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EASY ANSWER ^^
our colonises can only support so many people who aren't already of the side willing to join the revolution and leave their old nation behind... there is a subsystem where your town generates liberty bells, and more when you place people in there to generate them. colonists are converted from royalists to revolutionaries one by one by the number of liberty bells generated in a city they are living in.
SO, to increase population without drawing the massive red negative numbers , a city must simply generate more liberty bells and convert more of its population from royalists to revolutionaries.
there is a specific # of population that a city may have of royalists before the people become restless and stop working properly. generating more liberty bells will SLOWLY remedy this. However, until then you can simply make additional small towns to toss the extra colonists into.
The Max Colony Size is 32
However, the red penalty you experienced kicks in if you exceed "x number" of "unionists" (this number varies based on the difficulty setting => on hardest setting you cannot have more than 5 unionists in a single colony)
Unionists = those who are still loyal to the motherland back in Europe (England, France, Spain, Netherlands)
How do you increase the rebels and reduce unionists? By generating Liberty bells within THAAT colony (each colony maintains its own rebel rating)
Every time you add to a colony a colonist he's added to the Unionist side. In some rare cases due to the rebel % it doesnt have an effect
You will notice each of your colonies has two numbers, those in favour of independence and those in favour of remaining under the rule of the european "motherland"
If Unionists > than limit => -1 BASE production for each colonist
If Rebels > 50% => +1 BASE production for each colonist
If Rebels = 100% => +2 BASE production
The importance of BASE production is that it means it benefits from some of the multiplies (so for some professions +1 may translate to +2 or even +3 etc). Example lumberjacks on prime timber