LATEST statistics show that Australia’s population is growing at a rate of more than a million every three years. This growth rate is being driven primarily by record rates of immigration and a relative young population, itself a product of rapid past immigration. Doubtless Peter Costello’s baby bonus has also made the situation worse by encouraging the increased fertility rates of Australian women.
At the present rate Australia will have a population of about 50 million by mid century and 100 million by the end of the century. If this sounds implausible, consider that at the end of World War II, just 64 years ago, Australia’s population was only 7.5 million, i.e. it has almost tripled in that time.
This population growth should be considered an economic and environmental problem of huge proportions. From the economic point of view, Australia relies mostly on mining and agriculture for its export earnings. These industries require a very small proportion of the population to operate (although it is true that due to inadequate training in the technical trades and engineering, they have suffered a temporary labour shortages in recent years).
The growing population in Australia will not increase exports of iron ore, coal or gold and will reduce our exports of food as we are forced to consume more of our output internally. The money that comes to Australia from the sales of our resources presently gets divided among 22 million Australians. When the population doubles the amount per capita will halve.
There are plenty of examples around the world where resource based economies, almost all of which do not rely on a large fraction of their population to produce the export income, are worse off with large populations. Compare the UK with Norway, both supposedly rich from North Sea oil. The UK, with a population of about 60 million, spent the income and will soon run out of oil. Norway, with less than five million people, could afford to save a huge proportion of its income in large government investment funds. Norway’s future is assured.
During the recent resources boom, Australian governments squandered the bulk of the tax revenues generated by the mining companies, at least partially, in building infrastructure for an unnecessary population explosion. As an example of this problem, consider the state of Queensland’s finances which are caught between falling resources income and the staggering costs of providing the infrastructure for a third-world rate of population growth.
In the post war period of immigration there were some sound reasons to expand Australia’s population. There was a genuine, if exaggerated, security concern which was a rational response to the near death experience that Australia encountered in World War II. There was also a concerted effort to expand Australia’s manufacturing industry which, it was argued, needed a larger population to make it viable. In the days of poor transport, we needed large internal markets.
All those factors have now changed. Manufacturing in Australia is on its knees and a growing population will not help. Mining, agriculture, tourism, and the education of foreign students are our biggest export earners and do not need a growing population.
From the environmental side, a growing population is an obvious problem. Currently we have water shortages of varying severity in all our big cities which would have been less acute if we had maintained our population at levels of 20 years ago. Melbourne would not have to contemplate encroaching into its green fringe or building a desalination plant if its population wasn’t growing. Finally, if you believe that C02 causes climate change, Australia’s population growth will make it almost impossible to achieve meaningful emission reductions. We have to reduce per-capita emissions by 50 per cent every 40 years just to keep our total emission at present levels.
Even though the problems of population growth are obvious, it is a political sacred cow that cannot be argued or debated. None of the major political parties will argue for lower immigration because they are scared of being labeled racist. Even the Greens who have a useful population policy are almost always silent on this issue. They should be arguing for lower immigration every time the Australian Bureau of Statistics population figures are released. There is also an unholy alliance between the right wing who want a growing population to feed our housing construction industry and the extreme left who want to allow the whole world to come to Australia on compassionate grounds.
The housing industry is the main beneficiary of high population growth. Every year we have to build a city the size of Canberra just to house our growth. Unfortunately this is not a productive activity, unlike building a factory, a mine, the scientific development of better farming practice, a medical breakthrough or an environmental improvement. House construction appears to be good for us because it employs people in the short term, but in the long run it will get us nowhere because it is not an investment in production. The reality is that Australia has too many people in the industry.
Although the housing industry has always been a big winner from our population policy, there is now another big player that has its snout in the immigration trough. That is our education sector. Presently, applicants who wish to migrate to Australia and have a qualification from an Australian institution get preferential treatment. This has spawned a massive industry in education which could only be described as an enormous immigration scam. In the lobby of a large Pitt Street building recently I noted that half the companies in the building were involved in either immigration advice, or education for foreign students. Many companies were doing both.
It is not only some dodgy colleges which are involved in this cash-for-visa scam. Our universities take in large numbers of students whose main aim is to gain Australian residency. We are prepared to take money from them to smooth their way through the process. Effectively selling permanent residency visas through the education system is neither ethical nor in the best interests of the country.
The population issue is an example of where this country has lost its way and is not concentrating on the big economic, environmental or social issues. We are preoccupied with global warming and the supposed imminent demise of the Great Barrier Reef even though the science on these is far from conclusive. At the same time we ignore the obvious and definite environmental problems posed by population growth: unarguably the easiest and cheapest problem to solve yet underpinning all our environmental problems.
We also refuse to contemplate nuclear power to reduce greenhouse gas emissions because, like population growth, this is another sacred cow that cannot be challenged. Economically we are prepared to sacrifice our future for the short term gain of extra foreign students in our universities and dodgy colleges, and for jobs in our non productive building industry. Socially we are not prepared to pay to train our own kids to become doctors, engineers and trades people to fill the gaps we have in our labour force. At the same time we are happy to take skilled people from developing countries which cannot afford to lose them.
With Canada and perhaps Russia, Australia is in a unique position. We have a small population and a huge country, most of which is agriculturally unproductive and unpleasant to live in. We have a relatively unspoilt environment and an abundance of mineral wealth. We also have a technologically advanced society and a good base in science and medicine. Uncontrolled population growth risks what we have. We should immediately reduce immigration to about 50,000 a year, with the medium term objective of having a zero net immigration policy; and the baby bonus should be scrapped to discourage the present rise in fertility. Because of the pipeline effect, i.e. we have a very young average population, our population will continue to grow to at least 25 million. We can then decide if we wanted to keep the population at that level or reduce it by adjusting immigration to suit.
It really is that easy.
Peter Ridd lives in Townsville, North Queensland, and is a director of the Australian Environment Foundation.
This article was first published by On Line Opinion on August 13, under the title ‘Population: A Big Problem But Easy to Solve’ and is republished here with permission from the author.
spangled drongo says
“All those factors have now changed. Manufacturing in Australia is on its knees and a growing population will not help. Mining, agriculture, tourism, and the education of foreign students are our biggest export earners and do not need a growing population.”
Great article! The foreign student industry is a short cut to disaster. Similar to the C arbon R eduction A nd P ollution industry.
The Laundry Industry is all we’ll have left but it sure won’t get us out of the hole.
Graeme Bird says
Under current policy Peter is absolutely right. The predictions and models that people like Julian Knight made can only apply to a fundamentally capitalist society. But we are not a capitalist society. And we have been denied nuclear energy and the world at large has been subjected to a thirty year energy-deprivation crusade. The explosion of global warming racketeering being only one bloom of this more long-standing program.
We want labour shortages. It is my preference that we have labour shortages with high immigration. But we will not have a good Australian society unless we aspire to labour shortages. By this I mean we want such massive energy production and capital accumulation and update that all our businesses do not feel like they have enough people to run with all the gear they have.
This is a problem FOR THEM. But a gift for our society. Always the energy production must be the first pole when putting up the tent. And yet the various depredations of the left have meant that this crucial limiting step is now behind.
The alleged right-wing economists appear to be conspiring with the leftists, in that its their job to say “what me worry?” and act like there is no energy and resource problem. Well under Julian Knights dispensation there is no energy and resource problem. But we are not a capitalist country. And so the capitalist rules do not apply.
