Michael Coote explains why immigration is a good thing for NZ if we hope to avoid a national “death spiral”caused by crushing taxes and reduced public spending. Your thoughts?

By Michael Coote*

One of the more curious pieces of grotesquery published from over the ditch recently was the call from the newly formed Stable Population Party for unlimited immigration by Kiwis to Australia to be curbed.

"You can still have a close relationship with New Zealand without having a completely open-slather policy on immigration," stated the party’s candidate for the Victoria state senate Clifford Hayes.

Mr Hayes was reported to be oppressed by the thought that 50,000 Kiwis have moved over to Oz in the past year. He said wanted the rate cut by forcing Kiwis to apply to immigrate, with a quota set at a net 80,000 per year.

Anti-immigration politics will always play well to a certain sector of the population – just look at the perennial success of the xenophobic “Winston First” cult in New Zealand. Yet Australia has a “problem” that many developed countries facing Baby Boomer demographic ageing shifts would love to have, in that a continuous stream of younger, often skilled and educated, internationally employable people who can be active taxpayers for decades to come want to move there permanently in order to live, work and raise families.

In this sense the Stable Population Party is on the wrong side of history, not to mention demographics, and Australia is genuinely the Lucky Country, with a population growth of 1.4% recorded for 2011. Victoria, the state Mr Hayes wants to be a senator in, had the largest increase at 75,000 people, made up through a combination of foreign immigration, interstate relocation, and babies born.

Grey power politics

Oddly enough, the people most likely to respond positively to Mr Hayes’s anti-immigration clarion cry are older voters, the same sorts of people who in New Zealand keep Winston Peters in his long- accustomed Parliamentary style.

It is precisely the mature voting cohort, but most especially its “youth wing” made up of mid-to- late middle-aged Baby Boomers trundling relentlessly towards retirement, who should be the most vociferous supporters of policies that suck in young, hardworking, taxpaying migrants from abroad to pick up the tab over future decades for the likes of New Zealand superannuation and the public healthcare system.

Younger New Zealanders who intend to stay here rather than bail to Oz or further afield should also support pro-immigration policies, because of the diluting effect that mass importation of extra taxpayers with many years of working life ahead of them will have on the increasingly crushing dependency ratio otherwise hanging over this country.

If New Zealanders can’t breed enough future working taxpayers all by themselves, then they’d better import them from elsewhere or come up with other bright ideas to compensate for the falling per capita economic production and burdensome state revenue requirements of a country beset by a rising dependency ratio.

Who are you gonna call?

Much the same ideas were brought out by Christian Noyer, Governor of the Bank of France and Chairman of the Board of Directors of the Bank for International Settlements, at the conference “Demographic shifts – threats or opportunities?” held in Montreal, Canada, back in June.

Of the merits of having an increasing population in an advanced economy, but particularly of the latent benefits not always apparent in inter-country comparisons of contemporary national wealth, Mr Noyer had the following to say: “What are the main consequences of demographics for potential [economic] output?” he asked in his speech to the conference.

“The decline in the working age population due to ageing should negatively affect potential output in the long run, through the decrease in the labour force contribution and productivity, all other things being equal.

“I must stress here that France has a specific advantage: its population is expected to keep on growing fast for some decades thanks to a relatively high fertility rate and a dynamic migration policy; while our German neighbours for instance are on a decreasing trend.

“Overall, based on European Commission projection trends, we estimate that the expected decline of 1.5% in the working age population in the European Union between 2010 and 2020 could take 1 percentage point off its potential output. But there are ways to offset this evolution. A rise in the [workforce] participation rates of the young, seniors and women is one of them. Pension and labour market reforms implemented in Europe are certainly a step in the right direction and should be further pursued.”

National death spiral

Pension reform has of late been a political hot potato in New Zealand, with arguments raging briefly among Parliamentary parties about what changes are needed and when to KiwiSaver and New Zealand superannuation, but that only tells half the story.

Public health costs are the other half of the tale, with older people expected to live longer on average, suffer more from the ills peculiar to senescence, and need ever increasing medical treatment and residential care. The challenge for New Zealand is whether it can become enough like France and Australia in time, with a rising population growth trend able to sustain the potential output required to fund old age pensions and healthcare for the greying Baby Boomer set.

If our society can’t work out how to achieve that fairly soon, then the rational thing to do for all those able to emigrate would be to vote with their feet and move to another country that does enjoy a both rising population trend and a good standard of living. Otherwise if these people stay they could find themselves facing a national “death spiral” combination of much higher taxes and reduced public services and support.

*Michael Coote is a freelance financial journalist whose publication list includes interest.co.nz, the National Business Review, New Zealand Investor, The Press, and the New Zealand Centre for Political Research.



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No people = 100% Pure NZ

Why does no one ever address why the rate of growth in the worlds population continues to decline. Lack of resources to support growth perhaps?

If lack of resources is the reason, why is population growth grinding to a halt in the world's richest countries and exploding in a number of its poorest ones (Nigeria, Pakistan etc)? 

I said WORLD population, so those poor ones can't be 'exploding' that greatly because it isn't enough to make up for the shortfall in the rich countries. 

If there was a shortage of resources rich nations would be the last ones to run out.

