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Is criticism of Australia's liberal democratic response to the coronavirus disaster justified?

By Chris Lewis - posted Monday, 30 March 2020


This is despite the Morrison government indicating on 29 March 2020 that it was working on a wage subsidy scheme as part of its plans to allow businesses to "hibernate" during the coronavirus pandemic yet retain staff as part of a third stimulus package to be announced in coming days.

The Morrison government's boost to social security spending has also been mirrored by the US Congress announcing similar measures that include one off payments to low-to-middle income earners ($1,200 per working person and $500 per child), $600 per week provided for four months to jobless people in addition to unemployment assistance they receive through state programs, and assistance to those not eligible for unemployment benefits such as the self-employed and those employed in the gig economy like ride-share drivers.

For all of the talk by Denniss and others of flawed policies for decades, often looking to other nations for the inspiration of policy examples, it was worth remembering that China does not even have a decent social welfare system.

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As argued by others examining China and its coronavirus response, only the Chinese "with a deep pocket" were able to maintain their lifestyle and afford the home delivery of meals, groceries, and certain medicines in quarantined cities like Wuhan.

While delivery workers were also hailed as "heroes" in China for their hard work, along with doctors and nurses, they and small shop workers were unlikely to stop working given a lack of savings and social support.

Although Australian governments (like other liberal democracies) have been eager to support existing businesses to help them survive the coronavirus disaster, the Morrison government is astute enough to know that individuals need income support to afford goods, rent or home ownership payments which often demands two income earners in a family.

This is especially true given consumer spending makes up 60% of the Australian economy with the nation already having the world's second-largest household debt levels at around 120 per cent of GDP, after almost trebling in the 28 years since the early 1990s. As of 2019, the average mortgage debt alone was around $350,000.

The emphasis on consumers rather than production to boost economic activity is especially important with regard to the coronavirus disaster as less vital sectors decline and lose many employees. Given greater basic groceries demand, Coles and Woolworths are amongst the few employers actually hiring.

With Denniss expressing cynicism towards the Morrison government's lack of urgency when compared to China, it is worth noting making international comparisons in terms of strategy and health outcomes, even at this early stage.

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In contrast to President Trump's recent statements where he has expressed a desire for the US economy to get back to business as usual within 15 days on the basis that "We cannot let the cure be worse than the problem itself", an approach that would mean a clash with rational state governments and public-health experts, the Morrison government has always listened to health experts and has long informed the Australian population to prepare for the long haul.

In health outcomes terms, while Australia also has one of the highest per capita test rates in the world, its death rate as a proportion of positive coronavirus cases remains very low (as of 29 March 2020) at 0.38%. This is far lower than most other nations, including those with very different political systems such as China (4%) and Sweden (3%).

In other words, Australia's liberal democratic governments have been both competent in terms of results thus far, and careful to work with the people and interest groups in accordance to the values of Australia's unique liberal democratic system, despite obvious domestic policy differences that may be evident at the state government level where different rates of infection are occurring.

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About the Author

Chris Lewis, who completed a First Class Honours degree and PhD (Commonwealth scholarship) at Monash University, has an interest in all economic, social and environmental issues, but believes that the struggle for the ‘right’ policy mix remains an elusive goal in such a complex and competitive world.

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