Fairfax editorial spins immigration propaganda web

By Leith van Onselen

At the same time as former Canberra Times editor, Crispin Hull, made a robust case for lowering immigration, the Fairfax editorial was quick to pump out propaganda espousing that “immigration is key to our prosperity”. Let’s examine the main arguments.

“There are many great cities much larger than any in Australia. Our population has been growing by about 2 per cent a year, twice the international average and the fastest in the OECD group of 35 wealthy, industrialised nations. Immigration provides about 60 per cent, in raw numbers, of the growth and about half after accounting for departures. The number of immigrants, excluding our humanitarian intake of close to 18,000, has been close to the cap of 190,000 in recent years, with a further half a million or so temporary visas – mainly for tourism, seasonal labour and tertiary study – granted. This, though, does not mean almost a quarter of a million people shift to Australia each year; close to half are already here and are merely renewing a visa or switching to a new status as their bid for permanent residency progresses.

The argument that “there are many great cities much larger than any in Australia” is banal. There are also many struggling cities that are “much larger than any in Australia”, including Mexico City, Buenos Aires, Moscow, Sao Paulo, Rio de Janeiro, Manila, Jakarta, Istanbul, Bangkok, Lagos, and Tehran. So what’s the point? Is bigger necessarily better?

The editor’s claim that “immigration provides about 60 per cent, in raw numbers, of the growth and about half after accounting for departures” is also false.

The Productivity Commission’s (PC’s) 2016 Migrant Intake Australia report showed clearly that Australia’s population would peak at just 27 million by 2060 under zero net overseas migration (NOM) versus more than 40 million under current settings:

In a similar vein, the NSW State Government’s population projections show that Sydney’s population would increase by just 210,000 people over the next 20 years with zero NOM, versus 1.74 million people under current immigration settings:

The reason why current immigration levels have such a big impact on population growth is because migrants grow the population in two ways: 1) directly as soon as they come off the plane; and 2) indirectly as they have children, which is then counted as natural increase.

Regardless, immigration is the primary driver of Australia’s population increase. Nothing else even comes close.

Back to the editorial:

Policy has largely been bipartisan, so compelling is the evidence immigration is of net economic and social benefit, a notion reinforced in recent days by a study jointly released by the federal Treasury and the Department of Home Affairs…

Its net effect is unambiguously positive.

What about the PC’s various detailed reports on the impacts of immigration, which show small temporary economic benefits only if you exclude externalities like increased traffic congestion, having to live in smaller and more expensive housing, having to pay more for infrastructure, environmental degradation, and lower income growth for incumbent workers.  Add in these costs and the impact on existing residents’ welfare is very likely negative.

Rather than repeating the PC’s analysis, you can read a comprehensive summary of it here. You can also read MB’s separate comprehensive analysis of Australia’s immigration program.

Back to the editorial:

The situation has a mischievous internecine dimension, with former prime minister Tony Abbott publicly urging an unusually big cut of 80,000 in the cap, Home Affairs Minister Peter Dutton revealing cabinet discussed a cut of 20,000 that was dismissed by Prime Minister Malcolm Turnbull, and Treasurer and former immigration minister Scott Morrison, armed with the fresh official report, promoting immigration.

“An unusually big cut of 80,000”. Really? Such a cut would merely restore Australia’s permanent migrant intake to 2003 levels, which is still incredibly generous:

At the turn-of-the-century, Australia’s non-humanitarian permanent migrant intake was 70,000. In 2016-17 it was 184,000 – an increase of 160%. Any objective analysis of these figures would conclude that this increase in the migrant intake was “unusually big” and requires normalisation.

Back to the editorial:

The community’s consideration of temporarily moderating the flow is reasonable; there are valid concerns the pace of infrastructure investment has lagged. But the best solution is to build infrastructure, not significantly cut such a beneficial program.

Just increase infrastructure, hey? Like it is that simple.

