Dick Smith blames “ridiculous immigration” for Australia’s affordability crisis

They are not 'saving our a$$es', as the article says population growth is just giving the illusion of economic growth. If our incomes are not rising and our infrastructure is declining (not to mention things like the environment, congestion etc) then the GDP figure is just a meaningless number. The proper way to grow the economy is to increase value through innovation and productivity and sell things that the World wants. As well as to use our natural advantages to sell minerals and agricultural produce. Ie not to rely on a Population Ponzi scheme.

PS: that fact that our government's aren't up to providing infrastructure hardly disproves my argument. Also the $30 billion required to spend on infrastructure each year just to stand still in the face of population growth could be spent or more stable jobs and services with a bigger multiplier effect from the wages (construction jobs tend to be temporary and a lot of the money just goes on imported goods and to the financiers).

 

Harry Triguboff was recently asked at a filmed media conference with lots of journalists if a downturn in apartment prices might be his company's (Meriton) biggest risk. He replied "In that case, I will just bring in more people." Now, exactly why would one of Australia's richest men speak like he controlled government policy? The answer is that the Lib/Lab parties do PRECISELY what their major donors ask of them. Harry was spot-on, even though it may have been uncomfortable for his 'bought' politicians that he was so forthright. His finger-puppets always talk in far more grandiose economic terms why they support a 'Big Australia', rather than simply saying that Harry and the other bid donors want it.

 

“The main point that’s driving our unaffordable housing is about 200,000 immigrants come in a year.

That’s five jumbo loads a week that go out empty,” he told Sky News.

 

ok maybe best to square up my POV and take on the article - to me it says that of total gdp, if you take out the component attributed to income from migrant finances, we would be experiencing back to back quarterly contractions in gdp. However when you then factor this in, gdp growth becomes a positive number of 2.5%. so to me that says the underlying problem is that gdp would be decreasing regardless of the influence of foreign migration. So at that level i think we agree that the average australian is no better off than they were in the past.

My position is that immigration is not the problem leading to, as you rightly say, low wage growth and aussies not necessarily being better off at an individual level. Rather there is inappropriate government planning and involvement across many industries. Housing is not without its challenges in Sydney, and in WA the DAP process has been a complete shambles, particularly for South Perth. The flip-flop nature of government support then disproval then support again for such scehmes gives uncertainty to investors, and Finbar's Civic Heart development a prime example with a complete investor refund and building redesign years after it was officially approved.

In renewable energy where i work, my old department (private company) went from 250+ people to 45 after Abbott's repeal of existing policy and lack of commitment to any replacement. Since Turnbull committed to a firm renewable energy target we have seen business certainty and (significant) wage growth return, with billions of foreign and local private investment in new infrastructure, massive jobs growth, and companies such as Tilt Energy actually move their HQ from overseas to Australia (also something that would be more challenging to do with a highly restricted migration policy). Another thing I applaud Turnbull for is that on a number of occasions the media has tried to call in to question his policy, but he is quick to say "the liberal government has no plans to change it". That right there is the sort of behaviour that gives investors confidence to put their money on the table. Otherwise its like buying a block of land zoned for development, but then the council says they may or may not choose to remove that zoning in the future, they haven't decided and cant tell you when they will decide by.

So my position is that the biggest problem in Australia right now is flip-flop policy driven by polpulist vote grabbing, not migration. The government doesn't need to spend money to make such privatised industries work, they just need to give certainty to companies who want to put their money in to it.

 

Out of coincidence, I was just listening to "Small business secrets" on SBS as I was skimming through this thread. They mentioned an interesting statistic that 29% of small business owners are born overseas.

 

Well we we bloody well should be thinking of other ways to grow... Technology/AI is going to put more people out of work. Why are we shooting ourselves in the foot for a very short term gain (mostly for the govt and their big business mates like Harry).?

Oh but he would say that then.

Sciencmans's post sums up it all up nicely.

 

to put some context on how severe the lack of private investment is in Australia, here are ABS figures for private capex spending in Australia:

2012: $163.4bn
2013: $159.4bn
2014: $155.6bn
2015: $138.7bn
2016: $117.5bn

2016 private capex spend is $46bn lower than 2012. Cumulatively, there is an $82bn capex spending defecit since 2012. I don't think it can be anymore clear that the lack of growth is because private industry is not incentivised to spend. There is no way any government under a Keynsian stimulus plan could be expected to make up for this lack of private investment.

It's not rocket science to know that Australia needs to diversify, but you can't grow a $20bn/year spending stream overnight. Fact is we are in a hole of shrinking capex spend, and that has a massive impact on economic growth. No amount of migration or lack of will change that.

 

Immigration is great. I haven't worked since 30 thanks to immigration, rising rents and rising house prices.

One of my friends hasn't worked since 24. He had 7-8 houses at the time already. Probably worth $2-3m each now.

I don't see the issue?

