The great immigration conspiracy

Judith Sloan sums it perfectly:

Now I don’t use the term conspiracy often. But I have come to the conclusion that there is an immigration conspiracy going on involving Canberra bureaucrats and politicians, among others, who are only too happy to overstate the benefits of immigration while downplaying the costs.

…And don’t be fooled by the idea that immigration is a solution to an ageing population. The Productivity Commission has made the point on multiple occasions that the impact of immigration on the demographic profile of the population is small and doesn’t last without ongoing higher immigration. That’s why many people call immigration a Ponzi scheme.

When it comes to the distribution of the economic benefits of immigration, it is businesses, workers with complementary skills to the migrants and the ­migrants themselves who hoover up the gains. In fact, it is overwhelmingly the migrants and their families who gain the most. Workers with skills that compete with those of migrants lose out.

We also should note that most economic studies of immigration simply do not take into account the costs of immigration, such as the loss of urban amenity, ­additional congestion, stress on ­infrastructure, including schools and hospitals, and environmental pressures.

There is little doubt that were a figure to be put on these other costs that immigration would be imposing a net cost on many parts of Australia, particularly in Melbourne and Sydney.

…And to mention immigration as a means of addressing skill shortages is surely the ultimate cop-out. If there are continuing skill shortages, it is surely incumbent on the federal and state governments to ensure that these jobs can be filled by locals rather than allowing businesses to take the easy way out and bring in skilled migrants.

…But the real clanger in all this — and part of the conspiracy perpetrated by Treasury, which ­inci­dentally has never had any real expertise in the economics of ­immigration — is that a lower ­immigration intake — 50 per cent fewer permanent immigrants, say — would cost the budget $4bn to $5bn across four years. This is complete hooey and Morrison knows it.

We have ­always known the fiscal costs of immigration are borne largely by the states and territories. Think: extra schools, extra hospital beds, extra transport, the cost of settlement services, and the list goes on. For Morrison to worry about the supposed loss of $4bn to $5bn in federal government revenue over a four-year period in which total government spending will exceed $1200bn is neither here nor there. But the extra costs to the states and territories are many multiples of this imagined revenue loss.

The bizarre part for me is that the Fake Left are also in on it. Where are the class warriors to defend the unlanded, wages-crushed and generally young? Bootleggers and Baptists all off the cliff together…

Terry McCrann agrees:

You have to be in a state of comprehensive and absolute denial about every Australian’s lived reality, including presumably your own, not to understand, accept and indeed urge that we have — at the very minimum — a “conversation”, and an urgent one at that, about population growth and its major driver immigration.
Apart from anything else, it is a very odd claim to make, as you implicitly do, that the current immigration policy, both as to aggregate numbers and composition, is perfect — fashioned like a bureaucratic Mona Lisa — and cannot even be discussed, far less changed in any way. Everything else is up for discussion and change — even, as we recently discovered, the multi-millennium understanding of marriage. But immigration? Absolutely not. Any discussion is prohibited. For precisely how long: a decade; a century; indeed, a millennium?

In fact, in counter, immigration and population growth are the absolute foundational policy issue for Australia. They it at the heart of every policy issue, right across the board and at every level of government.

You cannot have a sensible discussion about anything in Australia — and I really do mean anything — unless you start with a discussion about immigration, quantitatively and qualitatively, and population.

But Adam Creighton is a card-carrying conspirator:

It is surely a bad look when one of the richest nations, with practically the lowest population density in the world (apart from ice-covered Greenland), ensconced alongside one of the most populous, Indonesia, appears to be toying with a debate about the benefits of slashing immigration.

Cutting immigration has become a popular agenda item for both right and left-wing populists the world over, fuelled by a slowdown in wages, soaring house prices, pockets of social breakdown, and ageing and cramped public infrastructure. Yet lowering immigration won’t solve any of these problems, which are complex and indeed feature among countries with a wide variety of immigration and population growth rates.

…Age-old economic fallacies about immigrants abound. They don’t “take jobs” because, logically, they create demand for goods and services. An influx of low-skilled workers may put downward pressure on the wages of the low skilled relative to those of the high skilled, but our immigration program focuses on the higher skilled, who earn more and pay more tax. In fact our income per person is on track to be $7000 a year higher by 2060 (in today’s dollars), according to the Productivity Commission’s 2015 study on the pros and cons of immigration.

