Leith van Onselen talks mass immigration on the Bolt Report

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By Leith van Onselen

Last night, I appeared on the Bolt Report where I was interviewed about Australia’s mass immigration program and its effects on living standards.

Below are some key charts showing the data discussed in the report.

First, below are the Victorian Government’s official projections showing that Melbourne’s population will increase by 3.4 million over the next 35 years (note: Melbourne’s population growth is current running way ahead of projections):

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In the segment, I noted that it took Melbourne 200 years to reach 3.4 million in 2001 (and 200 years to build the existing infrastructure):

And yet, somehow, our policy makers want to add Melbourne in 2001 to current Melbourne in just 35 years! Where’s all of the required infrastructure going to come from? Answer: it will never be built because it is impossible to do so.

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Second, I noted that Australia’s house price growth over the past five years has been driven by immigration, which has flooded into Sydney and Melbourne:

Hence, the huge price booms in Sydney and Melbourne and the relative stagnation (or declines) elsewhere:

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Third, I mentioned that Sydney’s population is projected by the state government to explode by 1.7 million people over the next 20 years, 1.5 million of which will be driven by immigration:

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Finally, after discussing the Japanese economy and the population ageing myth (used to support high immigration), I mentioned an MIT study released earlier this year showing that nations with ageing populations have actually performed better in per capita GDP growth terms. Here’s the extract:

ScreenHunter_18202 Mar. 26 13.24

If anything, countries experiencing more rapid aging have grown more in recent decades… we show that since the early 1990s or 2000s, the periods commonly viewed as the beginning of the adverse effects of aging in much of the advanced world, there is no negative association between aging and lower GDP per capita… on the contrary, the relationship is significantly positive in many specifications.

At the end of the interview, Andrew asked me “what a sustainable immigration program would look like” and I answered that Australia should merely return it to the historical (115-year) average of 70,000 per year, which would see Australia’s population hit around 32 million by 2060, rather than 40-plus million under current (200,000 strong) settings:

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I stated that immigration at this sustainable level would mean “Australia could continue being the generous migrant nation that it always was, but with far less strains in infrastructure, housing and the environment”.

This was the only part of the interview that did not make the final cut (due to time constraints), but it’s worth mentioning anyway.

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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.