Chris Kohler: Only the “ignorant” worry about population growth

By Leith van Onselen

On Monday, published the findings of CBA economist, Gareth Aird’s, excellent report warning that high population growth (immigration) is eroding the living standards of Australian households (read Aird’s report here).

Strategically placed above this article was the above video featuring BusinessNow Editor and video presenter at The Australian, Chris Kohler (son of Alan), telling people not to worry about immigration and population growth as to do so is “ignorant”:

“Australia welcomes a new immigrant every 2.39. Now, whatever you do, don’t worry about population growth. It’s a waste of time and it is ignorant. Population growth drives economic growth, and we need lots of births and immigration to keep the country healthy.

If you don’t think that’s true, have a look at Japan, which has tight immigration policies, low birth rates, and long life expectancy. That economy is in real trouble because the burden falls to family members and the state to support the fact that they’ve got over 10.5 million people aged above the age of 80″…

The “ignorant” senior economist at CBA clearly touched a nerve.

First, why has Kohler chosen the false binary choice of zero population growth or high population growth? How about moderate population growth – you know, the kind that existed throughout the post war period until John Howard opened the immigration flood gates in 2004?

ScreenHunter_15215 Oct. 02 18.45

Second, while it is true that population growth boosts overall economic growth (more inputs equals more outputs), there is strong evidence that it has made individual living standards worse.

Since 2003, Australia’s population has grown by a whopping 22% – way faster than other advanced English-speaking nations and 2.5 times the OECD average:

ScreenHunter_15563 Oct. 18 16.52

Since the immigration flood gates were jammed open in 2003, Australia’s per capita GDP and disposable income has grown at an anaemic rate compared to the previous corresponding 12-year periods (see below charts).

ScreenHunter_15534 Oct. 17 15.59 ScreenHunter_15535 Oct. 17 15.59

And this comes despite growth in the terms-of-trade being most favourable across the most recent 12-year period (see next chart).

ScreenHunter_15536 Oct. 17 16.01

Blind Freddy can see that qualitative measures like traffic congestion and housing affordability – which are not captured in the above data – have also been made much worse due to the high population growth, thus lowering individual living standards even further.

Third, why has Kohler chosen to use Japan in his straw man argument to support high population growth? Over the period 2003 and 2015, there were five OECD nations that experienced declining populations. These are charted below against Australia’s population ponzi:

ScreenHunter_15564 Oct. 18 16.58

If it was true that population growth was such an economic boon, then you would expect that GDP per capita would have experienced anaemic growth in these countries. And yet the data shows anything but, with the nations experiencing the biggest population declines – Hungary, Germany and Estonia – experiencing stronger GDP per capita growth than Australia:

ScreenHunter_15566 Oct. 18 16.59

Finally, Chris Kohler has frequently complained about the cost of housing (see here and here). Chris lives in Sydney, whose population surged by 18% over the 11 years to 2015. Moreover, it is projected to rise by 85,000 people per year to 6.4 million over the next 20-years:

ScreenHunter_15562 Oct. 18 15.29

With a flood of new migrants projected to inundate Sydney, Chris’ desire to own a home will be made all the more difficult. Maybe he should mull that while stuck in traffic or on an overcrowded train on the way to work.

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Unconventional Economist
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    • Bingo!

      Clearly had a talking to from the old man –
      Al: “now mate, you don’t do well in life by railing against the status quo and the interests of the rich and powerful. You’re povvo, but I’m rich enough for the both of us – if you serve your astroturfing apprenticeship well, I’ll sling you a mil. Or uncle Rupe might… Kapiche?!”

      Chris: “Gooooooo population growth and NOM, you good things! Woooooohooo!”

      • How does it all really work has he been lobbied already or is he looking for cash do ya think.

      • ErmingtonPlumbingMEMBER

        Those who can work unsupervised, are self directed and are prepared to behave in an unethical fasion (lie) always make the most sort after employees.

        It is essential to be able to demonstrate a proven commitment to being a stooge, sell out and eger cock sucker to land the best gigs.

      • Naw EP pre you comment about myself on another post… the brothers and drunken liver thingy…. lets have a drink… I love you… ahahaha~~~~

        Disheveled Marsupial…. he’s killing my kidney … chortle ….

