Lambert here: Angela Nagle’s article has gotten traction in unexpected places.

By Houses and Holes, who edits MacroBusiness. Originally published in Macrobusiness.

Here is what Crikey’s Bernard Keane wrote last week on immigration:

The same policy breakdown that has occurred in other areas of neoliberal policymaking is now occurring on immigration. It’s generating the same response as in other areas. And it has the same causes. Rinse, repeat. Scott Morrison, who only a matter of months ago was an ardent defender of high immigration, now wants to cut it. The PM says he has heard the complaints of residents of Sydney and Melbourne about congestion and access to services and housing. Ironically, 38% of people in Sydney and 35% of people in Melbourne were born overseas, so more than a third of this alleged problem are drawbridge migrants whingeing about people who arrived after them. As people with expertise in immigration, like former senior public servant Abul Rizvi point out, cutting permanent migration by 30,000, as Morrison proposes, isn’t going to do jack when every year we have hundreds of thousands of foreign students crowding into our cities, pushing up demand for housing and using infrastructure and services. Not that the government would touch the sacred cow of education exports. We’ve traded away a major chunk of the academic quality and intellectual rigour of our higher education system because we prefer to dumb it down to attract foreign students rather than adequately fund it from taxpayer resources (foreign students also make a great resource for exploitation by unscrupulous employers, as we’ve seen time and again). Business is appalled at the government’s turn against immigration too. After all, immigration increases demand and the supply of labour, enabling business to maintain wage stagnation and undermine unions. But it was appalled about the royal commission, and the bank tax, and the government’s gas policy, and its energy regulation, and every other shift by the government to acknowledge the deep electoral discontent about an economic system that works great for corporations, but poorly for workers. For once, however, the blame rests only partly with business itself. It was business that created the backlash against banks and power companies with its own behaviour — but most of the fault lies with governments, and well beyond decisions made in the immigration and education portfolios. It was state and local governments that for so long stymied property development in Sydney and Melbourne, preferring to give in to NIMBYism than to display some foresight in permitting higher density housing around established infrastructure and economic opportunities. It is the Commonwealth which fuels property investment and speculation with the taxpayer-funded “excesses” — Scott Morrison’s own word — of negative gearing, something Joe Hockey urged Parliament to fix when he left it. It is state governments that have failed to properly manage transport infrastructure until recently, but they still refuse to countenance congestion pricing. It was this government that promised a serious study of congestion pricing before abandoning it in fear of what voters might think. It is state governments and territory governments (apart from the ACT) that have resisted a shift from stamp duty to land taxes. It is the Commonwealth that dumped Joe Hockey’s successful asset recycling program that encouraged infrastructure investment by states. Business, too, is complicit — the community will inevitably find more congestion, higher housing prices and poorer access to services more difficult to stomach if they are receiving none of the benefits of the economic growth that immigration is supposed to provide — like higher real wages. But government is the main culprit. None of these issues are easy. Immigration isn’t merely about turning a tap of people on and off — it’s an intersection of infrastructure, taxation, development, education, health and public spending policies across all three levels of government, and all three levels have failed in Sydney and Melbourne, to varying degrees, over the last decade. Instead of trying to fix the failures, and encourage what has worked, Scott Morrison has taken the easy option. Like Commonwealth, state and local politicians of all stripes have taken the easy option before him. We’ve been governed by people who have failed at the challenge of solving difficult but manageable problems, and we still are.

And here’s what he wrote on wages:

In contrast to its constant railing against unions and the CFMMEU, the government is almost completely silent on the issue of wage theft. A union official only has to jaywalk for a minister to condemn their lawbreaking and link Bill Shorten to it. But literally industrial-scale wage theft by business gets nary a mention from the government. Last year, government senators dissented from a Senate committee report examining wage theft and superannuation non-payment and failed to mention the issue at all, instead attacking — you guessed it — the CFMMEU and accusing Labor of allowing unions to abuse Senate committee processes. In 2018 alone, the Fair Work Ombudsman has issued 76 media releases about separate cases of underpayment by employers, including repeated mass audits that have found massive levels of underpayment. Right now, the FWO is conducting a mass audit of 600 businesses in the Northern Rivers region of NSW. This week the FWO also revealed the result of another mass audit of 638 businesses in the farming sector along the Harvest Trail, uncovering widespread underpayment of workers and over half of businesses breaching workplace laws. As so often happens with underpayment, the victims were often migrants, people of non-English speaking background, or students, who are more isolated, struggle to communicate and can be threatened with deportation if they complain. “The inquiry found that almost 70 per cent of harvest trail businesses employed visa holders. Working holiday subclass 417 visa holders (aged 18-31 years old) were the most common migrant workers on the trail,” the FWO said. Perhaps that’s also why the Coalition doesn’t care that much about wages theft, as well? This is Coalition heartland — the agricultural sector that so often has its hand out for government assistance when times get tough — even while exploiting previous schemes designed to help them when times get tough. Perhaps the government could make it a condition of drought relief that anyone found to have underpaid workers is automatically disqualified from receiving it? Or, given the massive scale of wage theft, would that knock off too many recipients? Wage theft doesn’t directly affect wage growth indices like the Wage Price Index, which is compiled by surveying employers, not employees. But it affects wages more generally: if employers can get away with underpaying workers — foreign or not — then it puts additional downward pressure on wages elsewhere in the sector and, indirectly, across the broader economy. And the tens of millions — perhaps more — that employers underpay each year usually comes from the pay packets of the lowest-income workers, who spend a far higher proportion of their income than the rest of us. Wage theft undercuts demand as well as wage levels.

