We love a big Australia — but not so fast

Today in The Australian

It is true that Melbourne, with just half London’s population, covers six times London’s area, as Shaping a Nation, the research paper on migration released earlier this week by the Treasury and the Department of Home Affairs, claims. But it hardly follows that Melbourne should, or sensibly could, aim to achieve London’s population density.

About Henry Ergas

Henry Ergas AO is a columnist for The Australian. From 2009 to 2015 he was Senior Economic Adviser to Deloitte Australia and from 2009 to 2017 was Professor of Infrastructure Economics at the University of Wollongong’s SMART Infrastructure Facility. He joined SMART and Deloitte after working as a consultant economist at NECG, CRA International and Concept Economics. Prior to that, he was an economist at the OECD in Paris from the late 1970s until the early 1990s. At the OECD, he headed the Secretary-General’s Task Force on Structural Adjustment (1984-1987), which concentrated on improving the efficiency of government policies in a wide range of areas, and was subsequently Counsellor for Structural Policy in the Economics Department. He has taught at a range of universities, undertaken a number of government inquiries and served as a Lay Member of the New Zealand High Court. In 2016, he was made an Officer in the Order of Australia.
This entry was posted in Uncategorized. Bookmark the permalink.

38 Responses to We love a big Australia — but not so fast

  1. Ƶĩppʯ (ȊꞪꞨV)

    Soylent green!

  2. struth

    No shit Sherlock.

    You can fit the British Isles into Victoria, so what’s ya point?

    Do I really have to go and read an article by this meat head?

  3. OldOzzie

    HENRY ERGAS
    We love a big Australia — but not so fast

    It is true that Melbourne, with just half London’s population, covers six times London’s area, as Shaping a Nation, the research paper on migration released earlier this week by the Treasury and the Department of Home Affairs, claims. But it hardly follows that Melbourne should, or sensibly could, aim to achieve London’s population density.

    After all, the goal of migration policy is not to increase popula­tion density for its own sake. Nor is its purpose to increase gross domestic product, or even GDP per capita, as the paper implies.

    Rather, the aim is to improve the wellbeing of existing Australians, taking into account their interest in the prosperity of future generations, and humanitarian concern for the rest of the world.

    The choice of objective matters a great deal. The building industry wants to boost the number of homes that need to be built, while our major retailers salivate at the prospect of a larger market, but those goals may conflict with maximising the welfare of present Australians.

    At its heart, that conflict cen­tres on the resources that are difficult to expand, such as roads in densely populated areas. By increasing the demands placed on those resources, immigration makes them more congested, harming existing users in ways that conventional measures of GDP do not capture.

    It may be that proper pricing of those congestible assets (say, through road charges on intensely used routes) would limit the damage to living standards, as the paper suggests. But with even the most efficient pricing in the world, existing users will still be worse off than they would have been if fewer additional vehicles were on the road.

    And the costlier it is to increase those assets’ capacity, the more dramatic the harm to existing users must be as population rises, and demand with it.

    That is important because the costs of adapting our major cities to absorb fast population growth are now extremely high, compared with similar cities overseas and with historical experience.

    In part, those high costs are due to our industrial relations system, which adds 10 to 15 per cent to the cost of infrastructure projects, with myriad other productivity-reducing regulations aggravating the penalty. The persistently poor selection and management of major infrastructure projects makes costs greater again.

    But the high costs mainly arise from the fact, over more than a century, abundant land availability, high per capita incomes and a short working day have shaped an urban fabric that ­combines relatively compact CBDs, sprawling suburbs and heavily trafficked radial links ­between them.

    When that settlement pattern was in its formative stages, providing infrastructure largely involved its extension to new greenfields sites, where construction encountered few obstacles. Although costs were high — because the spacing between homes was nearly twice that in comparable cities in the US and more than three times that in Europe — they were relatively bearable.

    Moreover, in that phase of our development, population growth tended to significantly reduce unit costs over time, as fixed costs were spread over a larger number of users.

    Now, however, capacity expansion almost always involves brownfields work in heavily developed areas, disrupting existing uses of land and requiring reliance on costly underpasses, elevated ramps and tunnelling over long distances. And instead of economies of scale, costs often rise more than proportionately as the scale and pace of projects rises, with “mega-projects” being especially prone to massive cost blowouts.

