Sunday, September 27, 2009

Population Growth's Hidden Costs

Ross Gittin's article in the business section of The Age newspaper today warns of the danger of misreading the GDP as an economic indicator. See: http://www.theage.com.au/business/beware-population-growths-hidden-costs-20090927-g7ro.html

Basically Australia is trumpeting its success in overcoming the global recession of 2008. In terms of GDP, yes. According to Ross Gittins, this is done at the cost of increasing the population (through migration). Bigger population, bigger consumption and bigger demand for labour. All this adds up to a greater GDP, but not necessarily GPD per capita. In fact, GDP per capita contracted 1.5% in the last 15 months, and has fallen in three of the last five quarters (according to reports).

This is where I find myself having mixed feelings. On the one hand I am a beneficiary of Australia's generosity in accepting migrants. Yet once here, I know that continued high rate of migrant intake will only dilute the quality of life for which I am here. This is clearly explained by Ross Gittins in his article. Politicians and businessmen will continue to pretend that high migrant intake is good. The former is interested only in getting re-elected, while the latter is only interested in getting higher profit. So who is watching our for the welfare of the country? Generally speaking, the answer is nobody. I only hope that I am wrong.

1 comment:

Malvin said...

see what is Singapore is doing...cutting down migrants after 30 odd years....the end results was dismissal of quality of life and dilution of next generation equality....a very hard lesson given without the wisdom of conservation.