    • He reminds me of a kid who thinks he knows it all as he went to a private school and likely lives in Mosman.
      He has “b grade idiot” written all over him……
      Step out of your bubble and have a real look

      • Actually , I think the correct analogy is the Kid who asks his parents for money…but the parent says No…Kid ask why? Parent responds because I have none…..and Kid replies , But you have checks..cant you just write one?

      • I actually lived in Mosman next to his dad about 30 years ago.

        The fruit does not fall from the tree.

        What a total sell out. I think his dad has obviously got at him for recently not singing from the sam hymn sheet.

    • Actually I think its quite common view for people his age who have been conditioned all their lives to believe this unquestioningly. When asked, they struggle to find any strong arguments in favour of high immigration (just that it “causes growth” without being able to explain how/why it should lead to better living standards). But they also believe, in a knee-jerk way, that people who oppose it are xenophobes, and are opposed to Australia having a “vibrant multicultural society”.

      The myth of high immigration has been mostly propagated by the big business lobby (it benefits them mostly by increasing the number of customers while keeping a lid on wages) so it is strange that Labour and the Greens also parrot the line so unquestioningly.

      • Only thing missing in this story is the obligatory ‘racist’ refrain normally thrown out to anyone questioning the FIRE orthodoxy (did manage to infer ignorance). Banks and all other RE sector participants personal quality of life drops dramatically WHEN the Ponzi stops. The FIRE sector and by extension our economy faces a mathematical certainty ‘grow debt or die’, stop or even slow the debt creation flowing into the RE sector will trigger systemic collapse. So relax, immigration and its attendant loss of amenity and living standards is really a great thing, compared to their alternate reality.

  1. That Kohler clip is such palsied bullshit that I reckon its only getting a run as a troll for MB the Sustainable Australia types etc……

    I spoke with someone yesterday bemoaning how crowded Geelong has become (and Geelong has very little of the problems of Melbourne let alone Sydney). Uncle Rupert is just letting young Kohler have a run of this to front run a sentiment he knows is out there

  2. Even StevenMEMBER

    Nicely debunked, Leith. Kohler is a third rate financial commentator at best. Seems to me his genial persona and wry smile on the telly is the only thing he has going for him.

    • Even StevenMEMBER

      Oops. I was referring to Alan, but seems his son could be following in his footsteps…

  3. What’s with these muppets getting a run in the media because of their parents? Samantha Lane comes to mind as well

    • It’s how it’s done in Australia. Which explains why it has one of the most ignorant elite classes in the world.

      • Thia sort of nepotism is the basis of the British class system. we are reverting to type.
        If father is a lawyer the gates of the judicial system open for the son.etc. etc.

      • Australia more broadly is the home of the Piss Intellectual. Trapped between wowser and think-tank, you never see the good ones get proper cultural exposure.

      • rob barrattMEMBER

        There is a class system in every country based on education and (rarely on its own) money. To move up (or remain in place where the family does not have sufficient wealth to fully support you) you need all of the following:
        • Ambition;
        • A high enough natural intelligence;
        • Education;
        • Opportunity.
        • Have an outstanding talent in some sphere (eg. sport) enabling you to amass wealth;

        In the latter case, the children of the successful sports personality are sent to the best private schools to enable their class advancement as in the 4 earlier bullet points.

        To move down you have to lose wealth through:
        • Being lazy or having a harmful addiction or medical condition; or
        • Suffer a catastrophic lose of income; or
        • Suffer some catastrophic accident with resulting financial consequences.

        Class is competitive evolution expressed in terms of the human condition. You may come across cashed up bogans, but you won’t find them in any country’s equivalent of a gentleman’s club. And, believe me, every country has those sorts of establishments. Class is universal.

    • Nepotism, cronyism & corruption. Values that built a nation. Woles & Coolies advertising is written / put together for 6 year olds & semi illiterate. Sounds like Chris has borrowed their handbook. Pathetic & transparent.