Here’s what a dispassionate economic analysis of the impacts of a rolling supply-side shock does to the labour market, Adam, via UBS:

…and the positive labour supply shock from migration/participation In Australia’s (and NZ’s) case, there has also been a resurgence of migration in recent years which has generated a ‘positive labour supply shock’, likely an additional factor limiting (average) wages growth (Figure 30).

There has also been a large (albeit perhaps inter-related) positive labour supply shock from a surge in the participation rate (particularly for females) to around a record high level (Figure 31). This trend is likely largely cyclical, given it tracked the delta of stronger jobs growth. This increase in participation is more positive than the trend overseas (Figure 27 again).

That’s it. Mass immigration sits on wages. In the test tube it’s neither good nor bad. It just is. The Productivity Commission, the ABS and the Australian Population Research Institute also show that migrants have worse employment outcomes than the Australian born population (see here).

Creighton’s emotive drivel is the key input of the conspirator. Another dead giveaway is inconsistency, given Creighton has forgotten what he wrote in March 2017 about the population “squeeze” afflicting Melbourne and Sydney.

Moreover, his use of land mass as the key determinant in population is just the coward’s way of yelling “racism” into the heavens. Australia has roughly the land mass of Brazil. Should we have 200m people, its huge spread of slums and environmental disaster too? Why not shoot for a population density matching Singapore and we could have 60bn people! We can import Marsians and Betelgeuseans to goose GDP!

Economic, urban and natural sustainability are the key inputs that matter, all of which are obviously being stretched to the detriment of living standards for everyone but an elite few living on the east coast.

As Phil Coorey notes, kind of sitting on the fence:

 

…”Already, both cities stand out in global assessments of housing affordability and traffic congestion. And even if we do manage to stuff an additional 7 million people into those cities what are we going to do with the other 9 million who will be added to the Australian population in that same period of time?

…Such a backdrop is fertile ground for calls such as those made by Abbott. When Rudd first landed in trouble over big Australia, it wasn’t just infrastructure that was a concern but natural resources such as water. Back then, the Murray-Darling, in terms of its capacity to irrigate crops and maintain its vital environmental functions, was in poor shape.

Then opposition leader and former water minister Malcolm Turnbull said investment in water infrastructure would determine whether Australia could sustain 35 million people. Today, the basin is in worse shape. And thanks to the bungled handling of the water portfolio by Joyce, trust levels between the basin states are at a poisonous low.

The immigration debate is here at last, in no small measure thanks to the LVO one man wrecking-ball, and the longer it goes on the more hollow the conspirators sound.

Enter Greg Jericho:

Immigration – because there are many desperate to hate – must be treated with extreme care by politicians and journalists, and certainly with more care than Abbott seems capable. The inherently racist parties will seek to use any discussion and any seeming evidence of the negative impact of migrants as fuel to burn their fires of hate.

But the economy is not as straightforward as Abbott would have us believe – migrants increase economic activity and generally improve overall productivity. What they don’t do is lower wage growth.

Research by the Australian National University has found that “immigration had no impact on the wages of incumbent workers”. Yes there were some workers who were negatively affected by migrant workers, but “positive effects outnumbered negative effects three-to-one, and the overwhelming impression is that immigration has no effect”.

As the Productivity Commission found when it looked at Australia’s migrant intake, one of the biggest issues for migrant workers is not that they increase unemployment or drive down wages, but that they are more susceptible to exploitation by their employers.

Wages growth over the past four years has been steadily falling until it has reached a state where 2% annual growth is viewed as an improvement. There are many factors at play that have led to this – and a large one is the run of policies by governments of which Tony Abbott was a member that sought to undermine the ability for workers to bargain for higher wages and which also made it easier for employers to pay workers less.

But talking immigration is a simple solution – it blames others and frees Abbott and his kind from admitting their own ideology has always had as its aim lower wage growth.

The same can be said of housing.

…For Abbott, as so many of his ilk have found, it’s easier to attack migration than admit their own policies are much more to blame.

Ahem…mass immigration is one of the Coalition’s policies. It’s not some God-given truth. Any sensible economic policy addresses both supply and demand.

