Thoughts on economics and liberty

Who owns Australia?

I migrated to Australia from India about ten years ago and got busy with setting down and writing and thinking about India. Not everyone who migrates to Australia does that. Some even become fans of Carlton.

But my hand has now been forced. I’ve been forced finally to devote some of my very precious spare time to Australia as well. Too many bizarre policies keep surfacing that threaten to affect me as a citizen – if I don’t speak up. Plus good citizenship requires everyone to participate in their society. So I’m opening my batting with a forthright view about Australia’s optimal migration intake, and optimal population size. My position is simple: No more: more or less. Stop! 

Australia shouldn’t even have admitted me (despite my PhD and all that) ten years ago for even then Australian cities were heavily crowded. In 2000, when I landed up here, the congestion on the Eastern Freeway in Melbourne used to extend up to a kilometer before the Hoddle Street exit. Today cars back up beyond the Bulleen Road exit, about six (even eight?) kilometers from Hoddle street. And now, ten years later, after already boosting Australia’s population significantly during this period, there is now rampant talk of increasing Australia’s population by 50 per cent or more! Stop! I ask for the simple and ordinary right to live a quiet life without wasting my time in traffic jams. 

And can someone please tell me what’s the problem with having the 22 million people we have today? Are we facing poverty, or is our quality of life in shambles that we need to bring more people to save us? Let’s understand this basic fact, that population and income and quality of life have absolutely nothing to do with each other (if you are not clear about this, please read the work of my doctoral dissertation committee member, Richard Easterlin, in Growth Triumphant. I can explain in detail, as well, but another day).

Countries with small populations can have high per capita incomes, equally as countries with large populations can have low per capita incomes. It is the system of governance, and level of freedom that matters, not population. Thus, at the beginning of the 20th century, Australia had the highest per capita income in the world but only 3.7 million people. Today Australia has six times the people but many other countries have overtaken Australia without ‘putting on’ as many times the number of people. 

The key question, however, has nothing to do with population size. It has to do with what we are and what we want to be. People keep suggesting that Australian cities are less dense than Singapore. But why is such a comparison relevant? Why should Australia give up its lifestyle to mimic the miserable lifestyle of crowded cities elsewhere in the world? 

I would ask this basic question: Who owns Australia? Are we a free democratic country where the choices of people (‘common masses’) are respected, or are we a two-penny dictatorship that bows to the whims of its ‘rulers’? In a democratic free society people matter. All over Australia, local councils are unanimous in the view that if high-density buildings are ‘needed’ by someone in the state or federal headquarters, these buildings should be built in some other place, not inside their council! And they are absolutely right. They represent the people who own Australia. The people who own Australia refuse to change their lifestyle just because some ‘ruler’ wants to shove more people down their throat.

I don’t care much, personally, for many arguments advanced by local councils which are often full of people a bit too fanatical about their heritage and culture. For these cultural dilettantes, beauty and amenity is usually preferable to functionality. For them the idea of rebuilding their city every ten years: broadening its roads, building flyovers, demolishing buildings that are over forty years old, is anathema.  I may not personally care for these conservative views, but I suggest that Australia has one thing that Singapore doesn’t, which is freedom and respect for its citizens. Australia ought to respect the views of its own citizens, people who want to live in sprawling suburbs, people who prefer narrow roads to wider ones, and those who want to preserve buildings built more than forty years ago in a variety of ungainly architectural styles. Let’s live peacefully with all our cultural fanatics and not bulldoze Australia, in order to make a Singapore out of it, literally speaking: without freedom of choice.

The counter-argument by control freaks (often found inside state and federal governments, their natural watering hole) seems to be that since local councilors are freaks anyway, that they should be forced to allow us to rebuild our cities to their centralist tastes and convert them into Singapore. And the way to do that is to apparently increase public transport. Apparently this magic pudding will can overcome all barriers to increased population. Apparently, with more of public transport we could avoid congestion in Australian cities no matter whether they increased ten times in size. 

The truth is that despite unbelievably massive subsidies, public transport can never compete for popularity with cars for some very obvious reasons including that public transport is desperately crowded during peak hours and miserably scarce for the rest of the time. Worse, it is shabby, hopelessly uncomfortable, hot, and stinky. It also requires people to trudge through rain and sleet. No. Public transport will never ease congestion in the cities of Australia. They will need to be broken down entirely and rebuilt, in order to accommodate more people. That, the local councils won't allow. Which is their legitimate choice and must be repsected. 

