Fix the darned pipes

Wellington loses somewhere between 7 and 32 percent of its water because of leaks in the pipes. Nobody knows how much is lost because water isn't properly metered. Wellington has more than three times as many old cruddy pipes as the next worst council, Christchurch. 

Getting a new source to meet both new demand and the leaks will cost $250 million. Additional sources are likely worth having anyway for resilience against quakes, so long as they don't feed into the same potential fail point of the big pipe at the main faultlines. But the leaks mean supply costs are higher than they need to be. 

Metering makes an awful lot of sense - or at least I'm pretty optimistic that the business case will come out well. 

Wellington Council's decided to spend $200m strengthening the library rather than looking to the something more like a $90 million model based on the rather nice example in Christchurch. 

There are somewhere around 80,000 households in Wellington. The library then costs each household a bit over $3k in capital costs. There's a huge looming capital cost in fixing all the pipes. 

So long as voters keep rewarding councillors and mayors for flashy new convention centres ($180 million, or about $2,250 per household) and for deciding that 1990s libraries are actually historical monuments that have to be kept exactly as-is but strengthened every few years to new standards, and keep failing to punish councillors and mayors for letting all of the underground infrastructure rot out from under us, this is what we'll keep getting. 

Better borders

Kate MacNamara over at the Herald goes through the problems caused by the current lack of capacity in New Zealand's managed isolation facilities. 

New Zealand's current border settings allow only citizens and permanent residents into the country, with very limited exceptions.

Despite these restrictions, demand has threatened to overwhelm the Government's capacity to accept arrivals, at least under the current policy settings. New Zealand requires all arrivals to spend at least 14 days in managed isolation, at which point most leave following a negative test for the virus.

Capacity for such approved facilities is roughly 6000 per fortnight. Recently, those facilities came so close to brimming over that the Government, through airlines, suspended new international bookings for arrival into the country for most of July.

The log jam has many implications. It curtailed the ability of New Zealanders abroad to return home (there is an estimated one million, though there is no way currently to estimate demand for return). It has also pushed farther toward the horizon the prospect of New Zealand accepting a wider range of arrivals, foreign students, work visa holders and tourists among them.

All have large implications for the economy; foreign students brought in some $5 billion annually before Covid-19. International tourism was more valuable still.

MacNamara also notes the suggestions I've had for scaling things up at the border. 

This is a problem that isn't going to go away. The virus is going to be around for a long time. Getting things set at the border to enable more people safely to re-enter will become increasingly important. Delaying travel gets more and more costly for those who are able move their travel plans around. 

Even the best system can leak. Making sure that contact tracing is up to spec is important. I still think it would be a good idea for the government to start training even more contact tracers, just in case. They could manage it as a kind of Army Reserves, but for contact tracing. Pay people from all over the country to attend training and provide a stipend for them to be willing to be called into contact tracing service if needed for the door-knocking parts of the job that cannot be done from remote call-tracing centres.

Meanwhile, Stuff reports that AirNZ understands the government now to be working on a voucher system for returning Kiwis. I have no inside knowledge on that one - I have floated the idea in opeds over the past month or longer, and on twitter, [update - and a podcast!] well before our report on it came out last week. 

I hope that AirNZ is right on this!

Air New Zealand chief commercial and customer officer Cam Wallace said the Government was looking to set up a voucher system which passengers would need to access in order to return to New Zealand, regardless of which airline they flew with.

His understanding was that it would be up to customers to obtain vouchers before booking an airfare home. Failure to do so would result in passengers not being allowed to board a flight to New Zealand.

Shoup ba doup

It's a true but little-known fact that Salt-N-Pepa's classic song was actually an ode to Donald Shoup. 

Okay, maybe not. But it should have been. 

The National Policy Statement on urban planning bans larger cities from having minimum parking restrictions. The Shoupistas have conquered New Zealand. 

It is excellent news; congratulations in particular to Julie Anne Genter. 

My column in this week's Stuff newspapers covers the basic economics of minimum parking regulations.

