Big Australia is making us poorer

By Leith van Onselen

Former head of the Business Council of Australia (BCA) and Audit Commission chair, Tony Shepherd, has called on the Government to lift Australia’s immigration intake in a bid to raise living standards and add $1.6 trillion to the economy. From The Australian:

Tony Shepherd, has warned that the ­migration intake should be maintained at current levels and then rise in the years ahead to confront the challenges of an ageing population…

In a sign that Australians will live healthier and longer lives, by mid-century there will be about 35,000 people over the age of 100. The continued arrival of young migrants will be essential to dealing with the ageing of the population…

“As the population rises we should consider raising the rate, having regard to our capacity for absorption”.

…keeping net overseas migration at current levels will add $1.6 trillion to the Australian economy every year by mid-century, driving almost half the country’s economic growth over the coming decades.

That Mr Shepherd has backed a “Big Australia” is hardly surprising, given his long-time role as a mouthpiece for Australia’s biggest companies. After all, it is big business and the owners of capital that are the primary beneficiaries of Australia’s high immigration intake.

You see, rising population is an easy way for businesses to sell more goods and services. Immigration also gives businesses access to lower cost workers. And there’s less need to become more efficient when your customer base is growing inexorably. Rather, just sit back and watch the profits flow.

Take, for example, Australia’s banks, which get the double bonus of not just having more consumers to sell debt to, but also extra demand for housing, which helps to support house prices and their loan collateral, especially given the urban consolidation policies operated by Australia’s states.

However, while the big end of town is a clear winner from rapid population growth, it doesn’t wear many of the costs. That is borne by you and I.

It is you and I that will be forced to spend more time in traffic jams as Australia’s infrastructure – already straining after a decade of rampant immigration – fails to keep up with population growth.

It is you and I that will be called upon to pay for expensive new infrastructure (e.g. roads, rail and desalination plants) in a futile bid support the rapidly growing population.

It is our children that will be required to live in smaller and more expensive housing, often further away from the CBD, as more people flood into our major capital cities.

And it is our children that will be called upon to once again ramp-up the immigration intake once the current batch of migrants grows old and needs support – the very definition of a ponzi scheme.

Perhaps the silliest claim from Shepherd is that without strong immigration, the economy’s growth would suffer – as if growth in overall GDP is the be all and end all. What he fails to mention is that economic growth through population is an illusion – it expands the economic pie (more inputs equals more outputs) but leaves everyone’s share of that pie unchanged.

One only needs to view the below chart to see what I am talking about. Despite enjoying the biggest mining investment boom in history, per capita real GDP has risen by a paltry 4.8% since September 2008, versus 15.9% growth in overall real GDP (see next chart).

ScreenHunter_6381 Mar. 05 08.07

That’s right, more than two-thirds of Australia’s economic growth has come entirely from population growth, with growth in per capita terms anaemic, despite the huge mining investment boom.

And then there’s Shepherd’s claim that a strong migration intake is required to offset the ageing of the population. This view has been debunked by the Productivity Commission, which found that immigration’s effect on Australia’s age structure is only modest and temporary:

…several studies, including some undertaken by the Commission, indicate that policy-induced changes to Australia’s population are unlikely to significantly affect the ageing trends.

Improvements in longevity are the major cause of population ageing over the long run. In recent projections, Commission researchers estimated that an increase in the long-run total fertility rate from 1.85 to 2.10 births per woman — even if it could be achieved — would be associated with only a 1.1 percentage point reduction in the proportion of people aged over 65 by 2051.

Similarly, substantial increases in the level of net overseas migration would have only modest effects on population ageing and the impacts would be temporary, since immigrants themselves age. The Commission has estimated that an increase in annual net migration from 150 000 to 300 000 would lower the proportion of those aged 65 or over by less than 3 percentage points by 2044-45. As an illustration of the challenge, the Commission showed that delaying an increase in the dependency ratio by 40 years would require a net migration-to-population ratio of 3 per cent per year, leading to a population of around 85 million by 2044-45.

It follows that, rather than seeking to mitigate the ageing of the population, policy should seek to influence the potential economic and other impacts.