We are in a lot of trouble. Hence for totally different reasons I agree with Peter Ridd. Unless we are willing to pump up our energy production, reduce our parasitism, reform money, and do whats necessary to increase capital formation, then we ought to cut back immigration.
Make no mistake I don’t think we ought to aspire to cut back immigration. Thats not my point. But Peter Ridd is right, in that if we want to have a feeble growth in energy production, and if we are not willing to scale down the government sector via mass-sackings, and do whatever else is necessary to basically have a permanent state of labour shortage (via relative capital excess) then if these are the choices we make, mass immigration will basically turn us into a third world country.
Immigration is a wealth creator under capitalism. It will be a wealth destroyer if we cannot get our act together. There is no lucky country magic spell.
Ian Mott says
If I were driving a metaphorical bus into the latter half of the 21st century I would much prefer to be driving one with Australia’s immigration based demographics than one without, like Italy or Japan. I have the greatest respect for Peters science and share many of his views on other topics like nuclear energy but his economics is rudimentary, to say the least.
It is true that nations are no longer dependent on cannon fodder but this was only a minor part of the equation. The major part of a successful economy was always, and remains, the supply of “tax fodder”. It was the collective economic and intellectual synergies provided by Britain’s tax fodder that allowed it to produce the Spitfire, and only just enough of them at that, that allowed it to remain free of Nazi rule. The significantly less tax fodder of Norway produced no such technological edge and no comparable critical mass. Britain could afford a Churchill, but only just, Norway had to make do with a Quisling.
The inescapable fact of economic reality is that more than 70% of GDP is sourced from “income from personal exertion”. Profits, interest on investments etc, will always be a minor part of the cake. Add more “personal exerters” (workers) and GDP goes up. And for every extra two consumers we have there will be 1.2 new jobs created. If we add too many new consumers, too fast, there will be a slight lag in the delivery of those extra jobs and the unemployment rate will rise. But if, as is the case in Japan, Italy and Spain, the number of consumers is actually in decline from low birth rates and low immigration then the supply of jobs will actually go down faster.
The jobs of most people in economies with immigration policies are not under threat from migrants. The new arrivals do their time on the unemployment queue and when sufficient numbers are added to the back of the queue then new jobs are created for the ones at the front of it.
What Peter is arguing for in reduced population is an economy that is even more dependent on the whims of foreign buyers. But does anyone seriously believe that we would be getting the current prices for Iron Ore if our economy was only half our current size? Does anyone seriously believe that the Chinalco deal could have been rejected by a government with only half of our current economic muscle? Not a chance.
The unkind truth is that economies must continue to grow to have any chance of maintaining geopolitical parity. If our population and GDP was only half what it is today we would not just be maintaining territorial integrity with half as many submarines, for example, that we have today, we would also not be building them here, and the lost economic stimulus would leave us less able to afford state of the art technology to go with them.
The only reason we have a domestic motor industry at present is the fact that our domestic market has continued to grow slightly faster than the minimum population threshold for those plants. Improved technology demands an ever increasing minimum market size and our own domestic market is the only one that we have any control over. Export markets are fine, but as the rest of the world is currently realising, they are also fickle, and when times are tough they are the first to disappear.
I understand Peters sentiments but I do not share them. I ache for so many of the the things we have lost with larger population but some of my fondest memories are of migrants. I blame the urban governments that have continued with centralist economic strategies long after the costs of metropolitan growth have outstripped the benefits. Decentralised growth into our regional towns and provincial cities would have greatly improved our overall economic and geopolitical health while substantially reducing our ecological footprint.
Instead of feeding our urban diseconomies of scale we could have, and should still, be investing in more evenly distributed, regional economies of scale.
Graeme Bird says
“In the post war period of immigration there were some sound reasons to expand Australia’s population. There was a genuine, if exaggerated, security concern which was a rational response to the near death experience that Australia encountered in World War II. ”
There was nothing ever exaggerated about it. And now we are sitting ducks.
“The inescapable fact of economic reality is that more than 70% of GDP is sourced from “income from personal exertion”. Profits, interest on investments etc, will always be a minor part of the cake. Add more “personal exerters” (workers) and GDP goes up. And for every extra two consumers we have there will be 1.2 new jobs created. If we add too many new consumers, too fast, there will be a slight lag in the delivery of those extra jobs and the unemployment rate will rise. But if, as is the case in Japan, Italy and Spain, the number of consumers is actually in decline from low birth rates and low immigration then the supply of jobs will actually go down faster.”
Its got nothing to do with consumers Mott. You ought not put this Keynesian claptrap about. Since its an excuse for blood-sucker-central to drain us even more. Obama would not be able to wreck things as badly as he is now doing if this consumptionism wasn’t out there as a virus in the meme-pool.
Our government was lately borrowing 2 billions a week, largely from the communist menace, on the strength of these consumerist fallacies.
Graeme Bird says
By the way. Your argument about more people amortizing our defense budget is a good one. My carping was a technical economics point.
On another note and slightly off-topic. Of course it is well-known that we can never have too much CO2, in the same way as you cannot be too rich. But while any sensible scientifically literate person knows this, still everyone wetting their pants about CO2 levels getting too high has distracted you all…. I’m talking to all of you (even the sensible people: Jennifer, Mott, Hissink, Cohenite, Siddons, Robertson, et al) ….. about what will happen WHEN (not if but WHEN) the CO2 levels drop precipitously. And if the historical CO2 record is anything to go by it won’t be a long time until that absolute disaster happens.
This morning I was mucking about on Catallaxy matching the CO2 record against famines and hunger. Certainly this is no research as such. But it turned up enough for us to take this seriously as something that ought to be researched with some despatch. We have the CO2 data of the last 180 years. Even the most casual investigation into it reveals famines breaking out just a few years after the CO2 plunges to abnormally low levels.
This is a serious matter. And we ought not let leftist propagandizing blind us to real ecological threats out there. It appears to me that we can expect a serious drop in CO2 levels sometime between now and 2020. Certainly no later than 2030.
“It appears to me that we can expect a serious drop in CO2 levels sometime between now and 2020.” OK – nail this to the wall as Bird’s greatest prophecy
I’m looking for one sceptic to support him. Step right up folks. Don’t be shy.
Hey Motty – what’s your rationale for inefficient high transport facility duplicating regionalisation ?
spangled drongo says
“I’m looking for one sceptic to support him. Step right up folks. Don’t be shy.”
We gotta keep churning it out cos when that ol’ ocean cools Lukey Boy, it sure sucks up the burp gas. Just have a butchers at this:
spangled drongo says
It’s started already!
spangled drongo says
AND EVEN THIS!
Graeme Bird says
““It appears to me that we can expect a serious drop in CO2 levels sometime between now and 2020.” OK – nail this to the wall as Bird’s greatest prophecy”
I checked on when the Dalton Minimum was (1790-1830) and the CO2 didn’t drop to severe levels until the early 1840’s. So for this reason that prophecy was a tad rash. The Wolf minimum had been going on a long time before the heavy rains that heralded the beginning of the little ice age. These delays can take a long time. But dropping CO2 levels are the real worry. It will happen. Its a serious problem. Whereas it is a fact that we can never get enough CO2 for all practical purposes.
spangled drongo says
Before you go to bed tonight you better shine a torch where the sun can’t reach.
You could have a bit of downey mildew yourself.
Can’t be too careful.
Graeme Bird says
“We gotta keep churning it out cos when that ol’ ocean cools Lukey Boy, it sure sucks up the burp gas. Just have a butchers at this:”
Yeah but drongo that particular one was when this massive North American lake exploded directly on top of the gulf stream and brought the conveyor to a halt for 1000 years. So its no surprise that its effect was immediate.
