Finally, a senior member of Australia’s main political parties, Treasurer Joe Hockey, has admitted that relying on endless population growth (immigration) to juice the economy is a “lazy way to grow”:
Mr Hockey said the government was forecasting a drop in immigration as a percentage of the total population.
“Immigration is a rather lazy way to try to grow your economy,” Mr Hockey told ABC radio.
“What we’ve got to do is increase our output per hour.”
Hallelujah. Not only is it a lazy way to grow, but excessive levels of immigration can also lower living standards for the existing population via:
- Exacerbating infrastructure constraints (think more time stuck in traffic jams);
- Diverting capital into infrastructure provision to support the growing population, thus crowding-out productive investment and capital deepening;
- Reducing housing affordability and livability (think smaller, more expensive homes located further out);
- Diluting Australia’s fixed mineral endowment amongst more people (i.e. less resources per capita); and
- Greater environmental degradation.
These issues were discussed in great detail yesterday, so I won’t elaborate today.
Needless to say, it is great to see the population elephant finally being mentioned, which will hopefully lead to a broader political debate about the merits or otherwise of Australia’s immigration program, which is the highest in the developed world.