Moreover, Shepherd’s claims that high immigration is required to raise living standards is bunkum. The broader economy can suffer as investment to support the growing population crowds-out productive investment and capital deepening, as explained by Dr Katherine Betts from the Monash University Centre for Population and Urban Research:

The Productivity Commission report on ageing points out that the infrastructure spending needed to manage population growth over the next 50 years will be five times the total that was needed over the last 50 years. This investment in capital widening must seriously weaken Australia’s capacity to invest in the capital deepening that would boost productivity.

Despite this, Treasury continues to emphasise its ‘three Ps’: population, participation and productivity. While Treasury treats these three variables as if they were independent some commentators argue that population growth has a positive effect on productivity. But there is a contrary argument. Population growth imposes pressures on infrastructure and adds to congestion; in so doing it depresses productivity.

International comparisons show that there is no association between population growth and growth in per capita GDP. This is not surprising as comparative data on 32 OECD countries show no positive association between population growth and growth in labour productivity…

Assertions that immigration-fuelled population growth will boost productivity remain conjectural. There is no empirical evidence that such growth in an advanced economy increases productivity.

Shepherd has also failed to acknowledge that Australia earns its way in the world mainly by selling its fixed mineral resources (e.g. iron ore, coal, natural gas, and gold). More people means less resources per capita. A growing population also means that we must deplete our mineral resources faster, just to maintain a constant standard of living.

No, the key criteria that needs to be met in deciding whether to expand the immigration intake is: “will it improve the living standards of the pre-existing population”? The answer to this question seems to be a resounding “no”. Therefore, policy makers should definitely not proceed with Shepherd’s plan, or preferably should curtail immigration to a level that provides net benefits to the existing population.

If all we are doing is growing for growth’s sake, pushing against infrastructure bottlenecks, diluting our fixed endowment of minerals resources, and failing to raise the living standards of the existing population, what’s the point?

[email protected]

Unconventional Economist

Comments

  1. StomperMEMBER

    Great rebuttal Leith!

    A spokeswoman from the “Migrant Council of Australia” was on ABC702 this morning spruiking the claims from the report and a BIG Australia.

    I nearly crashed my car in an apocalyptic rage as I screamed at the radio – there I was stuck in another glorious Sydney traffic jam with all the other sheeple while this sanctimonious mouthpiece was filling the airwaves with frankenumbers.

    Shame the ABC702 presenter was incapable of rebutting her nonsense and there was no counter argument.

    Your rebuttal gave me hope!

    • Isn’t it a question of 2/3rds of the growth coming at least in part of the expense of population growth, rather than due to?

      What % of that growth has been spread from existing capital (incl human) vs new capital raised by incoming migration?

    • SupernovaMEMBER

      Our great national broadcaster seems to be increasingly out of touch with ordinary Australians lately. ABC (ceo on salary of $800,000) floods the electorate with one-sided (far-extreem left) viewpoints meant to shame anyone whose cognition isn’t similar…..bias…..please!

  2. Australia is truly endowed with the dumbest electorate ever if they swallow this tripe from the richest, yet laziest business/political class in the world.

    • ThicklySliced

      Spot on!

      On the pig’s back for two decades will make one fat, complacent, gullible and quite quite stupid.

    • Unfortunately; much of the Australian electorate is at best, ignorant and at worst, has the mentality that as long as they can take care of their own “I’ve got mine mate” then to hell with everyone and everything else … other than giving obligatory politically correct/acceptable lip service.

      Much of this electorate is dumb enough to think that they can buy their way or their kids way into future “success”.

      This lack of foresight will come back to bite them and their progeny in the end.

    • Cris, you have to aknowledge that fighting growing population/immigration (which I totally support you for that) means fighting capitalism. Why?
      1.Growing polulation is a predisposition for capital growth. This is the main condition to have wealth growth, although not for everyone.
      2. Growing population serves perfectly the interests of the top richest. Their wealth grows exponentialy and the cost is shared by the middle class, which average income goes down consequently. So the graph above is just another prove of what some people and you know very well – we are living today in a genuine pure capitalism in his most developed stage – financialization of every side of our life. This is free capitalism, free for the only for the capital.
      3. More people means more competition among labour force, means lower wages, means higher profits. All this reflect as a consequence on our living standard. But the cause is not the immigration per se, it is the need for capital growth for the top. QE has its own limits, but growing population is the ultimate way for capital growth. There is mo other way.