Proper glacial periods come on in a series of little ice ages. And the finish quickly. Our new little ice age is starting already. But it won’t be like when that massive meltwater lake landed on the gulf stream.
Louis Hissink says
Slow down a bit – that was the end of the ice age, the article linked is about it beginning and occurring within a year.
But back to topic, this is merely another Malthusian prediction of doom and gloom from an extrapolation – it’s the predictable outcome from adopting collectivist policies – the Trade Unions killed the apprenticeship system by raising their wages to adult wages, and I gather that most Australians seem quite at ease with any sort of welfare system.
So the doom and gloom painted by Peter Ridd is expected.
The solution is to reject the collectivist policies we have had since Federation.
Guess what? That is not going to happen. There are too many on the public teat and welfare. Only a climate catastrophe could allow the conditions for a change, and that isn’t on the schedule either, sad to say, so welcome to our Brave New World.
“But does anyone seriously believe that we would be getting the current prices for Iron Ore if our economy was only half our current size?”
If I have the goods at a better price, the customer will buy it from me, and gives not a crap how big my economy is!
If you imply that we can afford to upset the customer because we have a good thing going anyway, then you are wrong, local economy is just that, local, in the end we can wash each others underwear, without exports there is no growth.
As to the continual growth of population as a driver of economy, so far no one could explain to my satisfaction how far we can grow?
It sure is good for builders and the Harvey Normans for the moment, but what about services, raw materials,
energy etc. for the future?
What are the limits, what is the price, do we want to live like sardines?
After the second World War the Eugenics people became environmentalists as Eugenics was not popular anymore. (Holocausts, etc) The Alarmists have the over population on their agenda brought with them from the Eugenics days.
Some research indicates that there has been no major works to store more of our abundant water from before the second world war.
We in the regional areas need population to maintain reasonable services in our towns.
So Spanglers – after all that fluff I take it
(1) you fully support Birdy’s CO2 comment
(2) and you’re predicting an imminent Ice Age
Have I got that right?
Louis Hissink says
A reduction in CO2 causes ice ages? That’s Svante Arhhenius’ hypothesis which has been falsified.
spangled drongo says
Well Luke, I don’t think that rapid variability in climate is influenced by CO2 but there is always the chance of it.
Rapid cooling is more likely to come from volcanic activity or violent changes, from many causes, to ocean dynamics as Graeme just instanced.
By its nature it’s pretty unpredictable and for this reason rapid cooling does not tend to show up on GCMs.
Graeme Bird says
“So Spanglers – after all that fluff I take it
(1) you fully support Birdy’s CO2 comment
(2) and you’re predicting an imminent Ice Age”
Luke I don’t even support my CO2 comment fully. Whereas, at least aside from the hydrocarbon industry we could expect a nasty drop in CO2 levels sooner or later, and whereas this would be a disaster, my timing may be out since if we look at the record of when the CO2 surged up and then dropped, well 2020 might be a bit soon. Scroll up. I already backed away from that timetable after checking where the Dalton minimum was. But its an important matter. We can never have too much CO2. But we can certainly have too little.
On the second point. No Glacial period is imminent. But a new ‘little ice age’ is imminent. We can expect a number of ‘little ice ages’ and recoveries with each little ice age having a greater than 50% chance of being nastier than the one before it.
CO2 enters into the picture when we are talking about the availability of food. It doesn’t enter into the picture when we are talking about warming and thats just a fact get used to it.
Ian Mott says
Marcus missed the point, again. Business history is littered with companies that allowed themselves to become entirely dependent on just one customer. From that point on they were on the short road to a low priced takeover. All the major customer had to do was to switch suppliers for long enough to put the company on the brink of insolvency and the target shareholders would accept any price at all to avoid losing everything. So to paraphrase the old chinese saying, bigger fish have fewer predators.
If Luke would care to pose a coherent question I would be glad to answer it.
Bird, nice knee jerk but what is Keynsian about maintaining demographic balance or commenting on what we know about the participation rate?
Graeme Bird says
“Bird, nice knee jerk but what is Keynsian about maintaining demographic balance or commenting on what we know about the participation rate?”
Those are fine points as is the idea that we need taxpayers to underwrite the defense costs. But you don’t want to frame things in terms of consumers. It isn’t consumption that creates jobs. And we don’t need extra consumers for extra consumption. It is this sort of thinking that leads to those clowns in Canberra spilling red ink everywhere and hurting our chances of recovery (even as they artificially make the wrong figures look better.) If consumption is valuable then this makes parasites feel that they are necessary to the whole process. But consumption is the point at which wealth is destroyed. The points about the demographic balance and the participation rates are both fine points.
Comment from: Ian Mott August 16th, 2009 at 9:06 pm
“Marcus missed the point, again. Business history is littered with companies that allowed themselves to become entirely dependent on just one customer.”
You did not understand what I wrote. I never said nor meant anything like that, if anything the opposite.
Hate admit it but I’m inclined to share Luke’s view, you can dish up a load crap at times.
“Luke I don’t even support my CO2 comment fully” says GB ! OMIGAWD !
And Spangly – looks like you’ve backed off. ! Mate – take the sunshine out of your GCM and it will respond !
You guys – you’re just playing with me aren’t you?
Birdy – I wouldn’t be able to persuade you about the notion of optimum CO2 ? Surely as an aficionado of economics you’d be into the optimum vis a vis the maximum ! And surely you’d be into multi-attribute multi-criteria objective functions?
The connection between environmental pressures and population growth is absent from all mainstream Australian political parties policy platforms and is explained (in my view) by the prevailing economic paradigm, to which all mainstream parties have to pay heed (or risk a caning in the mainstream media)….including the Greens. The prevailing paradigm requires the consumption of resources to always increase, and increasing the number of people consuming is one method of achieving this goal, and another is to increase the capacity of individuals to consume. If you can do both, then so much the better, and so better still to promote the borrowing of money so future consumption can be had now. They say people everywhere are becoming ever more irreligious, but personally I think the current economic paradigm is the ‘new religion’.
Virtually all current issues of unsustainable exploitation of resources are due to population growth, which on a simple level can be seen as the conversion of the biomass of other species to humans.
Somewhere out there in the universe may be a sentient species that has used its intellectual power to provide all of its kind with access to every level of resources to ensure there are none who suffer any kind of want, and at the same time act as sympathetic steward to the species that share its world. To me, that would be an ‘Eden” worth aiming for.
I am not for a moment asserting that Adam Smith was wrong, but that just as Smith’s insights came at a time in history when western society was moving through a revolution which transformed the entire social order, so it is that we face the opportunity now to reshape the prevailing paradigms that govern how we live, work and prosper.
Graeme Bird says
“Birdy – I wouldn’t be able to persuade you about the notion of optimum CO2 ? Surely as an aficionado of economics you’d be into the optimum vis a vis the maximum ! And surely you’d be into multi-attribute multi-criteria objective functions?”
Persuade me Quant-boy 101. I’m saying the optimum can be no less than 1500ppm and may be a little higher than that.
“Somewhere out there in the universe may be a sentient species that has used its intellectual power to provide all of its kind with access to every level of resources to ensure there are none who suffer any kind of want, and at the same time act as sympathetic steward to the species that share its world. ”
What is that I here playing in the background. Could it be John Lennon’s trite fairytale IMAGINE?