    Those facts of life aren’t about to change. The urban fabric is extraordinarily durable, as is the housing stock: that is why there is so much truth in Winston Churchill’s dictum that “we shape our buildings, and afterwards our buildings shape us”.

    In democracies — which cannot adopt China’s approach of simply bulldozing millions of homes to build high rises and ­superhighways — modifying the structure of urban areas is the work of many decades.

    As a result, the constraints those costs impose should figure prominently in setting population policy. Put in the jargon of economics, they limit the optimal population of our major cities, relative to many cities overseas, and the rate at which their population ought to increase.

    But rather than facing that reality, the report simply excludes the costs of adapting our urban fabric from its calculations of the net benefits of the migrant intake.

    Given that those costs are scarcely negligible — as a proportion of GDP, our infrastructure spending is already almost twice the average for the major advanced economies and may need to rise further — that exclusion casts serious doubt on Scott Morrison’s claim that the report provides “a clear evidence base for the government’s migration policy settings supporting our national interest”.

    That the report’s quantifica­tion also ignores many other costs — including the impact of high rates of population growth on non-market resources, such as the untrammelled enjoyment of open spaces — only makes the Treasurer’s claim yet more suspect.

    None of that is to deny that ­migration brings a broad range of benefits, many of which are also hard to measure. By far the most important is that migrants are driven by the desire to make a better life for themselves and their families. Settler economies, such as Australia, have benefited enormously from that ambition, as migrants have striven to give their children the future they dreamt of. Retreating from “Big Australia” to a country bunkered against inflows from the rest of the world would therefore be an unwarranted diminution of national possibility and an unjustifiable loss of social hope.

    But there is no surer way of provoking that retreat than to keep migration at levels that exceed our absorptive capability. If that is what the government wants to achieve, it risks succeeding wonderfully.

    From the Comments

    Australians will save our envied quality of life by adopting Australian Conservatives Immigration Policy, to reduce current migration by half while our infrastructure and services catch up and we have a National debate on population policy for the future.

    – More common sense and clear thinking backed up by rigorous research from Henry.

    No mention of the camel in the room though.

    – What has happened to our old decentralise Australia policy .Surly we don’t have to have all Australians live in a capital city

    – Best of all, Henry shows us the correct use of ‘striven’!

    – So much sense, logic and thoughtfulness…shame those properties miss the political classes.

    Politicians live in ivory towers and don’t give a damn about the personal freedoms and space that are so precious and so easily destroyed. Do we want crowded streets like Bangkok or shanghai???

    – I think Turnbull and Morrison should open up their own homes to the next batch of immigrants that show up so they can see first hand what overcrowding actually means. They obviously have no concept of the impact their policies are having on average Australians. Same applies to Bill Shorten.

    – This debate is being driven by those who live in the overcrowded big cities. In the meantime the bush is dying due to lack of people. We need to focus on developing ways for people to live and work outside the big cities. Start by moving more of the Federal Govt departments out of the cities.

    – We need to focus on migrants who are likely to live outside the big cities. Eg skilled and assimilatable South African farmers, miners and those with technical skills from rural areas.

    What we are getting is, sadly, urban unemployed and sometimes criminal and those who don’t assimilate.

  4. Myrddin Seren

    Shaping a Nation, the research paper on migration released earlier this week by the Treasury and the Department of Home Affairs, claims.

    There is the nub of the thing.

    Is it an options paper that includes ‘steady as she goes’ ? Doubt it.

    Seems we are getting the view of the people really running this country as to where it is going to be made to go.

    And I have seen left wing commentators on Sky plainly stating that it is a good thing there is no broad public debate on immigration because ‘red neck racism’.

    Not so much an issue for open borders views promulgated from the Protected Classes.

    Comrades.

  5. struth

    Yes, after reading it, one of the better articles by Henry……………..

  6. stackja

    Enoch Powell in 1968 asked a similar question.

  7. woolfe

    The Kleptocracy continues (yep, love that word)

  8. John Constantine

    High density living is where they start.

    Highest density communal living, in dormitory cubicle blocks, without window access for most.