  3. OldsaltMEMBER

    Great work Leith. This needs to find its way into the MSM and the myth debunked among the wider populace. If unemployment rises over the next few years, as we all expect it to, then traffic jams will be the least of our problems.

    • fitzroyMEMBER

      +1 Leith this post is too good for subscribers alone.
      I heard Jon Faine giving this fellow air this morning without any rebuttal. Send him a copy of this post.

      • Jon Faine is a stated supporter of A Big Australia. He does not even pretend to be balanced on the matter.

  4. The most toxic combination of factors is the rentier economy, especially in housing, being combined with growth pressures. Australia has had higher population growth in the past that did not seem to do much harm at the time. Of course building new houses at honest prices has major multiplier effects relative to rentiers in land running off with most of the moolah. There has been suggestions from researchers like Enrico Moretti, that affordable housing cities like Houston generate spin-off multiplier jobs from growth in energy or high tech sectors, at 5 times the rate of high-rent San Francisco.

    I really think we have lost sight of the beneficial past when factors like this applied.

    The other thing that it is crunch time for anyway, is that greenfields infrastructure is actually cheap to do, but cost blowouts can be expected decades down the track as it needs replacing, especially if you have failed to consider for easy replacement eg by permitting intensification developments all over what should have been rights of way. This is why some good studies of infrastructure costs in US cities have found a sweet spot for costs, existing in low to medium density cities, with very low density ones having diseconomies, and the highest density ones having diseconomies.

    I do wonder whether teasing out these complicating factors would change things a bit – plus the quality of the immigrants is very important. Some immigrants, any nation would be stupid to forego.


    • Some immigrants, any nation would be stupid to forego.

      They aren’t the ones we’ve been targeting, although we get a few of them by sheer dumb luck.

    • I did some work for greenfield housing development years ago. The developers insisted in running sewers down the backs of small allotments instead of in the street reserve at the front. Result, when there is a need to repair a pipe, half the back yards will have to be destroyed by hand digging. That went on all the time. Of course, the “savings” went into the developer’s pocket, not cheaper prices. And they had the gall to blame government charges. LOL!

      Another good one was a CBD hotel development. The developers argued for, and got, permission to build an eating area (enclosed, and with granite paving) over a major water main buried below. It’ll be fun if that blows. Oh, and no doubt it will be the public paying for damages.

      Bloody inefficient government.

    • Phil, a friend of mine once suggested there seems to be a bit of a sweet spot in terms of city size of a population of 2-3 million. He’d done a bit of traveling, and observed the nicest cities seemed to be around that size.

      I know it’s a completely subjective analysis, but I think it has merit. When they get bigger than that they seem to become too cumbersome to manage, smaller than that, and you start missing out on some of the services and experiences that a larger city can support.

      • I thought that until I went to Seoul. Never thought somewhere could be so chaotic and ordered at the same time.

      • drsmithyMEMBER

        When they get bigger than that they seem to become too cumbersome to manage, smaller than that, and you start missing out on some of the services and experiences that a larger city can support.

        I’ve lived in small towns of <10k people, cities of a few hundred thousand (Zurich), 1-2 million (Brisbane) and 4-6 million Sydney, Scottsdale/Phoenix).

        Personally, I struggle to see what additional "value" a city over a few hundred thousand delivers, assuming it is well connected with other areas.

  5. ceteris paribus

    Important article which exposes lack of vision and underlines the self interest of captains of industry.

    By the way, let’s have a few less “captains” and a few more thinkers in Australia.

  6. If you’re not building a massive rentseeker led population ponzi into your future models for australia you just haven’t been paying attention.

    Increased ecological and environmental degradation;
    Increased inequality;
    Increased infrastructure failure.

    It is baked in, plan for it.

  7. So our actual deaths double from 2024 to 2046 and our natual growth may drop to zero. Will a NOM be doubled or trebled to compensate? I do not think so…

    Note in 2013 WE HAD LESS BABIES than in 2012.

