Rahm Emanuel’s GFC quip about not wasting a crisis is resonating in the pandemic debate.
Now as a news commentator, Emanuel has repeated his advice with regard to the coronavirus crisis. And lots of people want to take it. Here in Australia, there are renewed calls for a universal basic income, which would give everyone regular cash subsidies, whether they have jobs or not. Others are calling for a freeze on all residential and commercial rents.
Progressive think tank PerCapita goes so far as to claim that capitalism itself is ‘broken’ and the ‘era of small government is over’.
In reality, capitalism isn’t broken, and the idea that government has been shrinking over time is a complete myth. Going into the coronavirus crisis, spending by Australia’s governments (federal, state, and territorial) already accounted for over 36% of GDP — higher than at the height of the GFC.
What has changed over the past four decades is that government has been spending smarter. For example, instead of bearing all the costs of university education, the government now splits it with the students, while ensuring that no one is denied access to education due to inability to pay.
Government housing assistance has been shifting from difficult-to-manage public housing to third-sector community housing and housing support grants, which are able to help larger numbers of people live in better conditions.
Major changes to a country’s social policy model should only be made after years of evaluation and deliberation. They shouldn’t be pushed through in an emergency.
What we need now are tweaks, not transformations. Emergency government support should be focused on those who have lost their jobs and businesses, not squandered on those of us who are still collecting our regular salaries. ‘Never let a serious crisis lead to waste.’ That should be our motto.