Are you sure?  A lot of the "rich" nations get their resources from elsewhere.

Meaning they would be the ones with money to buy those resources.  Not meaning they would have them in country as a natural resource.

If there's a shortage of resources the intelligent ones aren't going to sell them.

Well that leaves out this crop of NZ Pollies out then (both sides).
That will I think happen...and I dont think its long away....
Consider the impact on NZ if we cant get any oil....longer term though Saudi etc has a growing population it has to feed. They will need food from abroad and hopefully NZ will be one of the few with food to sell to them....
If the oil or food doenst get pirated on the high seas on the way of course. Many other countries will only have debt and Saudi wont want more US paper, but the US will be the ones with the guns and ships, the future could be very ugly.

No, the rich ones dont have money, they have debt.....they borrow it, so at some stage they have to repay it.
With what?

That would be lack of resources as well, namely condoms, etsc

Education of women would seem a significant contributor.....for the poor ones in the past they bred and starved to death...with fossil fueled food that has been satved off for some decades....it will make a significant come back.

Yes, and the fact there are no jobs in NZ that cannot be done elsewhere at a fraction of the cost., unless of course we are counting under paid motel cleaning type service positions.  
Also the actions of the slimeballs as depicted here are unhelpful to future job creation. 

Kunstler sure has a way with words.

"The impairments of capital formation are now so profound that no one and nothing can be trusted"
I have the feeling he might have coined the term "cluster f***" seems apt.

Yes a thumbs up for Kunstler, lays it all out there but in a very poetic way.

How much freedom a woman has plays a big part - access to education, participation in the work force, access to contraceptives, abortions, rising standard of living.

I assume you mean women have the freedom to work and can choose to work, or to not work? Haha, yeah right. Try again.

Well, it's been estimated that we could get the world population to 15 billion.. However, the caveat is that this would require us all to live at subsistence levels of resource consumption, similar to people currently in the poorest of the african countries. Of course this population level is not actually sustainable in the long-term, and current studies have estimated the maximal sustainable population to be 1-2 billion.
Population growth for economic gain is foolish and essentially just another ponzi scheme, except when it busts (as it will eventually) it will result in large numbers of people dying. In the long-run advocates of constant population growth are actually condeming us all to lower standards of living.


Michael - I would suggest that you read the ideas of Prof. Albert Bartlett regarding exponential growth and it how it pertains to population.

I'm all for immigration as long as:
1) immigration is not used as a means to economic growth. It should supplement growth not create it.
2) we are cognisant of the inflationary effects immigrants can have on our housing market and make appropriate infrastructure changes, build enough houses etc to combat this. As part of this we should be hesitant to allow wealthy immigrants in. Inflation = growth in money spent v growth in the economy. If lots of wealthy immigrants means NZers are outbid for housing that is a terrible thing, but that is happening, and lets face it is a contributer to NZers heading overseas so they can save enough to come back and buy a house (and exacerbate the inflation). This benefits those already established, and marginalises those starting out who dont earn foreign incomes. Not too long ago a good income could afford a home, and by the time the earner was 40 could probably afford a bach somewhere nice. If we control immigration and the housing market we can have this again.

"If New Zealanders can’t breed enough future working taxpayers all by themselves, then they’d better import them from elsewhere or come up with other bright ideas to compensate for the falling per capita economic production and burdensome state revenue requirements of a country beset by a rising dependency ratio."
Complexity in a society increases to the point where all the energy and resources available to the society are spent just to maintain that complexity.
The rough figures are I believe: post WWII, 7 workers per retiree, presently 5 workers per retiree, estimated by 2020 3 workers per retiree.
Given that population growth is unsustainable and therefore will stop at some point I'd not suggest more people.  That would be like borrowing more  money when you're in debt.  At some point it no longer works.
Increasing per capita economic production sounds good, but isn't everyone trying to do that now already (and have been doing so for years)?
Reducing the complexity of our society might help.  Fewer laws and taxes and red tape each year instead of more.  I doubt that's going to happen ... yet.

Compexity isnt red tape....its job specialisation and interaction..but then being of your political ilk its not suprising yo think less tax and less red tape will solve this.....it wont btw.

"not suprising yo think less tax and less red tape will solve this"
Solve?  Not in your life.  Help, yes.  Eg. when the compliance costs to rebuild an old garage cost more than the new garage (I know where this has happened) I would suggest that yes, reducing this red tape would help.  I'd say that complexity is everything we do now that we never used to do, so agreed, job specialisation, but cetainly government and associated red tape as well.
Of course, as you will point out, there will be no need for a garage in the future (at least to house a car).

Tax has been about what it is now and indeed far higher.  Indeed when you look at the 50s and 60s the top rate tax was far higher, yet we did well.  Therefore I would suggest tax isnt the issue but materials and energy costs per item and due to the number of items wanted....
So in the past capitalism enjoyed the huge mark up on materials, what we have seen in the last decades is a vast improvement in materials use and transportation to mitigate those rising costs.

Given that population growth is unsustainable ...
Well with a closed assumption like that you're conslusions are going to be pretty narrow then.

Do you seriously believe that we can keep growing our population on Earth indefinitely!!?

