Scott Morrison’s government has been spruiking its life and economy saving program named Comeback on television and digital platforms. This means comeback from the unexpected changes imposed on individuals and the economy in 2020 by the COVID virus. But comeback to what?
The Comeback is an advertising campaign designed to persuade an exhausted public that Job Seeker and Job Keeper will bring the economy out of the hole in which it landed due to the virus and return it to some kind of normality perhaps recognizable from past years. It is responding to the events of 2020, a year almost unique if judged by the last two decades. Above all, the response to the virus has required the LNP to abandon its habitual anathema towards increased government expenditure for the benefit of the entire economy, instead of focussing only on the top ten percent.
There are two sides to this: firstly, the economies of the individual states have been severely diminished by the downturn in economic activity dependent on changing work patterns and the severe reduction of economic activity due to the necessity for many people to be quarantined and for states to close their borders. Secondly, is the federal government’s massive expenditure through Job-Keeper and Job-Seeker, and the proposed tax cuts.All of this has required considerable and immediate government expenditure to stimulate the economy. It has put paid to any possibility of a federal budget surplus for a number of years.
Comeback says, ‘The economic recovery plan is about rebuilding the economy and creating jobs, and includes measures that will benefit individuals and households.”? But will Comeback really do all that is claimed for it? All the evidence is unambiguous that the economy has been running down under the Coalition government since 2013, with increasing income inequity, dramatically increasing tax evasion by large corporations, malfeasance by the large banks, and consistent underpayment of workers–especially casuals on short term visas–in many areas. Despite the odd royal commission nothing of real substance has been done to change these underlying conditions which have led to a flattening of the economy, severely muting the media’s continued cry of Australia enjoying 24 years of continual growth and, on that measure alone, outflanking all other advanced economies.
Job Keeper and Job Seeker are designed to give the impression something positive is being done, and they roll nicely off the tongue. But when both are progressively wound back, with Job Seeker at the end of March, the short-term demand that has been created will inevitably decline. And with the new industrial relations legislation that is designed to further weaken the power of the unions, the diminishing of aggregate demand will be further exacerbated.
Leaving aside COVID 19, the social and economic effects of which will take considerable time to play out, the two large events of 2020 were the horrendous bush fires in January and February, and the ongoing attacks on China instituted above all by the Prime Minister and then by other ministers with the support of the main stream media.
Whilst the memory of the bush fires will have diminished in the face of the immediate effects of COVID– hundreds dying in Victoria, curfews and mask-wearing–, it was significant that some leading country fire fighters in various states came out attributing the severity of the fires in part to climate change. For some of the time the PM was on holidays in Hawaii, but even when he returned he fobbed off questions about climate change. He continues to do this, even under the censure of most of the Pacific nations and many others, with the notable exception of the USA, though that will hopefully now change.
Consistently the LNP has refused to accept the reality of anthropogenic climate change and even though Australia now seems to be an international pariah, this government is still strenuously resisting taking meaningful measures to reduce carbon emissions and develop the renewable economy. No doubt Comeback will not stop this from continuing, even where individual states are beginning to play the role the federal government should take. Even today there has been a new report on the effect of climate change on diminishing water flows in the Murray Darling Basin with its attendant effects on food supply.
As for China, the damage seems to be done and it was all to impress the former president of the United States and as an appeal to a latent racism in a certain part of the Australian population. The damage it will do to Australian exports (and GDP)–40% of which go to China–and the effect on imports from China to Australia, will take several years to determine, though it might be concealed for a short period by the rising price for iron ore.
Given the extent to which China is one our main trading partners, this has been an unmitigated disaster, and reminds one of Australia’s attitude after 1949 when we traded agricultural resources with China whilst refusing to recognize the legitimacy of the communist regime. It too will reduce the capacity of Comeback to bring the economy back to what it might have been, even though it has been declining over the past seven years.
Perhaps unsurprisingly, for its stimulatory activities during the COVID crisis the LNP has seemingly been given a slight boost in the polls. Anthony Albanese and the ALP are considered by most commentators to be struggling, with the expectation that the government will be returned at the next election whenever that is to be held.
There is no doubt 2021 will be a transitional year. But Comeback will remain what it essentially was intended to be, a marketing gimmick enabling the LNP government to continues the policies it has so successfully used in running down economic activity even before COVID hit the country. One can only hope we do not have a comeback to previous economic conditions over the past seven years, though that is probably a false hope.
Greg Bailey is Adjunct Associate Professor of Linguistics, School of Humanities and Social Sciences, La Trobe University. His main field of interest is ancient India literature and history.
Comments
25 responses to “2020 and beyond. Comeback, but to what?”
I heard Robert on the ABC this morning ….
he apparently thinks that his rich mates will trickle sown some of their wealth so that in March there will be lots of jobs available for all the Job Seekers that he intends to force into working
Will the statisticians be able to report the available jobs and clearly show which are full or part-time and how this balances with Job Seekers desire to pick jobs that will offer suitable hours of work.
