There is nothing more wearying than enduring the media’s preoccupation with all that is bad about the Coronavirus. It seems they can’t be overwhelmed by the surprising good stuff that’s emerging out of the tragedy that promised the worst-case futures imaginable that abounded when this damn virus escaped China, went to South Korea and travelled to Milan, Italy.
When I first encountered the predictions of the millions of people ‘destined’ to die of the coronavirus, I looked at the South Korean deaths over the population and they were staggeringly low. ‘Expert’ doomsday merchants threw Johns Hopkins predictions at me and threatened to call me out.
And while the deaths in Europe, the UK and the USA are huge by Australian standards, they haven’t come anywhere near what was predicted. On average, we lose 1,500 to 3,000 Aussies each year to influenza so our total of 96 deaths puts the threat and the achievements into perspective. And we have one of the highest infection test rates in the world, which is a standout reason to be proud of what we’ve done as a country, as this has been a national effort.
In our case, we’ve been named by the Brookings Institute as being in the best three countries in the world for beating COVID-19. And our fiscal policy attack on the economic threats of the virus has been seen as one of the best on the planet!
These are pluses we Aussies should be proud of, as the Morrison Government takes on the next big challenge of getting us back to work without making it easy for a second wave of infections and deaths to ruin our great coronavirus-beating record.
Treasury thinks unemployment will increase to 10% in the June quarter, while growth will fall 10%. But Treasurer Joss Frydenberg is tipping a significant bounce back. And it will be the second wave story that will be the key determinant.
What’s at stake if we screw up this opening up of the economy? First, the positive expectations of our Reserve Bank, which tips we have a rough 2020 ahead, growth-wise, but that we rebound strongly in 2021.
In case you failed to read the Big Bank’s Monetary Statement yesterday, this is what it told us: “In the baseline scenario, output falls by around 10 per cent over the first half of 2020 and by around 6 per cent over the year as a whole. This is followed by a bounce back of 6 per cent next year.”
If this happens, unemployment falls from 10% plus to around 6-7% in 2021, which means 1.1 million out of work shrinks to 700,000, if you need to put cold hard numbers into human misery or joy!
If we as a country (i.e. governments, businesses and people locked-up, closed down and socially-distanced) hadn’t done as well, the death rates and the unemployment rate would have been tragically higher. We should be proud of what we have achieved.
Pandemics of this proportion should exterminate base cynicism driven by petty political or philosophical differences. These kinds of debates and tribal sniping should be reserved for a time when life, limb and our material life is not under threat, so we have to step up and play ball over the next two months as the governments of Australia start opening up the economy.
And we all have to play our part. But we might need a little regulation, police force and social pressure to ensure we end 2020 where we are now, as one of the best coronavirus-beating nations in the world!
I hate to get social when I’m really an economist/financial commentator/financial adviser but if we screw up socially, we will screw up the economy, job creation, the stock market and our super returns.
I’m sorry but I’m a money man and socially I reckon money can be really helpful in delivering a fair degree of happiness. I know it’s not everything but it’s a fair bit of everything.
That’s why our federal and state government have to hit us with some impositions, such as masks on public transport and in shopping precincts. And morons who don’t get what social distancing is should be penalized. Yep, I’m going for a temporary ‘police state’ primarily because human lives and the economy are important.
Yesterday I saw five young builders in Australia Square in their life-saving high-vis jackets laughing their heads off looking at one guys iPhone, totally ignoring social distancing directions.
I love our historical, larrikin ways and our willingness to question silly authorities but this is serious stuff and sometimes we need tough leadership to get through to those who just don’t get it.
On Sky News this morning, Laura Jayes asked me if I believe the RBA’s optimistic forecasts. I explained that its record in predicting the future isn’t perfect but it has more chance of being right if we open up the economy as quickly as possible, without sparking a second wave.
That’s why we all need to focus on the coronavirus and its potential threat and act accordingly. I’m hoping the PM does a lot to open up our economy ASAP but I’m also hoping he threatens to clobber us if we screw up.
This is very un-Peter Switzer but this is an unusual, pandemic time. And it’s no time to worry about hurting the feelings of libertarians.
In 2021, if we are growing at 6% plus and the stock market is restoring our super balances, I’ll jump on board the “less government” train but, for now, we need these minders like never before!
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