Australia’s march towards mega-cities

By Leith van Onselen

KPMG’s Bernard Salt has published a piece in The Australian today projecting that the population’s of Australia’s two biggest cities – Sydney and Melbourne – could climb to 11 million by the end of the century:

ScreenHunter_13778 Jun. 30 09.25

By 2101 the world population is expected to be 11 billion, up four billion from today. The extra four billion will not be added to the developed world. There will be unrelenting pressure in the future for migration to ­places like Australia; this logic supports the bold immigration ­assumption that underpins the core or medium projection…

If Sydney and Melbourne are to add between three and five million people to existing city plans throughout the century, how will that growth be accommodated? It’s a fair and a confronting question…

Australia is an immigrant ­nation and will remain so. It is a question of the scale of immigration and therefore of the pressure that such growth will place on our capital cities. We should be thinking about what our cities might look like in the second-half of the 21st century… To not do so is an abrogation of responsibility to future generations…

It’s time for the nation to stop thinking in the present, and to start thinking about the exciting and challenging world that lies beyond our demographic solar system.

I find these population projections truly horrifying. Sydney and Melbourne are already straining under 12 years of rabid population growth and are ceasing to function properly. So I hate to imagine how badly they would operate in the event that they roughly tripled in size.  They would become a nightmare to live in.

Sure, Australia has an immigrant past. But this does not mean that it should necessarily maintain a high immigration future. To do so would be “an abrogation of responsibility to future generations”.

Australia’s population has already reached a sufficient scale and is now big enough to void the need for continued mass immigration. This way, it could begin to repair its infrastructure deficit and the strains caused by rapid population growth, not worsen them.

The key question that should be asked when considering a “Big Australia” agenda is: would it improve the living standards of the exiting population?  If the answer is “no” or even “ambiguous” then caution warrants cutting Australia’s immigration intake to more sustainable levels.

Unfortunately, the only political party willing to openly discuss Australia’s population policy is Sustainable Australia, which is why it has my vote in the Senate in this weekend’s Federal Election.

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Unconventional Economist

Leith van Onselen is Chief Economist at the MB Fund and MB Super. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.

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Comments

  1. GunnamattaMEMBER

    Jobs, they’ve gots to provide jobs, and they’ve gots to have an economic narrative to drive immigration.

    The US is the only nation to have made the leap from commodities source to modern industrial economy. Sure it did that with massive immigration, but anytime after the Civil War it was stated policy to make the US an industrial and commercial power, and to use the immigration accordingly. Then there is the slight difference in that Australia is big on deserts in a way that the US is big on fertile well watered land.

    • notsofastMEMBER

      The industrialisation of America’s North East was also essential to the Great Migration which in turn was essential to holding the North and South together half a century or so after the American Civil War.

  2. With the technological changes brought by additive manufacture, automation and the internet we may be facing an economic singularity in the coming decades. This will result in many of the accepted principals of economics and finance inverting or ceasing to operate. I think that the rise and rise of the City State is a likely response to this change.

    In an economy based on consumerism and credit, having a large percentage of the masses with no useful work to do is not an option. To counter this our political system must enforce a sort of command economy where the status quo is maintained, even if it is a cardboard cutout of the the past. Large cities are the easiest way to build a fake economy, as they necessarily impose a complex web of co-dependence on all the inhabitants. If you look at cities like Sydney and Melbourne you can already see the makings of this.

  3. This isn’t what over 70% want.

    Why are elected representatives doing this? Because we let them.

    Vote for anyone but LNP, Labor or Greens.

      • Don’t think so. There’s only a handful of die hard Greens voters and most think we’re populating too quickly. So not sure what you mean.

    • I’m hoping this election will see a significant shift away from the major parties. I was loitering on a dairy farmers Facebook group the other day (I was curious at how they’re coping with the international milk price) and I suggested that they don’t vote for Labor or the Coalition. I was excepting to get booted or told to buffer off, but quite a few strongly agreed!

      • Nice. I’m going to get myself far more social media savvy and spend next year poisoning LNP, Labor and Greens.

  4. Jim Casey says we can bring in 200k migrants a year to fill jobs (that don’t exist for our own kids).

    Why is Jim Casey going against Greens policy? Because there never was a (real) policy.

