Now I realise that immigration is a bit of hot topic because it’s one area where people don’t fit into the predictable normal left versus right viewpoints. Some lefties will favour increased immigration; others will argue that it threatens Australia’s sustainability. Right-wingers have those who are concerned that immigrants will take our jobs opposing those who want them here to stimulate demand. And let’s not forget that some people will oppose immigration because it involves foreigners.
So I’m not surprised that the reaction to Tony Abbott’s tweet centred on the immigration part:
“Big business reps are wrong about very high immigration numbers. High immigration adds to housing demand which boosts price. And it adds to labour supply which dampens wages. Big business is talking self interest here; not the national interest”.
And, of course there were comments about Tony Abbott’s pursuit of “national interest” when he was PM.
However, what struck me was the fact that Abbott was simultaneously being a cheerleader for both high house prices AND lower wages. Granted, some of you will think that there’s no surprise in that because isn’t he one of those Tory oppressors who’ll be among the first lined up against the wall when Russell’s Revolution comes!
It’s not that he believes in those things. Or even that the expresses them. It’s that he put the two things together in the one tweet.
Most of the time, politicians rely on the fact that we’ll behave like proverbial goldfish with a three second attention span (yes, I know it’s an urban myth!) and just forget that they told us about the sauce for the goose, and what’s all this nonsense about ganders getting sauce?
It’s one thing for Malcolm’s Misrepresentatives to be telling us that Labor’s policy on negative gearing is a bad thing because it’ll lead to a drop in house prices and house prices are just fine the way they are because we’ll all be able to afford a harbourside mansion once jobs and growth… Jobs. Growth. Undersand? House prices, good. High house prices gooder. Understand? Labor will cut your asset.
Then when you’ve had enough time to worry about the devasting effects of Labor’s policy, but not enough to time ask how it’ll drop prices for anyone selling, but won’t reduce prices for anyone buying, they change the subject to the need to stop the boats. We need to stop the boats to discourage drownings at sea and in order to stop people attempting to come here, we need to imprison them indefinitely. When someone is trying to articulate a response along the lines of: How much bigger deterrent can you get than drowning at sea?? – we suddenly are reminded about the terrible things that refugee advocates are alleged to have done by Peter Dutton. You know, giving them hope or treating them like people.
After this, it’s safe to come back to the issue of wages stagnating and put forward the argument about how the most important thing is to have a job and it’s only by keeping wages low that we’ll be able to employ some of those poor sods without a job, and nobody starts suggesting that greater employment might push up house prices even further and risk a bigger bubble, because house prices are so yesterday. And besides, low wages will help keep house prices down which is now a good thing again.
Tony’s tweet should encourage people to actually look at the economic contradictions in the Liberal pronouncements. It seems, for example, that wages are low because of immigration dampening wages. And house prices are high because of immigration. So, logically it should follow that less immigration would help reduce both our wage stagnation and enable more people to buy their own home.
No, I’m not about to join some anti-immigration group. I’m just pointing out the obvious logic if you accept Abbott’s assessment. As a general priniciple, that’s not really something that I’d actually recommend.
Our exorbitant house prices is due to the immigration ponzi scheme being perpetuated on Australia.Investors want this to continue unabated. For they care not for it’s rammifications.And money is cheap so the Bonanza contiues.
Let us not get too upset about political logic. There is none. Take the Coalition/IPA ideas about smaller government, lower taxes, less red tape, fewer policies etc etc – the logical direction of all that is to have no government, no taxes, no regulations, no policies…Just leave it all to private enterprise and market forces! Or is that happening already?
Behold the Gish Gallop in action.
Yes; lets get out of the way of business people. Cut back on compliance and silly work place regulations. They know what’s best for us. Remember we all get a golden shower due to their caring efforts or so called trickle down effect. Jobs, Jobs Jobs as Malcolm would say.
This effing inept, lying VERY poor excuse for a so-called Liberal should be taken out to sea–along with the rest of this bloody mob, & Alan Jones–& put into weighted chaff bags & dropped into the ocean! Now, where have I heard that before? Sadly, the Rabbitt was a hopeless Opposition”leader” (I use the term loosely!), & he is just as bad now that he sit on the backbenches of the Parliament! His “time” has definitely passed! Well written article, as usual, Rossleigh!
[However, what struck me was the fact that Abbott was simultaneously being a cheerleader for both high house prices AND lower wages].
Either I don’t get it or the tweet been misconstrued. What has big business said recently?
Abbott suggested last year that immigration should be cut to ease housing price pressures and has also complained about his own mortgage stress.
I’m not defending him as he did nothing when in power to help to decrease housing inflation or wage stagnation or fairer distribution.
Increased property prices are more associated with extremely low interest rates and a growing expectation that the share market is due for another correction. Money constantly moves between these three areas to where returns are greater. It’s always been that way.
