'If So-and-So Wins, I'm Moving to Australia,' Part II
By P.J. O'Rourke
America is having a frustrating presidential campaign. So a lot of people are saying they're going to move to the far side of the globe "if [reviled candidate] wins."
In the first installment of this column, I explained why my family and I love Australia so much that we really would move there.
But should we move there? And could we move there?
First, Australia is expensive. Australian taxes are high. The marginal rate is 45% for income over $180,000 (approximately US$136,260) a year. Also, the cost of living is 10% higher than in America.
If we're paying with U.S. currency, we can laugh at the Aussies' cost of living. One U.S. dollar is worth $1.32 in Australian dollars. And the high taxes buy Australia an Epcot Center-level of national infrastructure, a well-regarded educational system, a dearth of homeless on the streets, and other things that taxes are supposed to buy in America but never do.
Plus, the high rate of taxation doesn't seem to do the economic damage to Australia that you would expect. Australia made it through the 2008 financial crisis without going into a recession. In fact, Australia hasn't had a recession in 25 years.
Australia's per-capita gross domestic product (GDP) is US$56,324 – about $500 higher than America's. Last year, despite Asia's cooling economies, Australia's GDP grew by 3.1%. Median gross household income in Australia is US$9,000 higher than in America. Australia's inflation rate is 1%, and the unemployment rate is an acceptable 5.7%.
(Maybe the reason Australia can get away with taxing its people so much is that – unlike some countries I could name – it uses the tax money to pay its bills. Australia's national debt is 23.3% of its GDP. America's federal debt is 105.1% of GDP.)
So moving to Australia would be expensive. But just because something is expensive doesn't mean it isn't worth considering. I, for instance, got married and had three children. Money well spent! (Most of the time.)
So should we move to Australia? Maybe. But could we move to Australia?
Australia has a lot of complicated visa rules. And unlike America, Australia has an immigration system that works. Not only is the bureaucracy efficient, but the country is surrounded by the Indian Ocean and the Coral Sea. You can't just wander in through the Great North Woods forest or wade into the Rio Grande, like you can do to get into the U.S. Australia's borders are oceans with breaking waves so big that they make the most resolute surfer consider the kiddy pool and a pair of water wings.
Also, instead of a border wall that may or may not get built, Australia has saltwater crocodiles that grow to a length of more than 20 feet. You have to obey Australia's complicated visa rules.
(Click here to see an efficient bureaucracy being really, really bureaucratic.)
Basically, Australia wants "workers in skilled occupations." All I do for a living is make fun of things. So I'm out on that basis.
You can essentially buy an Australian visa by investing in the country. But you have to make a serious investment. According to a 2015 article in the Financial Times, Australia cracked down on this type of visa because every Asian business person with any worries about the political situation in his or her home country (which is most Asian business people) wanted to "invest" in Australia.
This investment used to mean buying an apartment in Sydney and leaving it empty in case the business person had to make a run for it. Now, Australia requires that $500,000 be deposited in an Australian-run venture-capital or private-equity company and that an additional $1.5 million be invested in "emerging companies."
I have no idea what the Australian definition of an "emerging company" is. It may have to do with lambs being born. Not only do I not have $1.5 million handy, I know nothing about giving birth to sheep.
Of course, there are numerous investment opportunities in Australia that don't involve giving birth to sheep. Well actually, they do involve giving birth to sheep – and other things in that general field of endeavor.
We have an old friend, John, who lives in Hong Kong. He flew down to see us while we were in Australia. John is very successful and has been investing in Australia for many years. Most of John's investments have been in coal and iron ore. But now he has completely switched his investment strategy.
"I've gone from mining to dining," said John. He has put a fortune into (and, if I know John, he'll make a fortune out of) exporting food from Australia and New Zealand to mainland China.
I said to John, "I thought the market for luxury imports was down in China."
"Oh, yeah," he said, "if you mean Chanel handbags and Louis Vuitton luggage." Then John went on to explain how the Chinese middle class doesn't trust the Chinese food chain – for good reason. To give just one example, in 2008, large quantities of powdered milk made in China were found to be contaminated with a chemical used in pesticides. Six babies died and more than 54,000 were hospitalized.
Wholesome and high-quality food products are a "necessary luxury" for the growing Chinese middle class. And as John pointed out, that Chinese middle class is still growing. China itself is still growing – at a rate of about 6.5% a year. The Chinese may consider this a "cooling economy," but President Obama would kiss Sarah Palin on the lips to get economic results like that.
"Besides, good food is not like a Chanel bag," said John, "no matter how long you marinate the purse."
I have, however, failed to mention one fairly easy Australian visa work-around. If you're 55 or older (and I sure am), you and your spouse (who is allowed to be as young as he or she likes) can apply for a "retirement visa."
You'll have to transfer assets worth at least $500,000 Australian dollars to Australia. In other words, you'll have to buy a decent house or apartment. And you'll have to show an annual net income stream of at least $50,000 in Australian dollars. (Which, if you've been reading the Stansberry Digest attentively, you darn well ought to be able to do.)
Australians will tell you their country is in the midst of a "property bubble." But it doesn't look excessively foamy by American standards.
In just a few minutes of fiddling around on the Internet, I found a great apartment in Byron Bay. It's a little seaside town, about a 100 miles south of Brisbane, and it's Australia's "surfing capital" (meaning the waves here can be even bigger than merely enormous).
We spent a long weekend in Byron Bay. I had to practically drag my wife and children away from the beach, even though this was "the offseason" with "bad" weather. (It was 70 degrees, and on only one day, it rained.)
The apartment is a five-minute walk from town in a small, new "high design" complex with a pool. It has two bedrooms, two full baths, a two-car garage, and an ocean view. The price is $770,000 (US$581,350).
But there is a drawback to the retirement visa. You can't have any dependents other than your spouse.
I say it's about time my two teenage daughters got jobs. (I'm assuming that spending the whole day with one's face pressed to an iPhone and sending text messages is a "skilled occupation." I mean, I can never get that little touchscreen keypad thing to work.)
This leaves us with our youngest, 12-year-old Buster. I tried to have a talk with Buster. First, I had him watch "Oliver!," the 1968 movie musical based on the Charles Dickens novel Oliver Twist. Then I said, "Wasn't Oliver having lots of fun singing and dancing at the workhouse?"
"I don't want to be a pickpocket," Buster said. "I want to be an astronaut." So it looks like, until we get Buster signed up with NASA, the O'Rourkes won't be moving to Australia.
Not even if you-know-who wins the election.
Regards,
P.J. O'Rourke