Richard Denniss: the economic impact of COVID19

This is the Better Reading Podcast platform with stories behind the story, James B. Better Podcasts, my book chat with Caroline Overington, and more. Looking for a particular podcast? Remember, you can always skip to it. Welcome to the Better Reading Podcast. Stories behind the story. Brought to you by Belinda Audio. Listen to Belinda Audio Books. Anywhere, everywhere. Hi, this is Cheryl Arkel for the Better Reading Podcast. We talk to authors about how they came to tell us their story. Richard Dennis, welcome to Better Reading. Thank you for having me. So Richard is the Chief Economist and former Executive Director of the Australian Institute. He is a prominent Australian economist, author and public policy commentator and a former associate professor in the Crawford School of Public Policy at the Australian National University in Tamba. That's kind of huge. It's usually we talk to people around books, and I know you've had a few, and you've written a couple of essays as well. But really, we've got you on this podcast today to talk about what's happening at the moment. We feel that our readers and our listeners, it would be good for them to have perhaps an unbiased view of what's happening out there because there's a lot of political discussions. And I'm curious myself to talk to you and to talk to you about the current mood, where we're at, where we're going, and how we come out at the other end. So there are big questions, right? Yeah. So talk to me a little bit about yourself, because that was a very brief intro. Well, as you said, I'm an economist. I've been in and out of academia, in and out of fintanks, giving advice to politicians and companies for nearly 30 years now. And yeah, I'm one of those lucky people who loves their job. Half of my day is. I've been out of people. Well, lucky in that I mean, I've been out of people. I've been out of my days sitting alone writing, which is how I get my head straight, and I spend the rest of my time chatting to people about things that I'm interested in, and hopefully they're interested in. So I kind of, you know, I get both sides of me out through two different kinds of work writing and talking. I know you've written a book called Afluenza, when too much is never enough. So let me just explain to our readers where we're courting this remotely because of COVID-19. Usually I do these in person, and I've got to say Richard, I've missed the human contact and the human cues. So bear with us, listeners. And we're also, you know, it's different technology for me. So that's been different. But I'm. The conversations are still fantastic. And I want to talk about ages I've been saying to anybody who would listen that we're a country of affluence, right? And that, to me, has created lack of empathy. And now we have this. So firstly, I want to go back to. I mean, I often think of Australia, and I think sometimes in my darkest moments, I think that why aren't we, like some of the Scandinavian countries, why aren't we progressive? Why don't we have alternate, you know, fuel sources? Why are we so reliant? On goals? Why did we go to down the track of what I think is conservatism rather than not? And then, because, you know, we would describe for so long as the lucky country, really how lucky are we? And those attitudes, I guess, have led us to where we are now. Oh, I look very much so. Well, let's start with the big picture. Australia is one of the richest countries in the world. We live at the richest point in world history. And until, until right now, politicians, state and federal, labor, liberal would brag endlessly about the fact that the Australian economy had grown for 29 years in a row. It's 29 years since. Can you explain to me what we live at the richest point of world history? Can you explain it to me? Yeah. Well, the way we measure income and the way we measure wealth, as in material wealth, there's never been more of it. And look at most. So, you know, look at the sum of people's accumulated savings, the add-up all the incomes we are. In Australia, it's a far financially richer place than it's ever been in our history. And that's true around the world. So, you know, we really are in the 7,000 years of recorded history from a material point of view. You know, to be middle class in Australia today is to be one of the wealthiest people of the world has ever known. But we've been made to feel poor. We've been told that we can't afford to have the health system and the education system. We had 20 years ago. And as you said in your introduction, we've certainly been told that we either can't or shouldn't have the kinds of health or education or transport or energy policies that the Nordic countries have adopted in Norway, Sweden, Denmark, Finland. You know, in those countries always come at the very top of the pops, not just for wealth, but for happiness and for life span and for everything else. So, yeah, unfortunately, a big part of my job as an economist is trying to explain to people, but in Australian public debate, in Australian political debate, we've been offered a very, very narrow range of choices. And a lot of people are frustrated by that. But to be. Why? Oh, because the people offering the choices are happy with those choices. So, think about going to a me. think about going to a restaurant. The waiter comes out and says, "Here are all the things you can order from." Well, that gives us choice. That's great. But who wrote the menu? You know, who's the chef in the kitchen that gets to decide what we choose from? So, in Australia, you know, successive governments, successive political parties, our business community, have spent decades narrowing the range of choices available