  4. And this is the guy who was only talking a few days ago about how houses are unaffordable herre. i’m convinced these pro-immigration population ponzi spruiker types just can’t see the clear connections between all of the contradictory polices they support. Climate change? yeah it’s happening, we gotta abate it, but lets also grow our population and take in heaps of third world immigrants. house prices are too high? yep, but lets keep the immigration going. Automation going to take all jobs? yep its gonna be a huge problem in the future – lets import another million people because we need people to do the jobs australians wont do!!! There just no ability to see the obvious logical contradictions when it comes to immigration because immigration is the core of contemporary secular humanist liberal quasi-religion – it is purely sacrosanct – the holiest of all holies. To oppose it or even desire to just slow it down is to commit the greatest of ideological heresies.

    Most people have the wrong idea about people who promote immigration in the media, business press and politics. The notion that immigrationism is driven by cynical business self-interest. While this explains some of its support, the majority of immigration enthusiasm is quasi-religious in nature. Immigration pushers really believe that immigrants are amazing, that they “enrich” society, to oppose immigration would be hypocritical because “we’re all immigrants anyway”, and most importantly to oppose immigration would be to commit the gravest of contemporary western sins, the sin of racism. This is why you cannot persuade immigrationists and growthists or to expose them as cynically self-interested – because for the majority of them, their beliefs run to the deepest core of their being.

    • Great comment! Agreed and add to that, the fact that most people like this kid are pretty much raised/brain washed into the idea that immigration is ALWAYS great for growth.
      Funny enough, i was watching The Century Of the Self yesterday and your comment resonates well with the documentary…

    • Well siad. However a minor correction….Automation going to take all jobs? yep its gonna be a huge problem in the future – lets import another million people because we need people to do the jobs australians wont do!!! Correction: import another million people for jobs that wont exist because of AI and automation, adding significantly to the future social security ques.

    • The religion of Immigration is kind of like the left wing version of the values voters such as Howard’s Battlers. Will walk off a cliff for an ideology that’s directly contrary to their own self interest, all for the benefit of the business elite. Sad thing is, even their own natural party (i.e. the ALP) is complicit in this one.

    • The people I see pushing *high* levels of immigration are almost entirely in the business sphere (and their political equivalents).

      I don’t see many people who “Believe” immigration is good from a social/cultural perspective arguing for high levels of immigration, just some.

  5. Totes agree the binary stuff is rubbish. I’m all in favour of population growth – mainly for cultural reasons, I love the diversity and vibrancy it brings. But I am totally with you on the need to plan for and acknowledge it – fast trains to build up more regional centres and a recognition of the need to expand services accordingly. I’d also like to see a discussion about what type of immigration we have. A discussion about the merits of a mainly refugee population, rather than a skills based and backdoor student one. How to keep the responsibility on training our own people and maintaining wages and lifestyle is not mutually exclusive but it’s certainly not happening now.

    • Totally agree Felix. I think we need a multiparametric solution. Of course a conversation about immigration levels can be part of that, but the focus should be on better urban planning and drastically improved means of travelling within and between our towns and cities.

      I think the CLARA proposal is quite clever in that it tackles the housing /transport / employment problems in a way that will grow GDP but without necessitating any politically ‘risky’ action on immigration.

      • Hi UE thanks for the link, I think you raise some useful points.

        Looking at these one by one,

        1) “Exorbitant cost: the 2013 study estimated a HSR line linking the East Coast capitals would cost around $110 billion to build.”

        I think, if any private consortium (or PPP) is to borrow money for a project like this, now is the time. The longer we wait, the more expensive it will be later. The Hawke-era proposal cost only $2.5T back in the late 80’s, clearly the increase in cost has far exceeded inflation over that time. We have to do this now while interest rates are low. (Maybe we can get a loan with one of those tracker mortgages, hehe.)

        2) “Lack of population density to support the project.”

        This is kind of ironic isn’t it. This is a good example of why we actually NEED immigration to make long term solutions (like CLARA) economically viable. I’d gladly put up with a bit more inconvenience and congestion now, if it guaranteed the economic case for a truly 21st century solution to our housing/transport/employment woes. No pain, no gain etc.

        3) “Lack of competitiveness against air travel unless there are massive ongoing operational subsidies from taxpayers.”