  8. moderate mouse

    Not sure I see it as clear cut as that. Your position seems to be that growing the population through immigration will automatically lead to worse outcomes in terms of livability and infrastructure problems. This is a Melbourne/Sydney-centric view.

    Sure, unplanned growth – which has been the status quo to date in this country, will almost certainly produce these poor outcomes. But what if we had some vision and growth was focused on places other than Sydney and Melbourne? Incentives for businesses to locate outside of Melbourne and Sydney (through favourable tax arrangements) would drive jobs growth in areas of the country that aren’t at breaking point. This would benefit our smaller cities as well as regional Australia while simultaneously preserving/improving livability in Sydney and Melbourne. Having 50% of our population crammed into two cities is madness in the extreme. The USA is a patchwork nation of small and medium sized towns and cities – New York and L.A. count for less than 10% of total population. Seattle, Austin, Portland, Boston…these are all highly livable cities of under 1 million people. They have vibrant job markets and offer a quality of life people in Sydney and Melbourne would be more than satisfied with.

    Saying all growth is bad is like Joe Hockey saying there’s only one way to fix the budget (his way). Joe’s worldview is binary – and in reality it’s not that simple. Similarly with population – the quality of the growth and how it is managed is what counts. Nor does Australia’s future income need to always be minerals-based – thus I don’t buy the view that we’re stuck splitting a fixed amount of income between more and more people.

    But equally, many who support a Big Australia are outright delusional and think that organic growth in Sydney and Melbourne will deliver some kind of ‘Global City’ utopia. Unmanaged growth of Sydney and Melbourne will produce urban nightmares that have more in common with Mexico City than London, New York or Tokyo. Our planners, and Australians more generally, seem to be afflicted with a strange form of small man syndrome in that they all want to strive for mega-city status while neglecting the true impacts this will have. Opening the floodgates while closing our eyes, crossing our fingers and wishing for Utopia will produce the exact opposite.

    • “But what if we had some vision and growth was focused on places other than Sydney and Melbourne? Incentives for businesses to locate outside of Melbourne and Sydney (through favourable tax arrangements) would drive jobs growth in areas of the country that aren’t at breaking point. This would benefit our smaller cities as well as regional Australia while simultaneously preserving/improving livability in Sydney and Melbourne.”

      How about our politicians show me such a plan BEFORE heading down the Big Australia path.

      • That’s the critical point. Iff there is a credible plan that shows how they intend to achieve what they want, and how it is to be resourced, then let’s look at it.

      • “How about our politicians show me such a plan BEFORE heading down the Big Australia path.”

        They can’t because there isn’t one.

    • KlimashkinaSydney

      Like the idea. But you undermined your own argument:

      ” But what if we had some vision”

      What vision? Have you experienced any over the last few years?

      • moderate mouse

        True that.

        But really, decentralisation will happen one way or another. Left to grow organically, fifty years from now people will be leaving Sydney and Melbourne in droves because they will be simply unbearable.

        We can either act now, or leave two great cities to collapse under their own success.

    • kinetic ritual

      It is inevitable that surging population growth via immigration will lead to worse outcomes for the majority, because it is NOT going to be centrally planned. The market will naturally choose the path of least resistance, and neither this government nor the Labor opposition have indicated any propensity to intervene in the market to smooth out such a dramatic transition. The fundamental question that is still being ignored as a matter of policy discussion is what type of society and economy do we want to have, how do we achieve it, and what are the trade offs. To just be swept along in the currents of perpetually rising population to support GDP growth is intellectually lazy, which characterises the majority of thinking at a corporate and political level in this country.

    • You have a point, but there is no plan. There’s not even a plan for a plan at this point, and we’re importing over 0.5% of the population every year. The only plan being pushed is to increase that percentage.

      You also need the people in the regional areas to agree with your idea. Many of whom probably won’t be, and these are the guys that will be on regional councils.

      • moderate mouse

        You’re telling me regional councils would resist preferential taxation policies that favour them and their business interests? Doubtful….

        Advocating we pull up the drawbridge is easily dismissed by the Big Australia brigade of Utopian dreamers. A more constructive position is to advocate a realistic and strategic management of long-term population growth – and the most efficient approach to managing population is decentralisation, not bigger, better, faster everything for Sydney and Melbourne.