The reality is that in already built-out cities like Sydney and Melbourne, the cost of retrofitting new infrastructure to accommodate greater population densities is prohibitively expensive because of the need for land buy-backs, tunnelling, as well as disruptions to existing infrastructure. These are basic dis-economies of scale.

But don’t just take my word for it.

In November 2013, the PC released its final report on An Ageing Australia: Preparing for the Future, which projected that Australia’s population would swell to 38 million people by 2060 (let alone 40 million as projected currently) and warned that total private and public investment requirements over the 50 year period are estimated to be more than 5 times the cumulative investment made over the last half century:

ScreenHunter_15679 Oct. 25 14.39

The PC’s 2016 Migrant Intake into Australia report explicitly noted that infrastructure will have to increase to accommodate a bigger population, and that this infrastructure will necessarily be expensive:

A larger population inevitably requires more investment in infrastructure, and who pays for this will depend on how this investment is funded (by users or by taxpayers). Physical constraints in major cities make the costs of expanding infrastructure more expensive, so even if a user-pays model is adopted, a higher population is very likely to impose a higher cost of living for people already residing in these major cities.

…governments have not demonstrated a high degree of competence in infrastructure planning and investment. Funding will inevitably be borne by the Australian community either through user-pays fees or general taxation…

Whereas, the PC’s recent Shifting the Dial: 5 year productivity review explicitly noted that infrastructure costs will inevitably balloon due to our cities’ rapidly growing populations:

Growing populations will place pressure on already strained transport systems… Yet available choices for new investments are constrained by the increasingly limited availability of unutilised land. Costs of new transport structures have risen accordingly, with new developments (for example WestConnex) requiring land reclamation, costly compensation arrangements, or otherwise more expensive alternatives (such as tunnels).

So clearly, the most obvious and least cost policy solution to mitigate Australia’s infrastructure woes is to significantly dial back Australia’s immigration program and forestall the need for costly new infrastructure projects in the first place.

Finally, Infrastructure Australia’s recent study found that both Melbourne’s and Sydney’s living standards will be crushed as their populations surge to 7.3 million and 7.4 million by 2046, with worsening congestion and reduced access to jobs, hospitals, schools and green space:

Why would Fairfax’s editor wish to bestow lower living standards on Australians living in these two cities?

The answer is simple, Fairfax’s newspaper division is now little more than the marketing arm for Domain, which profits from an increasing population. Follow the money.

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Comments

  1. GunnamattaMEMBER

    This was another line by line examination of the pathetic Fairfax Editorial over the weekend…….

    Immigration is key to our prosperity
    https://www.theage.com.au/national/immigration-is-key-to-our-prosperity-20180420-p4zatk.html

    Australia is gripped by one of the most important policy debates such a migrant-fuelled nation could contemplate – what are the optimal levels of immigration, overall population growth and of investment in the requisite infrastructure? The impetus is the intensifying growing pains in cities, particularly Melbourne and Sydney, most acutely felt via traffic congestion, crowded public transport and concerns about housing affordability. Yesterday, Melbourne City Council released a report arguing for two more underground rail tunnels.

    A perfect opening sentence which takes you on to the off ramp of rationale as soon as you tack ‘and of investment in the requisite infrastructure’ on at the end, after passing the flashing lights represented by ‘such a migrant-fuelled nation could contemplate’ .

    The simple fact of the matter is the issue boils down to:-
    • What are the optimal levels of population growth?
    • What are the optimal levels of immigration? (as a component of that population growth)
    And in considering these questions, the economy we have, what it does, and what population is best suited to doing that, are the key question inputs.

    After coming to some conclusions there you start thinking about funding of whatever infrastructure is required to support the population.

    The opening stanza is about getting readers to think of infrastructure spending as what our economy does, and it then follows that you can boost more of what it does if you run immigration (or population growth) extra heavy to justify more of what the economy does – which is bullshit.

    It is worth noting that Fairfax has apparently given up trying to fend off the suspicion that immigration is connected with house price rises (which they did for maybe 5 years), and they haven’t tried to pin the blame on foreign students as the PM did yesterday

    This is a discussion Australia has to have. There are many great cities much larger than any in Australia. Our population has been growing by about 2 per cent a year, twice the international average and the fastest in the OECD group of 35 wealthy, industrialised nations.