    Good to see drsmithy has admitted that and stopped promoting that rubbish.

  5. Senate vote sorted. What to put on the other slip… None of the major 3 that’s for sure.

  6. Isn’t it wonderful that both the ALP and LNP want to lower living standards for all Australiams all courtesy of not having a serious look at cutting back on immigration and limiting population growth.
    And yet despite this, there will be huge sheep who vote for these 2 idiotic parties.
    Why vote more of the same?

    Tell both ALP and LNP to stick their mega cities where it fits.

    Vote Sustainable.

  7. notsofastMEMBER

    “Australia’s population has already reached a sufficient scale and is now big enough to void the need for continued mass immigration.”

    Well I would argue that Australia at 18million in the 1990s was enough, but then Australia elected a party that changed a sensible financial system into a totally disfunctional financial system that took Australia on a foreign debt funded private debt binge that created a housing bubble and made Australia financially highly vulnerable. And you talk to the average well to do Australian, with an investment in property, and they can’t see how they have been shafted. All they can bang on about is their concerns for government debt and government spending without realising that a government budget deficit is essential to maintaining house prices.

    Get Australia to be financially sustainable first, which includes putting in a suitable feedback system that limits the big banks borrowings overseas amongst many other intiatives, and then Australia can start to think about the very difficult ethnically and culturally sensitive task of reducing immigration.

    • Arguably it involves making Australians financially literate first and foremost. If we as a nation lack the comprehension of relatively simple concepts then there is limited capacity to engage in meaningful debate with the electorate. But perhaps that is by design.


  8. By 2101 the world population is expected to be 11 billion, up four billion from today. The extra four billion will not be added to the developed world. There will be unrelenting pressure in the future for migration to ­places like Australia

    I struggle to see how a 50% increase in global poulation over the remainder of the century leads inexorably to a more than doubling of Australia’s population. With well below replacement fertility, we should experience below average population growth.

    More particularly, I note that Salt specifically uses the current ABS medium projection variant, which assumes that NOM is 70k greater than it is currently – and has been steady every year since 2014.

    • notsofastMEMBER

      The other two factors which these studies of Australia’s future population don’t take into account are

      1) The approaching death bust in Australia, which will start to occur in the next decade or so, when the Baby Boomer Cohort starts to leave this earth in significant numbers and natural population (births minus deaths) growth falls to zero and even goes negative. Then population growth in Australia will be entirely driven by immigration.

      2). The trend of increasing life expectancy is likely to reverse as the health of the baby boomers is clearly better than the health of the Gen Xers and the health of the Gen Xers is clearly better than Gen Ys. The current life expectancy is based on the health of the builders generation (the one before the Baby Boomers) which was a particularly health and robust generation whose health again was clearly better than the Baby Boomer generation. I can’t see the life expectancy of the succeeding generations matching that of the Builders Generation.

      • The first factor is included, as Australia’s current age structure is an input to the ABS projection model, and future changes to the age structure are an output.

        However, the model assumes that there will be further mild increases to longevity, so factor 2 is not.

      • Mr SquiggleMEMBER

        If Australia wanted to avoid the baby boomer death bust, then why did we choose to grow our population with so many baby boomers in the mid -80s?

        A 30 year old migrant from 1986 who helped us grow our population is now 60 years old and getting ready to go on the pension.

        Whereas a baby born to domestic Australian parents in 1986 would now be turning 30.

        Growing the population via migration is like trying to fix a debt problem by borrowing more money – it just doesn’t work.

    • blacktwin997MEMBER

      To be fair, Mr Salt was never particularly good at anything other than being paid handsomely for voicing neoliberal wishful thinking.

  9. You are not as important as and should gladly make way for wealthy foreign but future citizen.

  10. sydboy007MEMBER

    Would be great if someone had asked the Laberalgreenuts on what population growth do they support and how do they plan to fund the infrastructure needed for that level of pop growth.

    i’m sure they’d have waffled on, but it might have produced some interesting focus group discussions and got them worried.

  11. Robots will kill a lot of jobs.

    Even $10/hour immigrants will not be able to get jobs in AUS.