Well in absolute terms probably not.  But I hesitate to predict the future at that level.  This kind of thinking fails in two ways.  First it doesn't address any kind of proportion and second it assumes all other variables will remain static.
If only 100 people live in the world and acted on that thought they might start birth control, which might not be the wisest course of action.  Thanks goodness for us they didn't.
At the other end of the scale, we may invent things (as we have done in the past) that enable us to do things not currently possible.  To curtail any kind of growth because there may be a future unknown limit is an over reaction.

thats a good point Ralph. Life expectancy (including the third world) is far superior to what would have been the case 100+ years ago when Malthus was around. Technology has outpaced pop growth .... so far, although whether it can continue is a moot point. And lets not forget the biggest users of resources are those countries with static populations - humans have a tendency to consume what they can, and there is more per capita capacity to consume rubbish when you only have 1 or 2 kids (my family of 2 kids has 10 times as many toys as the large family I grew up in!!).

Ralph and the Squirrel - what do you think held the Malthus thgesis at bay thus far?
Ever increasing amounts of energy, is what. Actually, that's been going on since we used fire (wood being stored solar energy) to shortcut the need to digest raw food. Gave us surplus energy to do more. Take a look at a modern tractor, vs a scythe-swinger. It's not the clever engineering of the tractor - it's the explosions in the cylinders that do the work.
Globally, 80% fossil fuelled (agriculture nearly 100%) - all that building and infrastructure, all your supermarket offerings, and no viable alternative in sight. It would have to have been here before now.
Technology only does efficiencies - how often do we have to say it?
Consuming less?  Won't do enough, although it will happen - and that sure as hell spells the end of 'growth economics'.

nuclear energy is underutilised, so plenty of potential energy there. Necessity will drive a viable alternative - when / if they run out then more and more money will go into a replacement. And dont forget GE food, we could be doing things 10 times as efficiently when this ramps up. And if we start running out of oil we just have to be smarter (public transport, drive golf carts, put on a jersey when you are cold or have a glass of water when you are hot, better insulation and smaller houses - necessity drives behaviour a lot better than a future potential risk). Also dont forget that technology will increasingly enable us to work from home and be schooled etc from home. Maybe we will be able to harvest organs that dont require as much energy to function. Humans adapt!

Nuclear is finite - current estimates say 40 years supply if it took over from oil. At present rates of consumption.
GE food doesn't cut the mustard - Aquifer depletion, soil degradation outflank it, as does the immunity issue.
Being smarter has to have the wherewithall in place BEFORE the deficit in energy hits - or you have to triage something you're doing already because you're at full noise.
Technology is efficiencies. Never forget that. Working form home - virtual or with stuff? Working virtually and then expecting the proceeds to buy the real, might be a bit of a shock. Negative pigs.
Adapt?  Yes we will. But it won't be life as we know it now - and it won't be finance as growth would have it, either.

where does this "more and more money" come from?
GE food needs fossil fuels, you cant make it en-mass with electricity.
"technology" its underpinned by maths and science, obviously not a strong point of yours

efficiency means you are using LESS of the energy to create the GE food. I never said you dont need the energy, which by the way does not have to be fossil fuel. And in answer to powderonkiwi, 40 years is a good amoutn of time to think something else up. As for the continual economic growth model, I have no issue seeing that fall by the way side. if people have to reduce consumption then they have to reduce consumption - big deal. I reckon the average person in the west could get by confortably on 10% of what we consume without a reduction in lifespan - although it may be a bit more boring (geez, that would probably only take us back to our granparents consumption rates). And the point i was making about the "virtual world" is that we wont need to travel as much to work, school, entertainment etc etc etc. We wont need to cut down as many trees for paper and pay for fuel to transport it and process it, tablets really are making offices paperless.

The problem with the efficiency claim is three fold,
1) more population means they need more food....so the efficiency gains which are not inifinite and indeed will reach limits get absorbed....say 2% more ppl.
2) Food needs fossil fuels the output of which goes into decline somewhere soon at about 4% per year.
3) As that oil for transport fuels goes into  decline we will switch food ie corn and soya into fuel for cars, another large decline.
We dont have 40 years, 40 years is until it is effectively gone, its set to decline inside 5 years.  Growth in world GDP of 4% needs more energy at about 2.5%....when oil dclines at 4% per annum that points to world GDP shrinking at 6% per year for the next 40 years or so...expotential curve stuff.
10%, Consider that in terms of AGW we need to get to 25% of what we consume today to balance emmissins. In the last 3 years I have managed to cut my needs by 20%....I am really struggling to get down lower, to say 50% let alone 25%....so something will have to change and very big things.  10% looks a long drop.....The problem with virtual is it takes too much energy, its goidn bye bye.  To get to 10% we will have to live like the Amish within the annual energy gift from the sun.....Im not aware the Amish are un-happy ppl....