to us. And there's a mean, you know, again, one of the richest countries in the world. But if you said in Australia six months ago, how about we make child care free for everybody? Everyone want to told you you were mad and we couldn't afford it. Well, this week the government announced free child care. Guess what? Well, apparently we couldn't afford it one more ridge. And we can afford it now that we're going broke. What do you think made us that way? Is it. is it because, you know, the governments are simply the people we vote for, right? I mean, that's. It's kind of. I mean, I look at the current government and, you know, it sends shivers up my spine. But, you know, people voted for him. Oh, absolutely. I look ultimately, I'm a Democrat. I'd rather live in a democracy than any other kind of system. And I don't agree with anything that. I don't agree with everything that any government has ever set out to do. But I respect their right to make those choices. And yeah, it looked clearly a majority of people at the last election either voted for the coalition or against labour. It's not clear which. But they formed the government. It's only got a majority of one seat. They formed government. And why are we offered such narrow choices? Oh, it's a great question. I've been lucky enough to spend a bit of time in the Nordic countries. I've been lucky enough to spend a bit of time in lots of countries around the world. And things that we think are heresy. A lot of people around the world just take for granted. I mean, you know, Germany doesn't just have free universities for all of its students. Germany offers free university for temporary residents and wreckages. How do they afford that? Well, they afford that by choosing to collect a bit more tax and choosing to spend it on those things. We're not offered a broader range of choice in Australia. And arguably when we are offered one, we've chosen the conservative options. That's not wrong. But we shouldn't pretend we don't have much broader choices and the ones we've made. So I'm going to be talking about pre-COVID and post-COVID because I don't know what the world's going to look like afterwards. PC and BC, yeah. That's right. But if I look at that, I mean, I've always, and I say this a lot on the podcast, that John Howard introduced hatred in this country through Tampa and using refugees, I think, as a political tool. But people jumped on it real quick. It wasn't that he was forcing it down our throat. People accepted that. And we were, I feel that for a long time, we were the lucky country in the free country. And when you look at post-City at Nowmore and the Vietnamese, orphans that came to this country, and that were embraced by Australians. But then all of a sudden, there seems to have been a shift. And was it a political shift to stay in power, or was it the shift of people? Were people feeling that they want to keep their affluence, or were they feeling that their affluence is under three? - Oh, look what is a great question. It's a big question. I'll answer bits of it. Okay, I hate to say it, but it's history says it's not too hard to get humans to play us versus them. The trick is to define who's us and who's them. And I would say that the biggest leaders, the best leaders are those that have the biggest notion of who us is. That they're trying to build a very big broad coalition of support and get people to focus on the things that are important to all of them. But there's another approach and that's to divide and conquer. And unfortunately, it's not hard in Australia or indeed in a lot of countries to get people to focus on difference rather than similarity. And John Howard was highly successful in doing that in a little bit of history, but in the 1980s, John Howard was very unpopular in the Liberal Party. Former Liberal. - Yeah, when you had won eyebrow, then that's fine. - Well, yes, but you know, former Liberal leaders like Malcolm Fraser and Andrew Peacock were liberal in the true sense of the word. They, Malcolm Fraser warmly welcomed Vietnamese refugees to Australia and Drew Peacock was very open to treating people of all races and all countries as welcome here. And back in the 80s, John Howard was quite unpopular in the Liberal Party for sort of blaming at the time it was Asians for coming here in droves and ruining our country. But the Liberal Party didn't kind of take up that cause and the Labor Party didn't. But after Pauline Hanson sort of proved how politically potent those arguments were, John Howard really came into his own and ideas that had been unwelcome in the Liberal Party were rapidly adopted. So yeah, John Howard played a very big role in it. He was very good at creating difference and not just ethnic difference. I mean, I'm looking at the way we treated the unemployed. We increased the age pension steadily. And we kept people on unemployment on crushingly small benefits. And whenever it came budget time, we were sort of told, "Hey, should we give more money to pensioners or should we give it to the unemployed?" Even people on welfare were divided and conquered. So yeah, it's an old trick, it's an effective trick, but it's not a good way, I think, to build a cohesive society or indeed a stronger economy. Talk to me about the coal industry. Look, the coal industry. That's a common standard, isn't it, Yves Inc? Oh, absolutely, absolutely. Look, the coal industry in Australia has got the best public relations machine you could imagine. There's 20, 20, 20-- We're all feeling sorry for Gina Reinhard when they were trying to introduce the, what was it, the mining tax? Oh, exactly. Everybody was worried about her welfare. I mean, what? Well, let's look at the big picture. There's nearly 25 million of