha yang sedang dikerjakannya.

Selain itu, tidak hanya kemudahan berusaha, kita juga harus bisa memastikan para pemilik usaha kuliner tersebut dapat memiliki kesempatan untuk bisa mendapatkan manfaat finansial secara penuh dari inovasi yang dibuatnya, terhadap produk-produk yang ia jual. Di sini lah, perlindungan kekayaan intelektual menjadi hal yang sangat penting untuk diperhatikan.

Hak kekayaan intelektual merupakan hal yang sangat penting dan esensial untuk dijaga dan ditegakkan, apalagi bila terkait dengan industri kreatif, salah satunya adalah industri kuliner. Melalui jaminan perlindungan hak kekayaan intelektual yang kuat, para pelaku usaha kuliner di Indonesia bisa lebih mampu untuk menikmati manfaat finansial dari karya dan inovasi yang mereka buat.

Beberapa jenis hak kekayaan intelektual yang akan sangat membantu para pelaku usaha industri kreatif sektor kuliner adalah desain industri, rahasia dagang merek atau brand. 

Desain industri sendiri didefinisikan sebagai sebuah kreasi tentang bentuk, komposisi garis dan warna, konfigurasi, yang memberikan kesan estetik pada produk tersebut (hakpaten.id). Berbagai produk-produk kuliner di Indonesia memiliki desain yang berbeda-beda dan khas, yang membedakan produk tersebut dengan produk-produk lainnya.

Sementara itu, merek atau brand didefinisikan sebagai tanda untuk membedakan jasa atau barang yang diproduksi oleh produsen dalam perdagangan (hakpaten.id). 

Merek atau brand merupakan kekayaan intelektual yang paling umum yang digunakan oleh berbagai sektor usaha, termasuk juga tetunya adalah sektor kuliner. Merek ini digunakan untuk membedakan berbagai produk yang dijual oleh para produsen di pasar, misalnya seperti produk ayam gorang A dan ayam goreng B.

Rahasia dagang sendiri didefinisikan sebagai kekayaan intelektual yang berbentuk informasi eksklusif yang memiliki nilai ekonomis yang tidak diungkapkan kepada publik dan tidak diketahui secara umum (viva.co.id, 2/5/2017). Hal ini merupakan sesuatu yang sangat penting untuk dilindungi mengingat bahwa dibutuhkan yang keras dan kreativitas yang tidak mudah untuk para pelaku usaha tersebut untuk bisa menemukan resep yang dapat digandrungi oleh para konsumen.

Tetapi sayangnya, penegakan hukum untuk melindungi hak kekayaan intelektual pada aspek tersebut masih memiliki banyak kelemahan di Indonesia. 

Misalnya, kita bisa melihat dengan mudah berbagai rumah makan dan juga desain-desain produk yang menyerupai desain dan brand yang dimiliki oleh badan usaha lain yang lebih teranma. Hal ini tentu merupakan sesuatu yang tidak bisa dibenarkan, karena merupakan bentuk pencurian ide, yang tentunya berpotensi akan sangat merugikan perusahaan yang memiliki hak kekayaan intelektual tersebut.

Bila kita dapat memiliki perlindungan hak kekayaan intelektual yang kuat, khususnya untuk industri kuliner di Indonesia, maka hal tersebut akan semakin mendorong insentif untuk berinovasi, karena mereka bisa mendapatkan jaminan untuk mendapatkan manfaat ekonomi dari inovasi yang dibuatnya. 

Selain itu, para pelaku usaha juga tidak bisa dengan mudah membajak dan mencuri karya dan inovasi yang dimiliki oleh orang lain untuk mendapatkan keuntungan.

Originally published here

Harm reduction strategy stressed to achieve Tobacco-free nation by 2040

Speakers in a discussion have urged policymakers to incorporate Tobacco harm reduction strategy in their tobacco control plans and establish safer alternatives such as vaping products as smoking cessation medium like progressive nations around the world.