        Have you ever travelled on the shinkansen? Consumers will flock to this over air travel. It’s more convenient (no security checks), arguably faster in terms of being direct to the CBD. The financial benefits in terms of unlocking new housing / employment / education opportunities all along the HSR corridor likely will far outweigh the initial outlay for the project, or any operating loss during the first 10-15 years. We’ve got to think really long term, this is a project that can reshape our whole economic trajectory for the next 20-50 years.

        4) “Equity issues: why should residents of WA, SA, NT, TAS or anywhere else not located along the route fork-out huge taxpayer subsidies for what will in all likelihood be an infrastructure white elephant?”

        I think the ultimate plan, of course, would be to link in other capitals as well. Not sure about Perth, but Adelaide and Hobart shouldn’t be too difficult.

        Anyway, yes it’s good to be pragmatic on these things. Here’s the link for those interested:

        • “This is kind of ironic isn’t it. This is a good example of why we actually NEED immigration to make long term solutions (like CLARA) economically viable. I’d gladly put up with a bit more inconvenience and congestion now, if it guaranteed the economic case for a truly 21st century solution to our housing/transport/employment woes. No pain, no gain etc”.

          Kipron. Your arguments around this issue seem to be back to front. You seem to want high population growth in order to make these projects viable. This is tail wagging the dog stuff.

          Can you please explain why a substantially bigger population is better than a moderately bigger population? And why importing people just so that we can build infrastructure to support said people is wise and will make us wealthier as a nation? You have yet to make the case.

      • UE, I don’t think I’m any more back to front than you on this.

        You’re essentially saying we don’t have enough people to support new infrastructure, whilst on the hand arguing against immigration on the grounds that our current (massively failing) infrastructure cannot support it.

        By your own words you don’t want to stop immigration completely. So your solution seems to be a slow attrition of our living standards where we let a trickle of people in, but don’t spend any money to fix the problems. What is your infrastructure solution?

        • I was referring to the High Speed Rail (HSR) proposal, Kipron. Don’t try to conflate my argument with other infrastructure in areas where there is already significant population and existing bottlenecks.

          Yes, we don’t have enough people to support HSR, which makes it completely unviable. The solution, therefore, is not to import a whole bunch of people simply to make HSR work financially. That would be tail wagging the dog stuff.

          Besides, what would the new or expanded towns located along the HSR rail line do? What industries would they work in (create)? Or would they simply be commuter towns for Sydney and Melbourne to work in unproductive services jobs (that earn zero export income)? And where is the benefit of urbanising the environment simply to make a HSR line viable?

          The whole idea does not make sense. It’s a ponzi property play.

      • I have already debunked the CLARA proposal.

        There is a better solution to the “problem” of great distance between Australia’s cities. Instead of having a One-Giant-City-Per-State policy, we should have a One-Giant-City-Per-Country policy.

        With all the population moved into one giant city there would be no need to build expensive trains between cities. The money saved could be used to service debt used to buy land in the single giant city – which would rise substantially in value. It is a win-win.

      • UE, just to answer your points.

        “Besides, what would the new or expanded towns located along the HSR rail line do? What industries would they work in (create)?”

        Agriculture, rural health and education/research are three immediate growth areas that come to mind. Not to mention all the associated jobs in industry/manufacturing that would be connected to building and maintaining a HSR service. HSR can connect young people in Sydney, Melbourne and Canberra with jobs in Wagga, Albury and Goulburn (and vice-versa). It will connect families in ways we can only dream about right now.

        If I could buy a 3 bedroom house in Wagga, whilst easily commuting to Sydney/Melbourne (or vice versa), I would consider it. And so would many people. I see people lining up for the Greyhound buses outside Central station every morning, it’s ridiculous to think there isn’t a huge potential market for HSR.

        “Or would they simply be commuter towns for Sydney and Melbourne to work in unproductive services jobs (that earn zero export income)?”

        High tech agriculture, research, health and manufacturing are hardly “unproductive”, in fact we really need to facilitate more of that. HSR will be the key to developing those skills for our country. If you can portray agriculture and/or manufacturing as a high tech prestige industry in the hearts and minds of our youngsters, that’s half the battle won. It might help out some of our poor old Ford / Holden workers too.

        “And where is the benefit of urbanising the environment simply to make a HSR line viable?”