    Your next off ramp, set nicely in amongst undeniable fact, is ‘There are many great cities much larger than any in Australia.’ – which is a nice little portion of bullshit on the plate if you think that there are many great world cities smaller than any in Australia, and if you think that much of Australia’s issue is the fact that the immigration tends to concentrate in Sydney and Melbourne.

    When asking ‘why?’ about this observation we come back to the economic raison d’etre of immigration and the possibility that Australia has no real economic raison d’etre at all apart from increasing diversity and juicing house prices or aggregate economic stats, and that because of this the most viable place in Australia for immigrants to live is in the burbs of Sydney and Melbourne.

    Immigration provides about 60 per cent, in raw numbers, of the growth and about half after accounting for departures. The number of immigrants, excluding our humanitarian intake of close to 18,000, has been close to the cap of 190,000 in recent years, with a further half a million or so temporary visas – mainly for tourism, seasonal labour and tertiary study – granted. This, though, does not mean almost a quarter of a million people shift to Australia each year; close to half are already here and are merely renewing a visa or switching to a new status as their bid for permanent residency progresses.

    Our next course has poignantly flavoured bullshit morsels on a coulis of paralogic and specious ‘normality’.

    Immigration makes up more than half of our population growth. That isn’t good or bad, but it does bring us to the question of if we want more people why don’t we get our own to breed more, and from there off into the realms of why people don’t breed more. Once again the ‘economy’ comes up as a reason and the possibility that people don’t feel they have good enough jobs, are far too far into debt to contemplate providing a decent upbringing for children, and don’t feel their economic prospects are likely to improve sufficiently, to warrant a few sparring sessions with their hoppo bumpo partner of choice sufficient to produce progeny. Fairfax isn’t going to go anywhere near acknowledging this line of thought because it is a key part in selling the debt and specious job growth story, and is reliant (as a loss leading media entity, channelling customers to its real estate sales section) on those Australians spending plenty on a house, and thinking this is both normal and of higher priority than children before they think about having children.

    There is a nice nugget of bullshit in the reference to our ‘cap’ of 190k immigration. Placing it in the sentence there gives it a somewhat innocuous look of ‘agreed to by everyone’ – without for a second asking why it isn’t 70k, or 100k, or why it was jumped up to 190k in the mid 2000s without reference to the Australian public, after the 106 years from 1900 to 2006 had produced only four years with an annual Net Overseas Migration figure of more than 150k in any given year, when every subsequent year has run at more than that, with some years running at double that, with this giving rise to a ski ramp look in the NOM chart (see below)

    Your bullshit coulis consists of students who comes to Australia and study here who do so for, say, 3 or 4 years, and then subsequently decide to become migrants.

    Before we get to asking what this dynamic implies for the Australian education sector (amongst the most expensive in the world, with a reliance on foreign students greater than any other in the world, which openly touts the prospects of migrating to Australia after study and noting that years studying in Australia contribute to the prospects of living on here ever afterward) and Australians using that sector (who will have their incomes garnished for eternity to pay off HECS debts, and find their course menu spattered with meaningless ‘internet marketing’ style courses which may not contribute to intellectual self actualisation or a job, and find a few classmates who may not be able to communicate all that well in the language of course instruction, and wonder if the value of the course is somehow diminished by that) the last stanza is an attempt to fudge away from the obvious ramp up in population growth, by suggesting ‘they are only students’ without quantifying how many stay and how many don’t, and what proportion of Australian population growth these comprise. Almost as though the fact that all the extra people Australians are experiencing (and competing with for house, places on trains, places in schools, jobs etc) is explained away by this.

    Policy has largely been bipartisan, so compelling is the evidence immigration is of net economic and social benefit, a notion reinforced in recent days by a study jointly released by the federal Treasury and the Department of Home Affairs.

