I like Treasury Secretary Stephen Kennedy. He’s a sensible bloke. But this is a bit dubious in parliament today:
“Given the high degree of uncertainty surrounding the economic impacts of COVID-19 Treasury is assessing the situation on an ongoing basis.”
“At this stage we expect the virus to detract at least a half of a percentage point from growth in the March quarter 2020.”
“This preliminary estimate takes into account the direct impacts of tourism international education exports and some exchange rate effects. It does not include supply chain disruptions or other potential broader impacts.”
“[June quarter] would also be affected”.
“There are a range of possible scenarios beyond the March quarter.”
“The economic impact will be deeper wider than that of SARS.”
“We need to thoughtfully unfold the response in light of the fact that the community would rarely deal with something like this. A very substantial part of this is confidence among consumers . The economy is quite solid and travelling quite well. [COVID-19] will be a short term shock. It will be longer than SARS but we will recover.”
Fair enough but within strict limits. Encouraging a spend up in public places will only accelerate the virus into winter and bring on the worst case economic outcome as the health system is overwhelmed.
Yes, the government response should be proportionate but the health response demands honesty and trust.