us Australians and a whopping 50,000 of that 25 million work in coal mines. So 99.5% of Australians don't work in coal mines. But such is the power of the coal industry. Such is their enormous expenditure on public relations. That most Australians think that somehow we all are our living or our livelihoods to the coal industry. There's this top secret organization called the Australian Bureau of Statistics and it publishes all sorts of data on employment and output. It's all entirely top secret. It's hidden on their website. Anyone can go there and see that the coal industry is a very small employer, that it's overwhelmingly foreign owned. And while it makes a contribution to our economy, it makes it employees far less people than the arts industry. It employs far less people than the education industry, it employs far less people than the health sector. And by the way, entertainment, tourism, arts, education, there are big exporters too. But in Australia, when it comes to jobs, we talk about coal. When it comes to exports, we talk about coal. The data says that plays a very small role. But our politics and our media say, we just have to talk about coal all the time. And-- That's giving me a segue into media, because I wanted to talk about Murdoch. And how much is that shaped our country? Oh, look enormously. I mean, less so, I think, than it used to, because as a percentage fewer and fewer people buy newspapers, look, Australia has one of the most concentrated media markets in the developed world. I mean, 70, 70%, 70% of our newspapers are owned by one company, Robert Murdoch's News Corp. And News Corp dedicates its front page most days of the week to attack the hey, B.C. to literally undermine faith in a key democratic institution. So-- I don't know how that family sleeps at night. I don't know, because it's all about acquiring personal wealth. So I think they sleep on the most expensive sheets, you know, imagine. Like, you know, no doubt they think they're doing something good for themselves or their family or the world. Really? They do not like climate change. They're pro mining. And I didn't agree with them. I reckon they've got themselves convinced they're there to help. But when you put so much of a country's media and the hands of such a small group, it can do enormous harm. And look, sadly, right now, in the middle of a global pandemic that's anyone watching the news can see what happens. If this virus is allowed to run unchecked, if you look at what's happening, Italy and Spain, you know, here in Australia, you know, we have some of the best-paid columnists in the country, kind of saying it's no worse than the flu. And what are we overreacting to? These are the same people. The same people that are ignoring the medical science here are exactly the same people that have told us for decades to ignore the climate science. And they're the Murdoch people. And well, they're employed by the Murdoch press, absolutely. So it has a big effect on our country. All right. So I was just trying to set the same here. If you think about conservative politics versus liberal politics, conservative has always been about less government, right? I mean, in its most simplistic term, isn't that what the feeling is? Well, it used to be. Yeah. Yeah, it used to be. And I wrote a book about this called Dead Right. How neoliberalism ate itself. Yeah. So for many years, we were told by conservatives that cutting government spending was good. And cutting regulation was good. And if only we cut enough spending and cut enough regulation, then we'd all be rich and happy. But in recent years, that's been morphing quite rapidly. The modern conservatives love to subsidize coal mines. They love to subsidize private schools or private hospitals. But they hate to subsidize renewable energy. And they hate to subsidize domestic violence shelters and all sorts of other important public amenities in public health. So what used to be an ideology of opposing government spending has morphed into a political strategy where they oppose public spending on their enemies and love public spending on their friends. And of course, the minute the crisis hit, the government spent $200 billion in 20 days, rightly, the glad they had. Yeah, I want to get there. But before I get there, I want to talk about how globally, we ended up with three bozos. Well, I guess democracy doesn't promise good outcomes. Hopefully it just promises transparent ones. But yeah, it's not normally in his historically. Or is it where we were always going to end up? Sometimes I think it's apathy that's got us here, particularly in this country, like the people care enough, that as you say, we're wealthy enough, we get on well enough. Is it apathy that gets somebody like Scott Morrison in? But what does it take to get Scott Morrison, Donald Trump, and Boris Johnson all in at the same time, at a time where we probably needed much different leadership? Yeah, look, I think. So what have they got in common? They're all blokes, obviously. But they're all effectively populist nationalists. Each, Boris Johnson made Brexit his thing, England, getting out of Europe, England being special. Well, that's working out for him, because I'll have to close the borders now anyway. So that's-- Well, indeed. Scott Morrison was the guy who stopped the boats. And of course, Donald Trump is the guy that promised to build a wall. So all of them have defined themselves in the us versus them game. All of them? Well, yeah, a bit of the other. We should fear those on the other side of the border. And as I said before, unfortunately, there's a long-- if not proud, there's long political history of turning that into electoral success, the problem is it doesn't usually lead to