THE DEFICITS KEEPING ON COMING
The sound you’re hearing is roughly 113 “back in black” mugs being tossed out of windows. As has been darkly prefaced through the week, the federal government is expected to record the largest budget deficit in modern history in today’s budget preview. The bottom line has been hit by the COVID-19 double punch of emergency spending ($164 billion) and a plunge in company tax receipts (down $25 billion).
Of course, the need for extraordinary government spending isn’t looking like passing anytime soon, so the deficit could increase by the actual budget in October.
Indeed, Simon Benson tells us over at The Australian that “Australia’s response to the COVID-19 crisis will saddle the nation with a record $850 billion gross debt bill and a combined budget blowout of almost $280 billion by mid-next year”.
But take heart — as Bernard Keane and Glenn Dyer argued in these pages yesterday, the stimulus is both necessary and affordable: “Australia has ample capacity to fund all this spending and much more. We’re on track for debt of about 30% of GDP — high by recent Australian standards but far below countries such as Canada, Germany, the US, the UK and Japan”.
AUSTRALIA RECORDS ITS SINGLE WORST DAY FOR COVID-19
The reason we’re planning for the deficit to continue to grow was laid out in the starkest possible terms yesterday. Australia had its highest number of new COVID-19 cases in a single day: 502. Any Melburnians hoping this means the blame is going to be shared around for a while are going to be sorely disappointed — the 484 recorded in that state alone still tops the previous high for the whole country. The rest were from New South Wales and a single case in Queensland.
While Victorian Premier Dan Andrews made no announcement on whether the current lockdown (covering the Melbourne metro area and the Mitchell Shire) would be extended or become more strict, according to unnamed “senior government figures” cited in the Oz, the “possibility of restrictions lasting many months, even if the current lockdown is eventually relaxed, have been discussed at the highest levels of government”.
According to government analysis, 90% of positive cases reported between July 7 and 21 did not isolate in the period between the development of their symptoms and getting tested. Andrews tacitly acknowledged this was largely down to the precarious nature of many people’s work:
“There is a large proportion of these people who are making these choices because, in their judgement, they will look at their bank balance, they’ll look at the fact if they don’t work the shift they won’t get paid for it, they don’t have sick leave,” he said.
Given the fact that roughly 80% of transmissions since mid-May are occurring in workplaces, the mooted expansion in the criteria for a one-off $1500 hardship payment to people who lose income by self-quarantining after a positive test seems the very least that could be done.
SORRY QANON — NO TWITS ALLOWED
What a day it must have been for conspiracy group QAnon. First US President Donald Trump wished Ghislaine Maxwell “well” as she faces charges for recruiting, grooming and ultimately sexually abusing minors as young as 14 as Jeffrey Epstein‘s accomplice. For the mercifully uninitiated, QAnon’s central thesis involves Trump fighting a secret war against an international cabal of elite Satan-worshipping paedophiles, so this must have caused them some consternation.
And then Twitter said it would no longer serve content and accounts associated with QAnon in trends and recommendations, and would block URLs and videos associated with the group from being shared on the platform.
The question immediately follows — what does this mean for Tim Stewart, (who posts under the nom de plume “Burn Notice”) a promoter of QAnon theories, and a long time friend of Scott Morrison who claims to have to the Prime Minister’s ear?
THEY REALLY SAID THAT?
These are tactics we expect from authoritarian regimes — not our democracy
The mayors of 17 American cities
The mayors respond to the horrors in Portland — overwhelming police force against peaceful protesters, a person apparently snatched from the street and placed in an unmarked van — in an open letter to the Trump administration.
“The hypocrisy accompanying this ocean of red ink is astonishing. How many words, column inches, furious editorials, scathing op-eds, breathless comment pieces were produced from 2009 to last year about debt and deficits — and Labor’s culpability? The evils of deficit spending were the pole star of Australian political and economic journalism over the past decade, even as the Coalition resumed its mantle as the party of high taxation and high spending.”
“Australian National University environmental law expert and honorary associate professor Peter Burnett said the money that state governments could make from large projects made them bad environmental protectors. ‘Those kinds of factors compel them to approve developments,’ he said. ‘Even if they say they’re committed to upholding certain environmental values, there’s a lot of pressure on them if there are jobs and revenue on offer, which of course there are.’”
“While the Order of Australia claims to represent all Australians remarkably, it appears, there is no Indigenous representative in the body that recommends awards to the governor-general. According to Inq’s analysis there are no Indigenous Australians in the group of eight community members appointed to the Council of the Order of Australia — nor has there been for eight years.”
READ ALL ABOUT IT
Lightbulb moment in the fight against hack attacks ($)– Rachael Falk (The Australian): “When people think about cyber crime and its intentions, data theft generally comes to mind. This is undoubtedly often a prime objective of cyber criminals, but disruption to critical infrastructure has increasingly been highlighted as another key goal. Simply making a network (and its functions and services) unavailable can wreak havoc. The federal government’s decision to exclude high-risk vendors from Australia’s 5G network is an example of protecting a critical network from such risk.”
I have sympathy for the lockdown, but nothing makes up for the fact our patients are alone — Ranjana Srivastava (The Guardian): “Lonely patients stare at the walls or watch the ward traffic. The television is stuck on endless loops of grim news from different countries. But the lack of visitors isn’t a mere inconvenience; in hospitals like mine with overwhelmingly disadvantaged patients with multiple illnesses and insufficient command of English, this edict represents a real threat to their welfare.”
Can China and the US agree again? ($)– Mohamed El-Erian (Australian Financial Review): “Not a day seems to pass without further evidence of the mounting economic tensions between China and the United States, the world’s two largest economies. This growing antagonism will have a bigger immediate impact on China than on the US, as bilateral decoupling fuels a broader ongoing process of deglobalisation. And the negative spillover effects for a subset of other countries – which I call the dual-option economies – could be particularly significant.”
HOLD THE FRONT PAGE
WHAT’S ON TODAY
Treasurer Josh Frydenberg and Finance Minister Mathias Cormann will deliver the federal budget update, ahead of the full October budget, at a press conference to be held at Parliament House at 11am.
The release of the Australian Institute of Health and Welfare report, which will examine the impact of COVID-19 and other major health issues affecting the health of the nation.
Case management conference in the case of the Director of Public Prosecutions v Herald & Weekly Times Pty Ltd and others for breaching suppression orders concerning George Pell.