A snippet:

But the more substantial cost of on-street parking, if council does not meter the spaces, is the congestion caused as people drive around looking for free parking. As Seinfeld’s George Costanza put it almost thirty years ago, “Why should I pay, when if I apply myself, maybe I could get it for free?”

That hunt for free parking imposes real costs. Economist Donald Shoup, who has spent the bulk of his long career tracing out the economics of urban parking, found that between 8 and 74 per cent of traffic in congested cities was caused by cruising for parking.

In New York, in the early 1990s, drivers spent between eight and 14 minutes, on average, cruising for parking.

If on-street parking is priced properly, there is no need to cruise for parking. High prices for on-street parking during peak times in popular places encourage people to only park in those places when it is really important, and encourage other people to build parking garages that charge for car storage.

But there is also a worse political economy effect of unpriced on-street parking. When on-street parking has no monetary cost for drivers in places where people want to be, there will always be shortages. Shortages lead councils to force other people to build more parking.

Fun bit: I wanted to cite the excellent George Costanza line about how nobody in his family ever paid for parking - if you applied yourself, you could get it for free. So I dug it up from the online Seinfeld scripts and used it in the column.

Then I wanted to get Shoup's numbers from his classic paper so went and dug that up - to find that he'd opened with the Costanza line as epigraph. 

Shoup-ba-doup. 

Morning roundup

The browser tabs... there are so many. 

• Auckland University's Prof Tim Dare argues for a better contact tracing app. I use the Rippl app whenever I find a QR that it can handle, and I keep Google Location tracking on all the time, hoping that both would make things easier if it ever were necessary. I had, early on, installed MIT's app that logged bluetooth contact with other folks running the app, but nobody in NZ runs it so it's a bit useless. The government always finds reasons not to do things that would work. The MIT app seemed fine to me, but presumably the data goes back to their head offices, and the government seems more worried about rights violations when data goes overseas than about the rights violations involved in lockdowns prevented by using those kinds of apps. 
• The Petroleum Exploration & Production Association wonders what happens when existing natural gas supplies run out and new production is not allowed. This is another of those areas where the ETS could have done the job on its own. The emissions associated with exploration and production are captured in the ETS. The emissions created when natural gas is burned are captured in the ETS. Banning new exploration then forces New Zealand into more expensive ways of mitigating greenhouse gas emissions.
• Cheap and fast tests, as part of a broader testing regime with lots and lots of use of those cheap fast tests, can be better than slower and expensive ones. The basic argument: the simple $5 tests won't catch all infections, but are very likely to catch those who are infectious - they'll read false negatives before viral load is high enough to be as infectious. And if you take the $5 test every day with immediate results, that can be more effective than a $35 dollar test if it takes a long time to get the results back. One for the epidemiologists to consider. 
• Houston scaled back minimum lot sizes and enjoyed a lot of intensification in middle income neighbourhoods; wealthier suburbs blocked it through deed restrictions. I know a lot of new subdivisions in NZ have covenants; I wonder any of the inner suburbs' neighbourhood associations will start trying to get residents to agree to covenants if they expect the NPS to result in upzoning in their neighbourhoods. The article on Houston suggests that allowing that pressure valve mattered in allowing more intensification in the broad. The NPS does allow developers to sue Councils for being too restrictive, so that might help in discouraging councils from finding other ways of blocking development. 
• New Zealand suspends its extradition agreement with Hong Kong. It's justified, but it probably kills any chances of a travel bubble with Taiwan. 

Safe arrivals

If entry into New Zealand from abroad is safe, it should be allowed. 

People arriving from places that are Covid-free, or no more risky than New Zealand, and who get here on flights that do not intersect with risky places, should return to normal travel arrangements. Currently, the Cook Islands, the rest of New Zealand's Pacific Island realm, and Taiwan would fit the bill - along possibly with Vietnam, if the epidemiologists figure that's safe. Similarly, any Australian states that get things reliably under control and maintain adequate border measures against the states that haven't, could be invited into our Pacific 'bubble'. 

Entry from other places needs to be made safe. And New Zealand needs to scale up its managed isolation system so that more people can join us - both Kiwis abroad returning home and others who might wish to come in. 