I recall a certain past PM who bragged that he was making Australians wealthier through rising real estate values.
Then again, just get a good job that pays well and all will be OK.
In addition the media has been frantically talking up real estate as a quick and easy way to make a lot of money and will be there when it all comes crashing down, telling us that we should have been more careful.
This is just another chapter in the popular conservative strategy of scapegoating and spreading fear and loathing in the community, whether by “kids overboard” or the constant threat of domestic terrorism. Turnbull’s already made his first move with the African gang assertions and there will be more to come.
It’s sad that this divisiveness comes out on a day that is supposed to celebrate national unity, but from Abbott in particular – not surprising.
Zathras: We have had 20 years of continuous house price rises.Before that it used to roughly be a 7 year cycle of ups and downs. Residential property is the new mining boom that seems to go on forever.
Remember, Australia is ‘open for business’ So said M B Turnbull. The finer print states, all offers considered, large or small and cash under table will not be refused. Being open for business is one thing, being ‘sold out; is another and the Liberals cannot forsee anything wrong with selling out.
Our labour market is warped, our taxation is corruptd and favours to ones rich chums an vice versa is rampant. What a lucky country, as long as you have the above
Rob The Commonwealth bank comes to mind.Re cash under table will not be refused.
I’ve just started reading this … there might be better books around but this is the one I have and, so far, it’s an eye-opener.
Game of Mates: How Favours Bleed the Nation: Cameron K. Murray and Paul Frijters.
http://www.booktopia.com.au
Australia does need a debate about population policy, in terms of the rate of growth, the optimum level of population and the sustainability of that population. The debate is too important to be left to politicians who do not have the nous to conduct such a debate.
It is strange that Abbot is raising this issue, I’m sure that he is picking up a zeitgeist though for him it is purely a populist ploy in a desperate search for relevance.
But just because it is Abbott we shouldn’t dismiss the fundamental strength of the issue.
The solution may be some sort of standing population commission, like the reserve bank, that can set population targets like they set interest rates but how you avoid it being stacked with big business flunkies is a problematic.
Abbott’s capacity for cognitive dissonance continues unabated…
Now I DO wonder if this is the beginning of the runup to the 30th negative newspoll result
Tony Abutt is an idiot. He is as ignorant of economics as he is of science. What was his degree in again? Shame on Universities for giving him one. Economics tells us that all growth comes from spending more. Suppress wages and you suppress growth. If the private sector doesn’t promote growth through wages growth then the government must step in with spending programs. Economics 101.
Tony who???
As the Silly Season draws slowly to a long-awaited end, Chimp Ears can always be guaranteed for some comedic relief.
Still waiting for the punch line though.
Speaking of which, why wasn’t Astro Labe crowned Australian of the Year? ‘Tis a travesty I say and I demand a recount.
Shutterbug: There are two reasons that I can see.
I don’t want to pee on anyone’s bbq here but I will; immigration analysis like economics is neither well understood nor represented correctly in media and politics, why?
The NOM formula (UN Population Council defined) is bogus, purposely and egregiously misrepresented to equate with ‘immigration’ and suggestive of ‘permanent immigration’ that can be blamed for everything (deflecting from real issues of the nation and giving a xenophobic outlet); appears to be only used in the Anglosphere while in the EU it’s irrelevant due to Schengen Zone of free movement (most other nations use the OECD formula).
The NOM actually measures all movements irrespective of nationality, visa status etc. and sweeps up Australian citizens too; with a line in the sand 2006, i.e. conflation of temps and permanents inflating the headline figure bunched on top of an ageing permanent population base which is becoming more significant.
For example, like the UK, if you stopped all temporary foreign inward movements to reach an NOM target, it may have little if any impact, why? It ignores the impact of ageing and longevity of the permanent population e.g. citizens who have never departed, and in the case of the UK, if retirees returned en masse from Spain, they would spike the data.
A data literate scientist, without a bias against ‘immigrants’, has done analysis:
‘I suggested Australia’s migration rate might be substantially overstated by “Net Overseas Migration” (NOM), and the derived “Estimated Resident Population” (ERP) might also look bit frothy, or even a million people frothy according to ABS data.’
https://www.quixoticquant.com/post/the-state-of-debate-a-bird-s-eye-on-migration/
Should not be a surprise then to learn that the UN Population Council was formed via Rockefellers (Standard Oil/Exxon Mobil and gifted the Manhattan land to the UN) coopted the American Eugenics Society, ZPG/ZEG (avoid trade agreements because global oilgarchs and related don’t like them), and Nixon signing off too (all well documented). The sustainability of population growth etc. was also their baby via the conservative constructs synthesised by the ‘top thinkers’ at the Club of Rome for lobbying, PR and astro turfing….
Very clever long game of not power or control, but influence and nudging of policy in the background.