Chris Smith:
Adam Creighton is senior fellow and chief economist with the Institute of Public Affairs, columnist, too, with the Australian newspaper. Adam, good morning.
Adam Creighton:
Good morning, Chris.
Chris Smith:
There’s a stack to talk about. I’ll tell you what I’ll do. A question without notice to start, I was very interested to see what the commissioner, the EU Chief, Ursula von der Leyen, has said about Canada. She wants Canada to become the EU’s first associate member, whatever that means. And this is because Canada has been looking at second tier nations to deal with in terms of trade because Canada and the United States are at war at the moment over trade.
But then this morning, only about an hour ago, I was watching Donald Trump in North Carolina on the tarmac, and he had something to say. He thought it was laughable, but then he issued a threat to the EU. Have a listen.
Donald Trump:
No, I think it’s laughable. Look, the whole thing with Canada. Canada’s been a terrible trade partner and I don’t see that. And if they do that, if I think it’s at all a hostile act, I will put very serious tariffs or stop trading with Europe.
Chris Smith:
Stop trading with Europe.
Adam Creighton:
Yeah. Well, look, the threat has not surprised me, but you’ve got to take this threat seriously. I mean, Trump’s already put very serious tariffs on many, many countries. I think Australia got the lowest of all from the US. But yeah.
Chris Smith:
Anything’s possible with DJ Trump.
Adam Creighton:
Yeah. Well, look, I think it is somewhat laughable. The Canadian economy, as I’ve written numerous times this year, I mean they’ve started to see the light and cut their immigration, but they’ve had the worst economic performance basically of any Western country over the last 10 years. It’s been even worse than Australia’s per person, actually.
They’re starting to turn it around, so I really don’t see… As for the EU as a share of global GDP, it’s shrunk from a third to a quarter. I think it’s almost about a fifth now. Of course, it’s a beautiful area to visit Europe, but in terms of its economic importance, it’s shrinking all the time. And the US is growing still. Its population’s growing, that’s where all the innovation is. It’s about the only Western country left where the ideological mindset is not that the government should control everything.
Chris Smith:
Another space to watch very carefully. Now, both the coalition and One Nation beat the government to the punch, but finally, after a lot of toing and froing within cabinet, Minister Tony Burke will unveil the government’s migration mud map at midday today. A reset of policy that’s become an open door joke. Some sensible measures from what we have heard might be part of the plan, but they won’t go as far as the coalition or One Nation, will they?
Adam Creighton:
No, they certainly won’t. And from what I’ve been reading, these are not significant changes at all. I’m just reading the ABC article now and apparently the big plan is to reduce new overseas migration from 300,000 where it roughly is now to 225,000 by 2028.
Well, look, that’s just the current forecast in the budget more or less, maybe plus or minus 10,000, but it’s just a tiny change. And it’s extraordinary that they seem to be going to do this or make the reductions by reducing our working holiday makers and backpackers and this sort of thing. They’re not going to touch, as I understand it, or at least certainly not to the extent of One Nation. They’re not going to affect the visa mill, which is the higher education sector.
It’s just a permanent residency mill, and this is the big problem, but they’re not going to touch that and it’s pretty obvious why is because they’re massively ideologically in tune with the university sector. That’s what produces all these supporters and they need as many people in there as possible. So I think that One Nation would be reading these reports this morning thinking, “This is fantastic news for us. Please, let’s hope this is the actual policy.”
Chris Smith:
Yeah, it’s not a haircut. It’s a trim.
Adam Creighton:
Exactly. It’s barely even that. 225,000 is still well over double what it was in the final years of the Howard government. It’s about triple or even quadruple what it was in the Hawke-Keating years. And even at that level, it would still give Australia the highest net overseas immigration pretty much as a share of the population in a developed world.
Chris Smith:
Yeah. The Australian newspaper, I tell you what, doing a really good job exposing the WA government and WA bureaucrats on this indigenous kid scandal, which has seen abused children return to their family homes, including one instance where they were later killed. Aboriginal elder Doris Eaton, what a champion she is. She says the following, “This is not another stolen generation. That was kids being taken from good parents. This is different,” she says, “We need to take neglected and abused kids away from bad parents.” Dead right.