I've been banging on about this for some time. We released a more thorough report on it late last week, with a column in Newsroom as prequel. 

Here's the basic mechanism we've proposed:

• Arrivals from safe places of safe people (those who have not recently travelled outside of those safe places), on flights that do not involve transit or connections through unsafe places, should be allowed without requiring stays in managed isolation. Determining which places are safe or not should be left to the epidemiologists. 
• Those arriving from risky places should be required to present their booking in a managed isolation facility before boarding a flight to get here. Making those arriving responsible for making their own bookings gives them some control over the times of their arrival and takes some of that burden off of the government. 
• The government should start training up staff necessary to the scaling up of managed isolation. 
• Rather than the government contracting out facilities for use as managed isolation facilities, those facilities should instead contract with the government to provide services - and charged at cost. Facilities would be free to set their own prices for stays in isolation. If prices in managed isolation started looking high during some times of year, other hotels or resorts or campgrounds might flip into becoming managed isolation providers - contracting with the government for the necessary health and other staff. 
• Rather than the government charging a fee to some returning Kiwis for their stays in managed isolation, it could instead provide a voucher equivalent to the cost of a stay in a basic facility to those Kiwis whose stays the government would want to subsidise. I have a lot of sympathy for the #TeamOfSixMillion folks who want no charges for any returning Kiwis, but I worry that that way of doing things very quickly gets you into implicit rationing because of the cost to the state and voter distaste of shelling out a lot of money for the visits of Kiwis who have lived abroad for decades. The most likely outcome in that case is that the government makes a big deal about not charging because it would be unkind, but would just not do much to increase capacity and ignore the costs it imposes by lack of access. In any case, my ethics about who should get vouchers and who shouldn't are no better than anyone else's. I just think this mechanism makes it a lot easier to scale things up. Eligible Kiwis could apply the value of their vouchers to the full cost of a stay at a basic facility during non-peak times, or as partial payment for a stay at a nicer facility or for a stay during peak times. All of that helps encourage more hotels, motels, resorts and other places flip into becoming managed isolation facilities. 

I chatted with John Campbell about it on Breakfast, and with Mike Hosking on Newstalk (a 5.40 am pre-record egads!), and with Jesse Mulligan over on Afternoons. Susan Edmunds at Stuff covered it as well. 

Pattrick Smellie covered it at the Herald, but puts it into a standard 'health versus the economy' framework. 

The case for reopening to the Islands is not an economic one, at least not for New Zealand. It's a humanitarian one. New Zealand should be willing to admit travellers from the Covid-free Islands without an isolation period; those Islands' governments may be willing to allow travel from New Zealand without isolation as well. New Zealand wouldn't be picking up huge new business opportunities by reopening to the Cooks. But it matters a lot to families that are separated. And where they and NZ remain Covid-free, there is no sense in maintaining the restriction. We just need to be ready to reinstate restrictions if conditions change. 

And the measures I suggest for allowing more visitors from abroad to come to New Zealand under managed isolation come with increases in protective measures, like requirements that those visitors enable Google Maps location sharing with NZ contact tracing teams and show up for a post-isolation test - just to be sure. There's a lot you can to do increase capabilities and capacity on a user-pays basis for non-citizen arrivals when a lot of people are willing to pay a lot of money to come to NZ. 

He may be right that there's no public appetite for anything that might enable more people to come here, even if it's done with even tighter safety standards than are now in place. And that it's unlikely that the government will move much on this before the election. 

But it would be dumb to pitch measures that were actually a health/econ tradeoff - if anything of that sort compromised safety, we could quickly again be in lockdowns, and the losses on that side are easily greater than the gains from allowing more people through. It takes a lot of economic activity from new arrivals to make up for the GDP losses of lockdown. Scaling up safely matters. 

Living free

Holidays over the winter school break were glorious.

We took the ferry across to the South Island to catch up with friends, find some snow, and see what was all going on on the Mainland.

I'm giving way more of a travelogue here than I ever normally would, because of the anecdata on what restaurants, tourist spots, and hospitality venues were like. The loss of all international tourists can matter. 