    Your bullshit main, with a time travel sauce, is arriving now.

    Policy has been largely bipartisan, so compelling has been evidence of the economic and social benefits of immigration.

    OK. How old is that evidence? How much of that evidence is from the last 12 years? How much evidence is there that since Australia jumped up its immigration intake in 2006 Australia’s economy has performed better because of immigration and its increase?

    Any evidence was far stronger in days when migrants came to Australia and Australia’s employing sectors were expanding import competing or exporting sectors. Australia’s employing sectors any time forward of circa 2012 have been those exposed to government transfers – aged care, public service, health, or jobs running off the Population Ponzi – housing construction first and foremost. Prior to that Australia’s economic outcomes had reflected a mining boom

    From there we come to the implication that a study from Treasury and Home Affairs should be somehow viewed as unbiased. Anyone with the remotest familiarity with Australian public services – particularly Treasury and Home Affairs – would be more than aware that they ceased producing anything which was in any way at variance with the government and the Minister’s preferences, well over a decade ago. Anyone reading something from Treasury and Home Affairs released to the public should be working from a position of assuming it reflects the Scott Morrison/Peter Dutton view of the world. Report here

    Their analysis delivers two core messages: immigration stimulates economic growth; and immigration at the relatively high levels of the past 15 or so years adds to pressure on infrastructure. The research can help planners prioritise infrastructure projects. The discussion boils down to this: whether Australia should, at least temporarily, reduce the number of people moving here, either as permanent residents or on visas allowing study and/or work. It appears the number of temporary visas, in particular, is being crimped.

    The cloche lifts to reveal a side of pure tenderloin bullshit on a large white plate, accompanied by artistes daubs of decorative bullshit, ladled over by a pureed bullshit sauce – the long awaited bullshit de main. The report produced by the Home Affairs and Treasury is as specious as anything coming from the mouth of Scott Morrison and Peter Dutton. It does not say anything remotely as bald as ‘immigration stimulates economic growth’ what it does is imply this with a load of presented inferences such as:-

    • immigration has been linked historically with stronger economic growth,
    • more migrants equals more demand, and
    • more migrants with skills equals a larger skills base

    ….all of which are true, but all of which don’t add up to ‘Australia’s economy is better going forward from 2018 (or 2013 or 2011), if we run immigration growth at 240k per annum’.

    It buttresses the implication that heavy immigration will benefit the economy, including our regular favourites:-

    • immigration offsets ageing – which we know is a generational can kick and
    • immigrants contribute more through taxation than they receive in budget outlays – which is bull if we consider the additional infrastructure costs incurred and ask to what extent this is at the cost of suppressing income growth of pre existing Australians.

    What the report rests mainly on when it comes to data – and is the first issue the report addresses when it comes to the economy – is the idea that ‘Australia takes in larger numbers of migrants when economic conditions are strong and fewer migrants when conditions are weak’

    However it is worth noting that the report actually shoots this contention in the foot with the first chart it presents, if we note that immigration has run much heavier in relation to GDP in the years since 2006 than it has ever previously done

    See the below chart from the report and note the years from 2005-2006

    The second part of the paragraph’s contention about heavy immigration states an obvious fact when noting the impact on infrastructure. But it then offers another side salad of bullshit for the unwary with the line ‘The research can help planners prioritise infrastructure projects.’ when in fact the research does absolutely nothing of the kind and in fact the research would lend itself more overtly prioritising any need for immigration and the levels at which it can best continue. The paragraph then rightly poses the question whether we should tone down the immigration taps, but then alludes to this as already being in the bag with ‘It appears the number of temporary visas, in particular, is being crimped.’

    The situation has a mischievous internecine dimension, with former prime minister Tony Abbott publicly urging an unusually big cut of 80,000 in the cap, Home Affairs Minister Peter Dutton revealing cabinet discussed a cut of 20,000 that was dismissed by Prime Minister Malcolm Turnbull, and Treasurer and former immigration minister Scott Morrison, armed with the fresh official report, promoting immigration.

