Flat White

A new pragmatism, not old dogma, is needed to tackle economic corona catastrophe

13 August 2020

1:52 PM

13 August 2020

1:52 PM

Startling figures from the Australian Bureau of Statistics give us a taste of the poison that is COVID-19 on our economy, or more accurately the taste of the poison of the Andrews Labor Government’s handling of coronavirus.

From the week ending on the March 14, when Australia confirmed its one hundredth case of the virus to the week ending on July 25, a devastating effect on the economy can be seen with payroll jobs decreasing by 4.5 per cent and total wages down by 4.8.

The ABS numbers for July told a great depression-like tale of the fate of Australian workers. The ABS release simply stated, “For the first time there were more than one million people out of work, available to work and actively to look for work”. This is only part of the picture as, of course, those figures do not include the thousand and thousands more in zombie jobs in zombie businesses kept afloat by JobKeeper

This contraction is felt ever more in Victoria, with Melbourne under Stage 4 lockdowns where it is illegal to have a cup of tea with your mum and where ‘non-essential’ businesses have been ordered to close on government edict.

Melbourne is even colder and grey than it is in most winters, with the spirit and vibrancy of one of the greatest cities on earth sucked out by the Andrews Labor Government.

The mismanagement of hotel quarantine, black lives matter protests, lacklustre efforts in contact tracing with residents in the rural electorate of Polwarth having to wait up to nine days to receive their COVID-19 testing results have all contributed to the destruction of the Victorian economy.

Australia must learn from Daniel Andrews’s mistakes, and follow the mould of Taiwan, a country of around 24 million people that has only experienced four deaths from COVID-19. In Taiwan, business is open, people are working, and temperature checking stations, masks, and hand sanitiser are just a part of life around flu season. Taiwanese have experienced other Chinese flu variants such as bird flu in 2003 and know what they can mean.

The earliest indications of the effect of Stage 3 lockdowns in Melbourne are shown in the underutilisation rate, which combines the unemployment and underemployment rates, fell 0.4 percentage points to 18.7 per cent, but remained 4.7 percentage points higher than March. That’s an effective unemployment rate of 18.7 per cent, or nearly one in five workers.

Australia’s model is not sustainable; particularly, Victoria’s model is not sustainable. The level of debt in Victoria and how that will be compounded by COVID-19 is putting Victoria’s AAA credit rating at risk. A downgrade, of course, will expose Victoria to higher interest payments as well as less borrowing capacity. The Andrews Government management of the economy could see Victoria being bogged down in debt and low productivity for generations.

The Narrabri gas project in New South Wales and the ability to extract natural gas from Victoria need to be fast-tracked. The Victorian government has finally allowed natural gas exploration could commence from July 2021. Job creating projects need to be at the forefront of any plans to boost economic growth. Across the board, Australians need to be encouraged to get out and build a new future, rather than hide under the doona and hope the past will come back. Further, greenlighting nuclear energy could see a boost in over 50,000 jobs, if Canadian figures are anything to go by. A new pragmatism, not the dogmatism of yesterday, will be the golden ticket to Australia pulling itself out of this mess.

Finally, the business community needs to be able to be trusted by the government to operate in a COVID-safe way instead of being simply shut down as in Victoria. We must reopen again soon as a nation, even if that means leaving Victoria out of the picture for some time.

One state cannot be allowed to weigh down national recovery. Daniel Andrews will understand. He approves of drastic measures.

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