    • New immigrants should be self funded for all health costs for five years and all welfare costs for three years.

      Then we will see how badly they want to come here.

      • You would find that many of these ‘immigrants’ are covered, e.g. Working Holiday Backpackers need insurance and/or reciprocal health treaties (e.g. UK, Ireland, etc.), international students all have private approved insurance for visa eligibility, and ditto 457s temp workers.

        Although all of the above contribute most to the population growth in Australia (vs permanent immigrants), they are temps and not eligible for Medicare, pensions etc..

    • Mouse
      I think you are missing the point. Numerous international studies have been undertaken on this subject and they have repeatedly found that there is NO net financial benefit for the existing population. The only overall financial effect is to widen the gap between rich and poor. And of course there is a huge deterioration in environmental impacts, social cohesion and lifestyle.

      It doesn’t matter where the immigrants settle. We don’t need a plan.

      If there is no net per capita financial benefit and substantial degradation of lifestyle, then why is the government, who is supposed to be looking after the interests of its citizens, consider anything but zero NOM.

    • I’d tend to agree, outer suburb and regional property have been dropping in value, while acknowledging that Australia is very short term in its outlook.

      Decentralisation and tempering the big city self centred nimby outlook of Australia is needed, and many of the solutions lie in the regions (while battling with steam engine internet…. but utilising technology in agriculture etc.).

      Property (too much is up sized cf past) and its religious worship are propped up by Fairfax media, banks etc. focusing upon inner city and middle eastern suburbs of Melbourne and Sydney (big fish small pond), with celebrity spruiking and manipulation of data e.g. how many people know difference between median and average? In other words if the real estate complex focuses upon promotion and selling of above median price property (and dodgy clearance rates), the numbers only go up…..

      Unfortunately with our colonial capitals or influence centres, regions are precluded from promoting and developing themselves internationally, while monopolies such as Telstra (owning both retail distribution and infrastructure) have no real interest in providing fast cheap or even free internet, now essential for any business and community (but great for dividends and super).

      In the U.K. The Guardian (that lefty rag) featured a township outside of London few years ago which has attracted city dwellers simply by faster internet, and cheaper property.

      Peak population for most of the first world will probably hit by mid century due to prosperity and improved health, and will become dependent upon the developing world whose peak will be by end of the century, so the world (if framing in the long term) is hitting the peak of the pyramid later this century.

      The Anglo world has a huge advantage over e.g. mono cultural Europe as we have always been immigration nations, and will be able to use various forms of immigration to lessen the impact of ageing populations and declining tax bases via temporary immigration (presently a godsend for youth and working age people in the EU where there is more mobility between nation states with different languages versus Australian states). The issue for many in the EU is that they don’t even look at future data because it so alarming…… e.g. many twenty somethings don’t expect a pension….. while Australia actually plans…..

      The other issue, like the real estate industry, is the over stating or inflating of population numbers through seguing or conflating definitions, whereby there are no less that three definitions of ‘immigrant’ in Oz media….

      The Inter Generational Report’s own data or statistics of population can or will become irrelevant over night through revising the existing definition of population according to the UN (many nations in Europe don’t bother as their populations are crashing, and in some cases include working age population resident elsewhere to maintain population on paper).

      This has been mooted already in the U.K., as those temps deemed to be ‘immigrants’ by the media and politicians, are not viewed as such by the majority of citizens, creating a ‘torrid and emotional debate’.

      They, including UK Business Secretary Vince Cable, whom are old enough to remember the Zero Population Growth movement supported by the Rockefeller’s, you know (then, maybe still) major shareholders in Exxon, Chevron, Chase Manhattan Bank etc.

      Other month ABC RN’s AM show had Dick Smith talking of infinite ‘exponential growth’ in population but was met by an incredulous (think) Hamish McDonald asking for evidence, that Dick didn’t seem to have…. and could only claim that the ABC was full of soft headed lefties…. very confusing, but that’s the point isn’t it?

  9. It’s a shame that Shepherd will probably never read this, and continue to spout his nonsense.

  10. BuyHighSellLow

    Reminds me of the underpants gnomes of South Park.