the 40 years relates to powdeonkiwis comments re nuclear energy not petrol. My general point is that I think we underestimate our ability to MASSIVELY reduce consumption simply because the majority of consumption in the western world is superflous. If we adopt some of the things below we can RADICALLY reduce consumption without a big decline in quality of life:
1) we dont need cars - we can get buy on golf buggies/bikes so long as freeways / roads are converted to accommodate these. Leave cars / trucks for business services that need them. But for general passenger use, golf buggies should be the largest form of personal transport. Go to hamilton island, buggies are great fun.
2) we dont need expensive heating and air conditioning. wear a jersey
3) we dont need fancy food and drink
4) my wife does not need 20 handbags and 50 pairs of shoes, expensive perfumes and makeup.
5) we dont need to wash our clothes/linen/car/house/carpet nearly as much as we do and dont need as much soap / detergent to do it.
6) we dont need to shower everyday (thats why I prefer golf buggies to the bike idea)
7) we dont need 90% of our electrical appliances or tech gadgets, we really dont
8) we have backyards that can service 50% of our vege needs - spend less on flowers, we dont need these
9) we dont need to travel long distances to work as we can work remotely
the list goes on and on and on and on - the reason we can't make these changes now is because these are politically unpalatable. But WHEN or IF we start to run out of an energy source then NECESSITY will result in us having NO CHOICE. And I reckon we'll find our life is not so bad - we will all just smell a bit more thats all.

And we don't need 5 bedroom, 300 square metre, 4 bathroom houses that's for sure!
In fact we don't even need 4 bedroom 200 square metre 3 bathroom houses either 
We are living in a duplex here in Adelaide, even though the winters are slightly cooler than Auckland we've only used the heater for 2-3 nights. That's a product of a smaller floor area (approx. 120 sq m) and the thermal mass offered by the adjoining unit. Also like Jimmy says we wear big jerseys.
We also live in a fairly central area so we can survive with one car.
We are saving our money as well as the environment. 

"And we don't need 5 bedroom, 300 square metre, 4 bathroom houses that's for sure!" I think this should read "And I don't...". It all depends on the number of people in the house and how much sleep you wanna get I'd say.

I'm talking about the average household Elley, say two adults two children. Sure if you have 5 children then a 5 bedroom 300 sq m house is probably justified. But there's plenty of smaller families living in these monster houses, each to their own but IMHO just a ridiculous waste

Yeah, I do know what you mean. Our retired neighbours have that kind of house. Seems a bit over the top to us for just two people. (We have a home-based business, ie office space required, on top of the 5 kids :) ).

Re 1) "we don't need cars" - You are kidding right? This is NZ, where you have "villages" (or what passes for villages anyway) dotted around the country, far from pretty much everything. Unless do not have children and never wanted to do anything (and that includes normal social activities like being involved in a sports club, taking your kids to training/competitions every week, going out to dinner at friends etc), you do need a car. 
Disclaimer: I am not into cars, didn't drive one for the first 2 years I was in NZ and biked everywhere in all weather. That's OK when you're just an adult (or two) on your own, but once you start putting babies/children (and the luggage, litterally, that goes with them), daycare/school runs and the size of the grocery shopping that go with a family, a bike just doesn't cut it anymore. We did go on bike outings with 4 under 5 (one on each bike seat, 2 in the bike trailer) but the reality is that you don't go very far, it's heavy and whatever space there is in the bike trailer is taken up by the baby gear you need whenever you go out with little ones so using it to put the shopping is a lost cause. I'm all for a carriage and horses but I don't think one would last very long on NZ roads while there are cars around.

2) Sure... NZ houses are famous for being incredibly poorly insulated and a jersey doesn't seem to help with the big asthma problem among children (and adults).
6) Each to their own!
9) Totally agree but go tell that to a boss. Companies may be more open to flexible work (time and location wise) but if you applied to a full-time job saying you wanted to do it 100% from home I doubt you'd get an interview. And that's assuming you can actually do your job 100% from home. We can and we ended up setting up our own business and working as consultants just to get that flexibility.

Elly, I dont need a car because I could see this coming and set my life accordingly. What you are going to see inside a decade and probably 5 years is petrol shortages and rationing and huge price spikes. If you have set your life around cheap petrol you will be forced to change, I suggest trying to beat the rush but adults make their own decisions and take responsibility for them.  I also believe you chose to have 5 children, this will be a cost you will have to bear you made the choice.
Houses can be insulted and should be, your choice, electricity is cheap compared to where its going to be, think double, ie 40cents a kwh. Also consider what you will do in blackouts and brownouts.
9) Times will change, when the boss has to do it....enlightenment will dawn.

I think the car will go fairly quickly. Economic collapse will take away the discretionary spend, and burnt fuel is as useful as melted icecream.
Yeah - I always wonder at the folk who multiplied. I know some dedicated Greenies who give vast amounts of time to 'saving' natural areas/animals/whatever, but who have 5, and I know of a 7. No matter what they do, they'll never make up for their primal (I got that right, didn't I?) action.
Good discussion recently re the Waitati Energy Project - a village contemplating a communal grid-tied wind-generator. Discussion was re resilience - and the grid is suspect. You're more resilient in a cluster of self-reliant units - like the 'net. No way can everyone go down at once....

I know ppl today that spend $150 a week+ on petrol, that is 2 months for me. Their life is set around the car and they cant easily change. They have to commute or go bankrupt ie have no job. I really cant fathom the changes and how fast. Also petrol is descibed as in-elastic demand so it takes a huge increase to force a small change.....other things I think will go first, sky, broadband, mobile phones, fancy comms gadgets with large monthly sticker prices....food bills.....