Adam Creighton:
Yeah, look, she is. And I think these community services departments that oversee the policies of taking children away, they have reverse racism if you like. I mean, if the kids were white and the situation was the same, I have no doubt they’d be taken away for probably less crime and transgressions. But because they’re Aboriginal, they have to stay there because there can’t be any whiff, even the slightest whiff of so-called stolen generation. And so these tragedies unfold every week.
The Australian has done a terrific job, but I bet that’s just the tip of the iceberg. I mean, that’s just it would be far worse even than that. And it’s fantastic that this Aboriginal lady has been speaking out so candidly and honestly because they know, they’re there at the coal face of all of this and they know the policy must change. But it’s going to be hard because that would be an admission that the past 20 years of all this ideological nonsense has been wrong.
Chris Smith:
Yeah. Full points to Doris. Go, Doris. Now, former Victorian premier Jeff Kennett stuck his head into this debate about state debt and we know how chronic that debt is in Victoria. He says, “There’s only one solution, tough love.” But Adam, is tough love a vote winner?
Adam Creighton:
Well, look, I think as I pointed out, you don’t actually have to get too tough to fix up Victoria. I mean, if you just cut spending by a bit, certainly not increase taxation, you can actually turn the state around over 10 years or so. There doesn’t need to be anything too drastic actually, just some sensible decisions.
I mean, Jeff, as I understand it, he thinks that you need to impose some sort of household debt levy or something like that, but I would counsel very heavily against that in Victoria. I mean, the state is already the most taxed by far in the nation, six or 7% more than the other states. And I don’t think proposing more tax, if that’s what he’s proposing in any way, whatever you call it, if it’s more tax, I don’t think the state can handle it. On the contrary, I think taxes need to be cut quite a lot in Victoria.
But spending. I mean, according to the grants commission that divvies up the GST, I mean, Victoria spends seven and a half billion dollars a year more than it needs to, to provide the same level of services as all the other states. So therefore you can cut spending by $7 billion a year and not actually affect the quality of anything really-
Chris Smith:
Of course.
Adam Creighton:
… except the headcount in the bureaucracy, which I must add, it’s 393,000 now. I thought it was funny, the Victorian Trades Hall Council, the union movement was fear-mongering about a 30,000 cut that the liberals would supposedly enact. And I tweeted back, I said, ” Well, that just brings the public service back to 2023 levels,” which is really not that scary.
Chris Smith:
No.
Adam Creighton:
So that’s just how fast it’s grown under Labour.
Chris Smith:
Unbelievable.
Adam Creighton:
Basically got to freeze public sector hiring, freeze the crazy wage growth in the public sector, and just a bit of trimming here and there, and you’ll be producing cash surpluses. It really shouldn’t be that hard.
Chris Smith:
And you know what happens when we increase the public service and the bill increases, and you know what happens when we spend like drunken fools, and you know what happens when we have lack of productivity. Our living standards crash. And here is a classic example. The superannuation industry claims today that older Australians are losing out more from this cost of living crisis. The association says, “Couples who own their own home now need almost $80,000 a year, 1,513 a week for a comfortable retirement.” That’s close enough to $730,000 when they retire. You see, this is what happens when living standards crash, Adam.
Adam Creighton:
Yeah, certainly that’s true. I mean, the price increases particularly affect people who are living on fixed incomes or who don’t have the opportunity to go back into the workforce to make up for their savings. They’re certainly hit the most by inflation and they should be the most concerned about this inflation crisis that Australia is currently in.
But I’m always wary of the super sector when they release things because really they’re just thinking of themselves and they want more money in their funds. They are horrified at the thought of even 3% of the compulsory 12 being an option. Just an option, not diversing in the wages. And in my view is 12% is more than enough. No one’s even had 12% yet for their entire working life. And we’re already seeing that people in retirement, some people who’ve had nine or 10% for their whole lives basically have huge sums of money and they would’ve been better off having it when they were younger and raising their families.
At least that’s my view. People can debate that, but there’s a cost of living crisis now. And it’s quite right that people would want to have their funds now to face those challenges.
Chris Smith:
I think you’re spot on. And I think if it was explained like you explain it by our politicians or even opposition, I think the public would come on board. Adam Creighton, great to have you on the programme. Thank you, mate.
Adam Creighton:
Thanks very much, Chris.
Chris Smith:
Good on you. Let’s go to Ross-
This transcript with Adam Creighton talking on Mornings – 2SM from 17 September 2026 has been edited for clarity.