    The red herring bullshit desert comes in the form of a TestosterTone mention which the Fairfax editorial mischievously links to ‘an unusually big cut of 80,000 in the cap when an 80k cut wouldn’t even bring us back to the 30 year NOM average before 2006. Further bullshit dessert options come from the egg off the face of the Prime Minister and Treasurer when it was revealed in the media that Dutton proposed cutting the intake by a meagre 20k to Cabinet, and this was denied by the Prime Minister and Treasurer, only to be subsequently confirmed by Dutton.

    It is worth noting that the assertion that the Dutton proposal (miniscule though it was) ‘was dismissed by Prime Minister Malcolm Turnbull, and Treasurer and former immigration minister Scott Morrison, armed with the fresh official report, promoting immigration. if anyone doubts the relevant departments ability to produce only that which the Minister wants, or if anyone is still deluding themselves that federal government policy is data backed, strongly reasoned, and coherent. Report here

    Immigration has been central to Australia’s coveted economic and multicultural success. Its net effect is unambiguously positive. The community’s consideration of temporarily moderating the flow is reasonable; there are valid concerns the pace of infrastructure investment has lagged. But the best solution is to build infrastructure, not significantly cut such a beneficial program. The federal budget will be delivered in a few weeks, as an election approaches. The government needs to use the population projection to guide their investment in long-term assets truly crucial to Australia’s prosperity and growth.

    The Fairfax piece concludes with a full blown bullshit banquet.

    Immigration may have been central to Australia’s economic success up until the mid-90s when there was a concerted policy effort to ensure a diverse economy, when there were lower levels of immigration, and prior to the unstated deindustrialisation policies pursued ever since.

    But ever since then, and particularly since 2006 when annual immigration was effectively more than doubled immigration has occurred despite the Australian economy – and the impacts of this ramp up of immigration despite the effect on the economy are obvious to anyone thinking about suppressed wages outcomes, infrastructure overcrowding, crazed real estate prices, and a body politic (both sides) increasingly unable to acknowledge large sections of Australian society and their concerns, because they are unable to acknowledge the role of immigration within those concerns particularly:–

    • jobs,
    • wages,
    • infrastructure,
    • queues for services,
    • real estate prices,
    • money laundering,
    • indebtedness,
    • the world leading expense of Australian education,
    • energy prices, and
    • the world leading uncompetitiveness of the Australian economy overall

    which ultimately bring us back to the question of ‘Why are we running immigration as heavily as we are?’

    Beyond that the paragraph is nothing other than a pro uber immigration population Ponzi rant.
    Australia certainly is a multicultural success, but that success is based on the efforts of historical governments to ensure that economic circumstances suited high (but nowhere near as high as currently) levels of immigration. Since 1996 Australian economic policy has been about closing down economic diversity and shielding Australia from the impacts of that, with the pro uber immigration ethos given a specious kick along by a mining boom post 2004-2005, and in the years since 2012 by nothing other than a refusal of contemporary politicians and the media to look at and discuss Australia’s ramped up immigration volumes with Australians and the persistence of these same to accuse anyone wanting to discuss these as being racist.

    The bullshit flows on forever, rich creamy and loquacious.

    When you read ‘The community’s consideration of temporarily moderating the flow is reasonable; there are valid concerns the pace of infrastructure investment has lagged. that is to take you off the line of thought where you may otherwise ask ‘Are there valid concerns the level of immigration is too high?’ and when it is asserted But the best solution is to build infrastructure, not significantly cut such a beneficial program. you are given nothing by way of data to support the benefits nor any analysis of what the implications of cutting may be, or analysis of what the effects have been of the increased number of immigrants arriving each year since 2006.

