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Demand the future: COVID-19 and the economics of opportunity

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The Morrison Government's pandemic response has opened our economic model to the possibility of reform (Image by Dan Jensen)

Now is the time to develop the Government's response to the COVID-19 pandemic into a sustainable economic model, writes Jacob Debets.

We must rapidly begin the shift from a thing-oriented society to a person-oriented society. When machines and computers, profit motives and property rights are considered more important than people, the giant triplets of racism, materialism and militarism are incapable of being conquered. ~ Martin Luther King Jr: Beyond Vietnam, 1967

Crises don’t break societies, they reveal what’s already broken and the global pandemic that has resulted from the COVID-19 virus is a once-in-a-century kind of crisis.

As of writing this, hundreds of thousands of workers have been stood down or sacked across Australia, forcing unprecedented numbers of people to experience the indignity of our welfare system.

Entire industries are grinding to a halt, with corporate conglomerates that have assiduously avoided paying taxes crying out for publicly-funded bailouts or all-out nationalisation.

The dynamics between the Government and the governed has changed overnight, with millions being forced to rely on public institutions and infrastructures for information, assurance and economic security. Privileged apathy has been replaced by anxious dependence and enemies of collective action are finally realising that we are indeed all in this together.

COVID-19 demonstrates that resources can be rapidly mobilised to respond to emergencies and existing paradigms can be transformed just as swiftly, with the Morrison administration’s complete (albeit “temporary”) repudiation of neoliberal orthodoxy being just one potent example.

Shocked at the speed at which the virus has spread overseas in places like Italy and New York – crippling health infrastructures and leaving hospitals in a state where they literally have no room to store the bodies of the deceased – the Coalition-led Federal Government has shuttered large swathes of the economy whilst greenlighting the biggest government spending package since World War II, consisting of a $130 billion wage subsidy scheme, a doubling of unemployment benefits and free childcare, amongst other measures.

To be sure, the package unfurled by the Prime Minister and his cabinet contains conspicuous inequities – not least the devastating exclusion of visa workers and more than a million casuals from the wage subsidy scheme – and there are significant battles ahead for unions, welfare advocates, NGOs and other progressive organisations fighting to buttress and extend the safety net to the country’s most vulnerable. But the concessions made by the establishment, on the legitimacy and necessity of Keynesian economics after spending so many decades seeking to dismantle the nation-state and replace it with a “market-state”, is a cause for cautious optimism.

So as the Overton Window skews noticeably left for the first time in generations, the challenge and imperative for progressives are how to translate these emergency interventions into long-term structural reforms. Everything from company tax rates to a Universal Basic Income, a U-turn on the casualised labour market to the re-nationalisation of public transport and airlines are on the table, as is a more sober and urgent conversation around adapting Australia’s economy and society to a warming planet.

Those of us occupying the broad spectrum of Left economic thought – unionists, socialists, anarchists, liberals and progressives – must not miss this moment: the opportunity to introduce or revive genuinely radical alternatives to an ecologically destructive, unequal and unsustainable status quo.

The starting point of this effort should be to translate temporary measures into permanent features of Australia’s safety net. We must not, for example, entertain the possibility of the Jobseeker allowance (formerly known as NewStart), currently $1,100 per fortnight, being reduced back to its pre-pandemic level of $550 per fortnight, an amount which was found to be one of the least generous unemployment benefits of all OECD nations.

Nor can we regard the provision of free childcare or the effective merging of the private hospital system with the public sector as anything other than the new normal. When the Morrison Government and its cheerleaders in the corporate sector and the tabloids demand a resurrection of the old paradigm, we must be prepared to fight back.

Next, we must focus Australia’s post-“hibernation” phase around a massive renewable energy investment, a detailed blueprint of which was recently published by public intellectual Ross Garnaut in his book, ‘Superpower: Australia’s Low Carbon Opportunity’ (Black Inc, 2019). Australia must rapidly phase out coal, end fossil fuel subsidies, aggressively transition into a renewable energy export industry, utilise the Clean Energy Finance Corporation to underwrite smaller electricity generators and provide proper support to regional communities currently dependant on mining. Eliminating our carbon emissions and investing massively in green technologies is not just sound economics, it is necessary for our long-term survival a moral obligation towards our Pacific neighbours.

To deliver on these undertakings – a fortified floor of social security protections and a Green New Deal – will require more than just a transfer of cash from the Government. It necessitates a much larger public sector: more healthcare workers and Centrelink staff; boots on the ground installing solar panels and a more robust NBN infrastructure; a resurrection of shuttered departments and the installation of new independent commissions (like the Greens’ proposed Future of Work Commission).

With unemployment anticipated to reach as high as 25% as a result of the coronavirus shutdown and even the most optimistic economic forecasts predicting it will take years for the labour market to reach its pre-pandemic state, State and Federal governments must become employers of last resort, providing security for those thrown out of work due to the coronavirus and the hundreds of thousands more who are unemployed because of monetary policy.

These goals are ambitious, but the alternative is a swing back in the direction whence we came — or perhaps even further Rightward. Business and mining groups have already used the pandemic as a proxy to lobby for a widespread removal of workers’ rights akin to WorkChoices’ and it is feared that the fossil fuels sector will do the same in relation to the watering down environmental protections. We shouldn’t forget that the Global Financial Crisis is largely credited with accelerating the growth of the gig economy and the global precariat and that once the dust settles, the forces of predatory capitalism will begin circling once again, waiting in the wings with an agenda of privatisation, deregulation and austerity.

It is up to us to demand the future, to take advantage of a once-in-a-generation opportunity which COVID-19 presents us.

Anything less would represent a colossal and immoral failure of imagination and courage.

Jacob Debets is a lawyer and writer from Brunswick and is the Managing Editor of the New Economy Journal. You can read more of Jacob Debets's work at jacobdebets.com and follow him on Twitter @jacob_debets.

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