Andrew Leigh

NOBODY LIKES RUNNING DEFICITS, BUT RIGHT NOW CREATING JOBS IS PRIORITY NUMBER ONE

The Canberra Times, 2 September 2020

‘The first duty of all Governments in the present period of stress is to relieve, as far as possible, the hardships and needs of persons who are willing to work but cannot find employment.’

The year was 1930, and the Canberra Times editorial reflected the anguish of the Great Depression. Around the world, unemployment spiked, and millions of lives were blighted by joblessness.

Nine decades on, the world is suffering the worst downturn since the Great Depression. Yet economic policymakers have a considerable advantage over their predecessors. It wasn’t until 1936 that John Maynard Keynes published The General Theory of Employment, Interest and Money, advising governments to spend in order to support demand. Keynesian economics did not become mainstream until decades later.

WHY ARE THE CANBERRA LIBERALS SO EXTREME?

CityNews, 18 August 2020

When the marriage equality vote was held in 2017, the Prime Minister supported it. Every premier and chief minister backed it. Every opposition leader – federal, state or territory – voted for marriage equality.

Except one. In the ACT, Canberra Liberal leader Alistair Coe opposed marriage equality. Three out of four Canberrans voted yes to marriage equality, the highest share in Australia. Yet Canberra was the only place where a major party leader voted no.

Marriage equality isn’t just an isolated incident. On a broad swath of issues, the Canberra Liberals have shown themselves not just to be more conservative than the typical Canberran, but to be the most conservative Liberal branch in Australia.

CARVING WITH THE GRAIN

Evatt Journal Vol. 19 - After the lockdown: Essays on a Post-COVID World – July 29, 2020

Carvers asked to make a bowl from a piece of timber don’t simply pull out their favourite blueprint, says philosopher Peter Singer. Instead, they examine the timber and adapt the design to suit the wood. Likewise, anyone looking to reshape society cannot simply begin with abstract ideas.  Reformers must understand the values, aspirations and needs of the community if we are to make change that does not run against the grain.

Globally, COVID-19 has infected millions, and claimed hundreds of thousands of lives. The International Monetary Fund expects it to cause the sharpest drop in global GDP since the Great Depression. In Australia, unemployment spiked, with hospitality workers, arts employees, women and young people the hardest hit. The promised Morrison ‘snap back’ seems unlikely. Rather than a V-shaped recession, the best we can hope for at this stage is a recovery that looks like a Nike swoosh.

THE UGLY TRUTH IS THAT THE NUMBERS MATTER — AND WE ARE NOT GETTING THEM RIGHT

Crikey, 22 July 2020

Numbers, said mathematician Paul Erdős, are beautiful. But when it comes to coronavirus, they’ve also been downright ugly. That’s true whether we’re talking about the rate of infection of the virus, or the size of the economic slump, which has literally required economists to redraw their graphs to accommodate the drop. Getting the right numbers to the right people at the right time is critical. Yet amidst the first recession in a generation, Australia is fighting blindfolded, because we’re not measuring and publishing the things that matter most.

Let’s start with JobKeeper. When it was first announced in March, the federal government anticipated that the wage subsidy program would cost $130 billion and support 6 million jobs. In May, they continued to say that the program was on track in terms of both cost and jobs. Then the $60 billion penny dropped. Suddenly the Treasurer admitted that the program would in fact cost just $70 billion and support only 3.5 million jobs.

POLICY MAKING NEEDS TO CHANGE POST-COVID

The Canberra Times, 15 July 2020

If a policymaker doesn’t think differently after coronavirus, they’re probably not thinking at all. Would any conservative now dare to quote Ronald Reagan’s claim that ‘government is the problem’, or Margaret Thatcher’s suggestion that ‘there is no such thing as society’? Imagine the outcry if Scott Morrison was to present the budget proposals he supported in 2014, including a Medicare co-payment, reduced CSIRO funding, cutting pension indexation, and abolishing unemployment benefits for under-25s.

The same is true for progressives. After World War II, Labor didn’t yearn for a return to the 1930s. Instead, Curtin and Chifley made the case for full employment, and democratising home ownership.

What’s the equivalent today? In health care, we’ve seen the benefits of a universal system over that of the United States, which spends nearly twice as large a share of GDP on health, yet provides patchier care. Coming out of the crisis, there will be a strong demand for telehealth, particularly in regional Australia. Preventive health will become a greater priority. The vulnerability of nursing homes has given new urgency to calls for serious reform in the way we manage aged care.

