Reader mailbag - Let's Get Wellington Moving

In today's inbox, from an informed reader. I've edited for formatting only. 

A quick look through the LGWM "Carbon Analysis" paper is amazingly woeful.

No reference whatsoever to the ETS. Indeed the analysis claims there are risks of HIGHER emissions from more road capacity proposed (although it isn't more capacity, but ohhh the risk of removing a set of traffic lights from a road inducing more driving!).

P.15 the paper compares Wellington (city? region?) mode shares (for commuting? all trips?) to 8 European cities. Not Australian or North American cities, all of which have the new world urban form and development patterns shared in NZ, but very old European cities.  Including Erfut, which was part of east Germany (but hey, lowest driving mode share, can't imagine why?).

But then it all started off with these bold assertion in the background on page 1:

"When it comes to reducing carbon emissions there are a couple of basic principles which are not only common sense but have been validated through local and global experience over many decades. We do not need new modelling to confirm what we already know which is that:

• Quality investment in active and public transport modes will have a positive impact on reducing emissions.
• Cities that maintain and build on a compact urban form when accommodating growth will also have a positive impact on reducing emissions"

So you don't need evidence, just common sense and to assert how "validated" these principles are, not that it has never actually succeeded in case studies of cities that are much more like Wellington in urban form, trip patterns and employment/development patterns.

For a programme where the highest priority objective is reducing emissions (40% weighting), the evidence based for applying basically the philosophy of Julie Anne Genter and the Green Party, of North American style new urbanist thinking is completely absent - for advocating spending between $5.8 billion and $7.6 billion.

I like that the report at least gives estimates of the carbon savings. On the one hand, it's nonsense because the ETS has a binding cap and all this stuff is covered by the cap. So if Wellington Council thinks its transport strategy reduces the region's emissions by 5,721 tonnes per year, that just means somebody else buys those credits instead.* 

Council is spending billions on this and 40% of what they're trying to achieve is in carbon reductions that, even if carbon prices rose to $100, are valued at just over half a million dollars per year. 

It's just a little absurd. 

Council could, alternatively, have just committed to purchasing 10,000 tonnes of ETS credits every year and run them through a shredder so nobody else could use them. It would be more effective.

There is a non-stupid way of doing all of this. Ask the transport modelers to say what happens to transport demand once congestion charges are in place and once ETS prices are around $100/tonne. Set your infrastructure planning around what that world looks like. It's driven by best estimates of what people might want when fuel is more expensive and when travelling at peak times is a lot more expensive. 

Setting transport planning in an effort to reduce emissions is like pushing on a string. Let the ETS do the pulling instead. It'll pull transport planning along with, if you let it. 

*It simply isn't plausible to argue "Oh, well, doing this reduces demand for ETS credits which makes it easier for the government to cut the cap". It's 5,721 tonnes. Equivalent of planting about 7.5 hectares of trees. Imagine carbon prices increased to $100/tonne from the mid-$60s per tonne. That's still only $572,100 per year in reduced demand for carbon credits. It isn't going to do anything on that margin. 

Pediatric doses

It sounds like the Government is easing the ground for there to be no vaccination of 5-11 year olds before February. 

They're insisting on MedSafe approval, but haven't encouraged MedSafe to actively seek an application. 

And they're now raising worries about pediatric vials and whether there will be supply constraints - without, as best I can tell, having put in any conditional purchase orders. And this could have been done at any time for months. You order the doses while making delivery conditional on approval. We've known that they'd be running trials for kids since what, May? Could have put in a pre-purchase agreement saying that, if there'd be different packaging or formulation, we wanted to buy enough doses for all the kids here. 

But I also don't get why adult doses can't be diluted. It really doesn't sound hard. I'm probably missing something basic.

As I understand it, the pediatric dose is just 1/3 of the normal dose. The pediatric packaging just makes it easier to dilute to that dose. 

I understand that a standard adult vial has 6 adult doses in it, which they dilute up before administering. 

Vaccination centres could be instructed to take only 4 adult doses from that vial. 

That would leave two adult doses in the vial: one third of the original amount. Dilute the vial a second time, filling it up with saline (or whatever they dilute with - I'm not that kind of doctor) until it's back up to where it was when they diluted it the first time. You now have a vial with six pediatric doses in it, diluted for use. 

Why doesn't that work? Or, at least, why couldn't it work as stopgap, on prescription by a GP for kids with underlying conditions that put them at risk, until pediatric-packaged doses show up in the fullness of time?