    Step 1: Population growth
    Step 2: ????
    Step 3: Profit

    • Yeah, the whole ‘Big Australia’ comes across as a Cargo Cult mentality. “If we become big like America, we will become rich like America”, completely ignoring any other factors that led to America’s success.

      If a large population was key to prosperity, then China & India should be heaven on earth. In fact, when you look around, some of the countries with the highest quality of life (Nordic), they have small stagnant populations.

  11. Shepherd is wrong even on his own terms. As any demographer will tell you, immigration does nothing to help an ageing population problem, because migrants get old too.

    Tony Shepherd is a classic case of a successful businessman who thinks this policy stuff is easy peasy yet every time he opens his mouth on any policy issue he comes across as not having a clue about what he is talking about. All you get is 40 years of accumulated prejudice that he’s gathered over hermetically sealed lunch and boardroom conversations with people like himself, agreeing with each other unreservedly, completely undisturbed by logic or fact.

  12. There is one point you got wrong, Leith. The ‘powers that be’ will also get stuck in traffic as based on the basement carpark where I work I don’t see any of them leaving their brand new european cars at home.

    In saying that I rather be stuck in a Porsche Carrera than in a dilapidated bus that smells of urine..

    Great analysis all. There’s more beef in what I’ve read before morning tea than what you’d get out of the MSM and politicians in years!

    • I reckon your average exec on $400-$800K per annum is copping it in the neck like the rest of us. Whereas the likes of Lindsay Fox doesn’t drive from Melbourne to Portsea in 2 hours like the rest of us or Lloyd Williams to his horse stud in Macedon. They get ferried around in their choppers. It’s the 0.1 percenters driving this.

      • Yeah, I did hear the following conversation between the top dog at work and one of my colleagues regarding skiing in Queenstown..

        [underling]: it’s beautiful but the lifts aren’t up to European standards and its crowded
        [top dog]: yeah, well we have a helipad at the back of our place so we don’t have to worry about that

  13. I’m a support of a Bigger Australia. I see it as both inevitable and challenging.

    Great benefit has flowed from the many migrants we have welcomed to this country. We would not be the Australia we are now without the contribution of these various immigrant groups.

    Well targeted generationally beneficial infrastructure spend is essential to manage our growing population. Free up land, roads and highways and EWLinks to ease congestion, efficient public transport servicing outer suburban regions, change zoning codes, build desalination plants and dams where needed, etc.

    All doable. And as we’re going to spend spend spend anyway, spend on infrastructure (at bargain financing rates) which can be enjoyed by a growing Australia for decades to come.

    Fact: We’re going to get bigger. Look for ways to make it work.


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      • Yeah, everything there except the offer to pay for what they want.

        On the other hand, 3d is a delicate counterpoint to Reusachtige in some ways.

    • Well targeted generationally beneficial infrastructure spend…

      lol you forgot “moving forward” at the end of that just to make it complete bullshit

    • That’s just silly 3d my dear chap.
      A big Australia is hardly inevitable, a change in policy is all that is necessary. Nor do I think that an aging population will have the ramifications that the business community contend for. Usually people do not require large amounts of intervention but for the last one or two years. People are getting older and healthier.

    • The IGR predicts population around 40 million. Not that big, but bigger.

      You lot can keep your head up your ar….oops in the sand, but reality will rudely awake.

      Accept it dudes.

      • “You lot can keep your head up your ar….oops in the sand, but reality will rudely awake.”

        Whilst I think it is the most likely outcome, it’s far from certain. Bad economic times have a massive effect on net migration rates.

        See Ireland which had a higher level of immigration prior to its bust than Australia does today. Things have changed greatly since the bust.

      • Forty years back…

        Population 14m
        Ave weekly wage $143
        Ave House Sydney $34,000

        …keep the blinkers on boys.

      • Forty years ago was also the year our TFR declined to replacement level before going under and never climbing back over.

        Also, kind of important for a country so dependent on immigration for population growth:

        World TFR 1975: 4.45
        World TFR 2015: 2.45

        We attract immigrants by bribing them with high wages and welfare. Our offer in both categories is very likely to deteriorate.