The Monday afternoon ride across was wonderful. Calm all the way through with smooth sailing. We booked our sailing a month in advance. The Bluebridge was already booked out for the ride South, so we took the Interislander - and the Bluebridge on the way back North. 

We made it through to Kaikoura that evening. After dropping our bags, we went out in search of food. Kaikoura has always been a bit of a tourist town, and I wanted to see how busy things were. A lot of places seemed closed - perhaps because we were late at night, perhaps for other reasons. But we stopped at Strawberry Tree pub. We got the last table, and they'd already run out of the lamb shanks and steak - they'd underestimated demand over school holidays. It sounded like things had been slow and they'd not reckoned on its picking up quite this much. I hope it keeps up. The fish and chips were excellent.

We stopped to see the seals the next morning before heading out to the snow. The seals were happy as always. The walking trails were busy, and while the parking lot at trailhead was empty when we arrived, it was full when we left.

From there, off to Castle Hill Village for the night to meet up with friends, before a Wednesday and Thursday of skiing at Porters.

We stopped in Cheviot for lunch. Cheviot was sad. It was stranded by the Kaikoura earthquake in 2016, north of the detour for those heading up to Kaikoura and points north, and not a destination unto itself. Only one cafe seemed left, everything else was closed. I don't know whether they'd all gone before Covid, or whether Covid put the final boot in.

The pies were good at the Cheviot Tea Rooms, and it seemed busy enough for lunch hour, but it was all that was left. 

Further south, Pegasus Bay's cellar door and restaurant were closed - open only on the weekends now. Torlesse's cellar door was open - their port is always great value. But we were the only ones there.

Porters had what seemed a reasonable turnout for a very early part of the season. Not all the runs were yet open - more snow was needed. And parts of the ones that were open were a bit icy. But it was still great. I missed the snow. 

We went back to Christchurch Thursday night to see what's all been happening in our old home town. We were a bit late heading out for dinner and got the last table at Spice Paragon. Dinner was excellent, and I doubt we'd have been able to get a walk-in table absent Covid. But it was great to see that the place was full. 

Friday we explored downtown. Much of it was unrecognisable because of the building that's happened since I left in 2014. Tourist places in town were busy. The Canterbury Museum was busy with a couple of new exhibitions; the Arts Centre was busy as well, but the couple of food carts were lonely. 

The new Riverside Market seemed spectacularly successful. It was absolutely teeming early Friday afternoon. But elsewhere there were a lot of For Lease signs and quiet shops.

The University Staff Club was busy and full on Friday night, but not as busy as it typically was when I was on faculty there and the crowds would flow out into the gardens and dozens of faculty kids would run around near the stream. Friends wondered when and whether the government would ever allow international students to return under managed isolation, and spoke darkly about the consequences of its not being sorted. It will be very very bad. And other developments also had me very glad to be able to put the place under a Somebody Else's Problem field. The kinds of things Matt Taibbi warns about in his newsletter are creeping in. 

Alpine Ice was chocka that evening - as busy as I've ever seen it. Also, the standard of skating there has improved considerably. I'm not great at skating, for a Canadian, but that would typically have a bad Canadian in the top 5% at Alpine. This time, only the top quarter. That's good news. 

Saturday was more hanging out with friends, exploring town, and dinner at Himalayas. They were quiet enough when we arrived, but a party of a bit more than a dozen 19 year olds (or thereabouts), each charged with a bottle of wine on entry (and disposing loudly of the contents later in the night), put an end to the quiet rather quickly. 

I'm glad those kinds of festivities are here possible again, but I'd prefer to view them from a somewhat greater distance. 

Sunday we headed south again to Oamaru, stopping (as everyone always should) in Waimate to see the wallabies and in hope that Gwen were still there. 

When I coordinated the Erskine programme at Canterbury for visiting scholars arriving into the Economics Department, I put together a bit of a tiki tour guide for them for a South Island driving tour. I'd tell them to start by driving to Waimate to feed the wallabies and have a chat with Gwen. Gwen is a laugh-riot. If you haven't gone there, just do it. The wallabies are also very cute. They'll hold your hand while you feed them. 

