ScoMo left behind as Australia votes for virus elimination

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The Morrison Government should do a major volte-face on its virus suppression strategy. There are three reasons.

First and most important, elimination is the best way forward. Virus-free New Zealand is tracking for far better economic, lifestyle and health outcomes than Australia is.

Second, governments in the virus-free states of WA, SA, QLD, TAS, ACT and NT with sealed borders are immensely popular.

Third, the virus-free states will never reopen to VIC and NSW while they still have the virus. Indeed, when VIC manages to crush the curve again, it will refuse to reopen the border with NSW, leaving the latter an effective national leper colony. This may force NSW into lockdown eventually as well if the virus does not do so first. If Victoria does not kill the virus then it, and NSW, are cut off from Australia permanently. Either way, it makes it impossible for ScoMo to open international borders.

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The political corollary is simple. All of the votes are in virus elimination.

ScoMo should get ahead of this trend and start leading it:

  • take responsibility for national quarantine and do it on Christmas Island using the army;
  • support states with logistics and stimulus in the drive for elimination;
  • make a plan for huge ongoing public investment to support the fortress economy and start talking down the budget. Deficits no longer matter.
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ScoMo’s current “suppression” course of fiscal tightening, quantitative failure and viral convulsions hopes that opening borders for more migrants will save house prices. He’s still thinking in terms of dividing up the pie for political purposes when the entire kitchen is on fire as the national response Balkanises.

COVID-19 is an issue of national survival, not vested interests.

About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.