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The Australian government has missed the boat on refugees

By Jason Falinski and Greg Barns - posted Tuesday, 15 May 2001

The neo-liberal Economist and the leftist English newspaper The Guardian don't have a lot in common. But they both, in recent weeks, have argued that the economic case for freeing up the borders of countries like ours to people just as we have freed up our borders to capital, goods and ideas is compelling.

But judging by Immigration Minister Philip Ruddock's comments yesterday, the Australian Government is taking a very different view.

Ruddock is apparently preparing legislation to tighten the definition of who is a refugee. He's angered by what he believes is the courts' liberal approach in such cases.


One of the impacts of globalisation is the freeing up of borders and better communications. An outcome of this is that desperate and anguished people will seek to move to areas of the world where their economic and social prospects are even a marginal improvement on their current lot in life.

If, however, Australia's political leaders feel that it's easier to pander to the xenophobic tendencies of some in our community by expelling "illegal" migrants in vast numbers, or loading the judicial dice to ensure the sick, the old and the ailing have one more hurdle to jump before being allowed to stay here, then they are doing our nation a disservice and damaging our long-term economic and social interests.

Australia's economic relevance to international capital, and thus investment and jobs, is on the line at the moment. We're too small, and of limited strategic importance, for international investors.

Consumer savings have been increasing exponentially over the past decade or so as mostly US baby boomers begin to save for their retirement. Their savings have been managed in a variety of ways, but mostly through mutual funds. As these funds have grown, and fund managers have sought to save costs and send a greater percentage of returns back to investors, their capacity to make investments in smaller economies has shrunk.

Put another way, they have a choice of investing in 10 $100 million deals or a hundred $10 million deals. They simply don't have the management bandwidth to make the latter choice. In this investment environment countries like Australia, with limited investment options, lose out.

As one fund manager, Partnership Planning's Lynne Curtis, put it in this newspaper recently: "Separate regional markets are moving into one global market - and there are few truly global businesses in Australia to attract the attention of global fund managers."


There are some who argue that there are plenty of countries whose economies are not much larger than ours who thrive. While this is true it's always the case that these countries are part of large trading blocs such as the European Union or NAFTA. Or they neighbour large and growing economies. Australia has one active free trade agreement with New Zealand.

Some argue that the environment would suffer if we increased our population substantially. This argument reflects the fact that economic and environmental policies should be more closely integrated than is currently the case. As a community we should examine energy market-based incentives such as carbon credits or fuel pricing, water conservation and land use in a way that meshes the twin objectives of a major increase in population and a sustainable natural environment.

Then the doomsayers will throw up the social dislocation argument: that increasing immigration creates unemployment, ghettos and strains social cohesion. None of these arguments has held up over time.

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This article was first published in the Australian Financial Review on Tuesday 8th May, 2001.

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About the Authors

Jason Falinski is managing director of CareWell a provider of furniture and equipment to the health sector, and a former national president of the Young Liberal Movement.

Greg Barns is National President of the Australian Lawyers Alliance.

Other articles by these Authors

All articles by Jason Falinski
All articles by Greg Barns
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