        It’s a brilliant solution. HSR can protect the price of housing in Sydney/Melbourne for the >50% of voters that have already invested in housing in those cities. At the same time it will open up new housing opportunities for young families all along the HSR route, potentially near to work if they choose to work there. It will also add value and amenity for people already living there.

        “It’s a ponzi property play.”

        Maybe so, but if it works, what’s the problem? What’s the difference between a ponzi and an economic miracle? HSR can keep both going for decades.

      • People use buses because they can’t afford to fly, and/or are traveling somewhere planes don’t go.

        Neither of these things are addressed by high speed rail.

        People will not abandon planes for trains en mass along the routes proposed by HSR (with the possible exception of Sydney-Canberra). Common uses cases are, at best, unimproved.

  6. His example of Japan is pretty ignorant. Japan’s per capita growth rate over the last decade is actually pretty good. On avg it may even be better than Australia – over the 10 yrs up to 2016. Definitely better than the US who have a different population policy.
    He is confusing a fiscal problem with living standards.

    • True. Another big “quality of life issue” in Japan is housing affordability. As their population growth has slowed (indeed gone slightly negative) housing has become more affordable. Compare housing costs today in Japan with what they were 25 years ago. And compared to Australia, they have a lot less land per head of population.

    • Doubly-so. It has been previously reported that its very common (relatively speaking) for families in Japan to not report the death of an eldery family member. Reporting a death would take away the pension check, could trigger things to do with the house etc. This is best seen by the sheer number of >100 year old people in Japan according to statistics. Its clearly bad data, so anything to do with Japan and elderly demographics has to be taken with a grain of salt.

  7. What is it with these wannabes trying to do their preachy John Oliver videos?

    ooohh make it go viral!

  8. For every issue there are many plausible arguments, regardless of their quality. It is very easy to use the finely honed techniques of the spin doctors to dress these arguments up to make them appealing. What an intelligent, informed person should do is to carefully think through the ideas and discard the ones that don’t make sense. That is what MB is trying to do. Unfortunately, the average aussie will not, or can not perform this mental task. Luckily there are still some people who are naturally sceptical and will call BS, but its always going to be a close fought battle with the spin doctors.

  9. DelraiserMEMBER

    I love how these peanuts always try to foist the Japan example of why immigration is such a great thing and how Japan has “suffered” without it.

    What about the flipside; that Japan is one of the very few countries on earth to have retained its culture and traditions because it hasn’t had its population rapidly diluted? Anyone that has been to Japan will have been amazed by how clean it is, how polite the populace is and how strong their retained traditions are. I’m fairly certain most Japanese people will be able to easily define what being Japanese means to them. I’d be surprised if people in most Western nations could do the same

    • Yeah. Have you noticed all the Japanese flooding out of their homeland, desperate to find somewhere safe to stash their money and/or build a decent life for themselves?

      Me neither.

    • Ok, let me have a go at this *ahem*, “Some people are just xenophilic and hate Japan for their monoculturalism”. Oh yeah, there it is, that easy addictive hit of virtue signaling dopamine. /sarc.

    • ErmingtonPlumbingMEMBER

      Yes, and how about the lack of “white” guilt over there,…they have been part of the “West” for over 150 years and I’m pretty sure they killed more civilians in the 30s and 40s that the entire English speaking world combined,..even after months of allied incendiary raids, fire bombing all their major citied ,…plus 2 Nuks, at the end of the war.

      I want my kids to grow up “feeling” shame free,..just like Japo kids get to.

      • I want my kids to grow up “feeling” shame free,..just like Japo kids get to.

        Japo kids get taught Japan was the innocent victim in WW2. That’s probably why they don’t have any “white guilt” (which, in its most common usage, is just the recognition that the historical events that shaped our country and made us rich had some negative consequences on others that are still relevant – or, put another way, recognition that not everyone starts from the same spot).

        Your kids shouldn’t feel guilty for something their (or someone else’s) ancestors did, Ermo, but they should be taught that some of the things they did were wrong and the consequences thereof are still relevant today.