This is a classic case of Australia’s Fake Left media attitude to the mass immigration growth model. Mass immigration is directly responsible for the plague of wage theft:

Yet, ‘useful idiots’ across the leftist media constantly argue contradictory positions in defense of both wages and immigration without blinking an eye. Low wages are not a bug in this system, they are feature of it. The immigration-led growth model guarantees wage theft by relying implicitly upon a permanent supply shock that guarantees labour oversupply and by importing more exploitative attitudes to class within ethnic groups.

Angela Nagle has published a superb analysis of why the globalist (‘Fake’) Left supports extreme immigration in spite of the problems it causes the poor. From the American Affairs Journal:

The transformation of open borders into a “Left” position is a very new phenomenon and runs counter to the history of the organized Left in fundamental ways. Open borders has long been a rallying cry of the business and free market Right… There is no getting around the fact that the power of unions relies by definition on their ability to restrict and withdraw the supply of labor, which becomes impossible if an entire workforce can be easily and cheaply replaced. Open borders and mass immigration are a victory for the bosses. And the bosses almost universally support it… Today’s well-intentioned activists have become the useful idiots of big business. With their adoption of “open borders” advocacy—and a fierce moral absolutism that regards any limit to migration as an unspeakable evil—any criticism of the exploitative system of mass migration is effectively dismissed as blasphemy. Even solidly leftist politicians, like Bernie Sanders in the United States and Jeremy Corbyn in the United Kingdom, are accused of “nativism” by critics if they recognize the legitimacy of borders or migration restriction at any point. This open borders radicalism ultimately benefits the elites within the most powerful countries in the world, further disempowers organized labor, robs the developing world of desperately needed professionals, and turns workers against workers… The importation of low-paid labor is a tool of oppression that divides workers and benefits those in power… It has now become a common slogan among advocates of open borders—and many mainstream commentators—that“there is no migrant crisis.” But whether they like it or not, radically transformative levels of mass migration are unpopular across every section of society and throughout the world. And the people among whom it is unpopular, the citizenry, have the right to vote. Thus migration increasingly presents a crisis that is fundamental to democracy. Any political party wishing to govern will either have to accept the will of the people, or it will have to repress dissent in order to impose the open borders agenda. Many on the libertarian Left are among the most aggressive advocates of the latter. And for what? To provide moral cover for exploitation? To ensure that left-wing parties that could actually address any of these issues at a deeper international level remain out of power?.. There are many economic pros and cons to high immigration, but it is more likely to negatively impact low-skilled and low-paid native workers while benefiting wealthier native workers and the corporate sector… Mass migration… creates a race to the bottom for workers in wealthy countries and a brain drain in poor ones… Immigration policies should be designed to ensure that the bargaining power of workers is not significantly imperiled. This is especially true in times of wage stagnation, weak unions, and massive inequality… By providing inadvertent cover for the ruling elite’s business interests, the Left risks a significant existential crisis, as more and more ordinary people defect to far-right parties. At this moment of crisis, the stakes are too high to keep getting it wrong.

I couldn’t have said it better myself.

Australia has run a fifteen year experiment in mass immigration and labour markets – across multiple business cycles, Labor and Liberal regimes – and the empirical results are in. You can run mass immigration during a boom from an exogenous source to contain wage growth but if mass immigration is itself the primary growth driver then it crushes output per share:





And makes it impossible for wages growth without taking profit share from capital which is self-defeating:





Furthermore, by abandoning the working classes, youth and environment for open borders the Fake Left risks breeding hatred and contempt from the working classes, pushing them toward right-wing parties, and placing at risk the multicultural consensus.

The Fake Left would do well to take a leaf out of Bernie Sanders playbook and rethink their advocacy of ‘open borders’, which is playing directly into the hands of the capitalist elites that they supposedly oppose.