social success or economic success and it certainly doesn't lead to peaceful, harmonious relationships between countries. So it's a very dangerous game, populist nationalism, but done well as those three have done it. It can be a very successful game. It doesn't take you very far in terms of a country, but it can certainly take a particular politician far all the way to White House or Number 10 or being the Australian Prime Minister. Do you know at the time of the election here in Australia where I was absolutely certainly was going to be a Labor victory? Somebody said to me the night before, "I know the reason why you vote Labor is because you're such a snob." And I thought, "Wow, when did that turn around?" "When did that turn around that now to actually vote in this country, Labor or in the US Democrats or in the UK, Labor? Is that now snobbery?" I mean, I think that there has been such a shift between those two parties in this country, whereas now, like, you know, Western Sydney are voting for the Liberal Party. It's a feel that that's astounding. It's an astounded shift and it probably happened while I wasn't noticing. Yeah, but again, I agree, but it happened for reasons. Some very clever people manipulated a whole country. If you can get low income workers in casual jobs to blame refugees and migrants instead of governments and their employers, then that's a very successful political trick. So, again, based on hatred? Of course, you know, but humans are what they are and getting people to fear another or blame another is an old and successful trick. So, yeah, I mean, think about at the last election, we talk a lot about Queensland, but Labor lost two seats in Queensland. It also lost two seats in Northern Tasmania. So, let's talk about them. So, Labor lost as many seats in Northern Tasmania as it did in Queensland. Northern Tasmania has, well Tasmania is the lowest income state in Australia and Northern Tasmania is the poorest part of the poorest state in Australia. And Labor, who was proposing to give free child care for everybody only up to $70,000 free cancer treatment for everybody, Labor lost two seats and funded by removing some tax loopholes. Labor lost two seats in the poorest part of the country, promising free health and free child care to a party that was promising to protect tax loopholes for high income earners very few of whom live in Northern Tasmania. That's no mean feat. I mean, well played, Scott Morrison, but again, the trick is to get people not to look at their own personal economic interests or the policies that would affect them personally. The trick is to just make them afraid of someone and then promise to protect them from that fear. It's astounding, isn't it? Well, you know, I'm a Jane observer of politics. Scott Morrison's not the first one to do it. Sadly, I don't think it'll be the last, but boy, that's exactly, again, if we talk so much about Queensland and coal, but really, why did Labor lose two seats in Northern Tasmania, promising free child care and free health to low income earners? And the answer is because those people were more afraid of refugees or more afraid of terrorists or more afraid of someone than they were of going broke or getting sick. I want to touch on one more thing before we start talking about COVID-19 and the economy. When I think I know the answer it is, the shift where we started, where politics or anybody just started lying generally and telling us things that weren't truths. Now, Trump is a master at it, but so is Scott Morrison. And I feel if you go back politically, it again started with Howard back in the day, if there was a minister that misbehaved or whatever happened, those people would lose their job, you know, that the Prime Minister would sack them. He didn't do that. That started then, I think. And that's when I think untruth started to be accepted. And it's becoming a pandemic, I think. Yeah, look, absolutely. I mean, politicians have lied for as long as we've had democracy. Do you think outright though? Outrightly lying with stats, outright lying, you know, like, well, let's take Trump, for instance, you know, we're all going to be able to go to Mass on Easter Sunday. Well, I hope they do because that's called natural selection. But let's say, where did that come from? That's a lie. Yeah, no, I agree. No, my point is I don't think John Howard told the first lie in politics in Australia, but my point is that he did a reprimand. Well, he didn't reprimand, but also with, you know, the lies he told about refugees throwing their children overboard. He, he, he really was a worthwhile. Well, that's my point. Like from from that point on, there was kind of no bottom. What what he realized and what subsequent generations of politics, politicians have realized after a lie, that audacious is that if you're powerful enough, you can get away with a lie, that big. Now, how do you get away with a lie, that big? Well, let's come back to the media before. When you, when you have such a large section of the media that will always barrack for one side of politics, it what what what doesn't happen now, what very rarely happens in Australia now is for basically for all of the media to at some point just say, well, that's obviously a lie. So the truth has become the partisan football and, you know, if half the media says that's a lie and the other half spends just as much time reminding people of someone else's lie, we we we're not really holding ministers to account. I mean, think how common it is now when a politician's accused of doing something wrong. Think how common it is for them to point out that someone else did something wrong. Well, if your children did that, you'd never let them get away with it. Imagine you