Gerry Harvey Solomon Lew
Gerry Harvey (left) and Solomon Lew (right) (Images: Harvey Norman; AAP)

JobKeeper is set to be the greatest head-fake in the history of Australian fiscal policy. A policy purporting to keep workers employed is likely to achieve two other things. First, it led to a massive transfer of wealth from future generations (the young, and the not-yet born) to wealthy baby boomers. Second, it created a swathe of businesses that should have been wiped out by a COVID recession but instead live on, in zombified form.

At the time it was launched, JobKeeper was lauded by almost everyone. The left loved the prospect of free money purportedly being handed to young workers. The right loved it because it was a targeted boondoggle created by a Liberal government, which would likely be able to be manipulated by sophisticated businesses.

One (but not the only) flaw of JobKeeper was that it allowed companies to qualify for the cash handout based on a "forecast" of their turnover. In March 2020, as the nation was temporarily shut down, if a company believed (with reasonable justification) that its revenue would fall by 30% (or by 50% for larger businesses), it would be entitled to JobKeeper. Strangely, if it turned out revenue and profitability increased, the recipient could still keep the taxpayer-funded largesse.