Scott Morrison and Josh Frydenberg are presiding over the biggest economic collapse in more than 75 years, and yet they are not being punished politically and even ride high on public support.
It’s because the official recession we now have is not the “recession we had to have” but the “COVID-19 recession”; the result of a global downturn, which in turn is the result of a global pandemic.
Instead of the immediate political and economic debate being about the dire “eye-watering” debt, deficits, job losses, spending and collapse of GDP, the pressure point is about the future.
The Prime Minister and the Treasurer are not being punished for the recession or the extent of debt, deficit and job losses because the coronavirus pandemic has changed all the ground rules and public expectations.
The budget in October will be a grim document of pessimistic forecasts and a generational burden yet, like going into recession, it is unlikely to be judged harshly.
Yet the abandoned May budget, being judged before the global health and economic crises, would have severely damaged the Coalition’s standing and Morrison’s credibility and electability if it did not deliver a credible budget surplus, increase growth, start debt reduction and forecast unemployment falling below 5 per cent.
But as Australia falls into recession with the worst economic figures since the Great Depression, the prospect of double-digit unemployment, the biggest national debt, the largest budget deficit and generations of unsustainable spending the public is concerned but forgiving.
People are still most concerned about the health threat of the pandemic, fear of catching coronavirus themselves, or their families being infected, and continue to support political leaders who make mistakes, even grave errors.
This is not a recession created by tough policy or a lack of economic management – the public sees that and is giving latitude in an emergency which would never have been granted in a Covid-free world.
Before the pandemic Labor worked on a line that the budget and the economy were not in “good shape” because of the mistakes, lassitude and policies of the Morrison government. The argument has been swamped.
Anthony Albanese and Jim Chalmers have moved on from plans to scream about lack of a credible budget surplus and economic failure to talking about jobs and a plan for the future.
As Albanese said on Monday: “Australia is in the first recession in three decades. And still, we don’t have a jobs plan from this government. The government needs to address the fact that there’ll 400,000 additional unemployed, on top of the one million who are unemployed between now and Christmas.”
In these forgiving times there’s little else they can do but lay a new groundwork for an argument about recovery after the pandemic and concentrate on other issues, such as aged care and superannuation.
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