    Communal all gender dunnies to harvest nutrient rich waste and ration barns for feeding out algae sludge grown from the sewer treatment vats.

    Ration access to roads and communal areas, electric vehicles can be programmed to curfew the proles from the better areas.

    People are money, even poor people.

    Making a cent a year from each of a hundred million proles confined to barracks means a million dollar a year lifestyle for a crony orc political classer.

    Comrades.

    We will have all the electricity we need when it is properly rationed to cronies.

    We will have all the water we need when it is properly rationed.

    We will have all the nutrients we need when our diets are rationed out for us.

    Our transport access will be rationed as required by the State.

    Everything will be orderly, when we are compliant with all orders.

    Comrades.

  9. Roger.

    No, Henry, it’s not about roads, it’s about culture.

  10. Stackja:

    Enoch Powell in 1968 asked a similar question.

    And 50 years later, the same vested interests that squashed debate then, are squashing it now.
    Debate has shown itself to be a dead end that only serves the interests of the elites.

  11. RobK

    It’s good to see an account of “diseconomies of scale”. There are a lot of interests pushing higher densities that do not have to worry about culture or happiness of the masses.
    I thank Henry for the article. I agree that we need not be in such a rush to solve the worlds problems. If we managed our own affairs, and everyone else did the same, we’d all be better off.

  12. John Constantine

    The transformation of the Australian polity into a herd that is compliant with massively dense stocking rates, with ten thousand people in a dormitory cubicle high rise, low cost per unit prole stacking area is simple.

    Mass importation of millions of people from cultures and areas where high density, packed in living areas are already accepted, where the State eternally monitoring all movements is normal, where cheek to jowl is the way you move on public transport, the way you queue, the way you use the footpath.

    It isn’t jostling, it is merely finding where you fit in the puppy pile that is prole life.

    Stack them tight, stack them high, people are money.

    Comrades.

  13. Infidel Tiger

    If we want a “Big Australia” then get rooting, not importing.

  14. mh

    I asked my friend’s 6-year old daughter recently about their trip to Sydney at Easter (they live in southern suburbs of Brisbane, like me). First thing she said was “There’s too many people”. Listening to Bolta this week with Ray Hadley they both agreed there were too many people living in Sydney. So it seems that from 6 year old girls to the likes of Ray Hadley and Bolt, many are now forming the opinion that there are too many people here now. But not Scott Morrisson or Gerry Harvey.

  15. Myrddin Seren

    John Constantine

    High density living is where they start.

    Highest density communal living, in dormitory cubicle blocks, without window access for most.

    Communal all gender dunnies to harvest nutrient rich waste and ration barns for feeding out algae sludge grown from the sewer treatment vats.

    Sounds like we will have a large pool of well-conditioned candidates when the long-haul colonisation missions to Mars kick off.

  16. mh

    Outrage Over NYC Shipping Human Shit to Small Towns

    NYC no longer just forcing bad politics on America

    A small-town Alabama mayor publicly exposed how New York City rids itself of human excrement by shipping “poop trains” to rural, flyover country.

    NYC ships the waste by rail to numerous, cheap landfills across the country because apparently the high environmental fees and business costs prevent use of local landfills.

    But unfortunately for residents near these landfills, some of which are thousands of miles away, the sh*t sits on train cars for days before landfill crews can empty them….

  17. Myrddin Seren

    John Constantine again

    Mass importation of millions of people from cultures and areas where high density, packed in living areas are already accepted, where the State eternally monitoring all movements is normal, where cheek to jowl is the way you move on public transport, the way you queue, the way you use the footpath.

    Okay – I agree with this because I have been saying the same thing for a while too 🙂

    The existing old Australian demos is not especially coping well with higher densities of living – road rage is a good benchmark. Others will emerge as the press of people get tighter ( supermarket rage ? ).

    Given that is its plain the APS heads and the Uniparty have already rolled over to the UN on ‘sustainability’ the obvious solution to the democratic problem of the exiting Proles resenting being herded back in to high rise enclaves is to replace the existing demos with a New Demos that is assumed to be more amenable to battery hen living.