  10. casewithscience

    The problem with this debate is always the lack of detail. Immigration into existing urban centres is not creating sufficient additional demand to meet the costs weighing on infrastructure. On the other hand, targeted immigration into lower tier regional areas does create sufficient new demand to allow for beneficial economic outcomes (new schools, hospitals being built, job centres, etc). Its not a question of immigration being good or bad. It is a question of how immigration is being done. Simply pumping hundreds of thousands of new people into Sydney and Melbourne will continue to crush those areas and reduce living standards. If that same population was moved to Orange, Bendigo, Toowoomba or Mackay, then there would be improvements in average standard of living because of the increased economies of scale in those sub-Capital cities.

  11. Aussies don’t feel economically confident enough to bring more children into the world.

    We’ve tilted our debt treadmill too far. It’s showing in birth rates.

    More immigration is only going to make it worse for any native born (of any race).

      • The Greens asylum seeker policy is pretty much that. Claim asylum and it shall be granted.

        At last election they also refused to reduce immigration intake which is contrary to their supposed official policy:
        “Skilled migration programs that do not substitute for training or undermine wages and conditions in Australia”

      • There is that leftie extremism again. I could just as easily take the other extreme and say anything short of a Berlin-style wall or zero asylum and immigration cannot be considered a closed border.

      • There is that leftie extremism again. I could just as easily take the other extreme and say anything short of a Berlin-style wall or zero asylum and immigration cannot be considered a closed border.

        You are using “extreme” in a way that bears no resemblence to the word’s actual meaning. But then again pretty much everything you’ve written above only has a tenuous connection to reality, so that’s hardly surprising.

        Simple fact is that the record levels of immigration for the last 15-odd years – of which refugees are a rounding error – have been driven by right-wing neoliberal Governments, encouraged and advised by businesses and economics True Believers. Not a “leftie” in sight.

        You’d struggle to find any “leftie extremists” in Australian politics at all, let alone enough to actually influence policy.

        However, thank you for demonstrating my position that most people hear “immigration” and immediately think “refugees”.

  12. An excellent paper. Well written and fact based. Congratulations Leith.

    The next conversation is the gnarly one of the qualities and skills we want to have in immigration. To be candid, the argument about the levels are a given as ably demonstrated by the data in this paper. The discussion about who should come will be interesting and sadly will be as divisive.

    • I suggest the male:female ratio of immigrants should be close to 50%.
      I’d prefer no gays to be imported, but would tolerate them coming in to match our current gay:straight ratio. No ladyboys from Thailand. Male should look male and female should look female.
      Better not to import any with medical problems that are likely to overload our hospitals.
      Less Indians please, unless they are good cricketers (to add to our team).
      No more baby boomers – we have got plenty already.

      • I think you well and truly removed yourself from drsmithy’s chr… erhh festivus card list there.

        You’re micro-aggressing so many oppressed non-white males there.

      • Full sarc intended I imagine Claw, but not so far from the discussion I envisage will eventuate. I’m happy you avoided the elephant in the room ….dare I mention religion? Cheers.

      • I forgot one. They should all either have to acknowledge the supremacy of our God or supply proof that their God is more powerful than ours.
        A suitcase full of our God would do it, or a real estate brochure, or mortgage brokers contact details might also get them across the line.

  13. Loving your work!
    A non-racist series of rational arguments about why it is in the interest of citizens and permanent residents to significantly reduce immigration.
    It should also be accompanied by demanding all the strategic plans for how state governments plan and budget to accommodate all the growth if the federal government doesn’t reduce the rate of population growth.
    We could also be far more selective if we were taking less migrants, whether it be on having a reasonable level of English as a second language, on displaying an understanding of Australia’s political and economic systems and the obligations of citizenship, lack of criminal record, qualifications that will enable a transitions to Australian recognised qualifications, employment prospects, an expected net contribution including taking into account costs of retirement pensions and healthcare etc.
    But of course we should also accept refugees on a compassionate basis even though they don’t meet what should otherwise be the requirements.
    The recent federal governments have shown more care about the growth of the domestic markets for corporations than for the growth in income and standards of living for the citizens.

  14. Kohler is the one who is ignorant for dismissing and under rating Japan…

    Atleast that country has elite manufacturing, engineering, computer and electronic industries. They aren’t just FIRE and services industries.. and baristas!

    Japan can turn on the switch easily… they value sovereignty, productivity, innovation and actual skills….. opposite of Australia (primarily).