Dishonest Treasury last redoubt of Big Australia

Yesterday, Secretary of the Australian Treasury delivered a post-Budget briefing to the Australian Business Economists where he admitted that the collapse in immigration has helped lift Australia’s per capita GDP growth, but then endorsed a return to ‘Big Australia’ immigration levels anyway:

One downward revision in the Budget was our expectations around population growth based on updated assumptions about when borders might open. This is an area in which Australia has experienced one of the largest changes compared to other advanced economies, through lower net overseas migration.

While this downward revision to population growth will affect the size of the economy, it need not impact GDP per capita if the pandemic and economic consequences of the pandemic are well managed.

In fact, comparing GDP per person demonstrates just how well Australia has recovered.

In per capita terms, according to the IMF, Australian GDP is expected to recover as fast as any major advanced economy (Chart 5).

Nevertheless, a return to open international borders and stable, well-balanced migration at an appropriate level remains in Australia’s interests. Migrants – particularly skilled, working age migrants – deliver an economic dividend for Australia, raising workforce participation in the longer term and likely productivity growth.

Open international borders also provide economic opportunities for specific sectors, such as tourism and education services, and provide broader benefits that flow from being able to travel and connect with others in person rather than electronically.

If you want bonafide proof that the Australian Treasury is little more than a propaganda arm for the federal government, there is your smoking gun.

Despite explicitly admitting that Australia’s per capita GDP performance has excelled with negative overseas migration, the Australian Treasury wants a return to status quo ‘Big Australia’ migration on spurious “workforce participation” and “productivity grounds”.

This comes despite the actual empirical evidence showing that Australia’s productivity growth collapsed during the past 15 years of mass immigration:

Australia’s labour productivity collapsed after mass immigration commenced in 2005.

As did wage growth, which collapsed amid 180,000 to 200,000 additional foreign workers entering the labour supply every year:

The mass immigration program helped to push Australian wage growth to record lows.

Nor does Treasury bother to mention any costs from running a mass immigration policy on living standards or the environment.

The Australian Treasury’s modus operandi is to raise the wellbeing of the population. It’s mass immigration fetish is a dereliction of this duty.