New Zealand’s opposition leader, Andrew Little, was involved in a testy exchange Tuesday on TVNZ over the nation’s high immigration program, which Labour has promised to curb.
First the good:
Andrew Little: “Over the last four years, we’ve had a quadrupling of immigration numbers. And, the problem we’ve got is that a lot of people coming here are settling in cities, the big cities that are under pressure, cities that don’t have enough houses for people that are there at the moment. Cities with massive traffic congestion. So, the whole issue with immigration is managing our genuine skills and labour shortages needs with an immigration policy that meets those needs. That’s not happening at the moment. And, under National’s new policy, that they are now backing out of, it wouldn’t have fixed the problem either”.
Now the bad:
Host: “What would be the economic impact of cutting immigration by 30,000 persons a year?”
Andrew Little: “There’s no significant economic impact”.
Host: “Hang on, Labour has been saying for the last few years that part of the reason we’ve seen consistent GDP growth is because we’ve had net migration of about 70,000 people a year. Is that not the case?”
Andrew Little: “Taking them [international students] out of the equation isn’t going to have a significant impact on our economy…”
And so the interview went on with Little trying to argue that cutting immigration significantly wouldn’t affect the economy.
Focusing on the negative impacts on living standards is sound. But when the question arises about the impact on the economy and GDP, all Little needs to say is that overall growth will slow if immigration is cut – since less inputs in people means less outputs in economic activity. However, the impact on GDP per person – which is what matters for living standards – would be unaffected by cutting immigration and will lift more over time than otherwise.
Little should also state that there is no point growing the economic pie via mass immigration if everybody’s share of that pie is not increased, especially given the broader negative impacts on congestion, housing affordability, the environment, and livability.
If Labour sticks to this script, it will easily win the immigration debate.
