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Thus Spake Mungo: the depression

Last week’s numbers brought us the bad news we were expecting: Australia has fallen into the worst recession in nearly a century.

But now for the worse news: it is now clear that the recession has collapsed into a full scale depression, three consecutive quarters of what the economists euphemistically call negative growth, with the likelihood of a fourth to follow.

The official figure was a fall of seven per cent in the June quarter, catastrophic enough. But the human cost is still more dire.

Whatever jiggery-pokery our treasurer can devise, unemployment will go into double figures by Christmas

Whatever jiggery-pokery our treasurer can devise, unemployment will go into double figures by Christmas – unhappily, the latest date Scott Morrison has fixed on for his wildly optimistic turnaround. And it will be months, possibly years, before they subside to an acceptable level.

Confidence at all levels is at rock bottom: both consumer spending and business investment have plummeted. And with much of the government support that has had the survivors hanging by their fingernails about to be reduced or removed entirely, the chances of a revival in hope are slim indeed.

Morrison’s plan, if it can be dignified with such a name, is, as usual, tax cuts for the medium-to-rich, cutting red tape, tweaking industrial laws. At least, that is what the well-informed leaks are telling us will underpin the budget next month.

Infrastructure programs already in the pipeline may help in the medium to long term, and starting new ones will always be welcome, but will be no panacea

But this formula has been tried before, numerous times, without success, and in any case has been so well trumpeted that the likely response will be indifference at best, and at worst disappointment. Infrastructure programs already in the pipeline may help in the medium to long term, and starting new ones will always be welcome, but will be no panacea.

What Morrison needs – what we all need – is a big jolt; shock treatment to bring our timorous and torpid economy to some semblance of life. If Morrison and his indefatigable treasurer Josh Frydenberg have the electrodes in their kit bag, they have kept them securely hidden.

They are, however, still determined to look on the sunny side; things may be tough here, but you should see the rest of the world. Not all of it, perhaps, but with a little judicious cherry-picking we can find a few countries in an even more parlous position.

Australia has got through the COVID-19 pandemic better than almost anyone – our rates of infections and deaths are surely something to be celebrated

And sure, there has been, is, and still will be, a huge price to be paid, but Australia has got through the COVID-19 pandemic better than almost anyone – our rates of infections and deaths are surely something to be celebrated. Well, they certainly were. But unfortunately those days have come and gone; we are now back in the pack, even if we only consider the developed world.

The advantage Australia had was that we were always a bit behind; as the virus raged around the northern hemisphere, it paused at the equator, and Australia was able to learn from the depredations, and profit from the experience of others.

Hence: we closed our borders, implemented lockdowns, refined social distancing rules and brought the public, horrified by the figures in places like Italy and the United States, largely on board. So we came through the first wave better than most, and all governments and their agencies deserve considerable credit.

In spite of all the warnings, complacency crept in. The feds failed to heed the vulnerability of aged care, Victoria was negligent over quarantine, the public decided that it wasn’t really too bad and now it was just about over

But then, in spite of all the warnings, complacency crept in. The feds failed to heed the vulnerability of aged care, Victoria was negligent over quarantine, the public decided that it wasn’t really too bad and now it was just about over. So when the second wave broke, as it was always going to, Australia was reduced to playing catch up.

And the disillusionment spilled through into a widespread resentment; why haven’t the authorities fixed it by now – as they had promised? Why have we missed out on the curve flattening, snap backs, and the return to normal? Trust was broken, and an unintended (certainly from Morrison) consequence was that so was confidence. Restoring it will be far harder the second time around.

So the budget cannot be just more of the same. There will have to be a genuine circuit breaker, and perhaps – just perhaps – this might mean jumping outside the square, devising a new, exciting, even visionary approach. Anyone for a real energy policy?

There just may be an opportunity now that gas, once the remedy for the transition, is being shown not to be a saviour but a Trojan horse

After about 20 failed attempts, it is obviously time for one, and as the consensus moves inevitably away from coal, and towards renewables, there just may be an opportunity now that gas, once the remedy for the transition, is being shown not to be a saviour but a Trojan horse.

It has always been argued that gas, while not a squeaky clean fuel, is at least a better bet than coal. But now it turns out that it may be even dirtier

It has always been argued that gas, while not a squeaky clean fuel, is at least a better bet than coal. But now it turns out that it may be even dirtier, because methane leaks that cannot be contained will probably nullify any advantages over the emissions of coal.

Methane is a far more damaging greenhouse gas than carbon dioxide, so just a little can be a big problem. Add in the damage wreaked on agricultural land and, crucially, water supplies, and gas looks a lot less attractive than its proponents claim.

It has, however, one big plus; unlike coal power or renewables, gas can easily be turned on and off. But with the advances in batteries, this last advantage is becoming obsolete. As former government Chief Scientist, Penny Sackett, points out, that ship has sailed.