Will the statistician be able to classify jobs on offer as suitable for Seekers needing employment to earn enough to live above the poverty line, and be such that they will be able to successfully apply for housing mortgages with reputable banks.
(Is this why the banks regulations are being softened so they will likely be able to foreclose and make windfall profits from the new Seekers?)
Call me Cassandra but I do not think 2021 will be any good for us. I suspect that we are about to have a New York style pandemic thanks to the arrogance, selfishness, excessively business friendly NSW government. Their slackness (or something else) foisted the Ruby princess on Australia and now thanks to their crackpot overconfidence they are about (or have already) spread COVID across Australia despite knowing how quickly it will spread
.
No secure lockdown of Avalon and the Northern beaches
No attempt to control the outbreak in greater Sydney
Xmas as usual,
Churches as usual
Bloody unbelievable Boxing day sales
No compulsory masks
New years eve parties
the bloody cricket.
I think anyone who has done year 10 maths involving probability will grasp that the NSW COVID figures are a pinch of the proverbial.
Now two days ago there were nineteen NSW linked Covid cases one of which was n victoria. A week or so ago there were 9 one of which is in Victoria.
Now either Victoria is extraordinarily unlucky, or crossing the border has some magical effect that latent COVID cases appear or COVID sufferers have some magical attraction to Victoria or the underlying rate of COVID in NSW is way way higher than announced.
If we take the most recent data. There have been 6 cases of community transmission in Victoria in the last 2 days and apparently just 28 in NSW. Now it is perhaps possible that the Victorian cases are not NSW related but if we assume they are, given the border closures then almost 1/7 of the recent cases travelled across the border. (or their index person did so).
Now if we make reasonable assumptions that there are no magical events and that the travelers to Victoria are reasonably reflective of Greater Sydney then the NSW figures just do not add up. If 100,000 people travelled into Victoria from NSW in the last week, giving rise to 6 infections then a similar spread should be expected in NSW. We should be seeing 200-300 cases in NSW, not just 28.
People please tell me where i am wrong.
I expect NSW to explode California style over the next fortnight. Australia’s chance of economic recovery is looking grim. A vaccine will arrive two months too late.
I really, really hope my fears are ungrounded.
‘As for China, the damage seems to be done and it was all to impress the former president of the United States and as an appeal to a latent racism in a certain part of the Australian population.’
Indeed, and that certain part of the Australian population who “hate” Muslims have now turned into defenders of Muslims (Uyghurs) in their quest to vilify China – bigotry and racism are blind illogical and hypocritical.
It’s even funnier when the think tanks made up some propaganda involving Hui Chinese. The history of Muslims in China and their various Chinese names is an interesting read.
I think there is an error in fact in this article. With the exception of the years of the Labor Government during the GFC, Australia has been in a downward economic spiral since 1995. Although Australia is one of the richest countries in the World, this has come at a price of having one of the simplest economies in the World, i.e.propped up by mining. Consequently, the outlook for growth is at best below what might be expected for a country like Australia.
https://atlas.cid.harvard.edu/countries/14
Thanks, Ken. Good point. I will check this out.
Indeed comeback to what!
As normal our political economy relies on a short attention span possessed by the general public which is strategy with a proven record.
Western economies round the world entered the Pandemic in various degrees of bad shape!
Government money significantly flying over the FIRE sector ( Finance, Insurance real estate) creating money for the banks. And the banks basically providing money to real estate and to the financial sector, not to the economy at large.
Putting money into the economy! But there are two ways of doing this.
One is to put money into the banking sector, in which case you use quantitative easing, you inflate asset prices, you raise the price of real estate or at least loans for real estate, you raise stock and bond prices.
Or the government can run a deficit by actually doing real physical spending into the economy, by building infrastructure, by doing social spending. And there’s all the difference in the world between whether the government spends the deficit on the FIRE sector, or whether it does it on the real economy.
And for the last quote 12 years, since 2008, the government’s been spending money on the financial sector, not into the real economy.
So is that what we will snap back to !
I think the plan was to blame an economic reset on the Chinese or CoVid-19 or both, and ignore climate change until such time the loss of jobs can be blamed on climate activists (which isn’t possible yet – more pressure needed guys). Unfortunately China won’t play along and CoVid-19 didn’t just kill the poor, infirm and those unemployed who lean on our largess as born-to-rule taxpayers. And climate change seems to be coming on quicker than expected. Oh well, nothing a big world war wouldn’t solve. What we need is for Tony Abbott to Come Back and tell us plainly what the plan and ideology is, instead of having to work it out ourselves from marketing and dog-whistles under the current leadership.
Molan on the ABC this morning seems to be supporting the weapons industry as part of the plan to fix the US and Chinese economies …..
sadly I assume Australia and lots of other countries will suffer from a war …
does Molan and others like ASPI etc have somewhere else to live after the war…. or are they following Scumo expecting that God will lift them in Rapture?
I’m a little unsure about Molan … he seems to be a right sort of bloke rather than the Peter Jennings type. Australia will need a weapons industry and limited defence in the near future as China fuels the exponential growth of our Southeast Asian neighbourhood. We just don’t have to be such dicks about it.