know, you catch your key. Well, it used to be you'd lose that position. I mean, really up to John Howard before then, you wouldn't, you know, that there would be too much public pressure or media pressure and that you would have to go. Change that. He changed that, but he he was facilitated in changing that and he and he casts a long shadow because these days, it's very rare for the media to all act independently and and if a minister can point to half of the newspapers saying, ah, it's not that bad, the minister can justify sticking around. So I agree with you. I just think it's it wasn't just John Howard's shamelessness. It's the combination of a lack of shame now. I mean, I use that term literally. Like once upon a time, people would be ashamed of certain conduct and and when their colleagues began to feel shame reflected on them because of the behaviour of their colleagues, their colleagues would say, look, it's time to go. But you know, if you listen to Donald Trump, if you listen to Boris Johnson, if you listen to Scott Morrison, they're not the only people that are a bit shameless these days, but their their whole persona is based around, is based around shamelessness. Like Donald Trump will just stand up when accused of breaking the law and call it fake news and move on. Most humans couldn't endure that much shame, but politics is modern politics is kind of vulnerable to people who can endure that much shame. There once upon a time shame led to self-regulation, these days shame is seen by, is seen as a form of weakness. I mean, Bromland Bishop doesn't think she should have stepped down for the helicopter scandal. She's still blamed, no, to this day she blames Tony Abbott. She thinks they should have just tuffed it out. She literally to this day has no shame for her decision. She's proud of her decisions. And that's kind of the modern way. Don't worry about all the people criticizing you. Just tuff it out. It'll be all right. And this is a new phenomenon and we're seeing it all the time. And I get you probably see this like Washington Post or the New York Times. And they gave the heralds started doing it with a fact checking every time these people speak. And a lot of it would be at least 70, 80, 90 percent of it is wrong. Indeed. Fundamentally that makes a broken system. If everything that these people are telling us is an untruth, that is it. I think a mammoth problem. I share your conclusion. I think it's a massive problem. But in a democracy, like in the Australian constitution, there is no mention, not a single mention in the Australian constitution about the obligation on politicians to kill the truth. So in a democracy, if we We think it's okay for them to lie, then it is okay for them to lie. We can kind of be frustrated by that. We can call to some higher order principle, but under our constitution, there's no obligation to tell the truth. There's no obligation to be kind to people, there's no obligation to make good decisions in the long run. It's up to us voters to decide who should be in those positions. And part of the shamelessness, this comes back to what I was saying about how kids behave, part of the shamelessness is to whenever you're accused of doing anything, is to just accuse everybody else of doing something even worse. And that has a terrible effect on our democracy, a terrible effect on our body politic, because what it does is it normalises the idea that everybody lies, or everybody's got their fingers in the till. And if voters actually believe that everybody's got their fingers in the till and everybody lies, then there's no point getting too angry when one person lies is there. So it's a terrible consequence for our democracy. It is. And I want to kind of segue into COVID. But before I do that, do you think Barack Obama was a liar? I'm sure he did tell a liar of his truth at some point, but not to the same extent. No, I don't think anything, anyone's like Trump. I don't. But I just, I don't know, I can't put my hand in my heart and say everything. Barack Obama said it was true. I'm sure he was obliged to lie to not just ask but the American people about some elements of their foreign policy. I think he would have had a problem with that thought. I think he wasn't shameless. I don't think he was shameless. I didn't say that. No, I know. Yeah. But my point is, you know, when a country employs as many spies as America and those spies are learning things about their rivals across the country and across the world, it's kind of inconceivable to me that Barack Obama wasn't obliged to tell lies at some points. Otherwise, he'd reveal how much he knew about what was really going on. So. But again, I don't think he was shameless. I think he took democracy more seriously than that. OK. So then we have this pandemic, right? And I want to talk about the onset of it because there are so many people that I knew at the time saying shut the borders down, shut the borders down. Now that didn't happen and it's where we're at now. But I wonder, like on reflection, I have a wonder, who makes that call? Where is the world leadership these days? I mean, it used to be that there was, you know, a few, you know, European leaders like Anglomercal or, you know, Barack Obama, for instance, from the States and whatever, that there would be a collaboration and that they, I feel that if we had those types of people leading the countries or leading the world at the time, that maybe we wouldn't have got here, but that could be just my bias. So tell me what you think. Well, you know, let's be clear, there's no such thing as a world leader. We have nation states with leaders and the leaders of some nation states have a moral power that they can exert beyond their borders. But