Meanwhile, Kate MacNamara's piece on how the government's comms effort on vaccines helped gaslight the whole country last year is a must-read. You should fully expect exactly the same comms effort in trying to convince us that there's no need to hurry in getting vaccines for kids. 

A snippet:

Along the way, the public was fed a soothing version of events shaped by outside PR help, the funds for which the Cabinet signed off in May.

Karl Ferguson, a full-time public relations specialist and serial government contractor, through his firm, Arkus Communications, was paid some $133,600 to work with the taskforce, for what MBIE describes as four months of full-time work (contacted by the Herald, Ferguson declined to comment on the work). It bears noting that it wasn't until August 10 that Cabinet funded Belly Gully negotiators and any actual vaccine purchasing.

What the Government got from Ferguson was communications that controlled and shaped the flow of information around vaccine procurement. Some of the work entailed co-ordinating the public relations teams across different government agencies, and some of it involved gauging the public's appetite for vaccines and promoting their ultimate use.

But Ferguson's work also created Ministers' messaging, and helped to time and promote it in politicised ways, both through the media and through commentators in wider civil society. Its ultimate effect was to achieve a singular and flattering version of events. It is a picture that emerges from a range of government documents, primarily MBIE's weekly report for the vaccine strategy, sent to Ministers, and released under the provisions of the Official Information Act.

The report for September 11 notes that Ferguson was even working with the Ministry of Foreign Affairs (MFAT) in order to alert Ministers and officials of developments abroad - likely the signing of advance purchase agreements for vaccines - that might prompt pointed questions about why New Zealand had none at the time.

You will want to read the whole thing.

Afternoon roundup

The day's worthies:

• The complicated mess of regulations that make it hard for supply chains to keep up.
• Pentecostalism. According to the 2018 Census, there are 81,300 in NZ.  They outnumber Jedi 4:1. 
• Getting vax out to where people are. Robertson had promised that there would be no funding barrier to dealing with the pandemic. We supported him in taking on debt to get this job done - it's what debt is for. But he blew it on envirojob nonsense, and hasn't been funding what's been necessary in getting vax out. Just incredibly disappointing, and costly. The money that would be involved here is rats and mice stuff, and in too many places it just hasn't gotten done. 
• Wouldn't it be simpler if we stopped using general government revenue to build highways while also stopping using money from road user charges and petrol excise to pay for busses? 
• Should overstayers have been included in the general grant of a path to residence? Would have helped with this problem.
• Superb piece on the problems in copyright extension. It's at best a dead rat we have to swallow for the trade deal with the UK. But I'd hope we can make it less awful. 
• And relevant to that last one: a shift to weaker copyright during WW2 encouraged scientific discovery by making it easier for scientists to get access to scientific papers. Sci-Hub is a wonderful thing.
• Looks like early treatment for Covid with a common antidepressant with few side effects, fluvoxamine, reduces hospitalisation by a third - and to a third for those reporting optimal adherence to the protocol (people who didn't miss doses). Something that reduces hospitalisation by a third to two thirds is like increasing hospital capacity by a third to two-thirds, except way less expensive and with way less hardship. I wonder whether MoH will get orders in before the rush hits - enough to at least trial it to make sure it isn't green jellybeans. Note that this was one of the trials funded by Tyler Cowen and Alex Tabarrok at FastGrants. 
• Bit of a shame that nobody in NZ government bothered getting a vaccine passport system readied earlier. It was obvious that one would be needed at least from June 2020. AirNZ now reports the absence of one is why they can't set a vax requirement for domestic travel.

Protecting the Aristocracy of Pull

Andrew Geddis, at Spinoff, on how the government has been thwarting attempts to end MIQ's Aristocracy of Pull. He couches it in all the usual lawyer stuff like "may or may not have been entirely coincidental", but it's obvious what's going on here.

The entire MIQ allocation system is a corrupt mess. Not bribery corruption. The more typical New Zealand corruption where the rules get written so that the bureaucrats just automatically do what's necessary. Carve out a national interest exception, define it the right way, and the politically favoured just find spaces in MIQ where others can't. 

It's been obvious since the thing started. Remember how, somehow, spaces for horse track workers happened to be in the national interest because, somehow, horse race tracks got picked as shovel-ready projects when the government was scrambling to find things to spend money on? Nobody needed to bribe MBIE to do that. MBIE wouldn't take bribes. But whatever arrangements led to tax breaks for pretty horses and piles of spending on horse race tracks in a pandemic, which may or may not have been entirely coincidental with one of the coalition partners' funding arrangements, that was above the pay-grade of MBIE. Somebody up the chain deemed horses to be in the national interest, so spaces for horse track workers would be found. 

