The high cost of living in our golden cage, Australia

And it’s golden, with a booming economic comeback, falling unemployment, rising house and stock prices. “It remains to be seen whether the recovery is under its own power or solely under the leadership of the government,” warns Willox, and ultra-low interest rates. “It could be that stimulus is responsible for 90% of this recovery; things could turn out pretty quickly ”when government money runs out.


JobKeeper ended, but Treasurer Josh Frydenberg pumped extra wads of short-term money into the economy to keep the stimulus going a bit longer. This includes $ 20.7 billion to maintain emergency tax breaks for businesses another year, $ 7.8 billion in tax compensation payments for another year for low- and middle-income people, and 2, $ 7 billion for JobTrainer for an additional six months.

And wherever the Morrison government saw a political threat from Labor, it “flooded the area”. But where a sports team will flood the zone with players, the Morrison government is flooding the zones with money – for child care, senior care, mental health care.

At any other time in modern history, a Liberal Party treasurer would be embarrassed to produce a budget that continues to add to the national debt for at least a decade into the future to pay for decisions made today.

Conservatives who remember principles like saving, or living within your means, are scathing: “In the past, only the Labor Party was unable to say no to every call for increased spending and government intervention in people’s lives, ”says Institute of Public Affairs’ John Roskam.


But Morrison and Frydenberg are spending taxpayer dollars with far more abandon than any Labor government of the past half century. The biggest budget deficit of the Whitlam years was equal to 1.8% of GDP. This year’s deficit is budgeted at 5 percent of GDP.

Under Rudd and Gillard, Labor took the Costello-Howard surplus budget to leave behind a net debt of 13 percent of GDP. The Morrison and Frydenberg plan foresees a net debt of 40.9% of GDP in four years. It simply eclipses any other debt burden bequeathed by a Labor government, including Whitlam’s.

If that doesn’t embarrass Morrison and Frydenberg, it should. The financial review Wellington correspondent Luke Malpass reported on New Zealand’s budget this week under the headline: “Ardern is more budget tight than Frydenberg”.

The Morrison government is pleased to increase not only the size of government spending, but also the role of government in the economy. He pledged to spend $ 2 billion to subsidize Australia’s two oil refineries over the next 10 years, at least $ 300 million to build strategic fuel stocks, $ 1.5 billion to manufacturing subsidies and $ 600 million to build a gas-fired power plant in the Hunter Valley.


None of this is necessarily bad. In fact, Australia has woken up to its supply vulnerabilities in the COVID crisis. It is important that Australia has the capacity to refine and store fuel, develop critical manufacturing capacity in food, medical products, essential minerals and rare earths, and defense. These are all investments in national resilience. The gas plant can be questionable.

But the point is, the Morrison government is prepared to spend big, go into debt, “flood the zone” to protect itself politically, invest in bigger government wherever it sees fit. So why dwell on protection against the pandemic?

Morrison shows a genuine reluctance to spend as much as needed on the two obvious solutions to our national golden cage containment – an established system of rapid vaccinations and a rigorous quarantine system. For months now, the medical profession, states and businesses have been calling for a bigger, more rigorous quarantine system – cabin-based.

Morrison is correct that the hotel quarantine was 99.9% effective. But the 0.1 percent it failed represents 14 instances where the virus got out of the system and into the community. In most of these cases, this has led to a city or state lockdown. These breakdowns are therefore infrequent but costly. Very high indeed.

And the federal government’s cabin quarantine camp at Howard Springs in the Northern Territory has been found to be 100% effective. Morrison has pledged to expand the camp from a capacity of 850 to 2,000 people.

But his government is refusing state demands for more cabin-based camps. Morrison refuses to build more federal camps, and he doesn’t put much effort into helping states that want to build theirs, including Queensland and Victoria.

Queensland Premier Annastacia Palaszczuk said the lack of any federal funding for the new regional quarantine camps was “the most glaring omission from the budget”. She said: “In this current era of COVID, there are two things Australia needs: security and certainty. The regional quarantine is our last best hope for both.

“The return of Australians stranded from abroad, the filling of gaps in the labor market, the return of international students, the return of international travel – all of these issues are resolved with the regional quarantine. Our hotels were never designed for long-term quarantine. “

And in the long run, it has to be. Until the entire world is protected from the COVID-19 virus, it will continue to mutate. New variations will appear. And that means two things. First, we’re going to need long-term quarantine, in the cabin, and on a much larger scale than the existing system if we hope to have any real reconnection with the world beyond the cage. And second, we will need a high-volume vaccination system that can quickly adapt to new variants. It requires a rapid mass immunization system, which we do not yet have. States are stepping up efforts with their own vaccination centers after federal deployment has proven to be intolerably slow.


It also means the ability to manufacture mRNA vaccines in Australia. The capacity of mRNA is essential because it allows rapid conversion of a vaccine to adapt it to new variants. This group includes Moderna and Pfizer vaccines, which Australia cannot yet manufacture.

The federal government said on Friday it had published a “go-to-market approach” to seek out companies interested in developing mRNA manufacturing capacity in Australia. It therefore moves and retains the possibility of subsidies. But it has been an obvious gap in Australia’s vaccine arsenal for months.

Innes Willox says the failure to coordinate between the federal and state governments has “stuck” Australia’s ability to respond effectively. “The pandemic has shown that the federal government has the power of the stock market and the power of persuasion, but the states have the power of delivery. The federal government has lost control of the narrative; there is no sense of pressure from the federal government ”to get things done.


“The national cabinet was set up with good intentions, but they don’t seem to talk to each other half the time. It was a disappointment. Have we given up on the idea that we are one country?

Morrison says no; there is an international border and it keeps it tightly closed. His government’s indicative timelines for the border and government spending appear to coincide to keep the cage locked and gilded until after the federal election, which is due to take place no later than a year from now. This is the government’s first emergency. And that helps explain the lack of urgency.

So why rush, and why worry about the openness? Morrison has his three campaign themes in hand: creating jobs and growth, protecting Australians from COVID-19 and preparing for war with China. Take advantage of your confinement.

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Alan Adams

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