The current Chief Scientist, Alan Finkel, is still a gas pusher, but he is becoming increasingly isolated…

The current Chief Scientist, Alan Finkel, is still a gas pusher, but he is becoming increasingly isolated; not just the environmentalists, but business and agriculture are jumping aboard the renewables bandwagon. And if it is not already, renewables are rapidly becoming not just the cleanest, safest and most acceptable option available, but also the cheapest.

Many in the coalition ranks will never be persuaded. But the evidence is irrefutable. And what a coup it would be for Morrison if, on top of stellar polling, he could bring this one off – forget buggerising around with feasibility studies and inquiries to try to justify throwing taxpayer money at his bankers in the mining industry – and embrace the science, engineering and even the economics he constantly invokes.

Of course it won’t happen. But he needs to do something, and quickly. He is already the leader who gave us the second depression in a century. If he is to salve his legacy, nothing less than another of his miracles will suffice. 


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20 responses to “Thus Spake Mungo: the depression”

  1. Alice Johnson says:

    Where is that road map? Right we are here in Byron and Victoria is way down there over the border.
    Have you noticed to the East the tide is a bit higher than usual. Those Victorians are in a terrible state down there and are causing the continent to sink.
    Get the car ready and packed so let’s get on the road. We need this here map.

  2. Barrow says:

    Morrison gave us the second depression in a century mungo ?? No he did not Mungo !! Need for the reminder that infact China has certainly alot to answer for not only to Australia, but the rest of the
    World with some transparency !! This worldwide
    Pandemic bankrupted many nations. ” trillions “..
    And any talk of a please explain to China ..and well we all know the outcome of this Investigation.
    China are bullies , anf their human rights violations
    Are a disgrace… as for Renewables a cheaper
    Alternative to Coal or Gas …dream on … the land
    Needed for wind farms and solar projects is
    Enormous not to mention how many birds species
    Have been wiped out … also large Contruction
    Companies pulling out of renewables “Downers”
    Being one of the largest in Australia.. not a fan at all of Adarni and should not have got approval
    However Australia used to have the cheapest electricity costs in the world now the most expensive.. go figure!!

    • Vera says:

      The land needed for coal mining, cattle raising and empty desert is enormous. Could it be better used? The water needed for gas extraction, and for rice, cotton and almond farming is enormous. Could it be better used?
      I keep reading that renewable energy is now not only cheap, but cheapest. Australia seems determined to look the other way, while miners contribute to the coffers of both major parties.
      Go figure!

      • Barrow says:

        Hi Vera , iam not infact a fan of mining iron ore etc
        I work in the Gas industry liquefied .. its the workers
        PAYG who are now and for decades kept the
        Less fortunate wefare recipients , the Homeless
        Hospitals, roads and infrastructure going …
        These workers Vera pay 65 % of all tax collected
        Hence why its imperative to any government
        In power… look one day coal will phase out ..
        And cleaner powers will be available.
        But ATM renewables are unreliable and really dont
        Support that many jobs during construction
        Or maintenance.. and the wages are not anywhere
        Near other resource industries… have always maintained Vera that Nuclear good be a source
        Of power in Australia my opinion !! It powers other
        Countries successfully including 75 % of France
        Power needs.. we need to have conversations
        About this indeed..

    • Joachim says:

      Yo Barrow, that’s the spirit old son. Transparency you say, yes. Barrow my man you’ll be pleased to hear that I’m all for it as well. Pre Covid and now during Covid, so many failures on ScottyfromMarketing’s watch it hard to keep up with your Idol, yes. So hide your new found transparency and bring out the deflection and diversion, with this down with China and down with Renewables business. The Aged Care death camps, all China’s fault, nothing at all to do with your Idol, ProMo ScoNO. Your idol ScoNO, he loves a good slogan like the HomeBuilder slogan affair. Announced with the usual great ScoNO fanfare and delivered…zilch. Like The Arts and Entertainment Industry covid rescue package. Announced with the usual great ScoNO fanfare and delivered….zilch. These after the JobKeeper slogan affair. Announced with the usual great ScoNO fanfare which while helping many also DELIBERATELY didn’t help many, left many Aussies behind. Transparency, Barrow, lets have more of it, yes.

      • Barrow says:

        Joachim you and Stefanie are still not any closer
        To giving anyone thats read these posts or the
        Byron Shire population a example of the Climate emergency, “crisis ” as Stefanie explains regarding
        The councils DECLARATION… you two if my memory serves me right were in full support
        Of the councils decision… its a crisis Stefanie
        Joachim??? We are at Tipping point ??
        Example please.. ? Will keep asking
        A fair request.. facts or fiction ??