    Finally when the piece concludes ‘The federal budget will be delivered in a few weeks, as an election approaches. The government needs to use the population projection to guide their investment in long-term assets truly crucial to Australia’s prosperity and growth.’ We can be sure that the last thing the government will do will be to establish a clear population goal, in relation to economic, social and environmental considerations and honestly discuss this with Australian voters. In doing this the government will lay the seeds of its own demise, and the demise of the mindset being exhorted by Fairfax with far too many Australians having ceased to believe either their media or their politicians, simply because their day to day experience is that ‘Australia’s prosperity and growth depends upon good economic policy – well reasoned, evidence based, data backed, intellectually coherent economic policy – and for a generation Australia’s economic policymakers have been using ramped up levels of immigration to sustain a population Ponzi which makes aggregate demand statistics look OK but is not leading Australians anywhere near meaningful prosperity and growth, with high levels of immigration all too often a factor in their experience as to why they aren’t approaching greater prosperity and growth which they will be able to hand on to their children.

    Australia’s rampant immigration volumes have become a fig leaf over the increasingly pathetic economic policy settings bestowed on Australia by Australia’s entitlement fueled politicians, cheered on by Australia’s pawned media – Domainfax first and foremost

  2. Who was the new journalist at Domainfax who recently wrote an article saying that mass immigration is a bad idea? (and people on this website said he will be soon be reporting from dog shows if he writes another article like that)

  3. ErmingtonPlumbingMEMBER

    There’s an old saying in Tennessee — I know it’s in Texas, probably in Tennessee — that says, fool me once, shame on — shame on you. Fool me — you can’t get fooled again.
    George W. Bush

  4. rentsailorMEMBER

    Amazing analysis Gunnamatta.
    Definitely the MSM shills doubling down on the globalist agenda.

    Future AU will have wages that will be similar to the US with this wholesale importation of the masses. Watch the standards of living go down the toilet as cost of living goes up and wages are pushed down or completely stagnated agaisnt inflation (if lucky) all the while an 80sqm apartment in Surry Hills is 900k right now. Let alone in a 2038 Australia.

    Make no mistake. This is an agenda and they are playing the long game. Where is $horten on this issue? Ultimately the choice between the two major parties is to have the illusion of choice, since they’re running the same policies with different wrapping and spin.

    Local ministers need to be pressed on the issue of where they stand. Poked and prodded on it. Publicly and via their electorate. The only thing that matters to them is their seats and they need to be denied a free pass on not commenting on their stance.

    Inaction by the masses and our major cities will mirror those sh$thole countries and cities that did nothing to protect their economy. How do you wake up everyone who is more interested in the Bachelor?, than their future being sold out beneath them and told to be thankful for the added vibrancy…

    • Well if we had US level wages, and US level house prices, we’d all be much wealthier in real terms.

  5. St JacquesMEMBER

    Over the past two decades Oz has increasingly substituted a ponzi economy for a real economy, The damage has been done and is huge; the economy has been hollowed out and now depends on mass immigration to artificially keep it going, or to put it another way, the Oz economy is no longer self sustaining. Like a long time heroine addict, Australia needs more and more of this immigration drug to keep going, but is suffering from a continuous long term decline of health and ability to live a normal life. To quit would cause massive withdrawal pains and so is politically unacceptable to the main parties. But the immigration that artificially pumps up the total GDP is also weighing down ever more on wages and every other aspect of life and from here on this will only get worse and worse now that the once in a century mining boom is behind us. As more and more Australians find every aspect of life getting more and more difficult, angst is going to spread, cynicism is going to explode and politics is going to become ever more divisive and vicious.

    • St JacquesMEMBER

      And one other thing, all the tools are going to come out and say “nobody could see it coming”. Yeah, right.

    • SoMPLSBoyMEMBER

      Powerful words St J!

      And through it all, people that sincerely gave a rat’s cheese grabbed those people of influence by the lapels and screamed and pleaded to stop and re-examine. But those people were already too addicted to the easy money and the ‘she’ll be right’ attitude meant everything would be apples forever. Our stupid arrogance will ensure the illusion of prosperity will remain until the cold, hard facts reveal that it never existed and what we ‘had’ before we chased the illusion is now irretrievably lost.

      ‘One Last Shot’ ( DeNiro, Waken ) ‘The Deer Hunter’