For the past year Australians have heard politicians, business leaders and conservative commentators argue that we need to balance the benefits of protecting Australians from Covid-19 with the costs of those protections to “the economy”. Should we close down risky venues or keep them open? Should we worry about the elderly who might get sick and die or the young people who might lose their jobs?
How do we choose between my money and your life? Or your mum’s life? In a society where conservatives frequently argue that all life is sacred, that unborn babies have more rights than their mothers, and that those dying in pain must be denied the mercy of voluntary euthanasia, it is hard to imagine that we could even have such a debate. But we do, and the debate is led by conservatives.
The fact that you probably haven’t noticed is simply proof of how powerful the language of economics is. It allows people to make the obscene seem responsible.
While it’s not polite to put it this way, what these questions are really asking is: are all lives worth saving? Or, more bluntly, are the incomes of some groups more important than the lives of other groups? You can see why conservatives like to talk about abstractions like “the economy”.
It’s impossible to balance the needs of vulnerable humans against the needs of the economy for the simple reason that the economy doesn’t exist in a literal sense. The economy is not a thing and it is certainly not alive – it’s an abstraction, an idea.
The economy doesn’t have needs, desires or preferences. But people do. It’s more polite – and politically saleable – to say the economy would benefit from fewer restrictions on travel than to say that those who own shares in, or who are employed by, the travel industry would benefit. Likewise, it’s far more polite to say that the economy would benefit from company tax cuts than to say that rich people who own a lot of shares would benefit from tax cuts.
The fact that the economy isn’t a person or thing doesn’t make it unimportant. Far from it. Our culture, democracy, national security and environment aren’t things or people either, but they too are important.
Just as we can try to measure the environment by counting trees and fish, we can try to measure the economy by adding up the value of everyone’s assets or incomes. But adding things up doesn’t equal understanding them, and telling me that increased pollution in my city is OK because we cleaned up the air in your city doesn’t cheer me up at all. I don’t live in “the environment” any more than I work in “the economy”. What affects me is different from what affects you, and your gain doesn’t reduce my pain.
But when we talk about the economy, instead of what’s happening to my job and my income and your job and your income, we can hide all manner of sins. Indeed, if we ignore the pain of the millions of Australians currently looking for more work, we can tell ourselves that the economy is doing quite well. Indeed, the treasurer even believes that because some Australians have saved so much of the money he gave them this year, there is no reason for the government to spend more to help create jobs for those with literally nothing.
Which brings me back to those who want to have a conversation about whether some people’s income is more important than other people’s lives. Should Australia make such a decision and, if so, how?
Let’s start with the how. If we are willing to put a dollar value on each human life, we could estimate the number of Australians who might die if we let Covid-19 loose the way they have in the US and the UK, multiply the number of deaths by the value of each life and – hey presto – we have an estimate “cost” of letting the virus rip. We could tweak that number by estimating the “cost” of the lives that are ruined but not lost to the disease. Or not. Like valuing the environment, it’s entirely up to us what to include in our calculations.
And then there are the benefits to the economy of placing more vulnerable people at greater risk. No one doubts that if people with Covid-19 are free to move around there will be more deaths. And no one doubts that if restaurants and airlines are allowed to have more customers, they will make bigger profits and pay wages to more staff. All we have to do is compare the benefits of the higher profits and wages with the costs of the lives lost, and we can “get the balance right”.
But is an extra million dollars to a billionaire ever worth the loss of the only life you, or someone you love, has? Again, you can see why the conservatives keep the conversation abstract.
But such sacrifice isn’t just inequitable, it’s entirely unnecessary. Luckily for Australians, there’s no strong evidence that letting the virus rip is good for the economy. Indeed, it looks like countries that have done a good job of suppressing the virus have had faster economic recoveries than those that did let it rip. The “devil take the hindmost” approach in counties like the UK and US might be good for the owners and employees of funeral homes but the rest of their economies struggle on regardless.
The Australian government has literally spent hundreds of billions of dollars to help some people get through the past 12 months. So poorly was this money targeted that, according to the treasurer, some Australians have accumulated huge amounts of savings over that same period. Clearly, we haven’t all been asked to make a sacrifice.
It’s easy to talk in abstract terms about “the economy” when you ignore the true “costs” to those at the bottom – especially when there’s billions in unspent stimulus still sitting in the bank accounts of higher-income earners.
Richard Denniss is the chief economist at independent thinktank The Australia Institute @RDNS_TAI