    So at that point mass immigration will cease.

    But already there are not enough jobs to go round – thus we need to vote for the SAP.

  12. Like all large Asian cities, Sydney and Melbourne are great to visit but unbearable to live in.

    • I’ll bet they’re past peak liveability if you 80/20 experience, commute, cost of living, etc. Probably circa 2000.

      We left 5 years ago. You’re dead right. Great to visit, wouldn’t want to live there.

      Visited for work staying on Spencer St in Feb. Just observed. A society of automatons.

  13. To even question the wisdom of untrammelled immigration is racist, islamophobic, xenophobic, and maybe even ablutophobic.

  14. For me it’s absurd to even suggest that the current Australian voters can set population limits, sure we have a Anglo centric past but we have an Asia centric future, even if today’s Australia votes for a small population tomorrows Australia will undo that vote, our changing demographics guarantee this.
    Personally when it comes to planning I like to look forward rather than backward, so I see an Australia that’ll be more and more closely integrated with Asia, with this integration our attitudes will change, our ideas will change, our very concept of perfection will change. We only started down this road in 1980 yet a quick walk through down town Sydney should be enough to convince even the most skeptical that we are well on our way to becoming an Asian nation. If this much change has happened in just over 35 years, imagine what the racial profile of Sydney will look like in another 35 years (2051). Now go one step further and imagine what kind of city they’ll want (Hint: it ain’t Sydney of the 1960’s). They don’t want our quaint but dysfunctional roads and they dont want our 50’s fibro shacks, they don’t want big areas of land reserved for Rugby and Cricket fields, they dont want RSL clubs or traditional Aussie Pubs, they don’t want Scout halls, Bingo nights, Nippers or Surf clubs. All these changes will happen because they must happen, in the end analysis our city must become what our future residents desire.
    Unfortunately the changes that we fail to make today and tomorrow don’t go away, instead they just pile on the event horizon, their only purpose becoming our own dysfunction. These changes will happen because they must happen, they can happen today in a gradual progressive planned fashion or they can happen tomorrow as part of a destructive wave that simply sweeps away the past.
    I know which outcome I’d prefer but being an Aussie I also know which outcome to expect!

    • blacktwin997MEMBER

      You may be right CB, however I have an irrational attachment to notions of community, decency, honesty, fairness, justice, respect and inclusion which appear to be being diluted by the day with this asymmetric and senseless immigration, aided no doubt by our Current Elected Representatives and their FIRE friends.

    • notsofastMEMBER

      And after they have swept us away CB, what then? And who are “they”? Are they Chinese, are they Indian, are African people, etc, etc.

      In my experience of humans and human nature, after they have swept us away then they will only resort to trying to sweep each other away…

    • Given Asia’s population growth is expected to grind to a halt over that time frame, it seems more likely that an Australia bent on joyous growth through strong immigration will turn to the faster growing Africa for its migrants, and as such, Asianisation will effectively be replaced by Afiricanisation.

      A quick walk through downtown Footscray will give you a pretty good idea what that might look like.

    • As Switzerland and Japan demonstrate, an advanced post-industrial society can choose NOT to change its ethnic/cultural composition without significant costs to itself, other than Defence expenditure. While we are not as culturally homogeneous as Japan, and lack the level of direct democracy in Switzerland, we must, as a society, articulate & debate the values of the presently-dominant Anglo culture, and actively promote them if we want them to be preserved. I suggest that those values include:
      1 the fair go
      2 respect for the law
      3 equality
      4 social equity
      5 responsibility towards others
      6 private property rights
      7 presumption of innocence
      8 its not that you win or lose but how you play the game,etc.,
      and I would argue that Rugby and Cricket, RSL and SLS clubs, Scouting and Anzac Day are demonstrably successful means by which Anglo values are acquired and maintained.
      If a majority decide (as with the Brexit referendum) that foreign cultural values have intruded too far and should be curtailed, our politicians and media will articulate Australian inclusiveness instead of the bi/multi-polar “Multiculturalism” invented by the outrageous Al Grasby.