      • I see the IGR predicts average immigration rate of 1.3%, lower than the average of the last forty years, 1.4%…

      • No, that is the projected population growth rate, not immigration, and assumes no further falls in TFR coupled with stable NOM of 215,000, which is effectively stable from here, given the most recent update had 212,000 in the twelve months to June ’14.

        The whole point of mine, and AB’s comment was to predict further falls to immigration (and, to a lesser extent, TFR)

      • I actually agree with 3d1k a larger population can have benefits, right now Australian’s want to live in big cities mainly on the East Coast. If we had a more spread out population with cities outside of the big 3 we could solve the housing crisis by giving people valid options in terms of other places to live and relieve congestion.

        The real issue therefore is that we have no industry outside of mining to drive out GDP. We need to diversify into areas like IT (A silicon valley in Australia?) and renewable energy solutions etc..

        Population growth is inevitable and we can’t stay the same as we were in 1970-1980s although I wish we could… we just have to make it work better.

      • Sorry, immigration on the brain.

        My point is population will continue to grow. Inevitable. Indeed, I envisage scenarios where the immigration component may increase substantially. Forty years out with population and refugee pressures globally I fully expect Australia to accommodate growing numbers of displaced persons.

        Regardless, infrastructure spend is an imperative, if we don’t we will truly create a second class nation.

      • Population growth is not inevitable, especially now that world births have effectively stopped growing.

        We will see population growth for some time to come, but reaching 40 million in a forty year time frame is not at all certain, and would only happen if we maintain a very strong economy throughout that period, among other requirements.

      • Gavin
        So why is it that we have a desperate shortage of alternative industries ?

        One of the main reasons is that new and innovative industries cannot get finance. Why ?

        Because all of the nations finance is tied up in housing. Why?

        Because Australia is experiencing a housing bubble proportionally greater than we have seen in any OECD country. Why?

        Because we have had consistently higher population growth numbers than any other OECD country.

        Whatever financial capacity we have left over after paying for our houses has to be churned into growing infrastructure to cope with the growing population. No money left to spend on creating permanent productive jobs.

    • People should read that article. Opinion, sure, but it gives an idea of the guys mentality.

      “I’m a little bit anal, basically. I like to have everything ticketyboo.”

      Sorry pal – your “ticketyboo” is someone else’s miserable existence.

      Get lost idiot.

  14. Well said Leith.

    A 1999 Australian parliamentary research paper, entitled “Population Futures for Australia: the Policy Alternatives”, looked at the claim that immigration could offset an ageing population. It found that in order to maintain the proportion of the population aged 65 and over at present levels, “enormous numbers of immigrants would be required, starting in 1998 at 200 000 per annum, rising to 4 million per annum by 2048 and to 30 million per annum by 2098. By the end of next century with these levels of immigration, our population would have reached almost one billion.”

    Isn’t it about time we started listening to the Sustainable Population Party and Dick Smith?

    • So to keep our age distribution, by the end of this century 1 in 4 of all the babies born on earth each year will need to move to Australia at some point in their life time, whilst every other rich country (except Japan) puts everything they’ve got into luring young immigrants. Seems doable.

  15. notsofastMEMBER

    Anybody who uses the “We need to increase immigration to tackle the Ageing Population” argument is an idiot and should be treated as such. I don’t see how he can he honestly believe such BS, in which case he is treating his audience as idiots. How did a person who uses this argument ever get to be the head of the Business Council of Australia (BCA) and the chair of the Audit Commission? It damages the credibility of these organisations.

    • Because the people who get involved and climb to the top of these organisations aren’t actually experts in their field usually.

      They’re usually the gladhanders, the sycophants, the narcissists, nepotists and nepotees, who BS their way to the top so that they can use their power and influence for their own personal gain.

      They are just as much politicians as our own elected officials, although their electorate is much smaller with far more specific interests.

      Actual experts in a field are usually experts because they focus on and enjoy their topic, and don’t like to spend time on the other nonsense.

