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The bogus arguments for a “a Big Australia”

March 23, 2011

Old Parliament House

I attended one day of a two-day Productivity Commission Roundtable on sustainable population in Canberra. I was relieved that before this gathering of economists the Chairman of the Productivity Commission, Gary Banks, emphasised that he wanted attention to quality of life, a concept difficult for economists to grapple with.

I’m not sure the economists responded.

The papers were, however, of a high quality. There was probably a preponderance of enthusiasts for the now discredited notion of a Big Australia. One contributor devoted his paper to questioning the accuracy of those opinion polls which, with monotonous consistency, demonstrate that Australians are not supporters of a Big Australia.

Nothing I heard altered my view of the economics of immigration. Among my conclusions, unaltered by the roundtable:

      • High immigration does not benefit the existing population. Indeed this point was actually confirmed in the discussion. The House of Lords Select Committee (2008) inquiry into Britain’s high immigration policies said it all: “We have found no evidence for the argument, made by the Government, business and many others, that net immigration – immigration minus emigration – generates significant economic benefits for the existing UK population.”

      • Immigration worsens skill shortages, it doesn’t relieve them. When a skilled worked is imported he or she brings dependents. The family adds more to the demand for housing and infrastructure than the skilled worker contributes to the supply.

      • High immigration causes hothouse activity in the housing sector and exacerbates the demand for infrastructure, putting upward pressure on taxes and government borrowings. And in turn, high immigration simply adds to more demands for imported labour to ease acute skill shortages caused by over ambitious targets.

      • High immigration does not alter the age profile of the population. As the Federal Treasury said, “Migration cannot stop the aging of our population.”

    Let me declare an interest. I am a Patron of Sustainable Population Australia. I like liveable cities. I like coastal national parks. I like people but have reservations about the species. I think the last thing the planet needs is an increase in human numbers.

    The roundtable was held in Old Parliament House in Canberra now the Museum of Australian Democracy. What a revelation this is! A great teaching resource. A veritable inland sea of political and social nostalgia. You are struck by how small were the two parliamentary chambers and the meeting rooms for the government and opposition parties. I was surprised the press gallery has become part of the museum’s space and struck by how cramped and confined those corridors are.

    From the age of about 16 I wanted nothing more but to sit on those green benches in the old House of Representatives chamber. One of the lessons in life is that the things that mattered so much end up mattering so little.

3 Comments
  1. Watson permalink
    March 23, 2011 6:30 pm

    I believe that the infinite growth economists are a sub-species of climate change denialists, or perhaps it is the other way round. Either way, they shouldn’t be allowed out without a white cane!
    Somehow they imagine that infinite steady-state growth is good for ever and ever, no matter how big. On that basis, China should be the most successful economy in the world instead of the most fragile, while Sweden should be a basket case. Much has been written, in error, about the terminal decline of the Japanese economy as a direct result of the failure to replace it’s naturally diminishing workforce with millions of guest workers.

    When Kanaka labour was withdrawn from the cane farms of Queensland, the sugar industry did not collapse – it employed migrant workers, and then replaced nearly all of them with machines. All farming enterprise, from dairying to horticulture would be non-competitive today if it had stuck to ‘cheap labour’ solutions. Agriculture is the most mechanised sector of the economy, having reduced its workforce by nearly 90% since the 1950’s.
    The mining industry now employs one worker per $1,000,000 worth of equipment. The major mining companies, responsible for the extraction and export of 100s of millions of tonnes of minerals annually, employ collectively fewer than 100,000 workers.
    Japanese cars are mostly made by robots – delivering quality and quantity unmatched by European and American manufacturers. If they have economic problems they arise from difficulties in re-directing their product research and development into more dynamic areas of the market – nothing to do with their declining population.
    New workers require more living infra-structure, and while this provides the illusion of business growth through construction, there is no net benefit to the quality of life of the ordinary citizens, just the building and development entrepreneurs – the only people who matter to the ‘ growth model economists’.
    While they rabbit on endlessly about the burden on taxpayers created by an aging population, no-one stops to consider the reduction in the resources that need to be devoted to that other group of non-productive members of the society – the children. With reduced demands for childcare and schooling, the savings in that sector could be transferred to the care of the elderly. And the Japanese will employ robots!

  2. Mr Squiggle permalink
    March 23, 2011 8:21 pm

    Bob,

    Thank you for your contribution to the debate on population size.

    We constantly hear that one in four Australians are born overseas. Fair Enough.

    The ABS tells us that the average age of Australians born overseas is 45 years of age. By contrast, the average age of Australians born in Australia is 33.

    The migrant demographic is a middle-aged demographic. Obviously. Any immigration program that gives primacy to net migration over net births will accelerate the aging of Australia’s population.

    Please note, my isn’t an argument against immigration, it is an argument against growing the population through net migration at the expense of net births.

    Thanks again, I wish you had more success on this point

  3. James permalink
    March 27, 2011 2:14 pm

    I think I still believe in a bigger Australia in a smaller world. There are too many humans on the planet for this growth to be sustainable indefinitely. We could however actually make use of the current over population to start working on producing some beautiful cities and infrastructure that will be of benefit to future generations. Australia has much land and nuclear resources and political stability to hold the current excess population while world population peaks and gently falls back to a more sustainable level. Yes, this will effect Australia’s environment, but perhaps it is better for us to try and save the Amazon and the Congo than here. I do however respect your view Mr Carr, and you possibly could convert me.

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