By Pip Hinman and Jennifer Thompson
Coming in the wake of Pauline Hanson's strident anti-Asian views, the government's decision to cut the family reunion program — a move which will largely affect Asian migrants — reveals, once again, PM John Howard's willingness to play the racist card.
While Howard and Hanson jostle to be credited with this latest racist attack, the truth is that Howard has long regarded anti-Asian racism as politically useful if not flaunted too openly.
It shouldn't be forgotten that Howard's 1988 "One Australia" policy — which is reminiscent of Hanson's One Nation — specifically called for cuts to Asian immigration. Hanson, with her more blatant racist refrains, has provided Howard with a wider political space for his own racist agenda.
Officially, Howard's reason for the 6000 cut to immigration announced in the last fortnight — following a cut last year of 8500 — is that immigration and continuing high unemployment are linked — a claim echoed by immigration minister Philip Ruddock.
A year ago, Ruddock was saying that immigrants might create more jobs than they fill, but consistency and cabinet positions seldom go together.
Howard is again using the same phoney economic argument, but his motives are political. He needs to find scapegoats for his government's neo-liberal austerity program, and migrants — and Aborigines — fit the bill.
After years of Labor and now Coalition government cuts to immigration — ostensibly to hold down the unemployment figures — many people have accepted the argument that migrants take the jobs Australians would otherwise have.
This, as many studies have pointed out, is a lie. But it is a convenient one when the unemployment queues are becoming longer, allowing governments to escape blame for their economic policies.
Nevertheless, it is easy to understand why immigration does not increase unemployment. While migrant workers of course look for jobs, they and their families also eat, wear clothes, live in houses, drive cars and, in general, buy the same quantities of goods as Australian-born workers. So, to the same extent they increase the size of the work force, migrants increase the demand for goods and hence the number of jobs.
A wealth of detailed studies measuring the effects of immigration confirm this reasoning.
Published in November, William Foster's Immigration and the Australian Economy summarises the findings of more than 200 studies of the measured effects of immigration on various aspects of the economy, undertaken between the late '70s and the mid-'90s. The report was commissioned by the Bureau of Immigration, Multicultural and Population Research.
Foster's executive summary notes that rather than having a negative effect on unemployment, immigration may have had "a marginally favourable effect on the aggregate unemployment rate, even in recession".
While immigration expanded the Australian economy, average income, inflation, the current account deficit and the rate of unemployment were largely unaffected by immigration, he told the Australian last week. If you had to say anything, he said, "It would be mildly positive rather than mildly negative".
Others, including IBIS Business Information's Phil Ruthven, writing in the Financial Review (October 14), put the "accepted truth" at four new jobs created in the first four years after an immigrant family enters the country.
The net effect of immigration is based on a complex interaction of the demand for products and services and the supply of labour, capital and private savings that migrants contribute to the economy. It is the combination of all these factors, measured in the economic studies canvassed by Foster that produces the overall positive effect, including on the budget and employment.
Foster's executive summary also points out that migrants aren't — contrary to the government's propaganda — disproportionate users of social security or health services, although migration contributes to a higher per capita demand for education.
A "clear and important conclusion" from this work, wrote Foster, is that increased immigration cannot be associated with an increased unemployment rate, and that several studies suggested that immigration had led to a lower unemployment rate than otherwise.
"The additional employment generated by immigration's demand-side effects has evidently at least matched the addition to labour supply arising from the increase in population."
The Australian's economics editor, Alan Wood, pointed out on May 27, that the "connection" between unemployment and immigration is the reverse of that assumed by opponents of immigration.
When unemployment is low, immigration is high because governments encourage it in order to meet the demand for labour. When unemployment is high, immigration is low because governments restrict it.
Wood goes on to give some indication of why the immigration-causes-unemployment lie can be so useful for the business class. He says the only "respectable" economic argument for a smaller immigration program is that it can be used as a trade-off, in return for which the working class can be persuaded to accept structural reform of the labour market.
If Howard can be seen to be "doing something" about unemployment — like reducing immigration — then he can more easily dismantle the award system, cut the minimum wage and slash unemployment benefits.
Meanwhile, the Labor opposition can hardly claim the high moral ground. Shadow immigration spokesperson Duncan Kerr admitted on an SBS Dateline program that he did not accept that there was a link between immigration and unemployment. But, he said, the public perceived that there was, and so the government's cut was probably necessary!
When asked if he supported the cut, Kim Beazley admitted that Labor in office had been steadily reducing the migrant intake, "so we can scarcely complain about it".
Labor, in government, was largely responsible for generating the perception that migrants cost jobs, a racist fiction that Howard is now capitalising on. The 1988 FitzGerald report, which recommended an almost exclusive focus on skilled migration and cuts to other categories so as not to "burden" the economy, remains the key guide for the present government.