at the moment, you know, I don't think Donald Trump exerts nearly as much moral leadership outside of his borders as Barack Obama or indeed George W. Bush. So yeah, I think, you know, this crisis has hit at a time where because they're a populist, nationalist, in charge, those people have kind of proudly cut themselves off from performing a leadership type function. Margaret Thatcher had power outside of her borders, not because of any constitution, but because people took her seriously and she wanted to be a player on the world stage. So yeah, it's interesting. I mean, Scott Morrison made his whole career out of protecting the borders and, you know, he couldn't even protect Sydney from a passenger ship. So it's, I think, you know, history. At the moment, I've got to say, I think Australia broadly is doing a lot better than most countries and, you know, better than perhaps than some people thought we would have a week or a month ago. I just, well, I think our infection rates are not as bad as most similar countries we've seen. I think partly because we had a head start. We've literally got a crystal ball. We can look into two or three weeks into the future called Spain and Italy and it makes it a lot easier for Australian leaders, state and federal to avoid the mistakes made in those countries because we can literally see what happens if you don't act decisively. But still, I think the early stage of the outbreak in Australia was, wasn't managed as well as it could have been. But there's no doubt that at this point in time Australia appears to be doing a lot better than the Italy Spain or certainly the US. You know, I think about the humanitarian crisis that's going to happen because of this. And firstly, you know, you think about those cruise ships that are apparently there's 18 cruise ships out there that are just wandering the ocean and they've got sick people on there and nobody will take them. I mean, again, you know, that requires some kind of global leadership, doesn't it? I mean, in a way, I feel that that's very, it's tragic on so many levels. It's also a humanitarian problem. But it does frighten me that it isn't even one of the things that we think is a crisis and we have to deal with it now. Look, absolutely, but again, this hits at a time where a populist nationalist like Trump is engaged in a trade war with China rather than the leaders of the biggest countries getting together to solve this problem. China and America are throwing rocks at each other in an attempt to gain leverage and legitimacy over each other in the eyes of the world. So of course, some combined world leadership would help us get out of a crisis like this as it would help us get out of a crisis like climate change. But there's no constitutional obligation on the American president or the Australian Prime Minister to act in the world's interests. But there's certainly lots of incentives for them to act in their own short term political interests. And that's sadly what we're saying. What do you think will happen to those 18-go ships? Apparently there's something like 13,000 crew members out there. Oh, look, I don't know. I hope that Australia finds a way to be compassionate and helpful to those people, not just because we have an obligation to do so, but because there's Australians on ship stuck off other countries borders. And the way we cover Australians stuck off a port in the US being held captive, we need to compare that to the way we're looking at how we're treating both stuck off our own borders. Again, some international leadership would be nice, but it's not inevitable. So what's it got to do to us? Like say, at the current moment, how do you think governments are handling it? And again, I think that this is interesting where government has had to intervene where, you know, we've got a party that doesn't believe in government that much. But anyway, they are there and they're having a press conference almost every hour. Sometimes they're saying something, sometimes they're not. But what's your view on how this government is handling it? Well, I think that they were slow off the mark. I think that, you know, the next message from the Prime Minister was literally two weekends in a row. One weekend, I'm off to the footy because I love my sharkings. The next weekend, I can't believe Australians went to Bondi. It's unastraying to go to the beach. Those two things, I mean, time is a bit warped now that we're all stuck at home. But those two things happened on successive weekends. So similarly, you know, there was footage of the health minister sitting next to the Chief Medical Officer, shoulder to shoulder on morning television one day with the Chief Medical Officer saying it's okay to shake people's hands five hours later. The Prime Minister was standing next to the Deputy Chief Medical Officer. They were two metres apart. He said it's common sense that we should stay away from people and it's common sense that we shouldn't shake hands. So, you know, to be clear, there were very small and very big problems at the beginning of this crisis that weren't well managed, particularly at our ports and particularly at our airports. So, the role out of the lockdowns has helped a lot. Could it have happened sooner? Perhaps. We probably just needed to pay much more attention to people coming in from overseas, where the vast majority of the cases stemmed from. And on the economic front, the government in 20 days has spent nearly $200 billion on new measures to give you some sense of the significance of that in an ordinary year, the federal government would spend a bit over $400 billion in 20 days that spent an additional $200 billion. we have an even. were gun to deal with this crisis. So they've