Economic implications of a SARS/Coronavirus outbreak

[jbocker]

Didn't get that detail.
She was thankful that he was still working, and was quite accepting that this is perhaps going to be how it is. My comment is around the potential FIFO employment style transitioning back to Mining towns. Ultimately the desire to be in company of your family must be weighed against what you earn.

Ok just chatted some more with the hubby. Still in the planning, but likely to be two or three teams working in shifts and living in a 'commune' (my words) on site keeping the place running. This will be in place till a vaccine is available and some rotation can be safely introduced. The 14 day isolation will be shortened on eventual swap outs if and when better testing is available. Even if the family is local, you wont be going home. In the meantime all others are out.
If these are not in place it could mean no power for the city.
I would guess a lot of this sort of thing is being put in place elsewhere.

 

[Sdajii]

I have thought of that as well but I suppose they have so many other bugs in India that by comparison this one is not strong enough to do severe damage.

I also thought that the heat may effect the virus, they do say that cold weather suits it which is a worry with our winter around the corner

If you've properly seen India you'll understand that early on this will go unnoticed there. It'll wipe out a small percentage of people in the slums and no one else will notice or care much, including people in the slums (death and disease is just a way of life there, it's already bad enough that extra won't be particularly noticed). The people on the wealthy side of the divide will be more concerned. I can't see a place as chaotic and crowded and dysfunctional as Indian effectively achieving much in the way of quarantine etc. My friends in India I've been speaking to are split between thinking it's a big worry, and.thinking no one in India needs to worry because they have traditional Indian medicine (aruyveda? I can never quite remember) and cow urine (to drink), which they believe protects from literally any disease. I'd probably be concerned for.India if I hadn't already been there, but a place which still has people dying from leprosy, plague etc will function as per usual.

Heat does kill the virus more quickly but is only relevant for things like door knobs, keyboards, ATM buttons, etc. How much of a difference heat makes is difficult to measure, and is not relevant for direct human to human contact, and only partially relevant for things like pens etc. Direct contact w
might be the majority of the spread anyway.

 

[basilio]

Good analysis.

How the Covid-19 recession could become a depression
Coronavirus is a global economic catastrophe.
https://www.vox.com/2020/3/23/21188...-recession-depression-trump-jobs-unemployment

 

[basilio]

Federal Government offers $130b in coronavirus wage subsidies for businesses to pay workers
Businesses will receive a fortnightly wage subsidy up to $1,500 per employee as part of a Federal Government bid to prevent millions of people from losing their jobs to the coronavirus pandemic.
Key points:

• • The Government expects up to 6 million people will access a $1,500 fortnightly wage subsidy
  • The so-called JobKeeper payment is designed to keep people in work
  • The Government will also lift the means-testing threshold for the partners of JobSeeker recipients

The subsidy is the central plank in a $130 billion economic stimulus package, the third and largest package the Government has announced in response to the coronavirus.

Prime Minister Scott Morrison said he expected 6 million Australians would access a so-called JobKeeper payment for the next six months.

He said there would be a legal obligation on employers to ensure they passed the full wage subsidy onto employees.
https://www.abc.net.au/news/2020-03...sidies-government-businesses-workers/12103108

I'm trying to understand how this is going to work.
Lets say you are a hotel, restaurant or retail shop that has been closed down. You have stood down or sacked all your staff because you don't have a business anymore.
Are you supposed to take this government subsidy and give it to all your former employees even though they can't work for you because the business is closed ? What does the business owner get to be the administrator ?
What safeguards are there in place anyway to ensure the business owner doesn't just pocket most of it and let the staff get some pocket money ? (Be absolutely sure the hospitality trade already does this ..)
Why will any business currently in operation not immediately shut its doors to qualify for this largesse ?

What will happen to the 20,000 Qantus staff who were stood down ? They are not going back to work in a hurry .

Is this just a way to avoid the official unemployment figures going through the roof ?