The wallaby park was as busy as I've ever seen it, but we had always avoided doing anything touristy during school holidays when I was based in Christchurch. 

Lunch in Waimate at the Waimate Kitchen & Bar was superb. The place was not as busy as I'd have hoped for a Sunday lunch crowd. We weren't the only ones there, but well over half the tables were empty. And the rest of the main drag was very very quiet. 

Then, south to Oamaru in time to see the Little Blue Penguins come ashore for the night. Another of those 'if you haven't done it yet, what the heck is wrong with you' spots. At sunset, the little blues start coming ashore in rafts, shake themselves off, come up the rocks, and scurry out to their nesting boxes. They sing to their mates on their return. It's lovely. 

It had been a while since we'd been there - they now have a luxury box closer to the action, and not much more expensive than the standard seats. That slightly more expensive seating was near full; the standard seating was nearly empty. They still provide all the narration in both English and Mandarin, and there were some visitors there who did seem to appreciate the bilingual explanations.

We had dinner at the AirBnB that night rather than heading out, but the tourist-facing places in Oamaru on Monday were grim. Steampunk HQ was busy, and excellent, but the Victorian district was deathly. Perhaps some shops are only open on weekends now, but certainly would have been open more regularly during school holidays pre-Covid. We bought a few things at one of the shops, including a nifty 'vaping jacket' for me, and it seemed like the owner had not made any substantial sales in rather some time. 

The parts of town that cater to locals and to the agricultural community seemed busy. PaperPlus was full of people buying books and scratchies. The farm supply shops looked busy. 

But we were the only ones having lunch at India Garden that day.

Then, on to Tekapo - with a stop along the way at the Vanished World Centre for Fossils in Duntroon where the kids chipped tiny fossils out of hunks of limestone - one other family stopped in while we were there. I don't know whether they're typically busier than that on a Monday afternoon during school holidays or not. 

We arrived in Tekapo late in the afternoon. The salmon farms on the way through the lakes had all already closed for the day when we drove by - their hours were shorter than expected for school holidays. 

And we headed out to Tekapo Springs in the morning. 

If there are prettier skating rinks anywhere in the world, I've never heard of them. You can look out over the mountains while skating. 

Tekapo Springs was heaving with people. We arrived at 10, when they open, but they'd clearly had people queuing for rather some time before - it wasn't until maybe 10.30 that we'd gotten through. We managed to get a 2.30 booking for the snow tube run. I skated with the kids; Susan mostly hung out in the hot pools. It was busy the whole time we were there. 

That night, we were completely unable to get any table at any restaurant in town. Everywhere that was open was fully booked. We had wanted to go to the Dark Sky Diner, but it had closed at the start of Covid and has not yet re-opened. Every other restaurant was completely full, so Four-Square provided dinner. 

Wednesday we drove up to Roundhill for more skiing. I'd never been there before. It was absolutely perfect. The ski field was busy, but not crazily so. The snow was good. The granddaddy of all rope tows up to the expert slopes was not yet open because there wasn't enough snow on that slope yet, but I wouldn't have had the skill to have tried it anyway. 

And the views from the top of the normal runs were passable anyway. 

The place could have handled a few more people than were there, but a lot more would have started getting into congestion issues at the tow bar. I hope that their numbers hold up with school break having finished - the place is spectacular. Just wonderful. 

Thursday we started heading for home. The Friday afternoon ferry meant a Thursday drive up to Blenheim, via the Inland Scenic Route and Geraldine and Oxford. 

Geraldine was very quiet. We had the cheese shop to ourselves - that district would normally have been full of busloads of tourists. Barkers of Geraldine had scaled up considerably since we were last there, with facilities fit for those busloads. It was busy enough with locals, though I wonder whether that will last beyond school holidays. 

We stopped in Oxford for lunch. Oxford is a great little town about a half-hour out of Christchurch. It's always been a bit touristy, with a great weekend market we'd occasionally get out to. We arrived in Oxford at 1 PM on a Thursday and figured we'd try the new and interesting-looking diner. And it had no room at all - bookings only. At 1 PM on a Thursday, in a small town a half-hour out of Christchurch. 

