Over the weekend, News.com.au’s editor-at-large, Joe Hildebrand, proclaimed anyone wanting to lower Australia’s immigration program back towards historical levels is a “racist” and resorted to the usual flawed arguments to support current turbo-charged levels:
When the right calls for cuts to immigration it’s called “racism” but when the left does it it’s called “urban sustainability”. In fact they’re both saying the exact same thing: “F*** off, we’re full”…
…And so here is why cutting immigration is idiotic and wrong.
Firstly, there are basically only two categories of regular immigration in Australia: Skilled and family. Then there is a third humanitarian stream for refugees…
The vast majority of this — more than two-thirds, or 128,550 — is the skilled migration program in which migrants are sought out to fill shortages in the workforce. These include things like doctors in understaffed hospitals or specialist engineers for major infrastructure projects. They also include jobs that, frankly, native born Australians often won’t do… [T]he skilled migration program is vital to keep Australia moving…
The second category in the regular migration program is so-called family reunion, which accounts for virtually all the remaining 30 per cent — 57,400 to be precise…
More than 80 per cent of “family” migrants are the husbands or wives of people like you and I…
Which of them would the anti-immigrationists like to ban from Australia? The medical diagnostic radiographer? Suzie from Sussex you proposed to last night at Icebergs? The old digger who just wants to come home?
Upon reading Hildebrand’s rant, the phrase “a little bit of knowledge is a dangerous thing” immediately sprung to mind. If Judgement Joe had cared to examine the evidence he would have discovered that Australia has no “skills shortage”, that there is widespread visa rorting going on, and that Australia’s so-called skilled visa system is a giant fraud, whereby:
- many recently arrived skilled migrants (i.e. arrived between 2011 and 2016) cannot find professional jobs;
- many skilled migrants have gone into areas that the government’s own Department of Employment has judged to be oversupplied (e.g. accounting and engineering); and
- migrants have generally worse labour market outcomes than the Australian born population.
Regarding family reunion visas, the Productivity Commission’s (PC) 2016 Migrant Intake Australia report explicitly recommended significantly tightening parental visas and raising their price, given they are costing taxpayers an estimated $335 000 to $410 000 per adult, or between $2.6 and $3.2 billion per annual intake in present value terms (and growing).
The PC (another racist) also doubled down against parental visas in its recent Shifting the Dial: 5 year productivity review, claiming that their long-term costs to the Budget are enormous:
… parent visas, which provide a short-term benefit to the budget via visa charge income, but impose very large costs in the longer term through their impacts on expenditure on health and aged care, and social transfers. In previous work, the Commission estimated the budgetary costs associated with the 2015-16 parent visa intake alone to be $2.88 billion in present value terms over the lifetimes of the visa holders. By comparison, the revenue collected from these visa holders was only $345 million. Ten year estimates of the fiscal effects of the current parent visas would show a similarly stark disjuncture between revenue and costs, and would therefore provide the insights for a more informed policy decision on the pricing or desirability of these visa types than the current decision-making framework.
So to answer Judgement Joe’s question about who “the anti-immigrationists [would] like to ban from Australia”, the rorted skilled migrant program and parental visas are a good place to start:
Slashing these rorted programs could easily return Australia’s permanent migrant intake back towards the ‘normal’ historical level.
Thankfully, Fairfax’s Ross Gittins yesterday provided the perfect antidote to Judgement Joe, arguing that mass immigration is a “cheap and nasty way to grow the economy”:
There are at least four counts against the advocates of high immigration. First, their refusal to engage with the academic environmentalists arguing that we’ve exceeded the “carrying capacity” of our old and fragile land. Scientists? What would they know?
Second, they keep asserting high immigration’s great economic benefits, blithely ignoring the lack of evidence. Whenever the Productivity Commission has examined the issue carefully it’s found only small net effects, one way or the other. Its latest modelling found only a “negligible” overall impact.
Third, the advocates not only decline to admit the high social and economic costs that go with high rates of immigration, they decline to accept their share of the tab, doing all they can to shift it to the young, the poor and those on the geographic outer, including many of the migrants.
You rarely hear pro-immigration economists acknowledging the clearest message economic theory gives us on the topic: more population requires more spending on additional public and private infrastructure if material living conditions aren’t to deteriorate.
The more we invest in such “capital widening” to stop the ratio of capital to labour declining, the less scope for investment in “capital deepening” to keep the ratio increasing, and so improving the productivity of our labour.
The fourth criticism of high immigration is that it’s the cheapest and nastiest way to pursue economic growth. You get a bigger economy, but not the promised benefits. The studies repeatedly fail to show high immigration leads to a significant increase in real income per person…
In principle, one productivity-enhancing effect of high immigration is that you get greater human capital on the cheap by pinching it from other (mainly poor) countries… But as Dr Bob Birrell, of the Australian Population Research Institute, has shown, there’s a big gap between the claims made for our skilled migration program and the reality. We let in people whose skills aren’t in high demand, and plenty of them end up driving taxis…
High immigration may suit our rent-seeking business people, but it’s a hell of a way to pursue the professed benefits of economic growth.
Another highly-regarded grey beard economist, Ed Shann (former Australian Treasury, Access Economics, and BCA) also backed immigration cuts:
…there is a strong economic case for less migration…
The economic benefits to current Australians from migrant inflows, in terms of income per head, are small at best…
It does not create the skills needed, with many migrants unable to work in their area of skill…
The downsides of high immigration are greater congestion and rising house prices in the major cities, where migrants prefer to live.
…the locals most likely to suffer are the lower skilled and youth…
The strongest argument for cutting migration is the failure to invest in infrastructure needed to support Australia’s rapid population growth… Increasing congestion risks a backlash as our cities become less livable…
Until we improve the infrastructure in our major cities we would benefit by reducing numbers and improving the employability of migrants.
Pretending their is no problem will only fuel opposition to migration.
Whereas young gun, CBA senior economist Gareth Aird, openly questioned the efficacy of Australia’s turbo-charged migrant intake on Sunday’s Outsiders program:
“Immigration is great just like salt is great. But we’ve got to get the level right. If you put too much salt in your food, it doesn’t do us a good service…
At what level do the benefits start to wane and the costs start to outweigh the benefits?…
The evidence suggests at the moment that there’s a net cost to what we are doing. The rate is incredibly high… there are a lot of costs related to what’s happening with dwelling prices, what’s happening to public investment – it’s being diluted by more people, we’ve got traffic congestion on the rise, I think at the margin it suppresses wages growth because you are flooding the labour market with supply”.
Finally, Bob Carr on Friday called for the migrant intake to be cut in half, as well as for the federal government and Australia’s elites to shoulder their fair share of the burden that comes with rapid population growth:
“I want a population policy that says for every extra 25,000 people who will arrive, the Commonwealth will make a commitment for so many kilometres of extra light rail, underground or bus only transitway.
“Second, those ‘big Australians’ who tell us that we have to have the highest rate of immigration should accept that there’ll be rezonings and should share some of the increased density.”
All make far sounder arguments than the “racism” cries of Judgement Joe Hildebrand.