As Leith has previously explained, the ANU modelling cited by Jericho transpired exclusively through the mining boom (2001-11) which is hardly a fair sample. We supported higher immigration too when the nation faced genuine supply constraints, to keep wage rises from running away. The question today is: is it good policy to flood the labour market with foreign inputs during a period of huge oversupply? Obviously not. And Greg Jericho’s ignominious flip-flopping strongly suggests that he knows it, marking him out as card-carrying member of the conspiracy.

Jess Irvine does a better job with similar arguments, largely agreeing with Tony Abbott:

In the main, Abbott is correct to say that increasing the supply of something tends to decrease its price.

But he has missed a key caveat – a crucial phrase adored by economists the world over: “ceteris paribus”, or, “all other things being equal”.

In truth, all other things are rarely equal when it comes to analysing the economy.

Immigration is just one variable in an incredibly complex economy, in which demand and supply factors play equally important roles.

Abbott is right that more rapid population growth boosts demand for housing. But the story is far from over at that point. Governments can and do release more land for housing and local governments rezone land to boost supply.

 

Come on, Jess, we all know that’s balderdash. Population growth is nearly all immigration driven. As well, it’s pointless arguing for the supply side fix when it clearly is not coming. Our planning system is broken. And that means the downsides of further mass immigration are much higher. We need a moderated pace so we can look after the interests of Australian workers and youth, as well as making a still generous contribution to those wishing to come.

Comments

    • Hear hear!

      Given most political debates in this country are founded on lies and/or misinformation, the more evidence based commentators there are in the public debate the better. Most people who get airtime in this country have vested interests…

    • Former Treasury Secretary John Stone lending some gravitas to the Nay case:

      https://www.theaustralian.com.au/opinion/trust-tony-abbott-to-tell-it-like-it-is-about-issues-that-matter-most/news-story/3549d7242bb54ac7d0cd85facecbb8b4

      “What, moreover, should we make of Morrison’s claim that cutting the permanent immigration program would cost the budget $4 billion-$5 billion over four years?

      These figures are thoroughly misleading. For starters, they are up to 10 times higher per migrant place than comparable figures published by Treasury in the May 2009 budget would suggest. But even if you accept them as the commonwealth’s budgetary cost (which, for several reasons, I don’t), they neglect entirely the costs to which the greatly increased immigrant intake has subjected state budgets and local authorities. Think more schools, additional hospital beds, more police, more roads, footpaths, kerbing and guttering, and the list goes on. NSW and Victoria, in particular, where the immigrant increase has been concentrated, are groaning under these pressures.”

  1. Another load of garbage from Jericho:

    https://www.theguardian.com/commentisfree/2018/feb/25/immigration-must-be-treated-with-more-care-than-tony-abbott-can-muster

    Obvioously ignoring the fact that AUS is already 28% foreign-born. Making it 56% foreign-born will turn it into paradise?

    Norway is 11% foreign-born and is actually paradise with a sovereign wealth fund of U$1 trillion!

    Unbelievable claim about crime! Obviously doubling the population will mean more murders!

    264 murders took place in AUS in 2012. 43 murders happened in NZ in 2012.

      • Yeah I guess it would given that the entire point of mass low-wage immigration is to throw Aussie voters onto the unemployment scrapheap and force them to turn to crime.

        In the past, unskilled refugees could get jobs like truck driving or cleaning but now the braindead left wing thinks those jobs should go to foreign “students” instead. Thus both Aussies and refugees miss out on those jobs. Some poor people turn to terrorism. People have already been killed in AUS by terrorists in the last 5 years.

    • No point countering his arguments. Jericho is a monkey to Triguboff’s organ-grinder.

      He will do and say whatever the organ-grinder orders him to.

  2. It amazes me the state Govts aint bashing Canberra more for an immigrant subsidy.

    Start highlighting the fact it costs $100K in infrastructure for each immigrant and then bash the Feds to provide the funding since they benefit the most from increased taxes.

    • The states can stop letting kids of 457 visa staff study in government schools for free. The states can also put in a land tax on foreigners like NSW did. The states refuse to. The states love the ponzi.

      Maybe they can put a massive payroll tax on foreigners along with a rental tax.

    • Very good point sydboy. This silence has resulted in massive increases in state charges such as land tax which in the end are passed by landlords/landladies onto tenants who cannot stand such increases and leave business. Business formation is at a record low. In Victoria in the inner suburbs the state govt (liberal) introduced a new expanded congestion levy =land tax on business only (not residential) of ca $1000 per space. Land tax bills are about to be mailed and these will be a shocker and the desperate state govt is to revalue land each year to enhance tax funds flow -all anti business and anti small business particularly.