 

[basilio]

Does this seem really, really strange ?
Wrong ? Inflationery ? Over the top ?

Workers earning UNDER $1,500 previously will get pay rise
If you are are a worker who has earned less than $1,500 a fortnight, you are about to get a pay rise (if you are an eligible worker):

• If you ordinarily receive $1,500 or more in income per fortnight before tax, you will continue to receive your regular income according to the prevailing workplace arrangements. The JobKeeper payments will subsidise part or all of your income.

• If you ordinarily receive less than $1,500 in income per fortnight before tax, your employer must pay you, at a minimum, $1,500 per fortnight, before tax.

• If you have been stood down, your employer must pay you, at a minimum, $1,500 per fortnight, before tax.

• If you were employed on 1 March 2020, subsequently ceased employment and then were re-engaged by the same eligible employer, you will receive, at a minimum, $1,500 per fortnight, before tax.

https://www.theguardian.com/austral...gatherings-cruise-lockdown-app-latest-updates

 

[SirRumpole]

I'm trying to understand how this is going to work.

There are always unintended consequences of packages like this.

Giving money directly to individuals who have been laid off through Newstart seems the fairest things to do.

Giving businesses breaks on rent, loan repayments and utilities seems the fairest compensation to businesses.

Damned if you do and damned if you don't in cases like this.

 

[basilio]

More information about the Government proposal to underpin wages and business income.

https://treasury.gov.au/sites/default/files/2020-03/Fact_sheet_supporting_businesses_1.pdf
https://treasury.gov.au/sites/default/files/2020-03/Fact_sheet_Info_for_Employers_0.pdf
https://treasury.gov.au/sites/default/files/2020-03/Fact_sheet_Info_for_Employees_0.pdf

 

[PZ99]

If I had a choice I'd take the wage subsidy over the double dole newstart thingy.

At least you're still in the books and your employer won't need to rehire and retrain.

Don't know why we're doing both? We can't afford both. If there are no jobs to find and you're told to stay at home I don't see why you need nearly 2 newstart payments every week.

This spending is wa-a-a-y over the top. It's the anathema of everything this Govt stands for.

If you want to blow the budget - there's the Greens party. We don't need a govt that's basically a clone of that.

 

[Knobby22]

It will save the banks, hence the huge rises today.

 

[againsthegrain]

It will save the banks, hence the huge rises today.

save the banks and a somewhat controlled deflation of the housing bubble, hopefully doesn't bankrupt the government

 

[macca]

If I had a choice I'd take the wage subsidy over the double dole newstart thingy.

At least you're still in the books and your employer won't need to rehire and retrain.

Don't know why we're doing both? We can't afford both. If there are no jobs to find and you're told to stay at home I don't see why you need nearly 2 newstart payments every week.

This spending is wa-a-a-y over the top. It's the anathema of everything this Govt stands for.

If you want to blow the budget - there's the Greens party. We don't need a govt that's basically a clone of that.

Agree, makes a lot more sense to subsidise those who are used to a wage, those on the dole /pension continue to get the same as always

 

[Dona Ferentes]

It will save the banks, hence the huge rises today.

Good idea. Banks are different.

 

[Smurf1976]

Biggest concern I have about payments is that I wonder if this is an attempt to fudge the statistics?

Someone still technically employed and being paid taxpayer funds via their employer but not actually working will be included in the statistics as an unemployed person, right? Or not?

If not then it reeks of politics since that arrangement and being on the dole are much the same in practice. Both involve being paid welfare and not working so my hope is that this isn't an attempt to fudge the figures on a technicality.

 

[Smurf1976]

Giving money directly to individuals who have been laid off through Newstart seems the fairest things to do.

One thing I do hope comes out of all this is a proper review into the amount paid to the unemployed.

Sure there's a few dole bludgers but from what I've seen the majority of unemployed people will have a go if given a go. It's business which is often the stumbling block there in not being willing to give a job to anyone who hasn't already got a job somewhere else.