So what, they spend 150 clams week to have a personal vehicle, which they enjoy to drive, when they want,  & how they want.  It's called freedom, Steven. You really do worry too much. Let your hair down, and stop fretting.

To start with they complain about the cost, and the cost of freedom is going to get higher, or even rationed. I personally dont consider commuting like that a freedom....a sunday drive, yes OK, very nice.
The problem is with such freedoms in when they start whinning it costs too much so the Govn should do something about it.....its abdicating responsibilities....

Maybe the "folk who multiplied" do realise that children are the future? Granted, some countries have a fertility rate that is not sustainable, but it is hardly the case in NZ and other "developed" countries. If anything, those countries risk extinction. 
As for NZ specifically, I reckon that at the current rate of emigration it will run out of people well before it runs out of food.
But yes, raising a child, not to say a good citizen, is an enormous amount of work, a 24/7 job that never actually ends and arguably far more challenging than any paid job. I can easily see why some people can't be bothered making the effort and would rather count on others to produce tomorrow's doctors, scientists, teachers etc.

It's not about seeing it coming or not, it's about living the lifestyle that suits you. I know I couldn't live in a little box among millions (or even tens of thousands) of other people in a bustling big city even though it'd mean having everything on hand or within walking distance. Some people do love that but we wouldn't last a week so we choose to live further from a big centre even if it has downsides in terms of commuting. 

That said, we are not completely stupid - we have jobs that mean we can work essentially from home and as said above, have set up a consultancy business to do just that. I wasn't necessarily talking about big car trips btw - just a 3km commute to the daycare or school with the bags and all can not easily be done by bike, even with your average 2.1 kids and good weather. A car is convenient and I am happy to pay the price for that convenience. There's no such thing as a free lunch.


Re-the cost of children, I can't speak for you but all five of mine are worth every penny of their cost and I couldn't imagine life without them. I'm sorry to read that you see yours with a price tag attached. Thank goodness being financially savvy doesn't have to mean calculating every breath one makes. Life is for living! Well, that's what I think anyway. 


Our house is newly built and so well insulated that our heat pump is mostly used to cool it down.We have passive heating, wetback, solar etc. I was talking about the typical 70's bungalow which is the kind of place a good chunk of NZers (can afford to) live in. We have had 2 blackouts in the last few weeks, one which lasted a day and a half with an average temperature of 0 degrees and even with a baby and young children, we were perfectly fine thank you. As I said, we are not completely stupid...

How are you going to build your nuclear systems (which only do electricity, not roads, plastics, fertiliser, and aren't likely to till the soil Big-Ag style) and the communications systems and put into effect whatever you 'think up' in the interim?
With a fiscal system minus profit, interest, investment? (growth, in other words).

Yes the profit based system is usually overlooked by the "we will invent something to solve the problems' crowd. Funny how they seem to ignore what the inventors are telling them as well.

scarfie - as (or if) the problem becomes bigger then it will become profitable to build the alternatives given rising costs of oil. At the moment oil is too easy an option so thats where all the big companies go.

Jimmy - think that through.
Profitable - expects to buy more than before, yes? Even if you invested/saved/hid it, that is an expectation that the future can supply goods/services.
Which take work.
Which takes energy.
Get it?  Energy underwrites money, including profit. Any that isn't underwritten, will evaporate at some point, although (like the Consolidated Fund) some may have off-loaded the poison parcels, and some may be caught holding them.
That's why we can predict the end of economic growth with such certainty.

Dont you get that money is a proxy for energy, it is an iou for work...

We cant in NZ, (not OZ either you need an nuclear industry) I helped build four nuclear powered subs....it takes years and that was a standard repetitive design.....

Another way to put it might be his population thesis has proved wrong since 1798.
You energy doomsayers should get sandwich boards and parade the streets moaning "The end is nigh".

You've been alive every day since you were born.
Do you expect to be alive in 150 years, on that basis?
Me, I like to see what is underwriting the staving-off of his - entirely correct - math.
Ever-increasing amounts of energy. Why does it need to be repeated so much? If I was a teacher, I'd be going spare wondering why you don't get it. A Primary teacher, that is; this is way below secondary, conceptually.

Call it math f you like but the fact remains his theory has not come to pass for over 200 years.  In fact things quite the opposite way.  It's amazing how we try to rationalise away history.
Energy is but one variable, albeit one you love.  And if you guys abused your students like you do posters of this blog I suggest you wouldn't be a teacher for very long.  As I have stated many times abuse does not an argument make.

So you have been alive for x number of years, what guarantee is that you will be alive tomorrow?, next year? 2020?  2050? I would suggest, overtime less and less aproaching none.

Ralph - sorry, energy is the all of it. Don't put emotion into things - it's not what I 'love' - merely what I understand is needed for work to be done. Have you another candidate for that role?
Thought not.
Malthus was about exponential vs linear. That's math. Alleviated to date, by injection of energy AND NOTHING ELSE.
Folk who call things 'theories' ususlly do so en route to discounting/discrediting them.

so what limit?
7billion now?  at 2% thats 14billion in 35 years,
28billion in 70 years from now,
56billion 105 years from now,
112billion 140 years from now.
The only things that are limitless it seems, are stupidity and ignorance.

