There is no doubt that, during the COVID-19 pandemic, Australia has taken on a level of public debt not seen for generations. There is also no argument that this was necessary in order to protect jobs and livelihoods, and to mitigate the massive economic impact of the crisis on Australia’s living standards and future economic and social health.
What comes next is critical. The spending so far has been to put the economy on life support while we ride out the essential shut-down of our usual way of life. Any expectation that the economy will spring back to life – or “snap back” to normal operation – in the aftermath of this crisis is fanciful.
The key to ensuring our children are not punished for our debt is to take the necessary measures to protect and build the economy in which they will live and work. They will need good, reliable jobs with decent incomes; a strong social safety net; access to affordable housing; and the opportunities provided by a world-class education. All these things were needed, and were becoming harder to find, even before the pandemic hit; all can be realised by investing in the productive capacity of our nation.
A new social contract is needed; one which recognises the role of government in driving investment that can support Australia to grow in an equitable, sustainable way.