But more importantly, why should we be asked to accommodate more people? Will anyone answer that question very clearly please. The other day Greg Sheridan, with whose views I generally agree, made a novel argument with which I simply can't agree. He claimed that a larger population would bolster Australia’s security! I’m afraid that won't work. Should the one billion strong China get in the mood of taking over Australia, nothing that Australia could do would prevent it, regardless of whether its population was 25 million or 250 million. And Greg’s assumption that new migrants will join the Australian armed forces is laughable. Or is Greg's implicit argument that more migrants will increase traffic congestion and slow down the progress of Chinese (or Indonesian tanks) on the freeways of Melbourne, thus increasing our security? 

I ask this basic question: Who will benefit from having more people in Australia? Clearly only the owners of big businesses, who will get more consumers and generate more profits. The middle classes will get nothing but congestion and crowding, and find it even more difficult to buy a house. Those at the bottom rung of the ladder will only get the minimum wage, anyway. So having more people in Australia will definitely increase inequality while creating a headache for everyone.

I sometimes begin to think that Australia is fast becoming Alice in Wonderland, with mad hatters running about helter-skelter, offering ‘solutions’ to problems that do not exist. No doubt it will be possible, with some level of ferreting out of data, to ‘prove’ that increased population may benefit Australia in some way. But at what cost? Are the views of people to be shunned in the process? Should local councils be shut down? Should Australia become a semi-totalitarian society like Singapore? These are the kinds of questions that need to be addressed before rushing in where angels fear to tread. 

And this great fear about demographic change (more elderly) is grossly misplaced. The elderly have their houses, don't they? Just ask them to fund their retirement partly out of these houses. Reverse mortgages are an option, among many others. And if we ever get short of carers, we can import them, then. Not now!

In summary, Australia enjoys a unique and high quality lifestyle that will not be improved, but made worse, by reckless increases in population. I am not against an increase (or decrease) in population. I'm against reckless, mindless increase based on false assumptions.

These FALSE ASSUMPTIONS include:

1) Larger population leads to greater economic growth (Sorry. Per capita income has nothing to do with absolute population size but everything to do with the level of freedom and competitiveness in a society)

2) Larger population makes a city more livable (this nonsese was spouted an otherwise sensible philosopher Tim Soutphommasane in The Australian today, citing a few large cities which were apparently 'more livable'. Tim, please take ALL large cities in the world today, and historically, and determine if there is/was ANY correlation between city size and "quality of life" (a fuzzy subjective indicator anyway). If what I'm saying is too hard to understand, please go take a basic first year course in statistics).

3) A larger population will increases Australia's security (Greg, was Japan very tiny during its being bombed out in World War II? You too need to learn some basic statistical techniques, and try to prove your point globally and historically. There is no such correlation.)

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Note: Unlike 99.99% of my articles which are written for Indians, this one is written for Australians. I wrote this on 30 April 2010 and sat over the first draft, being too busy with other stuff. Luckily over the past three months, things have changed somewhat in Australia and the mania for "Big Australia" has somewhat dissipated, despite the continued mindless outpourings of otherwise respectable commentators. So it is perhaps worthwhile putting out a common man's view here, and force them to question their assumptions. 

I'll add to this write-up and develop it further over time. Your comments might give me an incentive to keep working on it. So pl. feel free to provide your views.

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A basic common sense statement: "Population growth does not determine our economic growth rate. The debate about whether you favour a big or small Australia misses the point that the Australian economy can grow rapidly through boosting productivity, even if population growth slows." (Ed Shann, in AFR 9 August 2010, "Big or small misses the point".

Indeed, I would argue that mindless immigration will REDUCE Australia's productivity. Each time Australia gets some with low skills, its productivity goes down one notch.

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Some material that may be relevant (for later) 

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One thought on “Who owns Australia?
  1. Sanjeev Sabhlok

     

    Comment received on Facebook: "Dear Sanjeev, With all my due respect, isn't it mandatory for a country to move towards immigration to ensure the future of an economy with an aging population? Almost all western countries are facing the same dilemma, may be I am missing something here with your post!"

    My response: I'm not against immigration on a needs basis. I've already clarified that in the article. I'm dead against policies to grow bigger for the sake of growing bigger. They are not arguing a way to MAINTAIN an existing population level but of doubling it for the heck of it! And if (and when) they need extra carers to take care of the elderly by all means import nurses.

     

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