There are many reasoned arguments as to why immigration is good for the economy and good for the country. Without wishing to dismiss those arguments there is however a sense in which letting foreigners into the country is akin to giving away our sovereignty. Let me explain.
Australia is a vast nation with lots of land. For the purposes of this discussion I’m going to assume that large tracts of it are currently worth next to nothing. For example if a million illegal immigrants secretly arrived tomorrow, secretly set up camp in the Simpson desert and then secretly did their own thing there for the next 50 years or so, it is not as if we would feel deprived of the land they occupied. The reality is that we are not using lots of our land.
Some of our land however is extremely valuable and this tends to be land in cities where there is a high amount of established public infrastructure. Libertarians will at times argue that some of this public infrastructure should be privatised or even given away to Australian citizens. However they would not generally argue that ownership of this infrastructure should be given as a gift to foreigners. Given that public infrastructure is essentially owned by the Australia people, via our sovereign government, any admission of additional new Australians represents a dilution of our equity in this stock of public infrastructure. Of course in such a vast land we have the capacity to build new cities with additional public infrastructure but none the less any admission of new Australians represents a dilution of our equity in the current stock.
According to chart 4b on page 7 from the following Treasury article the stock of public infrastructure in Australia is worth in the order of 50% of our annual GDP. According to Wikipedia our GDP per capita is currently $41,300 which suggests that on a per capita basis our public infrastructure is worth around $20,650. At the margin this is the amount of equity in public infrastructure that is given away each time an immigrant is admitted into the country.
This dilution of equity does not occur with private infrastructural, such as housing, because private infrastructure is not owned collectively by all Australians. It is owned individually and privately. An immigrant that moves to Australia may get to use the same footpath you use but they don’t get to use part of your house.
This dilution of equity situation is akin to a company that gives away shares for free. The new shareholders get a stake in the collective assets of the company and the existing shareholders find their stake diluted. For this reason companies don’t generally issue new shares for free. They expect new shareholders to contribute new equity so that existing shareholders do not see the value of their holding diluted.
Following on from the above analogy an argument can be made that immigrants should be blocked from coming to Australia unless they either move to the Simpson desert and live quietly with no expectation of infrastructure, or else they live amoung us but pay a contribution towards expanding the stock of public infrastructure. In essence this arguments says immigrants to Australia shouldn’t be let in for free but should instead pay an immigration tariff of $20,650 each toward collective public infrastructure.
Assuming immigrants pay this fee there really is no problem with any realistically conceivably rate of immigration. If the rate is very high we will have the funds to build the infrastructure for the new cities required. An immigration tariff would be more fair to existing Australians.
The conclusion to this argument isn’t new. On this site I have previously argued for an immigration tariff however on the basis of rather different reasoning. Whilst the conclusion in both cases is the same the argument is none the less different. Of course I should also mention that an immigration tariff is long standing policy for the Liberal Democrats (LDP).
Should we stop giving our sovereignty away for free?