  18. md

    Those on the Left who are racist want mass migration, and the ‘other Left’ want it so their donors and mates get new consumers and cheap labour. Name one society that is better for having had a non-selective mass migration program. Now take a look at those societies that do not tolerate mass migration and especially non-selective migration and as a consequence are cohesive, safe, orderly and relatively peaceful, and also have booming economies. But what’s the use of caring? Like all Western societies, our country is in decline and there’s no one to stop it. Even if there were, it’s too late.

  19. Leo G

    But it hardly follows that Melbourne should, or sensibly could, aim to achieve London’s population density.

    Greater Melbourne with Greater London’s population density implies a Melbourne population of 60 million.
    The Inner London Area of 319 square kilometre has an urban density of 10,000 per sq km, so why not suggest a Melbourne population of 100 million. Nor should we be wearing our anglo white privilege blinkers- Mumbai has a population density of 30,000 per sq km, so PC Melbourne could aim for a 300 million population.
    Sydney might have to settle for a mere 200 million.
    It seems to me that decision makers in Sydney and Melbourne do want to have commensurate population densities in selected parts of those cities, regardless of the associated wasteful infrastructure costs.

  20. Y

    Just got back to Melbourne from Japan.

    The differences – all of them – could not be more stark. It’s enough to make you weep.

  21. md

    #2691281, posted on April 20, 2018 at 1:37 pm

    Just got back to Melbourne from Japan.
    The differences – all of them – could not be more stark. It’s enough to make you weep.

    As is the case in the West, Eastern societies must also have their share of malcontents and aggrieved individuals. You have to wonder how long it will be before their societies end up like ours, with the malcontents and aggrieved reaching critical mass, at which point leftist political figures emerge to exploit the desire of the aggrieved to bring society down.

  22. Makka

    No, Henry, it’s not about roads, it’s about culture.

    Exactly.

    One terrible aspect of our deliberate demographic transformation into an Asian shithole is that in years to come memories of the once fantastic Australian lifestyle we grew up in will be lost forever. Replaced by Asian perceptions of ant like living.

  23. Myrddin Seren

    Crowded roads and rage.

    Just watched a semi pretty much ram a car through an intersection and then basically tell the car driver to eff off and drive away.

    Getting murderous out there – wait until we have São Paulo population densities

  24. Makka

    We love a big Australia

    No, WE do not.

  25. Dr Fred Lenin

    There will be safeguards in the u.n. Province of Australia Provincial President Rudd will ensure that each adulthas four square metres of space to live in , communal showers and toilets to perform our ablutions ,a communal kitchen to supply our daily thin soup . People won’t need electricity living close together will keep us warm in winter and we can crowd into the communal concrete garden in summer to cool off. The ten per cent in the aparat will be even more equal than the workers, they need electricity to have computers to get party instructions ,more room to assist their valuable work keeping the proles under control . They will need better food as their jobs are so demanding . The thin soup will prevent obesity, smoking and drinking will be banned for health reasons ,the aparatchiki will be exempt from these laws as —\their work is so exacting . Elections will be held every fifty years ,the party will nominate the candidates and you can pick the one you prefer ,results are not binding , world President Hilarity will decide the final result assisted by deputy Presidents Xi and Kim . ;

  26. We love a big Australia

    No, WE do not.

    Correct.

    NO. WE DO NOT!

    (mutters and walks away)

  27. Tom

    Since Australian big business is run by zombies, who’ll sign up for any passing fashion if they think it will make them popular — even if it damages their company — it’s astonishing that Australian still has what is technically a national economy, even though it’s now permanently on the brink of recession after a decade of reckless growth in government spending and taxation, not to mention economy-strangling regulation and distortion of markets as a result of government interference.

    The pretence will all go away next year when we elect a Labor-Greens regime that will double debt and spending — again — and make the national economy illegal except for the parts controlled by government bureaucrats and the CFMEU.

    There’ll be no stopping the Big Australia that the LNP is now frantically engineering, which will make government impossible by anyone except the totalitarian Deep State and their useful idiots on the left (which the USA is now fighting back against). In fact, in Australia, the backward, stupid “lucky” country, the machinery of the thought police to crack down on the last remaining freedoms is already in place via the AHRC and its state counterparts. The LNP had the opportunity to dismantle the machinery of repression, but chickened out.