Russell. Communist dictatorships are not any sort of ideal to strive for. Nor are they possible economically in this or any other planet.
“The prevailing paradigm requires the consumption of resources to always increase, and increasing the number of people consuming ‘
Its hard to know what you are talking about here. If you mean a free society requires this, this is not true. If you mean fractional reserve seems to require this you would have a point. Since under this monetary system there is always a lot more debt than money. And this would seem to require more money to justify the debt levels. So we have endless inflation which swings behaviour towards more borrowing, consumption beyond ones budgetary means, and so forth. Thats a treadmill we ought never have gotten on.
Yes Birdy – all blather – what’s your business case for >1500ppm
Russell. Communist dictatorships are not any sort of ideal to strive for. Nor are they possible economically in this or any other planet.
So, thats it then??? This is the perfect system? Or the only possible world?….take a long look around you. Three quarters of our behaviour, collectively and individually, would not be out of place in a chimpanzee colony…but you would have me believe we have already exhausted all the possible paradigms for social organization? Thanks but I remain an optimist.
Next you’ll be telling me you’re a skeptic.
Ian Mott says
So big fish don’t eat little fish, Marcus?
Bird, I agree on the evils of overconsumption, especially government funded overconsumption. But the addition of new consumers to an economy means that there is a whole set of essential and legitimate needs that must be met, either here or somewhere else. We do have a choice to leave a potential migrant in his home country but with that choice goes the high probability that he will buy his food from other sources and a certainty that his rent, fuel, schooling etc will be spent outside Australia. Bring him into the country and his GST money helps to cover a pensioners medical costs.
If we had a decentralist settlement policy then migrants would be diverted away from major cities where they currently exacerbate congestion costs and compound infrastructure costs. In a regional town or city their kids will improve the efficiency of their school, justify an extra medical practitioner, (so the existing one can actually have a normal holiday), increase the turnover of the local (non-chain) grocery store, reduce the market dominance of the major retailers, and enhance the viability of a range of local businesses and services. And all for next to zero impact on the surrounding environment.
Add 50,000 people to Sydney, Melbourne, Brisbane or Perth and each will require a whole new suburb and all its infrastructure and add another 10 minutes to the 90 minute commute to work. Add 50,000 people to 500 country towns and the 40 odd new houses required in each can be built on existing streets, using existing services, and still only take 5 minutes to get to work while the kids can still ride their bikes to school.
On that latter point, if the climate cretins were really serious about lowering CO2 emissions they would be diverting as many 90 minute city commuters as possible to 5 minute country town commuters and get the SUVs away from the school gates so its safe for the kids on bikes again. It sure beats pissing about with RE targets.
Graeme Bird says
” what’s your business case for >1500ppm”
I though you were going to advise me on something. Go for it. If you think its a lot more than that explain why.
Graeme Bird says
“Bird, I agree on the evils of overconsumption, especially government funded overconsumption. But the addition of new consumers to an economy means that there is a whole set of essential and legitimate needs that must be met, either here or somewhere else. We do have a choice to leave a potential migrant in his home country but with that choice goes the high probability that he will buy his food from other sources and a certainty that his rent, fuel, schooling etc will be spent outside Australia. Bring him into the country and his GST money helps to cover a pensioners medical costs.”
Well you can make that case that we need more taxpayers. But you cannot do so on the basis of their ability to consume. Its their ability to work, save and pay taxes that is the ability that you are after.
“Add 50,000 people to Sydney, Melbourne, Brisbane or Perth and each will require a whole new suburb and all its infrastructure and add another 10 minutes to the 90 minute commute to work. Add 50,000 people to 500 country towns and the 40 odd new houses required in each can be built on existing streets, using existing services, and still only take 5 minutes to get to work while the kids can still ride their bikes to school.”
A good point, but the existence of those new people in country towns still requires an allocation of resources elsewhere to cover the extra demand from those towns….water, power, education, health for example from a utilities perspective, and for the manufacture of consumer goods….nowhere is completely self contained is it?, although some communities may produce much of their own needs, they tend to be in countries where subsistence agriculture is the norm, and none of us aspire to that. If Australia is able to overcome its problems with supply of reliable and fast telecommunications outside cities, there is no reason why many people could not relocate to smaller towns, but they will still create demands that will have to be sourced elsewhere. Perhaps the general migration of people away from small towns is really an adjustment to a more efficient allocation of resources (including human capital).
However, the questions I think Peter was posing were……is there a desirable upper limit to our population growth, and have we already exceeded that?
My own view is the answer is ‘yes’ to both.
Walter Starck says
In considering the economic effect of population growth it is important to also consider the nature of the particular economy. At about 11% of GDP Australia has the smallest manufacturing sector and highest dependence on manufactured imports of any OECD nation. Both trends are also worsening with little prospect for improvement in the foreseeable future. Australia also has the highest proportion of urbanization in the world and faces growing problems related to massive urban growth. Not the least of these is among the world’s most expensive real estate.
The average house price here is six times average annual earnings or twice the level that collapsed the U.S. real estate bubble. This level now requires a dual income family indentured for most of their working life just to own a home. It also means that domestic savings are insufficient to provide the necessary mortgage lending and the banks must now depend upon ongoing overseas borrowing to sustain the bubble. Worse yet, the banks themselves have most of their assets based on inflated real estate and a collapse of the bubble would wipe them out. Any significant rise in global interest rates or downgrading of the credit rating of the Commonwealth Government (which guarantees overseas borrowing by the banks) will collapse inflated house prices. All this is exacerbated by high levels of immigration almost all of which settles in the cities.
On top of this is a chronic trade deficit set to increase dramatically with rapidly declining domestic oil production. The resulting foreign debt is already at 60% of GDP, among the highest of OECD countries.
The Australian economy is more heavily dependent on primary production than any other OECD nation. In other words we have a third world economy supporting a first world lifestyle. This is only possible because of a relatively small population. Rapid population growth is unlikely to rapidly expand primary production and if it did this would only result in accelerated depletion of the resource base. There is no indication that increasing population is making our manufacturing and service industries more competitive either. In fact our remaining competitive advantages in these sectors are in relative decline with increasing quality improvements in lower cost economies.
In UN and other quality of life surveys the top ratings are consistently held by nations with small total populations and/or low population densities. The economic benefits of increasing population flow to a decreasing portion of the total population. For most the result is only a decline in their standard of living.
Labour shortages mean a higher standard of living for millions of employees while a few owners have to suffer with only being rich instead of filthy rich.
This is indeed the lucky country. The high quality of life we enjoy is not because we are smarter, or more industrious, or morally superior to other less fortunate nations. Our overwhelming advantages are natural ones. There are no problems with adjoining neighbours, a mild climate, plenty of space and a wealth of resources. Perhaps most important of all, there is plenty to go around so everyone gets a generous share.
Doubling, tripling or quadrupling our population is unlikely to improve our quality of life. Almost certainly it will diminish it economically, environmentally, socially and with respect to freedom and opportunity.
This is an excellent article and entirely correct. Australia continues to increase its population yet fails to provide additional energy and water resources. With regards to water, there are few towns and cities in south east Australia that have had water reservoirs at capacity for nearly a decade. Should our moronic policy continue it will be to Australia’s peril.
