IMF chief economist, Gita Gopinath reckoned the global economy had entered “a delicate moment”. She offered a decisive insight: “If the downside risks do not materialize and the policy support put in place is effective, global growth should rebound. If, however, any of the major risks materialize, then the expected recoveries in stressed economies, export-dependent economies, and highly-indebted economies may be derailed.” So, on the one hand or on the other….
Alongside the IMF view, the private Brookings Institution delivered its view on the global economy, concluding from its tracking index of economic activity that the world had entered a “synchronised slowdown” which may be difficult to reverse.
— Read on thenextrecession.wordpress.com/2019/04/14/a-delicate-moment/
Note the reference to “export – dependent economies”. That’s Australia.
Given Morrison’s focus on the economic credentials, whatever they are, of an LNP government, the contest will include a battle over how to define responsibility for the downturn, even before it happens!
Under 3 different leaders the LNP neoliberal government, driven by its quasi religious faith in trickle down economics, a faith that defies the real world experience of 90% of Australians, must show that their economics for corporations and their system has not contributed to any downturn and is the best recipe for dealing with the next one.
The ALP, and also the Greens, will face the challenge of acknowledging that a downturn will probably happen soon, that is in the next term of the next government that they hope to form. The ALP wants this to happen on a stand alone basis but the electorate may not permit that. Hence, it’s a problem for the Greens also.
Labor might want to claim that the way it handled the last one, actually acknowledged as a crisis internationally, kept Australia out of recession. But, so far, Labor’s right wing controllers of economic policy don’t seem confident with that sort of quite mild Keynesianism. Fixed as they are in a laborist neoliberalism re economic policy they appear to believe 1) that the resources to do what they did in 2007-9 will not be there to repeat that, and 2) that their immediate commitments re tax revenues to fund health and education (etc) will do the job. Or, maybe, behind closed doors they are preparing to repeat what they did only with necessary lessons learned?
The prospective downturn problem is also real for “politics from below” driven along by unions (as in Change the Rules) and other people’s organisations some of whom have a “mass” character. I refer here to the disability and aged care movements whose programmes for reform require significant government intervention.
And above all there is the now multi dimensional “reverse climate change” movement. We all have until about 2030 to get the situation under control and momentum on reversal. That will also require massive government intervention.
And that government intervention must also enable more powerful intervention “from below”, by the unions and other people’s organisations, and in workplaces, industries and communities.
For workers and their unions, there is nothing yet in Labor’s stated changes to the industrial relations laws that will enable that.
In other words we have a political turning point centred on the interaction of economic downturn, possibly crisis, and ecological crisis.
For the broader politics engaged in by unions and other people’s organisations the challenge will be whether to retreat when the downturn hits or go on the offensive.
Historically, we have retreated. Our most recent experience was exactly in the period of the Rudd – Gillard Labor governments. The struggle over workers rights was pit to sleep and the environment organisations could not develop and lift a strategy from below to direct the Labor government and its erstwhile Greens allies to move forward. The scene was controlled by the fossil fuel corporations and its key front men like Tony Abbott.
There is precious little sign yet that the leading figures in both the union and environmental organisations have the economics to help their constituencies rise to the challenge.
How can we break out from that, and why is it necessary?