More Bonn, less Detroit: Rob MacCulloch calls $10b bailout for Wellington ‘unacceptable’

Summarised by Centrist

Economist Rob MacCulloch called out a proposed $10b bailout for Wellington. According to MacCulloch, the council is too indebted to pay for these upgrades and must rely on general taxation, which he argues is a bad idea. 

“Wellington will probably be bailed in a few years, just like defaulting Detroit, another failing city, this time in the US,” he said.

MacCulloch criticises ongoing projects, from tunnels and water repairs to a convention centre, arguing that Wellington’s shrinking population doesn’t justify such a large investment. “Whilst other cities in NZ boom, Wellington City shrinks,” he notes. He believes these projects should be funded by Wellington ratepayers—not by the rest of New Zealand.

Drawing on Germany’s experience moving its capital from Bonn to Berlin, he argues New Zealand should keep Wellington as the capital in name only. Essential ministries like Social Development and Education should be moved north. 

“It’s inappropriate they continue to be based in Wellington. Most of the country’s social & educational problems are located in South Auckland. Those Ministries should be moved to Manukau City, which is next door, and by the International Airport,” he writes. 

By decreasing government presence in Wellington, he suggests New Zealand could avoid further taxpayer burdens for infrastructure that a smaller Wellington population wouldn’t need.

Read more over at Bassett, Brash, and Hide

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