The economic recovery will be slow, and the government will continue to dominate it
This is no blip. There will be no ‘snap back’. And the fiscal fire brigade is spraying money at the rate of a flooded dam, not a fire hose.
Yesterday’s unveiling of another $20 billion in income support for the December 2020 and March 2021 quarters is sound policy.
But in the absence of a vaccine or a remarkable turnaround in which Australia achieves New Zealand-style elimination and can resume normal economic life within closed borders, the extensions push off into 2021 any kind of return to economic normality.
That is, a world in which the government is not central to economic growth and job creation.