In what surely must come as a great surprise to demographers biding their time at university campuses and in research bureaus, the population issue has assumed barbecue-stopper status.
The debate started when the former Howard government released its intergenerational reports, revealing the spectre of an ageing population putting the fiscal crunch on future workers.
In response, John Howard and Peter Costello developed a pro-natalist welfare policy stance aimed at lifting fertility rates above replacement level "for the good of the country".
With the Rudd government scheduled to release its intergenerational report shortly, Treasurer Wayne Swan recently gave the public a sneak peek on the latest population projections.
The forecast that growth in the number of elderly Australians will outstrip that of the working-age population would come as no surprise to demography watchers.
What has been the focus of public discussion is that our total population may grow from 21.5 million people today to 35 million by 2049. This latest forecast is higher than the former government's, and is due to a mix of higher fertility rates and increasing immigration.
The notion that we should ready ourselves for a significantly larger Australian population in the future has led to consternation in some quarters. A recent Nielsen poll found that 40 per cent of those surveyed believed that 35 million Australians is too many, with only 2 per cent suggesting the number is too small.
The critics have levelled numerous arguments in opposition to the notion of an expanded population base. The problem here is that flagging all the downside risks can be all too easy for such a complex issue as demographic change.
What has tended to be overlooked is a balanced discussion incorporating the benefits of a larger population.
At the outset, having more people means that economic activity is greater than would otherwise be the case.
Markets expand as more producers and consumers find plentiful opportunities to trade with each other for mutual benefit.
Increasing production of goods and services to cater for the needs of growing numbers of people leads to an overall improvement in living standards.
The idea that having a larger population base can grow an economy is recognised by federal and state treasuries under their population, participation and productivity, or "triple P" growth frameworks.
Yet, this argument has come under challenge during the past two decades in the form of a growing and more headstrong environmental movement. According to this view, how could we possibly sustain demographic expansion on the hottest, driest continent on earth? For many environmentalists, the arguments for a larger population come across as nothing more than some sort of pro-growth corporate conspiracy.
Convinced that a growing humanity is laying waste to the environment, some groups have gone so far as to suggest Australia should seek to reduce its human population, presumably to make way for other species.
The problem with these arguments is that they miss perhaps the most profound reason of all for having more Australians.
Julian Simon, who famously won a wager on resource prices against environmental doomsayer Paul Ehrlich, dismissed the radical green idea that people are little more than parasites destroying the planet.
Simon once wrote that "human beings are not just more mouths to feed, but are productive and inventive minds that help find creative solutions to man's problems, thus leaving us better off over the long run."
If any one trait characterises humankind it is its irrepressible drive to tackle all manner of problems by discovering innovative solutions. More people increase the probability of resolving problems more quickly, leaving a larger base of economic riches behind for our children and their children.
The ultimate renewable resource on this planet is you, me and every other person alive today and to be born tomorrow.
Having more creative human minds is unambiguously of net benefit for our country, and indeed the entire world.
Simon goes one step further to suggest that the underlying basis for all wealth, including our natural resource endowments, is our minds. After all, if some bright spark hadn't discovered that oil, coal or uranium could be used to unlock physical energy we might still be looking upon these materials as having no use at all.
It is because we have people with ingenious minds that we can also work towards solutions to promote ecological sustainability where appropriate.
To ensure more human minds can meet their greatest potential, there is a need for economic institutions that encourage enterprise and rewards for taking risks. This is why the basics of market capitalism -- private property rights, enforceable contracts, free markets and limited governments that do not tax or regulate the life out of the economy -- remain so essential.
Without these preconditions for market growth, it is difficult to assure improvements in the quality of life that a growing number of Australians will rightly expect.
It is also necessary for our political representatives to back their rhetoric favouring a larger population with compatible decisions.
In his speech on Australia's population challenge, Swan noted that careful infrastructure planning will be required to support an expected 35 million people by midcentury. Yet, a couple of months later federal environment minister Peter Garrett scuppered a major water storage infrastructure proposal in southeast Queensland, all in the name of protecting a lungfish.
Policy-induced population growing pains are evident in other areas touched by governments. These include housing, where governments maintain a tardy approach to new land release, insufficient transportation and road infrastructure services, and electricity generation capacity affected by an investment-chilling emissions trading scheme.
Other policy issues will affect the capacity of markets to adjust to a higher Australian population. For example, a more flexible labour market will be necessary to ensure that immigrants are able to secure attractive jobs consistent with their preferences, thus ameliorating the "doctors driving cabs" effect anecdotally observed in some instances today.
Policies that ensure greater labour market freedoms will also enable people born in Australia to contribute to the economic and social life of the nation to their fullest potential.
While the idea of pulling up the policy drawbridge on a larger population might pose as a tantalising option for some, this will ultimately do us much more harm than good.
ADVERTISEMENT
No comments:
Post a Comment