HOW FIRE HURT OUR FIRMS

The Canberra Times, 3 June 2020

When coronavirus hit, one thing many Canberra households didn’t have to rush out and buy were N95 masks.

That’s because we already had plenty in the cupboard from summer, when Canberra’s air quality was 22 times the hazardous rating. On some days in December and January, air quality in the bush capital was the worst in the world. People debated how many cigarettes you would have to smoke to do as much lung damage as just breathing our air. Was it half a pack, one pack or two?

The effect of the summer bushfires on Canberra was brutal. For weeks, outdoor activity was almost impossible. Restaurants, hotels, arts events, and the sporting sector were hit hard.

AS AUSTRALIA BOUNCES BACK, LET’S MAKE SURE WE’RE NOT LEAVING PEOPLE BEHIND

The Canberra Times, 18 May 2020

Recently I heard from a Canberra woman who had changed employers last November. Her new employer told her she’d start off as a casual and then transition to permanency. When coronavirus hit, and the government announced its JobKeeper wage subsidy program, she hoped that it would apply to her. But as a casual who had been with her employer for less than year, she was excluded. As she wrote to me ‘This will have a long and lasting financial impact on our family’.

In another family, I heard the story of two children, aged 18 and 21, who had each been in casual jobs for 11 months. They’re ineligible too. A local Turkish restaurant told me that half their staff were international students. Because those workers are on temporary visas, they are ineligible for JobKeeper. The restaurant owners are worried they’ll have to close permanently. They pleaded ‘Save us from folding up.’

Labor supports the JobKeeper wage subsidy scheme. More than that, we called for it. Early in the crisis when other countries had announced wage subsidy schemes, Prime Minister Scott Morrison said it wouldn’t work in Australia. It was only under pressure from business, unions and the Labor Party that Mr Morrison changed his mind, recalled parliament and enacted the JobKeeper package. It’s the most important thing the government has done.

THE POOR BEAR THE BURDEN OF THE CORONAVIRUS DOWNTURN, BUT INEQUALITY IS NOT INEVITABLE IN AUSTRALIA

Over the three-month American summer break, school students diverge. In high-income families, students keep learning, thanks to museum trips, instructional camps, and home tutoring. In low-income families, students slip backwards, losing 1-2 months’ worth of learning by the time they return to school. According to one study, the ‘summer slide’ accounts for two-thirds of the difference between poor and rich students.

The gap between high-performing and low-performing children in Australia is already larger than in most advanced nations. With a large share of families currently homeschooling, this problem is likely to worsen. Speaking with a range of parents, I’m struck by the differences in how children are spending their days - with some being intensively tutored, while others are literally left to their own devices.

Before COVID-19 hit, we already had too much inequality in Australia. And that’s not just a Labor view. In one survey, people were three times more likely to agree than disagree with the statement that ‘income and wealth should be redistributed towards ordinary working people’.

CHARITY JOBS AT RISK

The future of hundreds of charity workers remain in limbo as they continue urging the Morrison Government to further revise the JobKeeper program.

In spite of initial changes to the program’s requirements, major charities - including Oxfam, Anglicare, UnitingCare, Fred Hollows Foundation, the Samaritans, St Vincent de Paul, Wesley Mission Queensland and many of our major medical research institutes - say they cannot meet the test of a 15 per cent drop in revenue required for charities to qualify.

According to a survey this week by the Australian Council of Social Service, many charities are expecting to have to shed jobs as a result of the drop in donations. They estimate that 37 per cent of anticipated job losses will still occur in organisations whose overall revenue loss is likely to be less than 15 per cent.

CHARITIES ON THE BRINK

Major charities will have to dismiss staff in coming weeks unless the Morrison Government again revises its JobKeeper program.

Charities run a range of different services including retail stores, early childhood centres, disability services and facilities that bring communities together. In many cases, some operations have suffered massive losses of 80 per cent or more. But because other operations have been sustained, they do not meet the test of a 15 per cent drop in revenue that is required for charities to qualify for the JobKeeper program.

Charities have seen a major increase in demand for help, while also experiencing a drop in donations and volunteering numbers. While some federal assistance has been provided, much more is needed to help the sector navigate the impact of coronavirus.The government’s decision on 5 April to offer charities a reduced threshold (15 percent rather than a 30 percent drop in turnover) was an attempt to fix the problem. But major charities say that it isn’t a solution.