  3. Australia’s massive permanent immigration program, a perfect storm.
    A monster formed by the union of the ideologies of the lunatic progressive left and the mercenary neo liberal right.
    This treacherous union has occurred because the power of the traditional left has been seized by the progressive left …their ideal, a racial melting pot, a Garden of Eden populated by beings of no determinate race or culture.

    • Precisely. This is 100% the fault of the progressive left overtaking the environmental left and workers left parties. The ideological left watched as the neoliberals had their way with us decade after decade.

      I’m revelling in it blowing up in all their stupid faces. I despise what’s happened to Australian politics epitomised below.

      https://www.msn.com/en-au/news/australia/comment-the-lie-that-is-sucking-the-life-out-of-sydney/ar-BBJvXCd?ocid=spartanntp

      • Yes Ric, we need a real leader for the the people – a great orator

        “I know that men are won over less by the written than by the spoken word, that every great movement on this earth owes its growth to great orators and not to great writers.” —Adolf Hitler, “Mein Kampf,” 1925

        Graeme Campbell – extract from Immigration and Consensus
        It was known by the “elites” that the general public was not happy with both the composition of the immigration intake and the policy of multiculturalism, but the general public was easy to handle as long as it had no focus and was not organised All the elites, including crucially the great bulk of the media were in agreement that these two issues should not be publicly discussed, or, if discussed, in such a way as to discredit those who questioned them.

  4. Remove interest on debt as a tax deduction to fund infrastructure, instead of arguing for a land value tax. Let the beneficiaries of immigration and banking foot the bill.

  5. No surprise the Labor MUST support the ponzi in their next term. If they were to cut migration and become the real left, then GDP would tank, the fake GDP run would end and they would be a guaranteed one term government. You can’t ask an addict to stop, they have to be made to do so and finally discussion is occurring in the mainstream. Now if we had 4 year terms and no leadership spills then MAYBE a leader could have the guts to make a tough call….. but that will never happen.

    • It just has to be articulated to Australia via a great leader. That we are far better off becoming lean, productive and sustainable than the ridiculous literal ponzi. Everyone takes a fair haircut. The top 1% loses a lot.

      We haven’t had a great leader or party for many decades. Self serving politicians that we watch rort the system for themselves have ruined us.

      • It has been said that “a strong people do not require a strong leader.
        Only a weak people do…
        OK … where do we get a Strong Leader?
        At Bunnings ?

      • Nice sentiment but no ‘great leader’ will be allowed to emerge. The rich and powerful in this country insist on lapdogs, not leaders and thinkers.

        Don’t underestimate the degree to which democracy can be subverted by this lot.

      • Jessica Irvine’s two propositions grate against one another:

        It then becomes a moral question, as to whose needs should be prioritised: those of Australians, or those of others looking to live here . .

        and

        Ultimately, a country’s level of immigration is a matter for the government to decide.

        But why?

        Why, if this is essentially a moral issue? Why, if both parties are captive to sectional interests who benefit from Big Australia at the expense of the citizens they supposedly represent? Why, if the policies of the parties are clearly at odds with what the citizens seem to now want?

        Why is this a matter for the government to decide?

        The People of Australia never voted for a system of “government-by-politician”? The Federation Referendum (often cited as the fount of legitimacy) merely gave them a choice between federating under government-by-politicians, or not federating under government-by-politician. And the politicians have ever since been resolute in denying the People any opportunity to alter that system.

        Surely this is an issue – one of many, many issues! – which the citizens should be allowed to decide directly.

    • pyjamasbeforechristMEMBER

      From last October

      Attitudes to immigration numbers
      The survey found that 54 per cent of voters wanted immigration to be reduced a little or a lot,
      including 57 per cent of Liberal voters and 46 per cent of Labor voters

      http://tapri.org.au

      • My anecdotal evidence says it’s almost 100%.

        The few people I know that think it’s about right believe the ageing population or skills scam.

  6. Sloan writing an article contrary to the great orthodoxy almost a deserves a PR releases in its own right. This might be interpreted as a schism in the conventional view which should lead to more spurious replies from Irvine and Dr Demo and all the rest. This may have some unintended consequences because it will directly question the quality of the academic work.