Voice of Vapers Bangladesh organised the discussion titled “The Need for a Tobacco Harm Reduction Strategy: Achieving the Government’s Health Agenda & Revenue Ambitions” at a Dhaka hotel on Saturday to mark the World Vape Day 2022.

Health Diplomats’ president Dr Delon Human said that Bangladesh was widely recognized as a resilient nation, known for her prowess to prove her critics wrong.

Read the full article here

TRIPS waiver will cost us decades of progress

By removing patent protection, crucial incentives to develop new ground-breaking innovations will be lost.

The COVID-19 pandemic, economic disruption, war in Ukraine, global hunger, and now monkeypox… With all these crises, one might say that the future of humanity looks grim. That would probably be true if we didn’t have innovation and intellectual property rights.

It doesn’t take a degree in history to understand that, despite many challenges, the world is improving. HIV and AIDS treatment has prevented millions of premature deaths. Cancer survival rates have improved by almost 20 percent since 1986. The COVID-19 vaccines, developed almost overnight, are already saving thousands of lives in Europe and beyond.

We have made significant progress in boosting vaccine accessibility. AstraZeneca is selling its vaccines to developing countries at cost price, and many developed countries have donated their vaccines to those in need. Even though a lot more could be done to increase access to COVID–19 vaccines, waiving patents is not a solution we can afford.

Right now, the World Trade Organization (WTO)’s member states are discussing a draft agreement on TRIPS (Trade-Related Aspects of Intellectual Property Rights) flexibility to waive intellectual property protections. South Africa and India initiated the TRIPS waiver in 2020. Despite initial resistance from the EU and US, the compromise now seems in sight.

If adopted, the agreement would legalise compulsory licencing, a practice that allows the government to hand out the right to produce COVID-19 vaccines without the consent of a patent owner. On paper, allowing for the mass production of vaccines seems like a noble goal, but the consequences of such a policy are anything but promising. The short-term result of eroding intellectual property rights would be increased access to innovations. In the long-term, there would be no innovation.

While the current TRIPS waiver talks primarily concern COVID-19 vaccines, there is a worry that these flexibilities will become a norm or be misused once adopted. That was, for example, the case in Thailand, where compulsory licencing was introduced to treat non-infectious chronic diseases.

The move didn’t end well for Thailand. Abbott, one of the manufacturers whose drugs were targeted by the IP waiver, withdrew all of its patents from Thailand. After a series of negotiations, Abbott agreed to increase access to its drugs in exchange for IP protection. Back then, the EU Trade Commissioner Peter Mandelson warned Thailand that compulsory licencing would hinder pharmaceutical innovation. Now, it seems like the EU, especially the Left, has forgotten this lesson.

“While the TRIPS waiver seems like a quick fix, the consequences of such a move will be dire”

Innovation takes time and effort, and crucially, investment. Pharmaceutical development usually involves biological, chemical, and clinical research and can take up to 15 years to complete. Only a tiny fraction of these efforts leads to the creation of a ground-breaking cure. It is moral and right for these companies to expect their risk-taking and investment to pay off through patents. By undermining IP protection, the TRIPS waiver would remove these incentives and endanger drug safety. Without patents, third-party suppliers will make vaccine shots based on patented formulas and processes. Still, without specialisation, this will increase the risk of producing bad, inactive vaccines that will undermine vaccination in general.

While the TRIPS waiver seems like a quick fix, the consequences of such a move will be dire. We have too many challenges ahead of us, and millions in Europe and beyond still await life-saving Alzheimer’s, Cystic Fibrosis, Diabetes, or HIV/AIDS treatment. If we scrap patent protection now, all the progress we have made as a society and countless opportunities to improve the world will be lost.