Astonishing stupid article.  And where will what is advocated end.
We need to structure a society that does not ride on the backs of the young and the immigrants to survive.  Can be done.  It's just going to be different.
Soon the only places worth living will be where population is not overloaded.  They will be rare.  So the plan is to overpopulate.  He is kidding isn't he.

We need to structure a society that does not ride on the backs of the young ... 
Although we have in actual fact done exactly that - and any move toward change it politically has proven impossible at this time.

Exactly.  Politically difficult/impossible to change.  Economic suicide to continue what we now do.

Well the patient isn't dead just yet...
But interesting the root of the issue (as with most causes) lies in the human heart.

No he's off his rocker.....he's too afraid of the alternative which is a lifestyle change so is in make believe la la land....
"rare" yes NZ is one of these and here this "expert" wants to swamp one of the few lifeboats....like duh.

Actually Martinv (11.59am) there are people who think the way out of debt is to borrow more.  Yes.  It's nearly delusional.  Look out for those using words like 'stimulus'

Immigration is stupid politics Michael.
Why encourage immigrants to drive prices and congestion high in one part of the country with people who don't necessarily contribute anything more than what an average NZer can offer.
We need good people to come here but only the very best candidates.  We also need them to be prepared to move to the provinces and start businesses which "do good stuff" and "employ good people".
Dominion Road doesn't need anymore takeaway shops!

We need good people to come here but only the very best candidates
It is this attitude that allowed the Renumeration Authority and it's predecessor the Higher Salaries Commission to encourage cherry picking the most overpaid foreign job candidates and convert their local offshore salaries to NZ dollars and use that benchmark to supposedly stop the NZ brain drain offshore.
But those footing the bill and unentitled are increasingly voting with their feet.
Hutt Hospital is overwhelmingly infiltrated by British staff. I guess the Kiwis are in Aus. paying the loans off.
And before anytbody starts - I was born in England moved here when I was three.

"Why encourage immigrants to drive prices and congestion high in one part of the country " - what part of the country do you mean? Auckland? Things may have changed but when we immigrated (10 years ago in September), there was no pressure/obligation to settle in a specific area of NZ.
Of course, job opportunities were a big factor in deciding where to settle but for us in IT, Christchurch was said to be the place to go (at the time anyway, might have changed). We did move "to the provinces and start" a business since.
Based on the fact that NZ's economy relies mostly on dairy farming and RE, it might be fair to say that the skills of "an average NZer" lean rather towards cow milking and trading houses? I'm quite sure a good chunk of the immigrants can bring other skills into the mix (we do). And really, when the stats show that so many Kiwis are disillusioned with NZ and cross the ditch each month, the writer of the article kinda does have a point.
In saying that, I choked at  "The challenge for New Zealand is whether it can become enough like France". Didn't move so far away from France for NZ to become like it (not that I think it could anyway)!

"Immigration is stupid politics Michael."
Absolutely. Ignore the politics. The result of more immigration just "digs a bigger hole"
I really do not know how a 'financial journalist ' can be other than a mouthpiece for someone elses agenda.
The facts come to one conclusion. Adding to the population only adds to the problems he says we have. In the end we have to live with the problems of growth creating more problems than it solves.
So, I say to Michael Coote, start now and work out solutions that do not include more people.

well said sir.

Economics - as this article demonstrates -  is based on a lie. A provable untruth.
Who was responsible for teaching folk like Coote? I listened to Rodney Hide last night on Nat Radio - he genuinely believes it too. Someone - collectively the Economics Professors of the nation come to mind - should be held responsible.
T'isn't just the 'right' are deluded. Clare Curran thinks we should "share what we've got with those who haven't". How stupid a statement is that?  Thinka about it. Share what? Which will then make us?
Spare me. Roll on the day when sex requires a higher IQ.

Well said....

Speaking of Rodney Hide (and curiously related to the subject of immigration) - he actually wrote something intelligible recently;
It wasn't soldiers and muskets that did the real damage. It was the merchants and their stores.

"a country beset by a rising dependency ratio"
We've had far higher "dependancy ratios" in the past in the form of a high number of children and under twenties. We managed that OK, so what's different now? Could it be that what Coote is really trying to prolong is our out of control debt based money system? Feed the ponzi beast with more people, more resources and, most of all, more debt.
What we should be more concerned with, in the already developed countries, is refining our systems so that we are not forced into seeking ever higher GDP while the real disposable income per capita is declining. More and more of our countries and households resources are now required to stand still as they're siphoned off to the banks and foreign owners of our prime businesses.
No facts much in this pro immigration rant. Just what is the net economic benefit per existing immigrant? Does anyone even know? Are they creating exports and new domestic products and to what extent? Are they forcing down wages for Kiwi workers and taking a lot of our entry level jobs? What pressure are they placing on our existing resources (housing, fisheries)  and quality of life? Are they mostly crowding into our largest city and creating huge infrastucture problems there? Are they net importers or exporters?
If the answer is more people, Coote, you're probably asking the wrong question. 

This sort of debased myopic delusion has about as much merit as investing in a perpetual motion machine.
Anyone who advocates the dilution of wealth as a way to avoid poverty shouldn't be in economics.
"death spiral" -  great - sounds exactly what is needed to radicalize the population into devolving government and corporate hegemony.