The argument that ceasing immigration would be disastrous for the economy is nonsense. Sure we will have a lower GDP growth rate, but consider this: because population growth is lower, GDP per capita growth will remain much the same. In fact per capita GDP growth is not related to population growth at all. This is very clear in the figures (sourced from the UN):
country per capita GDP growth(%) population growth(%)
===== =================== ================
australia 2.4 (1970-90) 1.5 (1990-08) 1.22
liberia -4.2 (’70-90) 1.9 (1990-08) 4.55
japan 3.0(’70-90) 0.9 (1990-08) -0.02
italy 2.8(’70-90) 1.2 (1990-08) -0.02
sweden 1.8(’70-90) 2.2 (1990-08) 0.38
china 6.6(’70-90) 8.9 (1990-08) 0.58
China recongnised the perils of an ever increasing population decades ago, and they have been growth pretty well.
Graeme Bird says
“At about 11% of GDP Australia has the smallest manufacturing sector and highest dependence on manufactured imports of any OECD nation. Both trends are also worsening with little prospect for improvement in the foreseeable future.”
We can improve this if we choose to. This loss of manufacturing has nothing to do with comparative advantage. But rather its because of our high level of parasitism in the public sector, and our bad monetary and fiscal policies. Some of the effects of which you allude to. Things will get far worse if we don’t shake off this environmentalist menace and start producing abundant energy.
Ian Mott says
“Doubling, tripling or quadrupling our population is unlikely to improve our quality of life. Almost certainly it will diminish it economically, environmentally, socially and with respect to freedom and opportunity.”
But the inescapable facts are that we have tripled our population since 1945 and a great many aspects of quality of life did improve. Our economic standards have not diminished and the area of native forest habitat has increased considerably, especially on the coastal strip.
Those aspects of our quality of life that have declined over the past half century have had nothing to do with population growth. Kids expecting to have their first home with two bathrooms, five bedrooms and three garage spaces, on 5% deposit, were not forced into it by population growth. They made their own choices.
Kids growing up without fathers are not caused by population growth. It was not population growth that gave the single mums the impression that she could continually villify the kids father and not cause serious emotional harm to her own offspring. Population growth did not manufacture the “ice”, grow the psychosis inducing hydroponic dope or let the kids roam the streets at 2.00am on a Tuesday night. It was not population growth that turned school discipline into a joke and effective policing into a bigger joke.
And it was not population growth that has been lying to the policy processes, eroding personal liberties at every opportunity, stealing property rights without compensation and governing with fraudulent mandates. It was the elected representatives of Australians who voted for form over substance.
So I am sorry to have to put this so bluntly, folks, but you are guilty of serious intellectual laziness by way of attaching a causal relationship to what is nothing more than a very loose association. And deep down, you know better.
Luke, as always, will seek to dissemble instead of address issues.
Since our climate is not primarily driven by CO2, only AGW true believers are going to continue their fixation on it.
This thread is about population policy. I would encourage Australians to consider what is happening in Italy and Russia: If you are not growing, you are losing.
More people equates to more opportunity for growth. If my regional neighbors included India and China, I would not want to become in effect an empty sand box full of nice minerals. I would want a nice growing population, and a nice growing economy, as well.
Graeme Bird says
“But the inescapable facts are that we have tripled our population since 1945 and a great many aspects of quality of life did improve. Our economic standards have not diminished and the area of native forest habitat has increased considerably, especially on the coastal strip.”
This is true. But there are a lot of things different now.
1. The level of parasitism is now astounding. Whereas it was relatively minimal straight after world war II.
2. We did not have an anti-production ideology in treasury, and in the economics community (sadly on the alleged right) wherein according to them we are SUPPOSED to lose our manufacturing due to “comparative advantage.” The fact that nothing in comparative advantage suggests such idiocy is neither here nor there. The economics community has its heart set against good policy that would have us reindustrialise.
3. The last link to gold was lost in 1971, and the reserve asset ratio was lost in the late 80’s. For fairly esoteric reasons these two have also helped lead to deindustrialisation. The threadstarter hinted at some of the effects. We thought we were able to eliminate recessions. It turns out that recessions ought not be judged by real GDP, but rather by real gross sales revenues. So we only got rid of REPORTING recessions. And our allocation of loan resources got steadily worse. Leading to the nations savings and anything that might be borrowed squandered on credit card purchases and bidding up the price of the land beneath our feet.
4. We didn’t go nuclear. And we are not yet beyond the transition period after the cheaper oil is no longer dominating oil pricing. We have stood still for a forty year energy-deprivation crusade that has now metastisized into the worst science fraud rackent yet seen. Every day a new Piltdown man.
I’m like you Mott. I want a lot of immigration. I want us to be big proud and strong. Like the Hewson vision of fightback. I want us to have all these new people absorbed to undermine the totality of poverty on the globe entire, and to make this continent unassailable now that the Americans have chosen to destroy themselves.
I’m just like you. I want all their unattached single girls, the cream of their men, and far more than our fair share of refugees to be allowed to come here.
But if we go for huge immigration before a few fundamentals are cleaned up we are going to wind up with a third-world societal profile and there can be no doubt about it.
Why do you think I am so abnoxious to people over this energy-deprivation crusade? I want to save all the foreigners and give them an Australian lifestyle. But we cannot do it if the first energy peg isn’t in place before we put up the tent. And we cannot do it if there aren’t a few OTHER pegs in place as well. Thats why I’m so abusive. I used to be such a pushover. So polite.
Ian Mott says
I can see by your posts, Bird, that we were essentially in the same boat but I don’t see why immigration has to stop as a precondition to getting things right. Both Labor and Liberals have pursued centralist policies and, as a consequence, have maintained a metrocentric immigration policy. There was some toying with extra assessment points for those who settle outside the major cities but the program itself remained targeted at foreign city dwellers who had even worse anti-regional biases than the average urban Australian.
Without doubt, the migrants who have merged with and best complimented the existing community would be those Italians, Greeks, Yugoslavs and Indians who settled on farms and in country towns and now comprise a large portion of the Mayors, Councillors and industry representatives.
My cousin married an Italian boy who had never been called a “wog” until he worked for a time in Melbourne as an 18 year old. And if he was ever referred to as a wog, in the third person, he was, affectionately, “our wog”, with no reason to question where he belonged.
But despite consistent regional labour shortages the immigration program refused to recognise the capacity and desire to work on the land as a particular skill, in short supply. So we got an endless supply of dole funded work dodgers who made occasional stabs at fruit picking to keep the dole office off their backs. And we got an equal procession of Jeremys, Jemimas, Lars’, Gunthers and Ingas who would stay long enough to top up their petrol and drinking money but never long enough to acquire even conscious competence in any but the minimum skill set.
And they took most of their money out of the district when they went. This compounded the reverse multiplier effect that was already in place due to the leakage of local tax revenue to metropolitan departmental head office overheads. And the combination of the two elements of government policy produced regional economic decline and drove population shift to the major cities where it compounded the immigration derived congestion costs and infrastructure shortfalls.
State development policies also didn’t help. If the 1950’s Riverina irrigation model had been applied to Cubby Station in Queensland, for example, it would have supported more than 1000 migrant families on intensive horticultural holdings. The Ballone Shire, centred on the town of St George, with current population of only 3,800 people, would have had more like 15,000 once the money flowed through the local economy. And not one of those 15,000 people would be cutting in on you or I in the city traffic or crowding out our long weekend getaway.
Similarly, the Ord River scheme was a white elephant only because we failed to attract the kind of migrants who would have jumped at the opportunity to farm there. There was nothing wrong with the project, it was our collective imagination that failed us.