 

You cant complain that we have housing unaffordability on one hand and too much population growth (from whatever sources), and an oversupply of empty apartments on the other. Consumers just have to suck it up and discover that apartment living is considered perfectly normal in China's and India's cities. It is also the norm in Singapore, Paris and the parts of New York that we see on TV. How many of your British immigrants lived in detached homes on 600m2 in inner London, and how many come from semis and apartments?

If Australia wants Sydney to be a world-class city, then its residents can get used to living in apartments. If they don't want to live in a city that is comparable to New York, London, Shanghai and Hong Kong, then they can go live somewhere else like Brisbane, Perth and Adelaide. Or they can turn back the clock, fat chance.

 

[QUOTE="JL1, post: 358987, member: 8208"
]
Since Turnbull committed to a firm renewable energy target we have seen business certainty and (significant) wage growth return, with billions of foreign and local private investment in new infrastructure, massive jobs growth, and companies such as Tilt Energy actually move their HQ from overseas to Australia (also something that would be more challenging to do with a highly restricted migration policy). Another thing I applaud Turnbull for is that on a number of occasions the media has tried to call in to question his policy, but he is quick to say "the liberal government has no plans to change it". That right there is the sort of behaviour that gives investors confidence to put their money on the table. Otherwise its like buying a block of land zoned for development, but then the council says they may or may not choose to remove that zoning in the future, they haven't decided and cant tell you when they will decide by.

So my position is that the biggest problem in Australia right now is flip-flop policy driven by polpulist vote grabbing, not migration. The government doesn't need to spend money to make such privatised industries work, they just need to give certainty to companies who want to put their money in to it.[/QUOTE]

Look at how secure Malcom's tenure is but, there is a high probability that he doesn't represents the Liberal Party at the next election. Who (or what block) will next rule the party and what are their inclinations?
The saving grace here will be that at the current rate I see Labor retaking Power and they will reaffirm a renewable target.

I would say immigration is a major issue for political and economic stability.
The major parties will choose to ignore it at their own peril.
Unchecked it will most definitely turn into a major voting issue that will bleed votes to minor and right wing parties or any other party that promises to do something on it.

If we can't sustainably build and plan for the high rate of immigration then we need to pull back on it to a sustainable level.

 

Just out of interest, how many years ago did your friend buy investment type properties that are worth $2-3m each now?

Not sure if you are being serious? Well, whilst as investors (or would be investors) we all want to make money, but how realistic is it for many people to afford a $2-3 million house?

At the end of the day housing is something everyone needs, not just a luxury for the very rich, or just a tool to increase their wealth without any other considerations. How are people just starting out (especially in these times of stagnant wage growth, casualisation of the workforce and questionable long term prospects for employers due to technology etc) ever going to make it ?

I'm not singling anyone out here, but when people possess the attitude that it's perfectly OK for every house in Sydney/wherever to cost $2m+ that attitude, apart from being sad will cause great societal divisions down the line.

 

It ok, when it all comes crashing down, many will be either declared bankrupt or spend the rest of their lives paying back the debts they owe lol, I remember a recent story of a young millionaire landlord in Perth who was featured in the media but has been wiped out when things went south in W.A.

Things always have a way of reverting to mean and balancing themselves. It's just part of the CYCLE of life

 

Yes but who is complaining about both? If a few greedy developers and speculators get their fingers burnt so what? You cant justify endless population growth on the basis there will be empty apartments.

I don't see what's 'World class' about declining infrastructure and basic services or living on top of each other in apartments.

 

Well he certainly can no longer claim to be a philanthropist! If you only love Australian (and/or white people), that clearly isn't the case.

 

You have got to be kidding. He is critical of our high population growth, of which immigration is the main driver. He has specifically said that he doesn't care where the immigrants come from, but he has a problem with the numbers.

 

this is just not true, and history shows otherwise.

Please google "Snowy hydro".

 

But he's still looking at what's best for people living in Australia. From a philanthropic view, who cares if our standard of living goes down from massive immigration, as long as global living standards go up?

 

What's wrong with that? We have a national government which should be looking after the interests of it's own citizens. Regarding your proposition there are 100's of millions of impoverished people in the World. Our society and way of life will be destroyed long before we made much of dent in their numbers by bringing them here.

 

Not relevant to today's situation. Also you cant compare going from 12 million to 24 million to doubling again to 48 million. There is a point when population growth becomes a negative. And you need to look past flashy big projects like hydro electric dams, freeways etc and consider things like schools, hospitals, power, road congestion, etc.Just look at how we are falling behind with the last 12 years of high population growth, especially in Sydney and Melbourne (see the Alan Kohler article I put up).

 

couldn't agree more, but obviously disagree at where that threshold sits.

In regards to infrustructure, I believe we are being held back by a reductive political mindset that has also unfortunately leached its way into the mindset of the general public.

A mindset of why we can't and shouldn't.