        • Ken says:

          Barrow Hi,
          Look I can understand why the folks you’ve been directing your questions to, have perhaps thought your attitude is belligerent and merely facetious, but it occurs to me you really might be ignorant of the facts and so I will try to explain that lots of people see the evidence is self evident and irrefutable,
          The ” Climate emergency, “crisis ” “has seen the near total destruction of the Great Barrier Reef due to unprecedented hot temperatures that have killed the symbiotic algae necessary for coral to live. The Murray /Darling river system is near total biological death due to high temperatures and drought caused by the glass-house effect which is the direct result of fossil fuel consumption of millions of years of accumulated carbohydrate deposits and government ineptitude in controlling international industrial depletion of agricultural resources.
          Barrow, some people have also noted the horrendous and unprecedented fires last summer that have destroyed rainforests that have never experienced fire for millions of years previous to this holocaust.
          At least Three Billion native animals were incinerated. Two years previously Cyclone Debbie dumped 1.5 meters ( four and a half feet ) of rain in one night. Are you starting to see the trend here ? Unparalleled climatic events are causing Greenland, the Arctic,the Antarctic and the Himalayas to see the most extreme ice loss, while catestrophic floods,cyclones and droughts rampage throughout the globe.
          This is what is meant by ‘climate emergency’, it is World -Wide, it is deadly and get is growing exponentially, and when the ice-caps melt Barrow, the sea level will rise by at least 66 meters.
          That is why they call it an emergency.
          Cheers, G”)

          • Joachim says:

            Ken, I applaud your attempt to educate our Barrow. The facts and science are indisputable, but sadly we have people like our Barrow that don’t believe in facts. Instead they make stuff up so they can have their own ‘alternate facts’. Climate Emergency? Nah, it not happening. Environment and Biosphere sustainability? Nah, we live in an economy. Added to that we have the likes of the anti vaxxers, or these days the CovIDIOTS who believe the Covid is a hoax. Facts and science? Nah, how good is alternate facts!

          • Barrow says:

            Hi Ken , we are in a solar minimum and the likelihood is iceage for planet earth Ken …
            The Majority of the world are sceptical regarding
            This Global Warming hysteria.. the Majority of the warmist scientists are on the public purse ken
            Hooked on taxpayer grants hence the hysteria..
            So many other scientists have debunked
            This Global Warming nonsense and what of it ken ?
            Shutdown down , taken of platforms.. ostracized!!
            Sea level rises Ken where ? The climate council
            ABC, the Guardian, the Greens , the list goes on all predicted that Greenland would be icefree by 2013
            Was in the Maldives last year …uh uh uh its sinking
            The ABC the Guardian the greens say !! Load of sh!7 i got there asked the locals where are the sea
            Level rises ? They just laughed Ken .. in fact the government just put in a new airport, millions spent on new Resorts on the water ken ???
            Explain the Roman Warm period Ken ??
            Or go ask Tim Flannery he is a expert at predictions
            Ken .. !!!

  3. Thanks Mungo… Depression plus, it is. Tax cuts for
    the ‘well off to rich’ won’t work nor should they.
    Methane (gas) is out & renewables in because they
    are ‘cheaper’ & so are the new batteries. Truly – a
    miracle is required along with the reasonable news.
    Our Liberal-Nats will stick to their guns because
    that’s what they do. [It’s an Abbot heritage]. So it’s
    going to take a while. Jobs need to be found. The
    waiting is tedious. Aged care & quarantines must
    become a public ‘first’ along with the Climate
    Crises. New Job-Training funds are essential.
    Safety & care for one another – ditto.

    • robot says:

      Stefanie, taking up a comment in a previous response, ‘we must change, because there is no other way’. It seems pretty common sensical to talk about change. Anyone with a wiff of history would see nothing but change. And as Tofler pointed out, change in our era is accelerating because of the rapidity of scientific discovery. Yes, all robot-groan, but true. Tofler actually wrote before the info age but how true his analysis has become. My problem is with your use of the word ‘must’. I know, a word in passing, but this use is part of where we really are, not much differently from when the agitators were acting in 19th century Russia. Dosteyevski wrote about it, called his novel, Devils. Of course there will be change, and I would even like it a bit slower, my circuits have to catch up, but really we still have to consider, before the ‘must’ catches us again. If we’re in a post-industrial world in the West, meaning a service economy, tourism etc, and a biosphere, then so be it. I will not however tear down the past. This was both the fault of far left and right wanting a total new beginning. They were as bad as each other.