  7. I call BS on Jess’ claim that governments can and do release more land. In NSW in 2016 the government made only 1 land release under the Environmental Planning and Assessment Regulation 2000. The release was in Schofields and had the potential to allow for the construction of 4000 dwellings. In 2016 greater Sydney’s population increased by 90K! That land release would absorb about 2 1/2 month’s worth of population growth assuming an occupancy of 2.6 people per dwelling according to the last census.
    Moreover just because an area of land is ‘released’ doesn’t mean that it’s going to result in construction within a year. Typically it takes four years until a land release results in construction of new homes due to all the planning requirements for new releases. Clearly Jessice Irvine has not done her homework on this and is just making a broad fact free statement to support her position. No surprise really when she works for flufferfax.

    • Forgive Jess. Her maths isn’t too flash hence why she’s quaking at the prospect at being replaced by an immigrant who can cover this critical skills shortage. Hope she didn’t commit to that mega-mortgage.

  8. I am surprised the comments are open on Ms Irvine’s article because around two thirds are not happy with the current rate of immigration or its effects. Similar to Jericho’s piece yesterday which was swamped with people decrying the population Ponzi amongst some shrill calls of racialism. It was nice to see many facts from here being used which seemed to cause some head scratching from those so rebutted.

  9. More than one million quasi permanent temporary visa holders are in Australia at any given time (including NZers). Any crush loadng effect is caused by this not permanent migrant visa intake of ~200k.

    This ongoing ‘temporary’ intake (one year to xxx years) puts pressure on infrastructure, housing, jobs and possibly wages, although the jury is out on the latter:

    “There is little persuasive evidence that immigration has substantial harmful effects on average UK wages or employment. Damian Green is correct to identify effects on the least well paid as being of greatest concern but evidence suggests these effects are not large.”

    https://theconversation.com/fact-check-does-immigration-have-an-impact-on-wages-or-employment-83666

    • So:

      a) there is no evidence that immigration increases wages;

      b) it is acknowledged that there is an effect (albeit small) depressing the wages of the most vulnerable;

      c) there are other externalities such as reduction in amenity not even addressed in this study; and

      d) the citizens apparently would prefer some decrease in the immigration rate.

      Therefore, Big Australia must continue!!!!

      QED.

    • “Listen to me boys ,and I don’t lie,
      we’ll wear $10 shoes and eat Rainbow Pie.”
      From an old Hobo song, courtesy Joe Baigent (RIP)

  10. Note Jessica Irvine’s virtue-signalling: ” I have never placed the hopes and dreams of Australians so far above those of foreigners that their needs become unimportant in the debate”

    The comment is more intentional conflation of poor/displaced refugees with already skilled/paid/housed workers. It should be interpreted as more anti-democratic globalism ignoring the needs of Australian voters.

  11. ”Australia has roughly the land mass of Brazil. Should we have 200m people, its huge spread of slums and environmental disaster too?”

    Practically racist NOT to.

  12. I have a theory that all the zombie movies made in the last 10-15 years are an analogy or allegory for rampant foreign immigration to the Western World.

  13. LNP need to hear it loud and clear: POPULATION POLICY WILL DECIDE THE NEXT FEDERAL ELECTION !!

    …and they bloody-well already know what the people want!

    • In my opinion immigration has been deciding elections for some time. Course you wouldn’t know because you’re not allowed to talk about it. But if you were an average Australian who wants immigration cut but is in no other way radical who would you vote for? For me it explains last two elections and possibly even Howard’s ousting.

  14. A conspiracy by the Immigrationdepartment requires intelligence. I would argue, based on some personal experience that the senior immigration leadership in Canberra is incompetent and doesn’t really know what is happenning across the portfolio.,

  15. My thanks to Ms Sloan if she’s reading, one of the good guys and making a brave stand.

    You know something is seriously wrong when you get looked at like Attila the Hun for suggesting that we maybe, possibly, talk about our historically and internationally high immigration intake which is choking our cities and help bury the future of our children.

    Bravo and a big f you to the elite and their attempt at global tyranny. WE WILL NOT STAND DOWN!

  16. Disappointing from Greg. His analysis of the proposed company tax cut was well researched and evidence based. Why doesn’t he apply the same rigour to this debate? I think we know the answer … though it’s a shame.