New Economy Journal

Demand the Future: COVID-19 and the Economics of Opportunity

Volume 2, Issue 2

May 6, 2020

By - Jacob Debets

Piece length: 1,147 words

Cover photo by Austin Chan on Unsplash
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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.

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 Privileged apathy has been replaced by anxious dependence, and enemies of collective action are finally realising that we are indeed all in this together.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 is how to translate these emergency interventions into long-term structural reforms. Everything from company tax rates to a Universal Basic Income, a rejection of casualised labour 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 $1100 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 and 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 9 per cent by July, 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 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 groups and big miners have already reportedly 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. The Morrison government is already flirting with tax breaks for big business, deregulation and wide-scale industrial relations reform; an effective resistance to these measures and an articulate alternative vision are essential.

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.

A version of this article appeared in Independent Australia on 24 April 2020.

2 Replies to “Demand the Future: COVID-19 and the Economics of Opportunity”

  1. Thanks, Jacob for the important points you make.
    Climate change must be seen as one of a number of environmental crises caused by increasing global consumption, which flows from ongoing economic growth.
    While short-term stimulus to move away from fossil fuels and to support those suffering due to Covid is justified, we need also to rapidly cap and reduce global consumption, particularly in wealth countries. If we don’t, we will never solve climate change nor the other environmental crises that threaten human and other life on this planet.

  2. Jacob, I found your goals lacking in ambition, and firmly “In the box”.
    We are faced with an opportunity.
    Peoples normality has been shaken by the Bushfires more localised tremors, and now the COVID earthquakes. The cold grey concrete walls of our workaday reality are cracked, and are letting in the clean,fresh breeze, and just a few rays of sunshine, if viewed from a certain angle.
    Will we take up the crumbs scattered for us, hoard them and protect them as we are supposed to do? Will we take a few gestures towards keynsianism, a few more dollars trickling down the leg of those who are extracting the wealth we create?

    We are faced with a responsibility.
    The system of human organisation we live inside, the “Economy”, is colliding with the systems of nature, the systems we actually, physically rely upon to survive, let alone thrive.
    We are living in a time where it is imperative that we communicate that the imaginary systems we have created to organise our systematic hoarding of wealth are literally destroying the natural wealth we are 100% dependent on. If you think you are not completely connected to Nature, all of the time – try holding your breath….

    We can no longer afford the old economy.
    We can no longer afford its extractive, hoarding, expanding behaviour.
    We can no longer afford its continuous, ever growing usage of fossil fuels, the dense energy our current civilisation relies upon.

    The new economy requires a complete rethink of ourselves, our community, our wealth, of ownership, and of work itself.
    It means we must survive using systems of organisation designed to stay within the solar energy budget we are given each year – and DO NOT grow beyond them.
    It requires a complete refurbishment of our collective imaginations.

    This is where we need to take the public imagination; to the future, to a fantastic, thriving future, where we have plenty of time after work to enjoy ourselves, our families and friends, our living earth, its food and drink. Time to think, to be democratic, to be responsible.
    A future where we are not chasing the exponential growth of the billionaires dragonesque treasure pile, but are following the fulfillment of our own communities needs, while ensuring the needs of our neighbors are met.
    A future where we own all of the assets required to fulfill our needs, and are not reliant on any outside parties we do not directly own and control, like big business and the governments they have so elegantly captured.

    Where is the new story for a new economy? How will we fire the collective imagination? What is the inspirational future we can build for ourselves?
    If we dont come up with a feasible, attractive, new story, then the ultra right will be more than happy to once again create fictitious enemies and focus the wrath of a rightly furious population upon them – upon us. Which also loses us the world.

    Keynes was a good bloke. His ideas held off the wolves for a few decades, but our situation is now fundamentally different from that which faced Keynes and his contemporaries. We have now overshot our natural limits, and like hungry bacteria, we have reached the edge of the petri dish, and now face the extinguishment of civilisation as we know it.
    There is no time and no excuse to be fiddling around the edges of a system which is fundamentally broken in so many different ways.
    If we cannot even articulate a new vision, a new story, we will never make it to the fundamental systemic change we undoubtedly require in the dwindling time we have left. We absolutely must use every ounce of imagination within us, and come up with a myriad of solutions, then try them out, beginning where we live, right now.

    Thank you, fellow NENAns, for beginning this journey.

    We cannot, at this time above all, let ourselves be distracted by the cry of “I must make a living” – which is absolutely right, but which currently means “I must somehow get hold of some money, to fulfill my needs, or I and my family are toast!”.
    Our lives, and the living that we must make in both the old and the new economy, are, and always will be integrally a part of the living systems of the Earth.
    It is here that our livings stem from, and we must recognise this.
    The new the cry of “I must make a living” will mean that we are building natural systems, we are building our society within them, and we are maintaining the fundamental force which sustains us – life itself. It means “I must somehow get hold of permanent and clean air, water, food, shelter and clothing. I must somehow maintain a healthy and vibrant community and nation so we can all have access to all of the things we need in perpetuity, or I and my family are toast!”

    Luckily, life and nature are endlessly intricate and fascinating, so this will not only be incredibly more productive than the manufacture of endless widgetry to place between ourselves and the natural world, but will also be incredibly interesting and incredibly fun!

    Imagine that!
    For a New Economy Now!

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