Beware second-wave coronavirus calamities

In a month Australia will be in winter. Until now we’ve managed to suppress the rate of coronavirus infections well beyond expectations, via early border controls, quarantine and strict social restrictions. Three months ago when we imposed a ban on travellers from China, extending it to Iran and Italy, biosecurity experts believed the best-case scenario would be if 20 per cent of us were infected, or about five million people; with an anticipated mortality rate of 1 per cent, we could expect 50,000 deaths because of COVID-19. Yet here we are with fewer than 6800 cases and just under 100 fatalities. We’ve flattened the curve, although at immense economic cost. Like New Zealand, which aimed for elimination of the virus, we have attracted attention from countries that want to learn from our experience.

But, without a vaccine, we’re not out of the woods. This coronavirus is sly, incessant and lethal. Deputy Chief Medical Officer Paul Kelly warns of a possible second wave of COVID-19. Epidemiologists say there could be second and third waves, deadlier and harder to fight, as with the Spanish flu a century ago. In Singapore, which had early success, the beast is out in the community, with 700 new cases in the past day. Did they get cocky, as some medicos believe? It has forced closure of businesses and schools for four weeks in the city-state.

As authorities here plan an easing of social restrictions and staggered returns for some activities, such as schools and community sport, they will need to be vigilant. Working in our favour is the good progress on three preconditions national leaders have established. First, ramping up capacity in hospital intensive care units, including more ventilators. Second, widespread testing, especially of asymptomatic people. More than 550,000 tests have been completed and officials want 50,000 people tested a day. Third, enhanced contact tracing. The new voluntary COVIDSafe app, based on Bluetooth contacts, will allow infection hunters to work more effectively. The app has been downloaded more than 3.3 million times. The Morrison government is seeking three times that many users to enable an easing of restrictions on “high-value, low-risk” economic activities. While we are sceptical of more state power and worry about threats to privacy, the emergency-level imposition appears warranted.

After shutting down the economy, the Morrison government insists its “whatever it takes” fiscal response to cushion the financial blow for workers and businesses is temporary, targeted and proportionate. We accept it is necessary and sufficient, given national output is forecast to shrink by 10 per cent and the jobless rate will hit double digits. Scott Morrison has used the term “snapback”, not so much to describe a sharp rebound in activity but to emphasise government support is limited and that a doubling of payments is not sustainable. Nor is a loosening in means-testing or obligations on welfare recipients. Still, there is a looming labour market and business viability crunch. Companies will use down time to recalibrate needs and costs; some will thrive but others will disappear. Sadly, as we have seen after earlier economic calamities, many older people will never work again.

A second wave of economic dislocation and despair is likely. It’s clear overseas travel bans are going to be in place for some time. The international tourism and education sectors, hit first and hard, won’t have time this year to draw proper breath. If Australians have no choice but to holiday at home, that may help some operators. But universities and colleges reliant on fee-paying foreign students — human cash multipliers who incur living costs and explore the country — will see their revenues plummet. As a nation, we need to be alive to countless disruptive forces at play. That means making changes to the way we work and do business. We need to take the shackles off companies, make it easier for them to expand, invest, innovate, hire and train people. That’s entirely the point of calls for reforms that boost productivity. Alas, this won’t be easy to do in a dire political domain, where mavericks often hold governments to ransom. But the alternative is grim: stagnation, oblivion and unrest in a nation smashed, wave after wave.