Alan Kohler is like a weather vane when it comes to the topic of immigration, changing his tune depending on which side is in power.
In mid-2018, when net overseas migration (NOM) was 240,000 and the permanent (non-humanitarian) migrant intake was 162,000, Kohler labelled the rapid population growth in Melbourne and Sydney a “national emergency” and called for immigration to be “drastically cut”:
Whatever is left [in the Budget], plus any more windfalls that arrive over the next few years, should be spent on rail transport, in my view. Either that, or drastically cut immigration. The situation is becoming a national emergency.
Last week Bernard Salt predicted that Melbourne’s population would reach eight million in 2050, roughly the same as London’s now. Sydney’s population would be less than that, but close…
Congestion is taking over from energy costs as the biggest drag on productivity and economic growth and by the time Melbourne and Sydney get to eight million people each, they’ll be at a standstill.
In October 2020, during the height of the pandemic, Kohler argued that Australia has become addicted to population growth and now must be weaned.
Kohler argued that Australia’s world-beating population growth had papered over a weak economy. He also argued that the acceleration in population growth (immigration) from 2005 drove the nation’s housing shortage and that there would be financial benefits from lower population growth.
“While kicking the population growth habit might be painful economically, there could be some financial health benefits”, Kohler said.
In 2021, Kohler argued that Australia’s high immigration policy has been designed to deliberately suppress wages:
Scott Morrison’s can-do capitalists can’t really do wage rises, not for the past decade anyway.
And now they’re demanding to get their imported ‘slaves’ (aka temporary visa holders) back again, to put a lid on wages.
There have been times when wages went up a lot in this country, notably in the 70s and late 80s, brought to a halt by the Accord of 1983 and the recession of 1991.
Then came John Howard in 1996 and the permanent fix of temporary migrant workers.
Now we are about to enter the 10th year of real wage stagnation in Australia – wages minus inflation per worker have been unchanged since 2012. That has meant that real household disposable income has also stagnated…
Unsurprisingly, the cancellation of immigration as a result of the pandemic is starting to put some upward pressure on wages, evident in yesterday’s figures from the ABS…
John Howard introduced 457 temporary work visas soon after becoming Prime Minister in 1996 and then doubled the overall net migration in 2005.
Both of these acts were industrial strategies specifically designed to suppress wages…
It worked. By 2016, close to half a million temporary workers were in Australia at any one time, creating a pool of labour that drove wages down…
It was a brilliant strategy that led to a huge transfer from wages to profits…
In 2022, Kohler argued that Australia’s immigration policy has been “designed to suppress wages, crush unions”. Kohler also seemed to support immigration slowing “to 100,000 to 150,000 a year people. Maybe 1% population growth rather than 1.5%”:
The Coalition doubled Australia’s immigration in 2006 from roughly 100,000 a year to 200,000 a year at the time and it was in my view largely an industrial strategy designed to suppress wages and to protect the project they had to crush unions.
And it worked. Wages growth has been extremely sluggish ever since then and the unions have got virtually no power.
So I think it was a very effective strategy to use immigration in that way…
And the question is, if the Coalition wins will they go back to high levels of immigration as before? I suspect not and I think the Labor Party definitely won’t.
Because it’s now become conventional wisdom across the economic world is that the biggest problem for the Australian economy is slow wages growth.
The high levels of immigration has contributed to the slow wages growth, which is now seen as the biggest problem.
So, I think there’s going to be a lot of economic pressure from various quarters and the Reserve Bank on the Coalition and Labor Party not to go back to very, very high levels of immigration.
So I think we’ll return to 100,000 to 150,000 a year people. Maybe 1% population growth rather than 1.5%”.
In October 2022, Kohler warned the Albanese government that if they increased the immigration intake, they would turn a housing shortage into an “horrific” housing crisis:
If the Labor government doesn’t start co-ordinating immigration and housing, the mixture will be explosive, because Australia’s housing crisis is going to be horrific next year…
At the jobs and skills summit, Giles announced an increase in the permanent migration intake from 160,000 to 195,000, or 16,000 a month….
But where are they all going to live?…
[Labor] has approved two million visas when there are 51,437 homes currently available to rent.
So obviously, the Labor housing policy is hopelessly inadequate and when combined with its immigration policy, it’s downright dangerous.
Last year, Kohler warned that record immigration “is causing a massive shock” and has pushed up inflation and interest rates.
[Immigration] is causing a massive shock, and changing everything about the economy producing a rebound in house prices, despite the huge increase in interest rates.
It is also leading to stronger than expected top-line economic growth, at the same time as [we have ] a “per capita recession.
GDP and aggregate demand would be falling if it wasn’t for 2.8% population growth, and interest rates would be on hold or even getting cut, not increased.
The Albanese Labor government ramped immigration to record levels, creating the worst rental crisis in living memory.
However, now that Liberal leader Peter Dutton has promised modest cuts to the permanent migrant program, Alan Kohler is suddenly up in arms:
Would 140,000 be a good number? Well, yes, it probably would, if you were only concerned with housing. Dwelling approvals are running about 13,000 a month, or 156,000 a year, and completions in the latest quarter were 30,000, or an annual rate of 120,000.
Given there is an average of 2.4 people per dwelling in Australia, that would be fine. It would almost be fine if each migrant had a place to themselves.
The problem is doing it, not just whistling it, and then, if it happens, dealing with the unintended consequences…
But if housing demand was curtailed, supply would be as well. As developer Tim Gurner told The Age last week: “By reducing demand even more, supply completely evaporates, which has huge ramifications for jobs and productivity”…
Capping student visas, as Peter Dutton also wants to do, would have massive consequences for Australia’s tertiary education sector.
As government funds have been withdrawn, the unis have turned to foreign students to stay the same size, employ the same number of academics and remain viable. If the number of foreign students is reduced, government funding would have to be increased, or universities would shrink. There would be less education, fewer degrees and less research.
Service industries like aged care and child care would be starved of labour, driving up wages and inflation. Interest rates would be forced higher.
There would be no one to deliver takeaway food on electric bicycles, so people would have to get it themselves, or cook! Riots would break out.
But we won’t have to worry. Cutting immigration and student visas is one of those ideas, like densifying the cities, fast trains and abolishing negative gearing and the capital gains tax discount, that sounds great in a budget reply speech or at a conference on housing affordability, but hard to pull off in practice.
Improving housing affordability would be difficult and unpopular.
Anything that seems easy and popular won’t work.
It is quite the change in tune, isn’t it?
After spending years advocating lower immigration when the Coalition was in power, and raising the alarm last year, Kohler now argues that lowering immigration would destroy the economy, drive up inflation (ignoring that inflation is currently being driven in part by record immigration – see rents), lead to lower housing construction (because a vested interest developer says so), and would lead to acute labour shortages (even though decades of record immigration have delivered said shortages).
The above proves that Alan Kohler is a Labor stooge.