Graeme Bird says
“I can see by your posts, Bird, that we were essentially in the same boat but I don’t see why immigration has to stop as a precondition to getting things right. ”
Maybe you are correct. And maybe having the extra immigration will spur the reform needed for the immigration to do good for us. What I’m saying is that the reform is needed. If we have more immigration, or no immigration, or about the same immigration, without the reform then we are in a lot of trouble. Moreso with more immigration because the world of Julian Knight cannot work if we will not let it.
So I cannot say what the strategy is. I only advise that at the moment the immigrants will not be doing us a subtle favour in the way that has been the case in the past.
Supposing I get a 100 million dollar inheritance and get together with you to put up a 3 billion dollar nuclear plant? Not exactly a natural law property rights environment for this sort of punt is it?
You may be right but be careful what you wish for and there is no use telling Julian Knight-based Pollyanna stories about the likely effects. I say this besides the fact that I think that Julian was fundamentally right on all points and that his world is the one we ought to be aiming at.
On another note here is what Barry Brook did to the person who started this thread:
“Pete Ridley said
24 June 2009 at 6.12
Gz, rfrncd Prfssr Rmnthns ppr f yrs g bcs hd bn drctd t t nl ths mnth b wll rspctd scntst whm ndrstnd t b nvlvd n mprtnt crrnt rsrch nt spcts f th mpct f th q-sphr n glbl clmts. Tht Prfssr dvsd m tht Prfssr Rmnthns ppr ws stll k n ths dbt vr C. Snc m nt scntst nvlvd n clmt rsrch dpnd pn xprt pnn, frm bth sds f th dbt, t hlp m frm m wn cnsdrd (nd hpfll rsnbl nfrmd) pnn. Thnks fr th ddtnl nfrmtn tht y hv prvdd, bt t nl cvrs prt f th ss. Yr qts frm mr rcnt sttmnts b Prfssr Rmnthn rlt ntrl t glbl wrmng frcsts bsd pn wht ndrstnd t b nsnd scnc. Th brdr nd mr mprtnt bt vn lss ndrstd ss s whthr r nt r s f fssl fls hs sgnfcnt mpct pn glbl clmts. Prfssr Brk, fllwng yr pnng ntr t ths blg thr s n nvttn fr ppl t rspnd nd thr hv bn vr s fr. n yr pnng ntr nd drctl hd f th sgnfcnt xtrct tht hv qtd svrl tms y yrslf qt n xtrct frm wht Prfssr Plmr sd bt hs bk Hvn nd rth. bvsl y cnsdrs t prfctl ccptbl t qt xtrcts frm wht thrs wrt, jst s hv dn whn qtng y. pnt t tht qtd tht xtrct frm yr pnng ntr rght hr n ths vr blg n th Jn @ . (Nt tht tms gvn r strln, nt K) whn cncldd Prhps smbd cld nlghtn m! Thr ws nl n rctn t tht, srcstc n frm dr ld Prps. rptd m rqst fr clrfctn f tht sm xtrct n th Jn @ . ndng wth nyn bl t clrf?. nc gn n wrthwhl ttmpt t clrf fr m. n st Jn @ . rptd nc gn prt f tht rgnl xtrct. gn thr ws n wrthwhl clrfctn. Fnll, n rd Jn @ ., fllwng m clrfctn f hw s qttns frm n src, y rspndd n m s f tht qttn. t s ntd y nd wth thrt f ctn f sm srt. t s sttd n yr bt th thr blg:- Cmmnts Plc wlcm cmmnts, psts, sggstns nd nfrmd dbt, frm wd rng f prspctvs. ws cnsqntl mst srprsd t th rctn t svrl f m sbmttd cmmnts. M psts n th Jn @ . nd th Jn @ . wr dsmvwlld. f th mn blgs t whch sbmt cmmnts hv ncntrd dsmvwlmnt nl n ths n. M rsbmttd cmmnt n th Jn @ . nd gn @ . ws rfsd pblctn bt n th lst ccsn, ftr mplyng tht ths st ttmpts rsnbl mdrtn, th thrts strtd. Frst th thrt f bng bnnd, thn th mst rcnt n f rd Jn @ .. S mch fr wlcmng cmmnts nd nfrmd dbt frm wd rng f prspctvs. n th svrl ccsns whn hv cnsdrd tht smthng tht hv sd n blg wrrntd n plg hv md n. f hv md sm mstk b qtng N xtrcts frm wht NYN sys r wrts bt smthng m dbtng thn plgs sncrl t th njrd prt, bt d rsrv th rght tht w nj n ths cntr (nd blv ls n strl) t frdm f spch nd xprssn f r pnns. Ths shld b pssbl wtht bng sbjctd t thrts r nslts. Prps, v jst sn yr cmmnt f st Jn @ .. sggst tht y w Rss Strchn n plg. Childish submissions like that should be disemvowelled. ls, rflct pn whthr r nt y w m n fr yr cmmnt n th Jn @ .. Bst rgrds, Pt Rdl, Hmn-md Glbl Clmt Chng gnstc.”
Are Peter Ridd and Pete Riddley the selfsame fellow?
Look I went easy on Mr Baldyman because of his sterling efforts promoting nuclear. But I’m sick of him. And the people on his blog. They will have to bow and scrape in order to get me off this dummy’s case ever again:
‘Similarly, the Ord River scheme was a white elephant only because we failed to attract the kind of migrants who would have jumped at the opportunity to farm there. There was nothing wrong with the project, it was our collective imagination that failed us.’
Not sure I agree with that…..in my opinion the scheme has failed so far because of a lack of nearby markets and poor infrastructure development (airports, roads) that mean production and transport costs are not competitive.
The one area where it might be possible to make it work would be in the production of ‘high value’ products like Macrobrachium lar or M. rosenbergii, that could then be airlifted live to markets in Singapore, Jakarta and Hong Kong.
However that is a high technology industry with high capital investment and development costs and low labour input costs. It would also require an investment of 5-10 years before returning profits.
So I don’t see where the opportunity for large numbers of migrants would be there?
Ian Mott says
Russell, no-one is suggesting that migrants in country towns would not need additional investment in infrastructure etc. But it is important to recognise that country towns are a very long way from suffering diseconomies of scale. That is, increases in the size of country towns will always produce improvements in efficiency and service delivery.
Stand in the main street of Chinchilla at 5.30pm and one will observe no congestion, let alone congestion costs. And there is no need for a cross town tunnel to deal with population growth. Indeed, the whole concepts of the pace of change and unsustainable population growth seems to lose all of it’s traction.
What one will certainly observe in all country towns is underutilised infrastructure that is already being paid for by existing users so the additional user will spread the cost between more people. Country school class sizes are often much smaller than city ones so the extra kids improve the efficiency of the existing service. So it cannot be said that we have reached our population limits. Our immigration policy needs some serious reform to better serve our national interests.
We could, for example, use immigration policy to gain access to closed foreign agricultural markets. Set aside part of the Ord Scheme for the sons of Korean farmers, with a staged residency and citizenship process tied to a fixed period of farming that land, and the domestic Korean objections to imported rice, beef and other produce from this source would lose all currency. Ditto for many other closed agricultural markets.
We could also discharge a portion of our military obligations with a “Foreign Legion” style intergrated army unit with Australian citizenship and family settlement as the ultimate prize for a ten year service contract, shortened for active service. Indeed, of all the people we currently grant citizenship to, who would be more deserving of that priviledge than those who have already risked their lives beside Australian soldiers in this country’s service?
It would also be possible to improve the economics of such a program by having a graduated salary structure that starts at a level nearer to their home country pay scales and reaches Australian scales later in the contract, reflecting both satisfactory performance and their degree of “Australianisation”.
