Two hearty cheers for ScoMo and his $130 billion JobKeeper package.
If it had been a couple of weeks earlier it would have been three, but let’s be grateful for what we have got.
Not long ago Scott Morrison was deriding the idea of wage subsidies – they needed a whole new system to run, they would take too long, they were never delivered either well nor fast. His overriding mantra was caution, constantly mumbling weasel words like targeted, modest, proportionate, scaleable.
Now, with the éclat of a performing seal. he has thrown the biggest backflip in living memory, and good on him – he has finally got serious about the coronavirus pandemic and what it means to Australia.
The sheer size of the package is eye-glazing – the kind of subsidy Labor, for all it’s redistributive ambition, could only dream about. It is more than twice Kevin Rudd’s GFC rescue operation, the one that has been denigrated ever since by he coalition as economy-wrecking recklessness.
And it is not over yet – there will almost certainly be more to come. Indeed, within 24 hours more largesse was being wheeled out to the private hospital system and the export market. Then came free child care, and there will be plenty still in the pipeline. Many economists believe JobKeepers will have to be topped up if the crisis continues.
And already we have the Reserve Bank’s own stimulus measures, not to mention the various state government handouts. Add to that the huge hit on revenue from the economic slowdown and we are looking at consolidate national debt of well over a trillion dollars and budget deficits as far the eye can see and beyond. Hardly the stable and steady economy we were promised a few months ago.
It is not just Keynesian – the free enterprise wonks are branding it as socialism, the end of the capitalist world as we know it. They are wrong, of course – the aim is not to destroy capitalism but to preserve it, to allow it to rise from the ashes when the current emergency is finished,
And it may work, but it will take a lot longer than the six months Morrison was so blithely predicting just a few short days ago. And there will be problems, just as he foresaw. The implementation of the deal, like the quantum it envisages, is unprecedented, and given the Australian genius for turning a good idea into a rort, not all the money will be well, or even honestly, spent.
The glitches over Kevin Rudd’s pink batts and school halls that were part of the stimulus that saved Australian from recession during the GFC will be revisited in spades, although we are unlikely to hear the kind of pile on from the conservatives we have suffered for years this time around. And although the rhetoric is a touch overblown – the claim that all the six million jobs that will be eligible for relief will all be saved is, unfortunately, improbable – there is still a lot to like about the rushed design.
In particular, the fact that the subsidy will be at a flat rate rather than indexed to income levels is very welcome. In normal circumstances flat rates are regressive – the across-the-board 10 per cent GST demonstrably hurts the poor more than the rich. But in this case, the reverse applies, which is why the privileged among the cossetted neoliberals are whingeing.
Well, tough; as the multi-billionaire investor Warren Buffet has pointed out, in the long-running class wars the rich complain about, it was his class that was winning. it is time, more than time, they took a minor hit. JobKeepers will do a little to level the playing field. and more importantly, it will shield a great many workers – and some who have already lost work – from poverty or worse.
But perhaps its crucial aspect is the psychological. Morrison’s government have now spectacularly rejected the denial, procrastination and dithering over COVID-19 which has been their defining characteristic. Now it is to be all guns blazing, whatever it takes. This will restore much of the mistrust that has been lacking over the woeful hoarding, deceit and misbehaviour as citizens have decided that if their government is not really serious, there is no need for them to be either. It will give meaning to all the sloganeering about team Australia, sticking together, seeing it through.
The immediate response was that the price of shares leapt like a spring lamb bitten in the bum by a swarm of hornets We know the ASX is not the real economy, but it can be an indicator, and although it has since jumped around like St Vitus on the hot plate, the mood is positive – if fear has not yet been vanquished, greed is certainly recovering. So elephant stamps for the job market: the situation is dire, but there are whiffs of confidence from both business and consumers.
And incredibly, serendipitously, there were also rays of sunlight peeping through the pain and gloom that has called all the angst. Confounding even the most optimistic predictions, the rate of growth of infections of COVID-19 shows tentative signs of slowing. Weeks earlier than we had dared to hope, the curve may be flattening.
The figures are jumpy, and cannot be considered entirely reliable. There will certainly be setbacks, unforeseen clusters like the one that has emerged in the Adelaide airport. It is far too soon to rejoice yet, nor to relax the necessary restrictions that have been imposed, annoying as they may be for some people who still, apparently, refuse to acknowledge that this is not just mindless authoritarianism — it is, quite literally, a matter of life and death for many of our fellow citizens.
This is the time to consolidate and double down, pedal to the metal, nail the bastard down. As another war leader put it, this is not the end – it is not even the beginning of the end. But it just may be the end of the beginning.
And if this proves to be the case, if Australia can once again defy the world and deliver salvation when the prospects looked close to hopeless, Morrison may well deserve his ironic title of the Messiah from the Shire – a saviour who can indeed conjure up miracles. An unlikely saviour, certainly, but in these unprecedented times, nothing is impossible.
Mungo MacCallum is a former senior journalist in the Canberra Press Gallery.