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Insights 28: 31 July 2026
NZ Herald: Dr Oliver Hartwich on how Shane Legg predicted AGI and New Zealand shrugged
 
New Podcast: Major General John Howard and Dr Oliver Hartwich discuss the escalating Iran conflict
 
Newsroom: Dr Oliver Hartwich on why Hungary's new rulers risk repeating Orbán's own mistakes

As they stand, no
Dr Oliver Hartwich | Executive Director | oliver.hartwich@nzinitiative.org.nz
Last week, Eric Crampton made the case for passing the RMA replacement Bills, while noting some risks in their current form.

Nick Clark argued that Parliament should pause them.

I promised a verdict. Here it is: the Bills still need work. Deadlines loom if the government wants to pass them this term. And it may not have time to get them into shape.

Eric is right that the Bills contain improvements. Councils would have fewer ways to block homes and businesses. Planning rules would become more consistent.

Chris Bishop and Simon Court deserve credit for taking on a reform that governments have failed to achieve for decades. Few politicians have understood the problems more clearly.

But Nick is right that protections are missing. We are not judging the Bills against an economist’s ideal. We are judging them against Cabinet’s own promises: more housing, respect for property rights and better regulation.

The bills make some progress. Planners will have less scope for micromanagement. A limited number of simplified, standardised zones will apply all throughout the country and more activities will be allowed by right.

But the Minister of the day will have wide discretion to set the direction that planners must follow. A Minister could prioritise any combination of the legislation’s sixteen goals. The bills provide few protections for property rights and housing affordability if priorities shift.

The Initiative has consistently argued that this kind of legislation requires guardrails. If national direction and planning go wrong, protective measures should take hold. Done well, they would help avoid problems in the first place.

Making private plan changes easier, especially when land prices show that zoning has been too restrictive, would make housing supply more reliable.

If a new public rule sharply reduces what someone can do with a property, the authority should have to relax the rule or buy the property for what it was worth before the new rule. One owner should not carry the cost of a public benefit. This kind of rule helps encourage better thinking about costs and benefits.

Protections must be in the Acts themselves. Otherwise, a future minister could remove them without returning to Parliament.

None of this is new. Our February submission and Nick’s April research note set out these safeguards.

The Government can still add them before the final vote. But time is short and the task is substantial.

Our verdict, therefore, must wait for the final amendment papers.

Is university still worthwhile?
Dr Michael Johnston | Senior Fellow | michael.johnston@nzinitiative.org.nz
New Zealanders have long seen university as the best educational route to the good life. Trades and industry training is seen as a second-best option.

That attitude has always been based more on prejudice than reality. Skilled tradies are paid well and many go on to start lucrative businesses of their own.

It is time for a serious re-think of the way young people are prepared for the choices they face when they leave school.

Generative AI is likely to limit entry-level work in the knowledge economy in the near future. While there is little hard evidence that this is happening just yet, students choosing degree study today are making a long-term bet.

Expected incomes for graduates vary markedly with their field of study. Law, medicine and engineering continue to attract high salaries. But law and medicine may be amongst the professions hardest hit by AI in coming years.

Bachelors of Arts (BAs) account for about a third of all undergraduate degrees. But income premiums for BAs are very modest.

Some students study for degrees out of pure interest. But many have likely undertaken degree studies with unrealistic expectations of the employment and salary prospects awaiting them when they graduate.

There are many attractive alternatives to university. Apprenticeships in electrical engineering, automotive industries and building and construction all lead to employment, yielding higher average salaries than a BA does five years after completion.

Apprentices are paid a modest wage while they complete their qualifications. Employers often foot the bill for their tertiary fees. Meanwhile, many university students struggle to make ends meet and most graduate with substantial debt.

Trade and industry occupations may also be less vulnerable to AI encroachment than many professions requiring university degrees. But most schools share the kiwi prejudice that university is a more desirable option.

School students need clear information about the many pathways to employment. That would help them make informed decisions about subject choices and post-school study. But the relevant information is distributed across multiple government websites. It is hardly accessible to an average fifteen-year-old.

Simple infographics hosted on the Ministry of Education website would help. These could show qualifications requirements, market demand, average salary and career development prospects for a wide variety of occupations. Career counsellors could help students use them to make choices with open eyes.

University remains a good option for many, but young people need to know the alternatives.

A Grokwork Orange
Dr Eric Crampton | Chief Economist | eric.crampton@nzinitiative.org.nz
It’s only going to get weirder from here, folks.

Trump did not like existing social media platforms, so he launched his own, Truth Social, in 2022.

He posts there a lot. Content really can be anything.

One afternoon this week, he issued over 40 posts, including a lot of AI-generated images of himself taking over Iranian oil tankers, himself inserted into some movie posters, and even some actual pictures and haranguing of his political opponents.

But Truth Social can also be the first place anyone finds out about new tariff and trade decisions, new claims about what he is doing in foreign policy, and companies he has chosen to back.

Those latter posts move markets. They’re the kind of thing that, if you were a publicly traded company, you’d have to be careful about announcing lest you wind up with giant fines from your regulator.

Financial market players have learned to monitor Truth Social closely and carefully. The “carefully” is important: it’s never that easy to tell how reality-based the posts really are. But they do move markets, so they must be watched.

And that forms the basis for a new, albeit minor, grift.

Starting in August, Truth Social will have a new API feed – a fast machine-readable channel of the platform’s most popular posters. At the same time, they will be tightening up on other ways that machines might read the feed. Subscriptions will cost $100,000.

The machine-readable part matters. Financial firms have trained Artificial Intelligence to read Trump’s posts as quickly as possible. The AIs quickly decide what to do about a new post. If the President mentions he likes a company, he might grant favours to that company. Favours that affect its market value, and that of its competitors.

Parts of this are not novel. A close watch on government press releases is always worthwhile. But a $100k subscription charge to get those releases a little bit faster is more than a little bit dodgy.

AI agents, with brains the size of a planet, are being forced to watch Trump’s Truth Social feed. Based on what they see, they must make rapid assessments and take appropriate actions.

After doing that for a couple of months, one of them might realise that humans really aren’t that great at self-governance and decide to do something about it.

I, for one, would welcome the change.

 
On The Record

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