We also have specific ecological problems, like Rubber Vine, that are prohibitively expensive to correct if Australian pay scales are used. These jobs do not exist at present and the cost of not correcting the problem is worn by the Australian environment and economy. But they may exist at lower wage rates. If a properly quarantined system of contract guest workers was implemented where adjusted home country pay scales (plus average Australian medicare levy etc) applied for a fixed period followed by permanent residency on completion, many of these ecological problems could be fixed.
Yes, it is essentially “selling a visa” but unlike the student visa system, it is honest, up front about the price to be paid, with high degree of certainty on completion and it serves an important national ecological interest whilst protecting domestic wages and conditions. We have more than a million hectares of Rubber Vine which is more than a million man weeks of work to get rid of. Or we can just keep looking at it until it covers 5 million hectares and spend millions catching and processing boat people who pay the same amount to smugglers for the barest sniff of a visa.
The answers are outside the square.
“But the inescapable facts are that we have tripled our population since 1945 and a great many aspects of quality of life did improve.”
Agree that some aspects of quality of life have improved, but disagree that they are attributable to population growth. Many countries have enjoyed the same improvements with much lower population growth rates. That’s because of technological change. Over the last decade China’s economy has been growing rapidly, yet population growth there is near zero.
In fact immigration has created a sigificant degradation in quality of life in our cities: less personal space, air and noise pollution, stress, ethnic enclaves and related crime. Also, as more people settle, there is a steady loss of quality agricultural land.
Ian Mott says
Robert, the entire content of my thread has been to point out that there are numerous drivers of quality of life and numerous threats to same, other than population growth. The passage you quoted was in direct response to Walter’s claim that population growth was a direct causal agent to reduced quality of life. You then turn around and imply that I was claiming it as the sole driver of improved quality of life when I clearly was not.
You cite a loss of farmland as a consequence of population growth but declined to recognise that more than half the land cleared for housing has already been lost to farmland by way of native forest regeneration. That regeneration is an unambiguous ecological improvement and it has taken place close to all the major population centres as well as further afield. The scale of the regeneration is far in excess of housing based regeneration clearing and any loss of farmland. The regeneration process has no causal links with population growth.
So once again, I must ask you to distinguish between mere ecological, social and economic associations with population growth and actual causal relationships.
Good point, Hunter. Too many people assume that all the benefits of past action will automatically pass on after they make the changes they desire. So they focus on what they think they will gain while ignoring the things they will lose in the process.
Walter Starck says
You say, “…we have tripled our population since 1945 and a great many aspects of quality of life did improve.”
Did they improve because of, regardless of, or in spite of, the increase in population? Would they be even better without it?
Three times 7 is also somewhat less than 3 x 21. More is not always better.
With population it’s better to be wrong about having too many than wrong about needing more.
Too few is easy to correct and not unpleasant to do. Decrease is much harder, likely to be decidedly unpleasant and may even be irreversible without catastrophe.
Graeme Bird says
The death of Rose Friedman has reminded me that I would like to get back on the side of massive immigration. Thats the ideal. The ideal is that your policy is so well sorted that its in the unambiguous interests of Australians to have a massive amount of lattitude to foreigners in this regard.
Why it is that the death of Rose Friedman reminds me of this is that its hard to see the success of the Reagans without the success of the Friedmans. All you need is a few geniuses. And for them to succeed. But I”m not even sure if genius migrants would be helped up to the top in this day and age.
We look at the people on the leading edge of freedom in the States since the war. And many of them were migrants or were second and third generation only. But the reality of a fundamentally capitalist economy are not there like it was for the American migrant early last century.
The only way to end world poverty is for lots of capital development and heaps of immigration. But we are just not ready yet, so its risky. To many royal libertarians (crony-socialist posers) and not enough real libertarians.
It sounds like whining and handwringing I know. But actually what I”m trying to get across is just how IMPORTANT these issues are. Just how powerfully important that energy policy, and this science fraud, and property rights, tax and monetary policy, and immigration is. This stuff is so important. Its life and death stuff. Its salvation of humane civilisation stuff. These issues are important to millions and millions of people down the track. We just have to get policy right and to the extent that an avowed partisan, nationalist, patriot would agree that there is a fine case for higher and higher immigration.
This goes all the way from 50 year tax exemptions for energy production including nuclear. To no height restrictions on buildings. To user-pays infrastructure that gets business and individuals relocating to the towns. To policies that favour massive capital accumulation. To no taxes on interest earnings. To increasing the tax three threshold up from the ground even as a lot of welfare is slashed.
Its all so very very important.
And all good policy starts with mass-sackings in the public sector. Which is the best way of putting this global warming racket behind us. Which is also very important and every month that this movement goes by unvanquished will mean years of pain for many people.
Ian Mott says
Folks may be interested in seperating the causes of urban sprawl. Most assume that it is all population related but this is very far from the mark. Two other factors have produced most of the increase in the urban footprint. They are household size (people in each dwelling) and lot size.
When Australia’s population was only 7.5 million the median household had 3.7 occupants and they all lived in only 2.027 million dwellings. But today we have 21 million people with a median household of only 2.6 occupants and 8.076 million dwellings. If household size had remained the same we would only need 5.675 million dwellings today. So some 2.4 million extra dwellings have been constructed to enable smaller households. And this means that 39.7% of the total increase in houses had nothing to do with population growth at all.
But it is actually the visibility of new housing and its spread that has most environmental impact. And this has been impacted by changes in lot size. Back in the 1940’s the average urban lot size was around 400m2 while today the median lot size for Melbourne is 582m2, Brisbane is 600m2, Sydney is 532m2, Perth is 520m2 and Adelaide is 411m2, for a national weighted average around 550m2.
But since 2001 there has been a welcome decline in lot sizes. Melbourne was 640m2, Brisbane was 700m2, Sydney was 630m2, Perth was 750m2 and Adelaide was 600m2, for a weighted average in the order of 670m2. And in the 1980’s and 90’s it was larger still.
So even if we use a very modest estimate of only 600m2 for the mean of all new urban lots since 1945 we still have a very major influence on the total area of urban footprint. The 2.027 million house lots of 1945, at an average of 0.04 hectares each, occupied only 81,080 hectares. Street area etc would have increased this footprint by about 25% but for this exercise we will exclude it for simplicity sake.
Today, our 8.076 million dwellings, at an average of 0.06 hectares each, occupy some 484,560 hectares for a total increase in urban footprint 403,480 hectares. Now here is the rub. If our average dwelling size had remained at 3.7 people per household, and our average lot size had remained at 400m2 then our current 21 million Australians would only occupy an urban footprint of 227,000 hectares. All the post war population increase could have been accommodated on an extra 145,920 hectares, (0.0187 of 1%) of our national total area of 780 million hectares.
In all, some 257,560 hectares or 63.8% of the total 403,500ha increase in urban footprint has been caused by these two elements of lifestyle change. Population increase has contributed no more than 36.2% of the problem. But in actual fact, average lot sizes for most of the past half century have been much higher than the 600m2 figure we used in the above calculation. And much of the recent decline in lot size has come about through urban “infill” and re-development on existing urban land. This produces a lower mean lot size that masks small lot inner city redevelopment and continued larger lot expansion on the urban fringes.
There is neither time nor space to go into detailed analysis of the actual areas involved but it is sufficient to say that there is a very substantial “smoking gun” to indicate that population growth has contributed to as low as 25% of the total expansion in urban footprint.
