There is something peculiar about the Australian immigration debate. We hold elections over tax cuts, electricity prices, Medicare and relatively minor changes to industrial relations. Yet one of the largest decisions a government can make: how rapidly the country's population should grow, tends to disappear into Treasury forecasts, visa categories and bureaucratic assumptions.

That is the important argument buried beneath the considerably more colourful language of Stephen Saunders's latest Macrobusiness essay. The question is not whether immigration is intrinsically good or bad. Australia has been an immigration country throughout its modern history, and migrants have made enormous contributions to it, blah, blah. So have the Anglo-Australians. The question is one of scale, consequences and democratic consent.

Australia's population stood at 27.92 million at the end of March 2026. In the preceding twelve months it increased by 392,700 people. Net overseas migration accounted for 292,100 of that increase.

Those are Australian Bureau of Statistics figures, not numbers produced by immigration critics. Migration has certainly declined from the extraordinary post-COVID peak. Net overseas migration reached 538,000 in 2022–23 and fell to 306,000 in 2024–25. The government can therefore legitimately say that migration is coming down.

But "coming down" and "low" are two entirely different propositions. The Centre for Population forecast net overseas migration of 260,000 for 2025–26. The government says population growth should slow and argues that it has strengthened migration settings. That still leaves the larger question unanswered: what population does Australia actually want?

The contrast with the first Intergenerational Report is extraordinary. When Treasury produced the original report in 2002, it assumed net overseas migration of about 90,000 people annually. Treasury's own retrospective account says that actual net migration between June 2002 and June 2022 instead averaged about 200,000 annually.

The consequence was substantial. The first IGR expected Australia to reach 25.3 million people in 2042. Australia passed that figure more than two decades early, in 2018–19. Treasury explicitly identifies higher migration as the primary reason Australia became larger and younger than the first IGR anticipated.

The 2023 Intergenerational Report consequently envisaged an Australia of 40.5 million people by 2062–63. That is roughly fourteen million more people than Australia had when that report was prepared. It will be a vast under-estimate given the present Great White Replacement.

The new 2026 Intergenerational Report extends Treasury's horizon to 2065–66. Treasurer Jim Chalmers presents that document positively: Australians are projected to live longer, have higher incomes and enjoy more secure retirements, while the economy is projected to become more than twice its present size.

Every additional person requires somewhere to live. They use roads, public transport, hospitals, schools, electricity, water and other infrastructure. When population expands faster than the capital stock required to support it, congestion and scarcity can increase even while aggregate GDP rises.

This is where the distinction between GDP and GDP per person becomes crucial. A country can produce a larger economy simply because it contains more workers and consumers. That does not necessarily mean the existing population has become proportionately richer. A government therefore cannot establish that a rapid population increase has improved Australians' welfare merely by pointing to aggregate economic growth.

Housing provides the most obvious illustration. Migration did not create Australia's planning restrictions, infrastructure bottlenecks, construction costs or chronic failure to build enough dwellings. Those problems existed independently. But adding hundreds of thousands of people annually necessarily adds to housing demand. Whether that produces higher rents and prices depends upon how rapidly supply responds. When supply cannot respond rapidly, the arithmetic becomes uncomfortable.

The democratic issue is deeper still. Treasury projections are not laws. No Parliament has legislated that Australia must have 40 million people, and an Intergenerational Report cannot bind governments decades into the future. Treasury itself has acknowledged that actual migration outcomes depend upon future government policies and economic conditions.

That qualification matters, but it also raises the central question. If a population trajectory depends upon continuing particular migration settings year after year, those settings should be understood as political choices rather than demographic weather.

A population increase of ten or fifteen million people changes more than GDP. It changes cities, housing density, infrastructure requirements, environmental pressures, water demand, labour markets and ultimately the character of communities. People may reasonably favour those changes, and people may reasonably oppose them. What is harder to defend is pretending that no choice is being made.

There is also something revealing about the history of the Intergenerational Reports themselves. In 2002 Treasury contemplated net migration of 90,000 annually. By the 2023 report, the long-run assumption was 235,000. Treasury explained that migration had accounted for more than 60 per cent of Australian population growth during the preceding decade.

That is not a minor adjustment to an economic model. It represents a profoundly different demographic future. The economic case for it should therefore have to meet a demanding test.

How much does it increase GDP per person? What happens to real wages? How much additional housing must be constructed? What infrastructure investment is required merely to prevent existing service levels deteriorating? What happens to land prices? What are the environmental and water implications? And what level of immigration maximises Australians' welfare rather than simply maximising the size of Australia's economy?

Those questions are considerably more useful than shouting "racist" at people who want lower immigration The disagreement is fundamentally about numbers. Of course, it is too uncomfortable to consider the ethno-racial changes immigration brings, and anyway, no doubt such thoughts will be illegal soon.

Even the ageing argument needs careful treatment. Immigration can make the population insignificantly younger, but migrants themselves eventually grow old. Maintaining a permanently younger age structure through migration can therefore require continuing inflows rather than providing a once-and-for-all solution to ageing.

Treasury itself says population ageing will continue despite migration. The 2023 IGR projected the proportion aged 65 and above rising to 23.4 per cent by 2062–63. Migration moderates ageing. It does not abolish it.

Australia consequently faces a choice that should be stated plainly. One model seeks a continually larger population, using substantial immigration partly to expand the workforce and moderate demographic ageing, while accepting the requirement for enormous continuing investment in housing and infrastructure. Another would accept slower population growth and place correspondingly greater emphasis upon productivity, capital investment, participation, technology and adapting government finances to an older population.

The democratic objection raised by Macrobusiness is sound: Australians should know which future their governments are pursuing.

A country approaching 30 million people and contemplating something around 40 million within several decades is making one of the largest decisions imaginable about its future. That decision should not be disguised as an assumption in an economic spreadsheet.

Treasury can model Australia's future. Economists can calculate its costs and benefits. Business groups, unions, universities and migration advocates can argue their cases, and immigration critics can argue theirs.

But ultimately the question "How big should Australia become?" is not merely an economic question. It is a democratic one. And on a decision capable of changing Australia for generations, the Australian public deserves something considerably more substantial than being told that the numbers are simply what Treasury assumes. Those who do not want to see Australia cease to be part of Western civilisation, becoming a colony of China or India, need to get politically active, now.

https://www.macrobusiness.com.au/2026/09/treasurys-massive-intergenerational-immigration-crushes-democracy/