Yep, its assounding the likes of this are writing.....Saudi I think 2 generations? back had a wealth per capita of something like $20kUS, now its $6kUS....
"the population into devolving" thats our future I think.

Wrong Qs, its will they come back and can we stop them.

From what I've seen, having taught English to migrants for 20 years, many came to NZ to get the passport they needed to move to OZ. They never came back and after having since spent two years in Sydney I can see why - they move to their own ethnic and mother tongue communities, better weather ie similar to where they have come from, and they have greater opportunities.

Michael coote just proved himself to be unable to see the big picture...congrats yet another can kicker, something that seems limitless unlike oil, food and water.

Untill we build cities backed by productive industry, or indeed show the will or means to do so .......congestion caused by further immigration will only lead to exacerbation of  infrastucture utilities along with revised building policys to cram even more in to what ares becoming overcrowded subdivisions already...........is it the people you want or their cash ..?(which you like to refer to as investment in N.Z.) , but come on please give it a break on that one, it has suceeded only in putting the cost of housing even furter from Gen X's grasp, it has succeeded in disenfranchising people of this Country  from the opportunity to be half sure they could afford to raise their family here.......
Useful imigration to N.Z. doesn't just come with the skills they can bring ,it comes when we have the foresight to prepare the groundwork to relieve the pressure from the Metropolitan Cities......... Build it they will come...? yes it happens.
 Mr Coote , growth for growths sake is not an answer to the Fiscal situation of the Country, have a look around you in this world and give supportive case examples...in reality...not in IMF speak.
Immigration....not right now thank you, I've already got one and it's not working so why double my troubles ...eh.?

Christov - I just bought a ton of gold. Gummy would say - this puts me up to a simillar level of entrpereunial and inovating  spirit like Zuckerberg or Buffet, when gold surges over US$ 2’000 + in a few week times.

On you Walter...do be careful..!......I don't know matey...am expecting the Kiwi to slide over next two weeks to a month...good luck to you anyways.....Stay well..!

Good on you for having a punt-hope it works for you.

Michael Coote (a local?) referencing an exercise in AU Political Correctness. For what Michael?. Did you do any research?
There are more refugees arriving every year in Australia than New Zealanders arriving in Australia. Of the annual refugee intake, 20,000 are "illegal refugee boat people" who are politically untouchable. Refugees arrive in Australia and are detained at either Christmas Island, or Cocos Island, or onshore at various detention centres around the country, untill they are processed and refugee status confirmed.
The difference being ALL refugees are immediately entitled to welfare, rent assistance, education, health etc etc etc, while New Zealanders are not eligible to apply for welfare for 2 years.
Current Australian government spending is
Annual welfare on settled refugees = $1 billion per annum (excludes education and health)
Running Christmas Island $2 billion per annum
Running Onshore detention centres $1 billion
Royal Australian Navy and Air force operations for boat people $500 million
All the detention centres are overflowing
Boat People are currently arriving at the rate of 2,000 per week or 100,000 per annunm
Australian Gov't is going to re-open the Nauru Offshore processing centre at an initial cost of $2 billion
But you can't talk about that, it's politically sensitive
But you can talk about New Zealanders, they are easy targets, sleight of hand.

Here you go - The illegals are at it again today. At great cost. Two Australian RAN navy vessels and a Customs Border Protection Dash 8 plane on the way.  For 85 people. The illegals get 50k off the coast of Java and then ring the AU coast guard on a mobile phone - come and rescue us - we're sinking. Think of the cost. NZ is being spared - for the moment.
Another Leaking Assylum Seeker boat on the way - two merchant vessels already there.

I'm all for more skilled migrants. We need fresh blood and fresh ideas. Not to mention good work ethics. The migrants in my office work really hard and it rubs off on the rest of us.

Nobody has ever answered the question.
"if baby boomers are the problem in that there will not be enough younger people to pay their benefit'
Then the question is, or should be
"WHY are those really young people, who will retire after all the baby boomers are dead and the problem has died with them, WHY DO THEY NEED A SUPPERAN?"
Bernard, can you answer this question?

Mike B: It all depends on what rung of the ladder you are on. The aggro that has been shovelled out here on interest.co.nz about the BB's is largely by genX's. The real problem for genX is they should be looking over their shoulder. You can search for the following on google - it's out there
Friction between GenX & GenY makes tension between Boomers & Xers look tame.
66% of teens have a negative view of GenX.

Answer - Young people will have to prefund their own retirement.  Means less consumption now. Means saving. And means fewer inane articles like the one from Michael Coote.  New Zealand could remain a great place to live as well (fringe benefit).  KH 

Can't wait for New Zealand to be as populated as Japan

You and I will be long gone before that comes to pass.
Let's do the maths, If we have a 2% per year population growth we would go from 5million to 80 million (4  35 year doublings) in 140 years. If we pushed it to 5% annual growth we hit 80 million in only 56 years. Scary enough but why stop at 80 million? How long till we are the poulation of China. Five doublings from 80 million to 1,280,000,000 would only take another 70 years at 5% PA!!. Why would you want such a thing? 

