More push-back on the population ponzi

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By Leith van Onselen

It seems Melbournians are growing tired of the “Big Australia” policy being rammed through by the federal government and their big business backers, which has seen Melbourne’s population explode by 800,000 people in the Decade to June 2014:

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As reported in the Herald-Sun today, there is growing community anger over the spread of high-density apartments across our suburbs, which are rapidly pushing against infrastructure bottlenecks:

Melbournians are being urged to accept much greater densification in established suburbs to cope with rapid population growth…

Infrastructure Australia said it understood why there was “deep reservations” held by some people about increasing density. But the Australian Infrastructure Plan said densification within the nation’s four biggest cities had to be significantly boosted…

Mary Drost, from activist group Planning Backlash, said there was no way infrastructure would keep up. “you can’t keep adding to the population like that and expect the city to remain liveable”…

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Mary Drost is spot on. Infrastructure has not kept pace with the last 10 year’s of population growth, and there is buckley’s chance that it will keep pace with future growth as well.

And noted yesterday, infrastructure investment to cope with population growth is hideously expensive. Therefore, governments have responded by deferring the required investment and instead overloading the existing infrastructure stock with more and more people. This way, they and their big business backers can get the sugar hit from growth while per capita living standards slide backwards due to rising congestion and reduced amenity. Like the frog that boils to death slowly, our politicians hope that we won’t notice.

And it’s only likely to get worse. The “Plan Melbourne” blueprint, released last year. projected that Melbourne’s population would balloon out to 7.7 million by 2051 – that’s a further increase of 3.3 million people or 75% over June 2014’s population.

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The bottom line is that with rampant population growth, driven primarily through immigration, Melbournians and the residents of the other major Aussie cities, will have to get used to smaller housing, higher congestion, and overall reduced amenity. That is, unfortunately, our future.

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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.