    The replacement electorate now being imported at 200,000+ per year will make a future non-leftist government — not to mention a functioning national economy — impossible. Like Western Europe, government will be 60% of GDP, with a huge underbelly hanging off the welfare state. Every business left in Australia will function like a government department relying on Canberra for a repressive “social licence”.

    Australians don’t care. They’re so live-and-let-live they’ve let Big Government walk right over them. And a majority are now addicted to other people’s money — the taxes of the rich that prop up the whole house of cards.

    In that environment, freedom and democracy, not to mention a functioning economy, are not possible. The 87,000 Australian men who died in the world wars for our freedoms wouldn’t recognise what we’ve become.

    So our future will be as a fully-owned mendicant subsidiary of the Chinese Communist Party. That’s where lotus-eating eventually gets you, as the rest of the South Pacific is now discovering.

  28. Up The Workers!

    It seems fairly common knowledge that the densest segment of the population of Mogadishu-by-the-Yarra, are the 22 brazen election-cheats, the Parliamentary Allowance-rorters and those who corruptly use Parliamentary chauffeur-driven limousines to ferry their dogs about the State, and who illegitimately occupy the Misgovernment Benches in the Spring Street sewer.

    Is I.B.A.C. ever going to stop snoring and start prosecuting the embezzling, election-rigging A.L.P. cheats and crooks, or do we need a non-A.L.P.-appointed I.B.A.C. to investigate the A.L.P.-appointed catatonic I.B.A.C.?

  29. struth

    Australians don’t care. They’re so live-and-let-live they’ve let Big Government walk right over them.

    Good spray all in all, Tom, but that line is a beauty.

    We are the least racist, most tolerant people on earth, if the truth be known.
    Where did it get us?

    You can be too casual.

  30. Dr Fred Lenin

    I call the Canberra parliament the Kindergarten , Spring Street ,Play Group and the local council Child Minding group , the quality of politicians we get proves this very apt ,where the Hell are the Grown UPS?

  31. Myrddin Seren

    So our future will be as a fully-owned mendicant subsidiary of the Chinese Communist Party.

    The ChiComs don’t think much of mendicants.

    Things will be a bit different once we pass that threshold of control.

  32. Squirrel

    If the Treasury and Home Affairs masterminds are so fond of a Big Australia, move them out of their comfy enclaves in Canberra, with their easy (by Sydney and Melbourne standards) commutes, cheap parking (probably included in the fat salary package anyway), cheaper housing (so much more affordable with two nice, safe government salaries rolling in every fortnight) and relocate them to the ground zero of Big Australia in western Sydney. They’d learn a lot about life and about the real economy which funds their lovely lifestyles.

  33. Nerblnob

    A good economy will attract good immigrants.

    Without that, you get shit immigrants.

  34. Boambee John

    Dr Fred at 1438

    The left fascists have moved from using 1984 and Farenheit 451 as text books and guides to the future to using The Hunger Games as their guide.

  35. Combine Dave

    Fix the infrastructure first.

    Then pump in a shit ton of skilled and rich Chinese migrants for the Government to fleece.

    (No reffos)

    #Winning

  36. JohnA

    Boambee John #2691362, posted on April 20, 2018, at 4:39 pm

    Dr Fred at 1438

    The left fascists have moved textbooks 1984 and Fahrenheit 451 as textbooks and guides to the future to using The Hunger Games as their guide.

    No, they have probably absorbed too much of Isaac Asimov Robot series: Robots of Dawn, Caves of Steel and Naked Sun. Lots of collective, dense, urban “lifestyle” there.

  37. Jimf

    Where are our leaders? The media act as guards of a stinking political status quo. With MT and BS , surely there’s never been a more ripe time for some force of common sense to emerge. But anyone on the right ( he’s not perfect but eg Bernardi) gets marginalised as a nationalist racist.
    Only the most stupid, self destructive of nations employs a “non discriminatory” immigration program. How fucking stupid are we? As a (once anyway) smart , rich nation (12th biggest GDP with only 24m ppl) with a relatively harmonious culture we’ve earned the right to keep the world’s scum at bay. But no, let’s truck in the dead shits and their extended families hey? FMD we’re mugs …

Comments are closed.