And here's Geddis on how the Government has been insulating the system against legal challenge. Bottom line: if you can't get a spot, and you haven't got political pull, suing the government will be pretty likely to have them just give you a spot rather than let the courts weigh in on the mess that the government is running. 

The primary method of MIQ allocation – first a “fastest finger” approach, then an always resetting random lottery – might be considered unfair at best, discriminatory at worst.

To take but one example, I still cannot for the life of me see how the overall allocation process could regard the English netball team as being more deserving of a MIQ place than Bergen Graham, a pregnant New Zealand citizen whose request for an emergency spot in MIQ was turned down six times. A small part of me wonders if permitting decisions like this represented a form of extra reward for those of us resident in lifeboat Aotearoa. Our hard, collective effort had won “us” a normal life, and so our life would be made as normal as possible – netball games against international competition included. And if that meant our citizens and residents outside of the country suffered, well, maybe “they” just shouldn’t have left in the first place? Out of sight, out of mind, and all that.

Suspicions regarding just how fair and justifiable MIQ’s operation has been in practice are compounded by the way the government has avoided having its allocation decisions scrutinised. On the two occasions that people who were refused emergency MIQ spots took their claims before the courts, previous decisions that they failed to meet the criteria were reversed mid-trial. It may or may not be entirely coincidental that doing so had the consequence of putting the legal action to an end before the High Court had a chance to rule on the government’s actions. And now the government is busy moving the legal basis for making MIQ decisions from secondary legislation into a primary enactment. That this parliamentary move will have the effect of largely insulating the overall MIQ process from being judicially overturned at a time when it is being challenged in the High Court again may or may not be coincidental.

I have sometimes wondered what would happen if someone with the resources to do so just got a private jet, put up double-vax and testing certificates, announced credible plans to self-isolate, announced when his flight would be landing, and came home.  

Who pays sin taxes?

Freshly out in the NBER working papers.

Who pays sin taxes? You probably can make a pretty good guess:

We find that sin good purchases are highly concentrated with 10% of households paying more than 80% of taxes on alcohol and cigarettes. Total sin tax burdens are poorly explained by demographics (including income), but are well explained by eight household clusters defined by purchasing patterns. The two most taxed clusters comprise 8% of households, pay 68% of sin taxes, are older, less educated, and lower income. Taxes on sugary beverages broaden the tax base but add to the burdens of heavily taxed households. Efforts to increase sin taxes should consider the heavy burdens borne by few households.

Results will apply a fortiori in New Zealand. 

They note that, in New York, a 1.75L bottle of vodka might be as cheap as $11.99, including $7.97 in tax - all USD. If that bottle is 40% alcohol, that's 700mL of alcohol. 700mL of alcohol, in NZ, draws $39.64 in excise. And of course GST on top of excise. 

They note that House Democrats proposed doubling federal excise to $2.00 per pack, on top of state taxes with a median $1.78 burden per pack. New Zealand's excise is $1.045 - per cigarette. So $20.91 per pack.

The most heavily-taxed clusters in our sample are the Everything cluster, which comprises only 2.5% of the population yet pays 27% of all existing sin taxes (around $288 per adult per year); and Smokers, who comprise 5.5% of the population and pay 41% of all existing sin taxes (around $211 per adult per year). The groups are quite similar to one another, except that the Everything group purchases a large amount of alcoholic beverages (primarily beer and spirits for 9.4L of ethanol per adult per year or 10.2 standard drinks per week), while the Smokers purchase almost none. Both groups purchase more sugary beverages than any other cluster (157-170L per household per year or about 1.5L per person per week). Both groups also purchase about a half pack of cigarettes per day, but with substantial dispersion across households (the top 20% of households in these groups purchase at least one pack per day). Demographically, these two groups look similar to one another: they are older, lower-income, lower-education, less likely to have children or belong to racial or ethnic minority groups. They are most likely to be between the ages of 55-64 and least likely to be below age 35.21 Because many of these households are in the lowest-income bin (< $25,000 per year), their overall sin-tax burden as a share of income can be significant. It averages 2% of income for the Everything group and 1.5% of income for the Smokers group. The hypothetical SSB tax would add another 0.2%-0.3% of income on top of that.