abandoned their small government, small spending, they've abandoned their obsession with budget surpluses. But I think a lot of the new measures they've announced in history won't judge them well. I don't think they're being targeted at the people and the industries that need the most. There's big spending and that's better than small spending. But just because it's big doesn't mean we shouldn't still target it as carefully as we can. And a lot of what we're calling a wage subsidy is probably going to end up being a business subsidy. And that's going to cost us a lot of money and probably not save as many jobs as spending that same money in different ways, mate. I wonder what's the deal with hairdressers, do you think? Do you think he feels as though he needs a haircut? I don't know if you're teasing, but I'm bald. So I'm the wrong person. That's he who says the hairdressers is still open or still meant to be open. I know a lot of them made their decision. But if I'm walking down the street, for instance, Richard and a policeman stops me and I say I'm going to get my hair cut and coloured, is that a valid reason? Because they've still decided that hairdressers should be open. And so that's an essential service, right? Yeah, look, I think that we haven't done a good job of communicating what is and isn't essential. And again, it's cruel to ask me where the haircuts are essential or not. But yeah, I think that's one of many examples of where the people are getting quite mixed messages about what's appropriate, what's OK, and what they should do differently. And for a man who won the election stensibly because he was such a good clear communicator, it's strange to say the least that he's done such a poor job of communicating some of those messages. I don't know how good he was. Well, I guess he did, he won the election. He won. But remember the communication about the bus in Queensland, he actually wasn't on that bus. But anyway, we won't go there. OK, so in terms of-- and I don't know how much about this that you know-- talk to me about a pandemic and the dangers. Like, what are we looking at three months, six months, nine months? I know it's the great online. But do you have any signs behind that? Look, I don't, but I've read a lot of the signs. And look, it looks like that we'll be living a quite a different life than we ever imagined for at least three months, possibly six. We won't have any international tourists, for example, coming to Australia for at least six months. Usually governments are trying to stimulate economic activity. But let's be clear, you know, they've done the right thing here for health reasons. But it's the government that's crushed our tourism industry, crushed our retail industry, crushed our food industry, and crushed our export education industry. For good reason, I'm not criticizing them for that. But to say this is unprecedented is a bit of an understatement. Sydney getting hit by a meteorite would be unprecedented from an economic point of view. This is unlike anything we've ever imagined before. Government having to use the power of the state to shut down some of the biggest employing industries in the country for months and months on end. And as an economist? Well, as an economist, I can just tell you what it's going to look like. If no one wants to see scenes in Australian hospitals like Italian hospitals, there is no pill that can help. The only way to stop the spread of this is to keep people away from each other. And the only way to keep people away from each other is to shut down all the venues where people gather. So as an economist, should we avoid the scenes in Italy or not? Well, that's a social moral and ethical question. One, I don't think we should, but that's not an economist's perspective. That's a citizens perspective. What are the economic consequences of that? Well, they're enormous. The government is going to run deficits of hundreds of billions of dollars a year for the next two to three years at least. The government is going to employ hundreds of thousands of extra people to perform all sorts of essential services, not just in health, but in now seeing free child care. I'm going to see a radical increase in the size of government in our society, which coming to back where we started this conversation. We're going to look a lot more like Sweden and Norway in two years' time than we did last year. And personally, I think that's not a bad thing. But that's ultimately a democratic decision that others will make. How will we look as a country at the end of it? Well, we're going to look poorer. We're going to have between one and two million unemployed people in the lead up to the next election, probably closer to two than to one. We're going to have-- So you're implying that it's going to take you? Because what? We're only year two into this government. So we've got another two years. So you're implying that when it's going to take a long time to recover? Well, the crisis itself is going to run for anywhere between three and 12 months. And recovery from an economic crisis like this will always take longer than the crisis itself. So yeah, by the time we go to the election in 2022, there'll still be way over a million unemployed people in Australia will still have families grieving from the loss of the people that have tragically died. Businesses will have gone broke. Some industries will never recover. We're used to having two big airlines in Australia. It's not inevitable we'll end this with one. We're used to having big retailers like David Jones and Meyer. It's not inevitable that in that this both of them will still be there. And again, hundreds of thousands, possibly more than a million people are going to lose their job. And