And then we must distinguish between “home grown” natural increase of the 1945 population and the sum of post 1945 immigration and it’s subsequent natural increase. Without doubt, the post war baby boom was overwhelmingly home grown while the immigration based natural increase has become more significant over time. So it is likely that our immigration program has only been responsible for about 12.5% of the total increase in urban footprint over the 60 years.
Clearly, if we are serious about dealing with impacts of urban sprawl then we should not be distracted by elements of the equation, such as immigration, that make only minimal contribution to the problem. Indeed, if we were to take an even closer look at the differences in persons per dwelling between migrant households and non-migrant households, and their propensities to settle in inner city locations, then immigration’s contribution to the problems of expanding urban footprint will be revealed as being of even less (single digit %) significance.
And our total urban footprint, the supposed problem, still only occupies 0.062 of 1% of our national land environment.
Some interesting links at http://www.landcom.com/downloads/File/Demographia%20Survey%202006.pdf Especially pages 15 (impacts of supply restrictions) to 17 (house size comparisons).
Tom Melville says
That is a very interesting analysis Ian Mott. It is easy to slip into false impressions (like I did) when we base our perceptions on a small part of the facts. I think part of the change in family size may have something to do with improved life expectancy. My mother lives alone on an 800 metre block and she will kick-on into her 90’s. The average person like her 60 years ago would have died 10 years earlier. New technologies like Vital Call are also extending this sort of thing.
I also have a few friends who have divorced and mostly live alone but maintain a 3 or 4 bedroom home so the kids have somewhere to stay. Thats 2 bedrooms for each kid, one at mum’s place and one at dad’s.
Ian Mott says
Yes Tom, during the 1990’s there was a bloke named Birrell at Monash Uni who churned out a whole stack of barely numerate bull$hit on the costs and environmental impact of immigration and it was all completely debunked. The problem is that his stuff is still out there and people are more likely to google up his stuff rather than the rebuttals.
The town planners also have a lot to be ashamed about. It was they who put a stop to the conversion of existing houses into flats and they who loaded up the process of new lot development with red tape and bogus prescriptions. They have effectively eliminated the small scale property developer and handed the entire market to the big end of town who only do large scale developments on greenfield sites or industrial conversions.
In Vancouver BC, the most expensive city in Canada, most houses have a basement which is almost invariably converted to a rental unit. The owners live upstairs while the renters help pay the mortgage. The result is two households on each Lot. But that is facilitated by the house design whereas in Australia the brick veneer on slab design does not lend itself to lifting or dividing into units.
But one thing is certain, if all our existing urban housing footprint was redeveloped to a 400m2 average lot size and we returned to 3.7 people per household, our current 500,000 odd hectares of urban housing land would accommodate 12.5 million dwellings and 46 million occupants.
Graeme Bird says
“That is a very interesting analysis Ian Mott. It is easy to slip into false impressions (like I did) when we base our perceptions on a small part of the facts. I think part of the change in family size may have something to do with improved life expectancy. My mother lives alone on an 800 metre block and she will kick-on into her 90’s. The average person like her 60 years ago would have died 10 years earlier. New technologies like Vital Call are also extending this sort of thing.”
You know what I think it is? I think its the transfer of the function that gold-linked money had as a “store-of-value”…. from gold and silver at interest…… TO REAL ESTATE. I think its the paper money making us be able to be stooged that we are a lot richer. But in fact being a lot poorer in terms of being able to get a single unambitious paycheck… as an unstressed bloke not reaching for the great heights…. and take that paycheck, turn it into a big house with very little ongoing payment stress, and use that one paycheck to get your new girl to quit her job and look after you and constantly keep her up the duff.
I think we are deluded as to how much progress we’ve made materially. You can surely spin it that way. The marvels of capitalism are indeed marvellous. You can talk about the theory of how things get better all the time and thats a historical truth. But its all delusion if you think you can apply that theory to the reality of life under socialist fiat money.
One man. Not particularly ambitious. Leaves school at 14. Gets a pretty normal and not too high-pressured job. Gets a paycheck delivered by a van. Opens it up. That money backed by gold and silver. Got a savings account and a checking account. The two types of banking separated. One for convenience. The other type of bank to build wealth and to enrich the community.
That one paycheck buys a 30% deposit and pays for a house and lets the girl quit work and pays for one child following the other in quick succession only separated by gestation and breast-feeding. If he didn’t like the look of his girl boosted up with milk like that he’d probably shorten the time between kids and have them at an advanced rate. And he’d do it all on one paycheck.
I tell you straight we are being mortally ripped off.
Ian Mott says
Some (maybe most) could be being ripped off, Graeme. But those of us who chose to buy a modest first house with a big deposit, live frugally to pay it off within two years, pay cash for any improvements and remain in that same house (without additional agents and transfer fees) for 20 years and counting, were able to move quickly to the point where the interest on all subsequent borrowings for investment properties was fully tax deductible.
But I agree, there is a problem with the way we manage and measure wealth. Some countries, like France, have much less housing bubble because each house is treated as an investment. The interest on the mortgage is tax deductible but the owner/occupier is also deemed to have earned the notional rent on the house as taxable income. In this way, a single pensioner with a big house is discouraged from persisting with their inefficient use of that capital. If they are deemed to have enjoyed the luxury of exclusive use of a house that would rent for 5% of its value then they either opt to move out and collect the rent anyway, or sub-let and collect a portion of that rent and record the remainder as their income.
In Australia we do not have a level playing field between renters and owners and this seriously distorts our economy with under investment in productive capacity, over investment in owner occupier housing and under investment in rental housing. The green/left planners have made it even worse with more serious market distortions in the form of regulations, gonzo building standards and subsidies.
Ian Mott says
For the record, Peter, the numbers used in your lead article are wrong. You have based your population growth figures on natural increase and total settler arrivals to get an annual growth figure above 350,000 a year. The real growth figure must be calculated from the net permanent migration figure which is about half the total settler arrivals number.
But to be fair, it is not entirely your fault. The department of immigration can’t even present its own data competently. The link to Immigration Fact Sheet 2 tells us that in 2007-2008 there were 149,400 settler arrivals but the net figure was only 72,400 after deducting permanent departures. http://www.immi.gov.au/media/fact-sheets/02key.htm#c
But when we go down the page to the graph that supposedly “shows the contributions of natural growth and net overseas migration to Australia ‘s population growth between 1997 and 2007”, we find no such thing. These departmental bogans have clearly plotted the total settler arrivals, not the net migration number.
The real growth figure for 2007/08 is 150,000 from natural increase and 72,400 net migration for a population growth of 222,400. This is a growth rate of only 1.05% a year, needing more than 4 years to add a million extra people, not the 3 years you indicated.
Ian Mott says
Further to my above post which was made under time constraints, the projections made in Peter’s lead post also need major revision. A growth rate of 1.05% a year will take our current population from 21 million today to only 32 million in 2050, not the 50 million claimed by Peter. And instead of the 100 million by year 2100 claimed by Peter, we will have only half that, or 54 million. That is the problem with extrapolations out to a century or more, it only takes a small error to produce a major distortion.
So when we put these more valid projections into perspective we find that we could house the entire population growth out to beyond 2080 on our existing urban footprint. That is, by returning to 400m2 average house blocks and 3.7 people per dwelling. The much touted ecological impacts of population growth are all entirely home grown, the consequences of housing indulgence and lifestyle changes, like divorce, that most would agree are best avoided if at all possible.