Originally published here

Speakers stress need for tobacco harm reduction strategy 

They call for sensible regulations for vaping products to achieve government’s health agenda and revenue ambitions

Speakers at an event urged policymakers to incorporate Tobacco Harm Reduction (THR) strategy in their tobacco control plans and establish safer alternatives such as vaping products as smoking cessation medium like progressive nations around the world. 

To commemorate World Vape Day 2022, Voice of Vapers Bangladesh organised a panel discussion titled “The Need for a Tobacco Harm Reduction Strategy: Achieving the Government’s Health Agenda & Revenue Ambitions” held at a Dhaka hotel on 28 May, reads a press release.

Dr Delon Human, president of Health Diplomats and an expert on harm reduction said, “Bangladesh is widely recognised as a resilient nation, known for her prowess to prove her critics wrong. Historically, the indomitable spirit of Bangladeshis has made them question the status quo and establish the rights of its people. The stupendous development across all sectors is a true testament of that.” 

Read the full article here

New York lawmakers just killed Bitcoin and crypto mining and consumers will suffer

Albany, NY – Early this morning, the New York State Senate joined with the State Assembly to pass a moratorium on Bitcoin and cryptocurrency mining, issuing yet another reminder that state lawmakers want to deny their residents from interacting with cryptocurrencies.

The law would prevent new permits from being issued to carbon-based fueled proof-of-work mining operations that use behind-the-meter energy, putting millions of dollars worth of investments into jeopardy. This follows the logic of the much-derided BitLicense regulation, which has made it nearly impossible for small and medium-sized firms to offer crypto services to New York residents.

“By passing this bill, New York lawmakers are unequivocally stating they want their residents completely locked out of cryptocurrencies, from generation and mining services to actually being able to easily buy them through an exchange,” said Yaël Ossowski, deputy director of the Consumer Choice Center, a consumer advocacy group.

“If Gov. Hochul signs this bill, it will drive a stake through the Bitcoin mining industry, and states like Florida, Montana, Utah, and Texas will rejoice at the opportunity to invite those entrepreneurs and innovators to establish operations in their states.

“Because Bitcoin, and cryptocurrencies more broadly, will serve a vital role in making finance more inclusive and accessible for sending, receiving, and saving value, we hold it in the interest of consumers that the hashrate (the total computing power of the network) continue to grow, and that better public policy on cryptocurrencies is embraced among states.

“New York, however, has decided to take the NIMBY approach and deny their residents that opportunity,” added Ossowski.

“Cryptocurrency generation and mining firms have an incentive to use the most affordable and renewable energy sources available, and the data backs up this claim. This is a win-win scenario for towns and localities with these facilities, for employees of these firms, residents in these towns that benefit from increased commerce, and energy customers overall,” said Ossowski.

“As cryptocurrency mining proliferated in New York, it opened up new entrepreneurial activities that helped improve the lives of New Yorkers in small communities and large urban centers alike. Passing a ban on these activities, in pursuit of an unclear climate goal, will negate these gains. There is a better path,” added Ossowski.

“The aim of embracing climate goals to ensure 100% renewable energy usage in cryptocurrency generation and mining is well-intended, but a complete ban will have a devastating impact on innovators and entrepreneurs hosting their facilities in the state of New York, and consumers and investors that rely on their services,” said Aleksandar Kokotovic, crypto fellow at the Consumer Choice Center. 

“We understand that the quick rise of cryptocurrency mining raises many questions for residents, particularly when it involves the local economy and environment. However, a more prudent path would be an environmental review conducted by relevant authorities, rather than a wholesale ban and moratorium that would put many projects in legal jeopardy,” added Kokotovic.

***CCC Deputy Director Yaël Ossowski is available to speak on consumer regulations and consumer choice issues. Please send media inquiries to yael@consumerchoicecenter.org.***

—

The CCC represents consumers in over 100 countries across the globe. We closely monitor regulatory trends in Washington, Ottawa, Brussels, Geneva, and other hotspots of regulation and inform and activate consumers to fight for #ConsumerChoice. Learn more at consumerchoicecenter.org.