  16. Tony Shepherd needs a rapidly increasing population to try to get his toll road traffic estimates to actually match reality.

    http://www.smh.com.au/nsw/audit-chief-tony-shepherd-pushed-traffic-forecasts-on-lane-cove-tunnel-20140812-103beq.html

    Tony Shepherd, one of the key business advisers to the Abbott and Baird governments, was one of a group of ”big wigs” trying to drive up traffic forecasts on the ill-fated Lane Cove Tunnel project, the Supreme Court has heard.

    Mr Shepherd now chairs the WestConnex Delivery Authority, the organisation in charge of building the biggest motorway project in the country’s history, and was the head of the Prime Minister’s National Commission of Audit.

    But in a former role as an executive at Transfield Holdings, Mr Shepherd ran the consortium that won the right in 2003 to build the Lane Cove Tunnel – a project now the subject of a $144 million legal battle between one of its investors and traffic forecasters.
    Tony Shepherd previously ran the consortium that won the right in 2003 to build the Lane Cove Tunnel.

    According to documents read into court by counsel for AMP, the manager of two funds that lost money on the project, Mr Shepherd was one of several executives on the project in late 2002 trying to make the traffic figures more optimistic.

      • Disagree entirely with you 3D. Never thought I would see the day. If I had a gun, I would have shot my own screen after reading this tripe this morning.

    • The Lane Cove tunnel is a shining example of the flaw in PPP. Essentially the public get a worse service for more money.

      Shutting down a perfectly good lane just to force people into an overpriced tunnel that isn’t required for a lot of the traffic that has to flow past that point. Well done. /sarc

      Rent seeking for the win!

    • Brissy for now

      I believe the same traffic number spruikers of Lane Cove did a similar job on the also failed but resold Clem 7 toll tunnel in Brisbane.

      • drsmithyMEMBER

        I believe the same traffic number spruikers of Lane Cove did a similar job on the also failed but resold Clem 7 toll tunnel in Brisbane.

        I don’t think the opening of the Clem 7 was accompanied by the same closures/restrictions of alternative routes, that occurred with the Lane Cove tunnel.

  17. Spoken as the representative of businesses quite happy to rort the 457 visa system and employ temporary residence visa holders not allowed to work.

  18. Leith
    Excellent presentation of the facts in relation to the population ponzi scheme.

    One other point we need to consider is the inefficiency in delivering infrastructure to an moving demand. I’ll explain.

    If we had a stable population we would only need to consider replacement and incorporation of new technologies in the decision to build infrastructure.

    However, because of the rapidly moving demand in Australia, most of our critical infrastructure spends most of its useful life inappropriately sized for the.demand. The facilities spend the first portion of their life oversized (because they have been designed to cater for expected growth) resulting in an inefficient deployment of capital. For the second portion of their life the facility is undersized resulting in substantial inefficiencies on the part of the users.

    All infrastructure falls into one of the above two phases. The amount of resulting inefficiency is directly proportional to the rate of growth in demand and the lifespan of the facility. I do not have any figures on this effect but i am sure that it represents a significant drag on the Australian economy

  19. Let me get this right: since 2008 “more than two-thirds of Australia’s economic growth has come entirely from population growth, with growth in per capita terms anaemic, despite the huge mining investment boom.” So for 7 years, or more, we’ve been running this mass immigration scheme that was suppose to save Australia and bring mass riches….apparently. All I can say is it’s been a dismal fucken failure so far and is a pretty good indicator that Tony Shepherd is full of shit to argue otherwise.

  20. How could this conclusion by Tony Shepherd be an “independent” one, and not in the interests of big businesses and housing growth? There is no evidence that Australia has prospered for all the “growth” being imposed on us! Why are we struggling with failing budgets, and heavy cutbacks? Australia has had massive population growth since the post war period, but wealth is declining.
    An ageing population is inevitable, and procrastination of dealing with it will leave future generations left to carry inter generational debt, and even more older people for each generation. The
    great big myth of an “ageing population” threat is being blown up to promote Ponzi demographic that’s unsustainable!
    The basis of our population sustainability is our environment, that’s becoming increasingly degraded. We can’t dilute the number of aged people by more and more migrants, as they also age!
    The Intergenerational Report needs to go back to the drawing board and be revamped by professional demographers, ecologists, environmentalists and planners. An ageing population is inevitable, and a sign that we are on the track to a sustainable population size.