Austerity Is Prolonging the Pandemic
The Australian government had two years to build hospitals, train health care workers, strengthen social services, and manufacture COVID tests and vaccines. They didn’t, because it would have gone against the neoliberal consensus that unites both major parties.
Over the last few weeks, Australians have lived through a governmental failure unprecedented in living memory. For hundreds of thousands, attempting to get tested for COVID or accessing the health system has exposed a remarkable degree of dysfunction. For most, it’s extremely stressful. For some, it’s life-threatening.
As the rising caseloads overwhelms the public health system, there will be avoidable deaths and unnecessary pain. Indeed, the experience of watching state and federal governments lurch from ad hoc announcement to ad hoc announcement has driven anxiety and obliterated remaining confidence in government. For health workers, the moment is nothing short of traumatic.
How did it come to this? Australia’s governments had two years to plan for this moment. For most of 2020, state and federal governments told us that once the vaccination rates reached a high enough level, we would have to open up and “live with the virus.” You’d be forgiven for thinking there was a plan in place to deal with this new stage of the pandemic. In reality, however, both federal and state governments were woefully underprepared. Understanding why this was the case lays bare the limits of the political-economic frameworks that have dominated Australia since the 1980s.
The Plan That Should Have Been
We have had two years to learn about how to manage the reopening from overseas data and experience. Australia could have coordinated this so much better, with far less damage to the population.
Most obviously, the state could easily have significantly boosted health capacity. At the beginning of the pandemic, the government could have immediately began recruiting thousands more nurses and health workers. They could have sped up this process by fast-tracking training and by offering incentives to encourage uptake. Offering a substantial raise and/or pandemic bonus could have helped with retention, by compensating for the toll that the crisis has taken, while attracting trained professionals who have retired or changed careers back to the field.
At the beginning of the pandemic, the government signed contracts with private hospitals, to pay them for use of their beds in critical moments. Instead, private hospitals could have been nationalized and brought under a comprehensive public plan. This would have saved money and allowed elective surgeries to continue. Beyond this, in two years, we could have established hundreds of public general practitioners and pathology clinics to coordinate a massive expansion of PCR testing and to strengthen in-home care. At the very least, they could have established a well-resourced hotline to give people advice and facilitate access to the resources they need.
Instead, some governments did the opposite. For example, the Queensland Labor government of Annastacia Palaszczuk froze nurses’ wages in 2020 and cut $1 billion worth of funding for hospitals under the guise of “efficiency dividends.” Across the country our supply of ICU beds has in fact declined by two hundred since the start of the pandemic.
We also had two years to boost local manufacturing. The government could have expanded and taken control over manufacturing PCR tests, Rapid Antigen Tests (RATs), N95 masks, and oximeters for in-home monitoring. This would have made it far easier to distribute these much-needed supplies for free, and to match the demand during surges.
Instead, federal and state governments did next to nothing to improve our medical supply manufacturing capacity. In 2020, the Queensland government gave a local manufacturer a grant of an undisclosed value to scale-up RAT production. Ellume is now producing a hundred thousand RATs per day — but they are being shipped under contract to the United States.
The government could also have renationalized Commonwealth Serum Laboratories (CSL) or established a new, publicly owned pharmaceuticals company to develop and manufacture vaccines and antivirals. In fact, the Queensland Greens called for just this at the start of the pandemic. In addition to overcoming domestic delays in the vaccine rollout, this would have allowed Australia to support the vaccination of the developing world. Instead, the federal government has only recently signed an “in principle” agreement with Moderna to begin manufacturing their vaccines in Australia by 2024. And even then, this won’t put an end to Australia shelling out millions to multinational pharmaceuticals companies.
Lastly, in two years, we could have designed a comprehensive social support system. We could have established easily accessible paid pandemic leave and carer’s leave. We could have permanently boosted social welfare and health support. This would make it far easier for people to self-isolate when sick or exposed. Instead, testing positive or being exposed has meant a loss of income for many.
Why Did Australia Stuff It Up?
While state Labor governments aimed to eliminate COVID-19 for most of 2020 and 2021, the Liberals always preferred a “let it rip” approach. Despite these differences, all governments have failed over the last few weeks. And this exposes a deeper unity between the two major parties. Both are fundamentally disinterested in pursuing any plans that include expanding health and social welfare capacity. To do better, we need to understand why this is the case.
Part of the answer is short-term cost. Relying on lockdowns, border closures, and policing was cheaper than the massive boost in social spending that would be needed to allow Australia to cope with COVID. After an initial wave of crisis expenditure in 2020, the federal government has run up a significant debt, and is now looking for ways to make cuts in the long run (i.e., shifting the burden back onto everyday people).
To continue spending without new sources of revenue would risk Australia’s credit rating being punished by international finance capital. Obviously, deficit spending could have been avoided or paid down by imposing taxes or instituting a pandemic levy on billionaires, Big Mining, and banking corporations. But this would have provoked a backlash from some of the most powerful forces in society.
Cost, however, doesn’t fully explain it. The federal government is happy to spend exorbitantly on the military — for instance, the recently signed contracts for nuclear submarines and tanks will cost at least $135 billion.
The other part of the answer is institutional. From the 1980s onward, both parties, as well as the policy establishment — think tanks, consultancy firms, the media, senior public service — have been committed to neoliberalism. This doctrine regards the private market as the preferred vehicle for service provision. According to this model, governments have privatized public services, and then paid those private companies to provide those very services.
This economic doctrine has failed badly. On the one hand, private providers have proven inept and inefficient. For example, privatizing energy drove up prices while making it harder to plan the transition to green energy. On the other hand, reforms like Keating’s 1995 National Competition Policy, which imposed market logics on public services, stripped them of capacity by forcing them to streamline operations. In public hospitals, for example, efficiency meant cutting all slack in the system, and running hospitals constantly at capacity. This meant when the pandemic begun, our hospitals were already working overtime.
None of the ideological justifications for neoliberalism matter anymore. It has long been apparent that the ultimate goal was to boost corporate profits. Under neoliberalism, governments have proven they can spend big — for example on the military — provided they don’t challenge corporate profits, for example, by expanding public services.
This political vision — and the corresponding power structures — are so deeply ingrained in the governing parties and the state institutions, it’s unlikely that anyone close to power even considered the alternative, which is focused on public ownership or planning.
Perhaps, however, there’s a bigger and more sobering explanation behind Australia’s failure in the face of the pandemic. There is no significant group in society advocating for an alternative to neoliberal capitalism. Policies that go against the grain, no matter how rational and achievable, are not going to be adopted without major social pressure. Instead of debating a planned, public response to the pandemic, the atmosphere of emergency early on meant that most of the debate revolved around lockdowns and border closures. No doubt low public expectations — themselves the result of decades of privatization — also contributed to this.
After two years, we need to change tack. Hopefully, new cases will peak and then decline in the coming months, and with them, hospitalizations. However, the virus isn’t going to completely disappear and new variants are likely to emerge. With the era of lockdowns and border closures over, it’s time make the case for massive investment in our public health and social services. It’s the only way to end the sacrifices and privations of the pandemic, and build back on a fairer, healthier basis.