The U.S. wants to relax exclusionary zoning to combat housing crisis. We should, too

Increasing the housing stock puts downward pressure on prices and fosters economic growth

At both the federal and provincial level, Canadians and their legislators often look down their noses at American policy and politics, and sometimes with good reason: gun control and the abortion debate come to mind. But when it comes to tackling the housing crisis Canadian politicians could learn a thing or two from what is unfolding south of the border.

Earlier this month President Joe Biden announced that the federal government would be seeking to tackle the root cause of the housing crisis, which it believes to be exclusionary zoning — local rules that prohibit multi-family housing from being built and instead favour single-family units. In a White House statement, the administration said “Exclusionary land use and zoning policies constrain land use, artificially inflate prices, perpetuate historical patterns of segregation, keep workers in lower productivity regions, and limit economic growth.”

All of that is true. Increasing the housing stock puts downward pressure on prices and fosters economic growth. Research on zoning rules in the U.S. has shown that, by freezing workers out of high-rent areas like New York and San Jose where their productivity would be higher, local zoning rules lowered U.S. economic growth by fully 36 per cent between 1964 and 2009. There is no reason to assume similarly exclusionary zoning laws aren’t having the same negative impact in Canada. Toronto, for example, has nearly 70 per cent of its land zoned exclusively for single-family homes, making it illegal to build anything with increased density.

Elevating the conversation and targeting zoning reform are things Justin Trudeau and Chrystia Freeland could have done in their last budget. Right now, only two Conservative leadership candidates are talking about zoning on the campaign trail, Scott Aitchison and Pierre Poilievre.

But lessons about zoning reform aren’t just useful at the federal level. The U.S. offers plenty of examples of state and municipal legislators carrying out dramatic zoning reforms. In Oregon, for example, any land previously zoned exclusively for single-family homes can now, as of right, build a duplex on that site or even a four-unit dwelling if it is in a municipality larger than 25,000 people.

The same goes for Minneapolis, which abolished exclusionary zoning before the pandemic. The city now appears to be bucking the trend of rising rental prices. Rents for one- and two-bedroom units are actually lower in 2022 than they were in 2019. Some of that presumably can be chalked up to having made it easier to build for increased density.

Finally, the small town of Auburn, Maine, shows how local councilors can embrace “YIMBYism” (which stands for “Yes, in my backyard,” as opposed than “Not in my backyard”) to increase affordability. Auburn’s Mayor Jason Levesque, originally elected in 2017, ran on a pro-development platform that gave voters in his town of 24,000 three options: drastically raise taxes, cut public services, or bring in new residents. Having chosen growth, Auburn plans to increase its housing stock by upwards of 25 per cent, gutting zoning rules and taking an “all of the above” view on housing types.

That type of bold ambition is exactly what is needed in Canada’s major cities and the communities that surround them if we want to tackle rather than just talk about the affordability crisis. Nationally, average rents rose nine per cent in April compared to a year earlier. In Toronto and Vancouver, arguably the two Canadian cities most in need of increased density, rents rose 23 and 27 per cent, respectively. On the buying side, the national MLS benchmark price for a home was $882,000 in April, a 27 per cent increase year-over-year despite interest rate increases beginning to dampen demand.

Much of Canadian political culture is framed in opposition to what exists in the U.S. but on zoning reform, we should look southward and learn. It’s time to build but exclusionary zoning is in the way.

Originally published here

Fun Police

ConsEUmer Podcast

Consumer Choice Center Cast

Follow us

Facebook-f Twitter Instagram Linkedin Youtube Spotify

Contact Info

712 H St NE PMB 94982
Washington, DC 20002

info@consumerchoicecenter.org

© COPYRIGHT 2024, CONSUMER CHOICE CENTER

Scroll to top
en_USEN
it_ITIT pt_BRPT fr_FRFR es_ESES de_DEDE en_USEN