      • I’ve got no problem with the world view that you espouse, problem is the demographic change that I’m referring to is already baked into today’s Australia. I’d suggest you take a trip into the ABS’s database and slice and dice the racial stats for different parts of Australia, than take a deep dive into the specific stats for Sydney, you’ll see that many parts of Sydney are no longer representative of Australia at large and you’ll also see that they’re planning for their own future without our quaint Anglo heritage. Some cousins of mine grew up in Punchbowl, so growing up I visited them regularly and knew the general area, well last year I needed to attend a funeral over that way and drove down the street they used to live in, the Middle-Eastern change that began in the 1970’s is now complete, it’s definitely not the Australia that I grew up in. Politically this change is also obvious with council members like Salim Mehajer doing more to shape the face of that part of Sydney than any aspect of our Anglo past. It’s no different in Chatswood with the Chinese or West Ryde with the Koreans.
        Politically these groups dont have the numbers today to affect change at a national policy level but that too will change, it’s all baked into the statistics.

      • notsofastMEMBER

        Oliver47,

        Switzerland and Japan are both very wealthy countries with huge net foreign investments. Australia on the other hand has a huge net foreign debt thanks to its housing bubble and the fact that the government needs to continue to spend like a drunken sailor to support the housing bubble. You can’t compare Australia with Japan and Switzerland.

        What concerns me, even with the peaceful immigration proposal that CB talks about, is its becoming pretty clear to me that Australia as a single political entity is not sustainable in the longer term under this sort of sustained mass immigration. Think of the recent votes for Brexit and the Scottish Referendum. Australia should be looking at breaking up into a number of smaller nations which have significantly different boundaries to those based on the current Australian states sooner rather than later.

      • ChinajimMEMBER

        Thanks CB, as soon as I read the main post I scrolled down hoping to find a comment from you, knowing it would be a realistic assessment of what the future might bring rather than just what some of us might want.

        Yes, predictions are difficult, especially about the future, but we would be very foolish not to be planning, brainstorming, and considering what-if contingencies in our preparation and remain very open-minded with the expectation that things will most likely be unrecognisably different from what we have now.

    • China Bob,

      Israel has managed to stand off very hostile neighbours, who outnumber them many times over, for the past 70 years. We have approximately 3 times their population and far more in the way of natural resources. Furthermore, potential invaders are no doubt well aware that this country is mostly desert and cannot support a huge population. They can buy what they want for far less cost than an invasion.

      If we cut back to zero net immigration, I suspect that the same things would happen here as happened after the immigration cut-off in the US in the early 1920s. The migrants who are already here would assimilate, and those with high fertility rates would bring them down to the level of the host population.

      Some of us think our culture is worth preserving. I would be happy to pay far more taxes for an Israel style military than see the sort of future you predict for my children and grandchildren.

      • Prior to 1947 the whole world did a great job of denying the need for a workable solution to the Jewish homeland problem. Then along came WW2 and in it’s aftermath instead of a gradual planned assimilation we had a US/UK/UN imposed solution, sort of what I’m talking about wrt Australia making a planned transition or simply surviving a destructive wave. In the end analysis I doubt this will be remain our decision to make unless we’re moving in the direction that the rest of the worlds needs us to move, otherwise I suspect we’ll have no more choice in the matter than the Palestinians had in that fateful 1947 UN decision to adopt the Partition plan.

      • notsofastMEMBER

        CB,

        I think you are missing a bit of history there prior to 1948 on the creation of the state of Israel. Like the
        – collapse of the Ottaman Empire over the last part of the 19th century which finally dissolved at the end of WW1 after the Ottoman’s freely decided to enter that war on the side of Germany,
        – the Balfour declaration of 1917 by the British and the subsequent British Mandate of Palestine under the League of Nations (precursor to the United Nations between WW1 an WW11),
        – the desire to carve a small non-exclusive piece out of what was the Ottoman Empire for the Jewish people of the collapsed Ottoman Empire (what better part than the part which they are historically connected too). It is interesting to note that about 800,000 Palestinian Refugees were created in the 1948 war which is similar to the number of Jewish Refugees that Israel has received from parts of the old Ottoman Empire between 1948 and 1973. Yes Israel also accepted a large number of refugees from Europe too, but when the Palestinian Mandate was created in 1923 accepting European Refugees of Jewish descent was not the purpose for which it was created.
        – Israel ultimately created itself in 1948. The UN declaration only confirmed that.
        – That over 5million descendants now exist as refugees from those original 700,000 refugees is more a result of the policies of Israel’s neighbours than any action of Western countries.