The road back up through Kaikoura is still under construction from the 2016 earthquakes. They're managing it by letting traffic flow one way for 20 minutes, the other way for 20 minutes, and working for 20 minutes. But they are managing it superbly. A smiling worker comes by to explain the works to each car, when traffic might start moving again, and to point out the portaloos near the front of the queue. He didn't, but could have, pointed out the seals that made for excellent companions down the roadside cliff at the rocky beach.

Blenheim seemed busy enough. We got the very last table at Gramado's, next to the motel where we stayed the night. 

And we caught the ferry Friday afternoon after spending a bit of time at the Picton aquarium, where we got to pat a tuatara. It too was as busy as we've generally seen it on prior trips - but perhaps lighter than you might have thought for school holidays. 

Overall, the tourist-facing places that cater to international tourists in particular looked to be in rough shape - Oamaru's Victorian district in particular. But those catering to locals were throbbing. That will ease back as school holidays are over, and may erode further with the end of the wage subsidy scheme looming. 

Continuing to prop up tourist ventures catering to international tourists makes little sense if the government isn't able to set arrangements at the border to safely facilitate more people coming through. The link goes through to my piece this week at Newsroom that previews some of the things I talk about in the report we're releasing overnight.

Normal arrangements cannot be resumed; any safe opening requires at least managed isolation of incoming internationals, and that will prevent the kinds of tourism we've previously had from coming back. But there is a lot that could be done, safely. 

Tourists would never self-isolate for two weeks. But half of the US workforce shifted to remote work during their lockdown, and if even tiny proportions of them were able and willing to shift their remote work to New Zealand, bringing their jobs with them, it would bring life back to a lot of places. There would still be a big reduction in visits to the really tourist-facing places. Fewer visitors each spending a lot longer here will visit each of the sites once or twice; the bus loads of tourists that came through spending a couple weeks here visited each of the sites once. Even if the total number of international-nights spent here were the same, the traffic at those facilities would be well down. But the cafes and bars would be doing rather well - and not just during school holidays. 

I wonder how many US tech workers would be happy to flip from the nightmares there to hang out for a year in Oamaru, or in Napier, or in Cheviot, or anywhere else here where the internet is speedy enough.

As of 15 July, Our World in Data had New Zealand's Covid restrictions as being among the least restrictive in the world. Tighter restrictions earlier mean we're incredibly free now. We've always been the Outside of the Asylum, it's more true now than ever. 

It's sad. In America, and a lot of Australia, they rail against facemasks as being intolerable restrictions on freedom. We had a lockdown, and we can live more freely than folks can anywhere else. We have to keep the borders safe. But surely there are ways of letting a few more come in, at their own expense, to enjoy the serenity. 

I wish that I had been able to convince more of my friends, before all of this, to join us here. 

Bayesian updating and deities

Maybe we should upweight the chances that there is a deity - one that cares a lot about poetic justice.

Last year, a Bottle-O bottleshop tried to set up in Khandallah Village.

The shop was opposed by a pile of local NIMBYs. 

Among the objections raised were that:

• The branding was too down-market for snooty snooty Khandallah. Maybe if it was a Glengarry instead of a Bottle-O.
• That young children walk through the village and while they wouldn't be able to purchase alcohol, they'd see unhealthy things being sold and that would damage their fragile little minds.
• That the nearest bottleshop is only 1.2 km away, which is probably already too close in Ngaio; there's also one over in Johnsonville. Surely nobody could be inconvenienced by having to walk 1.2 km to get their alcohol. And, there is already beer and wine in the local supermarket.  
• Maybe disreputable types - persons of low quality - would take the train to Khandallah and sit in the little park and drink alcohol there. [Heavily racist overtones in the Khandallah town hall meeting, we all know what you meant, you horrid elderly lady.]

Imagine that you were a poetic justice God. What would you put in that spot?

Walking through the village today, I finally saw a sign over the window.

25 paces from the Hell's Pizza, we will have a Dominos.