  4. Hi Barrow.. I’ve no problem with you getting excited
    over Downer’s decision to pull out of renewables
    since there are so many new products on market
    appearing faster than grid operators. 3/4 of Scots
    ‘oil workers’ are considering retraining. In the midst
    of a pandemic it’s the best move towards ongoing
    & future jobs. Stuff like this helps the economy by
    far more than the usual Tax Cuts for our Rich &
    often ‘Famous’ who expect to be kept by Aussie
    Dad, Dave & Mum not excluding the kids.

  5. Ken says:

    Yup !
    Depression is a bummer, I am prepared to believe, however that it is preferable to the death-rates of the USA, much of Europe and I hate to think about the ‘developing’ nations. I think it is appropriate to point out that the unemployment figures are totally constructed for propaganda purposes and have as much relevance as Scumo’s (or Barrows ) insistence that this minority coalition have been anything but a total failure, socially and economically. In fact I suspect that is the main reason they are so determined to obliterate the ABC, as they are the only hope of any factual reporting of government actions. This is perfectly exemplified by the fact that the only reliable source of information on COVID 19 has been through the great work of Dr. Norman Swan and certainly not from the hired lickspittle posing as the chief medical officer, dispensing erroneous and dangerous govt. certified policy opinion
    He and the likes of Finkel will always spruik the Liberal line but the ‘fat lady’ is still in fine voice and the Pandemic is going nowhere and Wall St has a long way to fall, along with the ex-world power of USA.
    Cherio, G”)

  6. Jon agar says:

    UBI would jolt consumer spending and trust – a pandemic-scared service-economy is ripe to reap the benefits of this fiscal policy.

  7. robot says:

    Finally, Mango, you show your colours.

    Well the evidence, yes, you fail to mention one bit of it.

    How will a combine harvester manage with batteries, and where nearby are they charged? How many Musk trucks does it take to replace a semi-trailer, and where do they stop while crossing the Nullabor or the Hume?

    I have a thousand questions like that. We already have mountains of obsolete computers, the kids in Mumbai harvest some bits. Batteries will be another question altogether, as decrepit solar panels are now.

    I regret this non-existant conversation in the morning, hate myself for posting, wish I’d never tuned in. But this time I’m glad. You’ve said your piece finally and, as usual, without a single supporting fact.

  8. Tweed says:

    It is easier to fool someone than it is to tell them they are being fooled. Mark Twain!

    This is self evident to the scamvangelical Scotty from marketing, he was brought up in a cult that makes a living from fooling people. He’s been fooling people all his life.
    Now with some of the most corrupted media the world has ever witnessed and accomplices in this deceitful routings, corruption and insatiable greed we see daily, we have finally ended up in an economic depression.
    This didn’t happen over night this recession has been with us for years, gradually getting worse each year of the LNP Govt’s since 2013.
    Last election we only had to look around the pre-polling booths which had been empty shops for months, the empty shops in the street either side of them and the half a dozen across the road, some that had been empty for years.
    The Federal LNP Govt debt was already more than every Govt combined since federation prior to the election.
    But it was easier for the LNP to fool you again than it was for Labor to explain you were being fooled!
    Look at any economic graph, of the last decade and anyone can see the LNP economic missmanagement is the problem, everything else is just a by-product of that problem, it’s now catastrophic like all the other Morrison induced catastrophes.
    Take away this false 24/7 media propaganda from Morrison and he will sink in seconds, just like Howard in 2007. YOUR BEING FOOLED AUSTRALIA, ONLY YOU CAN MAKE IT STOP!

  9. TOLSTOY: RENUNCIATION [Stefanie Bennett]

    Best forget why he’s here
    and from where he came.
    If his step thundered
    the blunt black bloodstone
    of gunfire
    amid the roses…

    The Crimea wasn’t a parking lot, then.
    A September suburb
    pummeled
    by a double
    or nothing
    sequester.

    Now, eaves-droppers
    unerringly
    find him
    defrocked;
    servile – and
    beating
    tellable ploughshares
    into words

    into a Peace
    that
    shatters.

    Robot – just change (ie;) redesign mobility. We are not
    that stupid. Who invented the wheel?

  10. Ray Armstrong says:

    The Liar From The Shire can only BLAME BLAME BLAME!!
    The only policies he has are the ones he stole from Labor. This bloke is
    cunning and sneaky as a XXXX…and I thought Howard was cunning? An amateur compared
    to this bloke. Abbott? We we knew he was mad as he still proves daily.
    And Labor? Hopeless for not testing him. Not exposing him. Not learning
    from the Liberals when they were in Opposition how to win govt from Opposition..

  11. Well… we can no longer whistle or sing “what a difference
    a day makes – 24 little hours…” The plot keeps thickening
    & only a few are listening.

  12. Note – Fossel fuels are threatened by sustainable energy.
    [Yes – I can hear ScoNo sobbing]. Got to start our smart
    transitioning for workers to ‘out’ their fossil fuel employ-
    ment & settle into sustainable jobs.

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