        While I’m no expert on the Israel-Palestian issue I can see the problem with talking about it in terms of a Jewish Homeland Problem as simplistic in that if every people gets to have their own exclusive homeland then this would result in a massive number of refugees and displaced people that would dwarf the current problems the world faces.

    • There is nothing to be gained by a defeatist attitude. Using your logic, the British should have surrendered to Hitler in 1940. I frankly doubt, however, if any country would be willing to go to war to force more people on us, The Palestinians were under British control and couldn’t mount effective opposition. We could no doubt quickly acquire nuclear weapons if the international order broke down to the point where our survival as a nation was at stake. The first ones were built with 1940s technology, and we have lots of uranium. So far as mass migration is concerned, the first thing that you do when you get into a hole is to stop digging. We have a relatively small population and lots of natural resources. There is no reason that we couldn’t copy Israel, Japan, or Switzerland.

      • No disrespect but all three countries that you mention are successful because they leverage their Human capital to create opportunities for themselves. No other country can occupy these lands and force them to continue to be effective efficient providers of their labor to the global market, they’re already doing a great job at this as witnessed by their success sans natural resources.
        Australia is in a very different boat, like it or not we’re phenomenally inefficient providers of labor and possess few globally marketable skills outside the mining industry. In a way a much better comparison would be Mongolia or Manchuria both countries were invaded (occupied) because they couldn’t / wouldn’t develop their resource endowments on a time scale that suited Russia and Japan respectfully.
        Sure Australia as a standalone continent is a different class of problem but it’s just naive IMHO to expect the rest of the world to respect our hands off Australian resources position just because that happens to be the decision of 25M Aussies. Look at the language that’s creeping into all these Free Trade Agreements FTA’s and you’ll see that agreeing to allow other nations to develop your resources is the latest trend (check out our recent ChFAT to see what I mean)

  15. At some point Malthus will be proven right. A lot of people think we’re already past that point…

  16. Gen Y Home Buyer

    “The exiting population” this is a Freudian slip because if big Australia doesn’t stop I will be exiting for a country where my kids will have a future.

    • notsofastMEMBER

      New Zealand is going to get awfully crowded with Australians “looking for a future”.

      I think you will need immigrate to another planet to find what you are looking for.

  17. imagine the flow of refugees around the globe with a population of 11 billion….!!
    7.4 Billion is already putting the planet under enough strain, and its arguably close to ‘stable carrying capacity’

    Australia will need a huge navy dedicated to turning back boats !!! Maybe our new 50billion$ subs are secretly being designed as boat-turnback instruments!?

    • “imagine the flow of refugees around the globe with a population of 11 billion….!!
      7.4 Billion is already putting the planet under enough strain, and its arguably close to ‘stable carrying capacity’”

      For such a smart animal, we’re incredibly reckless with this precise planet.

      • The UN’s 11.4 billion projection includes fertility assumptions that lead to Africa’s annual number of births peaking in 2080, and the population of the continent of Asia peaking in about 2050. Under those conditions, I’d expect the number of refugees to be lower, not higher, than current.

  18. I wonder if the analysis is factoring in things like high speed rail which could drastically change how the population is distributed geographically? By the time these predictions come to pass we could have entirely new population centres along the east coast that don’t exist today.

  19. LachlanMEMBER

    OT. Your website is serving me ads offering 50% off a subscription to the Daily Terror. Lol. Clicked it to make sure Murdoch has to pay for the view.

  20. @notsofast Huh???
    I’m saying there were ample opportunities to find solutions prior to 1947 but none of these incremental / transitional solutions were ever adopted. So where a planned Transition failed, a Disruptive destructive UN mandated wave succeeded but bought with it a myriad of consequent problems that are with us to this day.
    I’m certain that both the Ottoman’s and the British Palestinians had good reason to deny the need for a planned staged transition yet here we are today, something that was always going to happen happened.