I believe that elderly people suport Winston because they remember the Wine Box. Have you forgotten?
Winstone is a prick because he suports the elderly while Peter Dunn is great because he supported asset sales. Well i havent heard you complain about others.. Me, i hate the lot of them, they are all self serving @#$#@

Mike B: You should have a look on todays Top10 at the video about Nigel Farage at the EURO zone parliament. Ask yourself which NZ member of parliament has the courage to get up and do what he does. NZ should get him down on secondment to teach a few lessons. Don't you think Winston comes close to him?

Do we really need more people? Contrast the fortunes of the UK and Norway. Similar sized countries that had similar sized oil and gas reserves. Norway's 4 million population is now the worlds wealthiest with a massive sovereign wealth fund built on fossil fuel receipts. The UK (65 million) is now an oil importer and the most indebted country in the world with public and private sector debt at over 500% of GDP.
A lesson there M Coote?
Take a look at the structure of the modern workforce. The vast bulk of the economy is services and Government. Our food - fuel - materials - manufacturing  sectors are using fewer and fewer of us (peak oil may change this) The rest of the economy is basically fluff: dog groomers, social workers - that sort of thing - and on a truly monumental scale 70% + by some measures. More workers; not required.
Excellent article on changes in the workforce and peak employment. 
Is it really going to bring us into poverty if some of the dog groomers become adult nappy changers instead?

There is little point in encouraging "the young, hardworking people" to come to New Zealand if there isn't work for them to do. It's the old problem, successive governments have failed to plan and encourage firms to set up here and as a consequence our young hardworking people have been leaving these shores to find work overseas for as long as I can remember. There is easily 1 million Kiwis spread across the globe doing worthwhile well paid work that NZ failed to provide.  
What is of most concern is why NZer's in work are leaving in such large numbers to work in Australia. Have the government done any studies as to why we are losing skilled workers and how many are new immigrants themselves using NZ as gateway into Aus?
Selective immigration is a good thing but first of all someone has to do a survey and find out what skills we are short of. There is no point following the UK's flawed policy of allowing in unlimited numbers of Indian software engineers when British engineers are on benefit. There is also something obscene about encouraging young graduates to come here when our own graduates are having to fill shelves in supermarkets.

“Among policy and analytical circles in New Zealand there is a pretty high degree of enthusiasm for high levels of immigration. Some of that stems from the insights of literature on increasing returns to scale. Whatever the general global story, the actual productivity track record here in the wake of very strong inward migration is poor. In an Australian context, the Productivity Commission – hardly a hot-bed of xenophobia or populism – concluded that any benefits from migration to Australia were captured by migrants and there were few or no discernible economic benefits to Australians. And that was in a country already rich and successful and with materially higher national saving and domestic investment rates than those in NZ.”
Government policies blamed for house prices
“Immigration and tax breaks for investment in residential property are being cited as the underlying causes of steep increases in the cost of housing over the past decade.
New Zealand now boasts one of the highest rates of home unaffordability in the world as a result of prices rising far faster than incomes, and the government’s Savings Working Group blames that squarely on the policies of successive governments.
Although “the favourable tax treatment of property investment” accounted for about 50% of house price increases between 2001 and 2007, the working group said, there was also strong evidence that rapid swings in immigration brought about price-rise “shocks”.
There was a sharp spike in immigration in 2001, 2002 and 2003 and, said working group committee member Dr Andrew Coleman, it appeared that property prices did not fall anywhere near as greatly when immigration fell again.
The report added that there was little evidence that immigration boosted local incomes. In fact, the need to build roads and schools meant that net migration contributed to the national deficit. ”

The theory of scale resulting from more immigration is a lie.
Latest technologies that allow for reduction of the "tyranny of distance" to be utilised can only help NZ without adding people.

Wait, wait wait. Wait!
How could importing more people here possibly help when we don't have NEARLY enough jobs for the people who already live here to do?
Why has nobody else mentioned this? Am I missing something here? 

Yes you are missing something, to quote the Paddington bear books, 'Never mind, the bear will do it cheaper, cough, I mean better'.

It sonded likeMr Coote was arguin that we needed more people to increase GDP such that the tax take was sufficient to pay superannuation. I don't see how lower wages contributes to that.

I am sure Mr Coote will be writing a full retraction when he see's the mistake in his thesis.

Gidday NZ
NZ is a very small country which is borrowing 10 billion a year more than it earns.
50 years ago NZ needed working people with skills.They did not advertise for large groups off people who had no money,bad health,no skills,no money.
Time limits an work for the welfare,get everybody doing something worth while.
Our growth areas are building bigger jails.bigger hospitals,more state housing for people who have no money an will never work.A bottle store an P lab on every corner,
NZ is running out of I O U 's,
We have 1 million people doing nothing now
NZ will be digging holes,building fish farms,growing everything that you can eat.
building the roads,keeping NZ clean.
Pandering to the bottom is clearly not working.
We have to give young smart working tax payers a reason to stay in this country.
The Germans master plan for NZ ,was to have all the natives growing trees an food to feed there army.
60 years later NZ will have full employment again.
NZ has to repay CHINA with food,water,fish,meat,produce,minerals,timber
Everybody is busy an happy again