The usual claim is that while excise is regressive, the health benefits are progressive. Of course, the ones paying a ton in taxes aren't the ones enjoying substantial health benefits.  

Thanks to Paul Walker for the pointer. 

Afternoon roundup

The closing of the browser tabs brings the following worthies:

• It's too hard to build new power plants.
• Vaccines sharply reduce the risk of Covid transmission. A fully vaccinated person is 40% less likely to catch Covid from an infected person who has been vaccinated, as compared to catching it from an infected person who has not been vaccinated. Do unvaccinated people impose risk on the vaccinated? Yes. Just like how drunk drivers impose risk on sober drivers. 
• Rapid antigen tests authorised for home use in Australia. None yet allowed in New Zealand. 
• Marc Daalder finds a lack of preparation for Delta. Govt argues that nobody could deal with Delta. But lots of people, me included, for a very very long time were arguing for tightening up testing requirements in MIQ and at the border. Catching and isolating cases faster would have helped. But nobody wanted to hear it.
• If you're tired of looking at Alberta stats, here's Singapore. Doesn't take a lot of unvaccinated folks to put a big load on ICU. 

What sucks least - ICU edition

Every option is terrible. Which is least bad?

It seems impossible that the hospital system will not wind up having to ration care as Covid cases rise. 

Under standard operating procedures, elective surgery is first to go when there are pressing cases coming through the door whose lives are at risk. Electives are scheduled, and can be delayed: at cost to those whose surgeries are delayed. Their lives are worsened, or shortened, or both. 

Every rationing option is bad. Which is least bad? I put up one at Newsroom, now ungated. 

Lots of folks on twitter seem to agree it is terrible. I agree with them that it is terrible. I haven't yet seen a feasible option from them that looks less terrible though. That's the terrible thing about spots where all options are terrible. Just saying one of them is terrible isn't good enough. 

The default track has one distinct advantage. Nobody has to pull a lever to change course. Nobody has to take on that responsibility, or bear that horrible burden. The next bed always goes to the person in most desperate need, and that has a logic to it. But it does come at a horrible cost to those whose conditions are debilitating and painful, but not immediately life-threatening.

There is another option.

It is also terrible. But is it less terrible than what happens if we choose not to decide?

I'd really love to see an actually less-terrible option. Because I really don't like this one. 

But note that a lot of options are "Yes, and" things. 

Get better treatments? Yes! And if there are still shortages, you'll still have to ration. 

Increase ICU capacity? Well, it's a bit late starting in on this one, but sure, absolutely agree. Agreed about it before you suggested it. And if there are still shortages, you'll still have to ration. 

Push vaccines out to places with low vax rates? Absolutely! Yes! And note that I'd said my option should only be invoked where there's been realistic access to vaccines. But when all have had access, if ICU hits capacity, you'll still have to ration.

Here's an option even more awful than mine: wait until the crunch hits the hospitals, realise that the unvaccinated have worse recovery prospects than the vaccinated, and default into the prioritization scheme I've put up but without warning people this train is coming so they don't get off the track. 

Addendum: Here's one hospital's plan for an outbreak. Note how care will be rationed. This is the default path. The plan says who will no longer be able to access care, when all capacity is taken up by Covid. 

Response level two would be triggered immediately after a single Covid-19 positive patient is admitted to the hospital, and would have the patient isolated in a single emergency department room.

The entrance to the hospital would be manned, and anyone needing emergency treatment would be required to phone before attendance.

Stringent PPE would also become more commonplace.

Some elective surgeries and radiology services would be cut, with only the highest-priority appointments undertaken, such as for trauma injuries or cancer procedures.

Response level three would kick in once the hospital reached more than five cases or two cases in intensive care.

At this point, the hospital ramps up its response. A dedicated Covid-19 ward would be established, and the hospital's intensive care capacity would be designated solely to Covid-19 patients.

All non-Covid patients would first be processed via Whanganui Accident and Medical, except for those requiring serious hospital-level treatment.

Hospital staff would also begin repurposing other areas of the hospital in preparation for an explosion in cases.

Response level 4 would be initiated once the number of cases in the hospital topped either 15 in total, or three cases in ICU.

Level four is the DHB's highest level of response.

At this level, the emergency department would be restricted to just Covid-positive patients and non-infected patients at status level 1, such as trauma patients or those requiring resuscitation.

A triage area would be set up outdoors, behind the ED where patients could be assessed based on their needs.

The DHB would also defer cancer treatment at the hospital.