So I do hope we see some change in that area both with amounts paid and from business with a change to how people are hired. It's time to bin the BS and give people a go.

 

[basilio]

Biggest concern I have about payments is that I wonder if this is an attempt to fudge the statistics?

Someone still technically employed and being paid taxpayer funds via their employer but not actually working will be included in the statistics as an unemployed person, right? Or not?

If not then it reeks of politics since that arrangement and being on the dole are much the same in practice. Both involve being paid welfare and not working so my hope is that this isn't an attempt to fudge the figures on a technicality.

Spot on. I can certainly see how "managing" multi millions of people via wage subsidy rather than unemployment benefits will keep the figures looking good.
This certainly protects the banks, property owners and the housing market. People should now be able to pay rent, house payments and basic bills with reasonable ease.

I am really wondering how this can translate into other economic activity. No entertainment, travel, retail spending. What's left are basic bills, perhaps cars ?, and then online expenditure on whatever.

 

[sptrawler]

I think these subsidies will be better viewed in hindsight, I really don't know how it will all work and I can't even speculate the weird stuff that will go on.
I think in 6-8 months time, the newspapers will be full of articles about it.
A mate, who is a 60year old brickie, can't wait to get onto it.

 

[basilio]

One point I can't quite see is "What is in this package for the bosses ?"
The laudable intention of this Job Savers program is to keep employees linked with business and allow the business to go into hibernation so to speak for 3-6 months.
Meanwhile the "precious" employees are still being paid or largely subsidised by the government.

But will the people who are taking home 300k, (or $3m) plus a year be content with holding an operation that is simply paying essential running costs and its staff ? Seems very altruistic to me.

 

[PZ99]

Biggest concern I have is that I wonder if this is an attempt to fudge the statistics?

Someone still technically employed and being paid taxpayer funds via their employer but not actually working will be included in the statistics as an unemployed person, right? Or not?

Probably not. As a worker you are basically on unpaid leave so technically not unemployed.
Your status as unemployed isn't determined by a Govt handout. If it was, we'd probably be 20% unemployed given that we are a welfare state already

If not then it reeks of politics since that arrangement and being on the dole are much the same in practice. Both involve being paid welfare and not working so my hope is that this isn't an attempt to fudge the figures on a technicality.

I think the wage subsidy could've been handled by the ATO - simply use last years' tax return to determine your eligibility and receive a credit in your bank account like you normally do with a refund. No need to violate the 1 meter rule by queuing up like packed sardines at centrelink.

When it's over you go back to work and be happy. (I'll be curious how they declare it to be over - OZ is a big diverse place so it won't be a uniform event)

Fudging the figures is a very flexible term. Any govt spending is added to GDP so you could say the Rudd govt avoided a recession simply because they spent a truckload of money. They also ran up a fairly large debt which has never been mitigated because we've never had a budget surplus since. I think it topped out at around $200b after 6 years.

These programs eclipse that in one go. You can imagine what's going to happen if we add this and the lost tax revenue to all that accumulated debt.

It means every future govt will be permanently hamstrung and will never be able to govern in their own right. Inter generational theft at its very finest. Forget about OK boomer

 

[basilio]

I reckon one certain loss from the budget will be the third tier of tax reforms promised by the Liberals.
Absolutely no way these can ever see the light of day.

On the big picture I think there will have to be some amazing budgeting to handle the $300plus billion expenditure increase and collapse of income. This will be forecast in the October budget.

 

[Smurf1976]

Still in the planning, but likely to be two or three teams working in shifts and living in a 'commune' (my words) on site keeping the place running. This will be in place till a vaccine is available and some rotation can be safely introduced. The 14 day isolation will be shortened on eventual swap outs if and when better testing is available. Even if the family is local, you wont be going home. In the meantime all others are out.

There's quite a few places doing variants of that yes.

Essential industry (power etc) and a few manufacturing plants etc too.