that's going to take years and years to unward. Wow, that's quite depressing, isn't it? There is no good news in this. We've been sold for years the idea of paying for gain. If we do this now, we'll be better off in the future. We might not agree with the medicine that we're often forced to take. But the people telling us to take the medicine usually have some story about how after we take the medicine, better off. Let's be clear, after we endure this, we'll just be worse off. We'll be poorer. We'll have mass unemployment. And hopefully, it's not too bad. But I think we'll have a society that's pretty frustrated. And that's fertile ground for populist nationalists. But it's also fertile ground for those that think now is a time to build a new kind of society, a new kind of democracy. That site that debate is yet to play out. But no one goes through something like what we're about to go through without having an impact on the way they see themselves in the world. OK, we need to finish off largely our listeners, our readers. And so I want to try and finish off on a positive note here. And I think that they're on a personal level and on things stopping, for instance, and us being told to adhere to the message of stay at home. We've seen a spike in book sales. And it might just only be for a couple of weeks at this stage. But where people are stockpiling books to read. And I often think about the story and how the story has survived through time. What's, I mean, I guess that to me is it's more of an emotional view, I guess. But when I think about story, it is part of everything we do. It is part of the economy. It is part of politics. It is part of family, social, home life, everything else. What's your view on that? Oh, look, absolutely. So 15 years ago, I wrote a book called "Athlowenza." And two years ago, I wrote a book called "Curing Athlowenza." Right. And in the more recent book, it's really all about the power of story to change our economy and our society. The stories we tell ourselves about what's possible and what's desirable have enormous cultural and economic impacts. Now, let me give you a trivial example. Every men's jacket you've ever seen has got four buttons on each cuff. Every jacket comes with eight buttons. And none of them work. None of them work. They are pointless. Right. But if I wore a jacket that didn't have those buttons on it, everyone would think it looked funny. Yeah. So our cultural norms determine so much of what we do. The entire industry for making ties is a bizarre cultural construct. Wildness, but anyone tying not around the index. But the answer is, if everyone expects you to, then you will. Well, our cultural norms radically shape our economy. 20 years ago, almost no one went out for coffee and no one paid five bucks for a takeaway one. In Australia today, 500,000 people work in our cafes. Well, 50,000, a tenth of that work in our coal mines. So the stories we tell ourselves about what we do and why we do it and what's normal and what's not. The major driver of culture, but culture is the major driver of the shape of our economy. There are plenty of countries in the world where you can't get a good coffee, but they're still happy enough. We can't get through a day without a good coffee. How could you live like that? So culture determines almost everything we do. Of course we need to eat, but what do we need to eat? Are we a vegetarian society or a meat intensive society? Don't get me started. That's a whole different podcast. My point is these are just cultural questions. And what we're experiencing right now is a radical change to our culture. And from my point of view, if we as a society spend a lot more money buying books, getting a massage and paying someone to teach me how to play the piano, if we spend a lot more money buying ideas and buying services, and we spend a lot less money buying foot spars and crap at Christmas that we know our friends and family don't want, then we would tread so much more lightly on the planet. We wouldn't ruin the economy if we all stopped buying hot dog warmers and foot spars, but what we do is change the shape of the economy into one that employed a lot more people that did things that don't harm the environment while consuming a lot less natural resources and protecting the environment. So we really can change the shape of our economy and the shape of our natural environment simply by having new norms about what we buy and what we think is valuable. Well, I think people should be buying books and they should be reading stories and they should be making stories as well. Me too. Richard Dennis, I can't thank you now if that was a fantastic conversation and I want you to come back and have another conversation with us at some point. Anytime, we've all got time now. Thank you so much. Thank you. If you'd like more information about better reading, follow us on Facebook or visit betteredinc.com.au. This podcast is proudly sponsored by Belinda Audio. Belinda audio books are available on CD and MP3 from online booksellers and bookshops everywhere or you can download from audible Google Play or the iBook Store. We've also created our own app called Borough Box that's available from both the App Store and Google Play. All you need to do to get it working is to download the app, join your local public library and you'll gain access to the world's best collection of eBooks and eAudio Books available for you to learn on your phone or your personal device. Belinda, we're here to enable you to escape, imagine, grow and be inspired through the power of storytelling. Belinda Audio Books, anywhere, everywhere. If you enjoyed this podcast, leave us a review and check out the other podcasts on the Better Reading Network.