As Australia curbs coronavirus infection rates, some are calling for an ‘elimination’ strategy that would seal our borders, while other countries are taking a ‘let it rip’ approach. By Mike Seccombe.
How this crisis will end
A comparison is often drawn between the efforts to overcome coronavirus and the struggles of war. Prime Minister Scott Morrison, for one, says this crisis is Australia’s greatest challenge since World War II. He talks of a threat to national sovereignty and calls on us to show “the Anzac spirit”.
In many respects, it’s a poor comparison. Here, conflict between powers will not bring us any closer to resolution – or the promise of normalcy. There is no distinction in this circumstance between civilian and combatant. In war, battle plans and weapons are developed in secret, but now openness in the form of shared data and scientific effort is the highest priority.
Aspects of the war metaphor ring true, though. The cost will be enormous, in both human and economic terms, and the young and poor stand to suffer most – unless we are prepared to countenance major economic and social changes on the other side of the health crisis.
When the time comes, six months or more down the track, to consider what the endgame will look like, the biggest issue will be how we share the burden. Specifically, to borrow the words of financier Mark Carnegie, the extent to which we will mortgage our children’s future to protect the health of our ageing parents.
So far, the Morrison government has focused on the immediate crisis. It has planned for a six-month economic “hibernation” of the economy, more accurately described as an induced coma, on the assumption that in that time we will wrest control of the spread of Covid-19.
After that, it hopes the economy will wake up and recover reasonably quickly, to function more or less as before. The government has committed some $200 billion to maintaining life support for jobs and businesses under this strategy.
But the evidence suggests such a quick recovery is unlikely, and that the health crisis will continue longer than they have planned for.
There is no question that Australia has done exceptionally well, to date, in limiting the spread of the disease – the daily rate of new infections has fallen dramatically over the past couple of weeks – and we have done even better at limiting the number of fatalities.
So well have we done, indeed, that some experts now consider the prospect of eliminating the disease in this country as a realistic option.
John Daley, chief executive of the Grattan Institute, and Stephen Duckett, a former secretary of the federal Health Department and director of Grattan’s health program, called elimination the “least-bad endgame” to the medical emergency.
Such a strategy would require the maintenance of rigorous social distancing for at least two or three more months, as well as comprehensive testing and contact tracing to ensure all cases were caught.
It would also require the sealing of Australia’s borders indefinitely, until other countries manage to eliminate infections – or until there is a vaccine against the virus. We would also need to delay the reopening of some sectors of the economy, as is now being considered by the state and federal governments.
Speaking to The Saturday Paper, Daley argued this is not a radical idea.
Overseas tourists aren’t coming anyway, and domestic tourism could fill the gap. It might even give Australia a competitive advantage in attracting students and visitors from China, he said, because that country has also pursued an elimination strategy.
But Daley’s is certainly not a majority view, either in this country or around the world.
The policies of other nations range from what might be called the “let it rip” approach of Sweden, where the elderly and vulnerable are protected, but the social constraints on others are minimised on the assumption that the disease will inevitably spread and result in herd immunity, to the New Zealand model of locking everything down and hoping for elimination.
Other nations fall somewhere in between, trying to “flatten the curve” of infections so health systems can keep up, looking to keep open or reopen sectors of their economies as infection rates decline and playing Whac-A-Mole when clusters of infections crop up.
Peter Collignon, professor of infectious diseases at the Australian National University Medical School, speaks for the majority when he says the elimination strategy cannot work because Covid-19 is so variable in the way it manifests.
“You are inevitably going to have low levels of this that will go undetected,” he says, because there are so many people who experience minor symptoms when infected with this virus, or none at all.
Elimination would mean populations have little immunity and remain vulnerable to future outbreaks. Borders would have to be locked down tight, potentially forever, unless a vaccine is developed.
“I think that’s a 50-50 chance,” says Collignon. “We’ve tried very hard [to find one] for HIV, for hepatitis C, [for] a very common virus called RSV. There are lots of viruses that we’ve put a lot of effort into and haven’t been able to. Even with influenza, the vaccine is only 50 per cent effective. I’m trying to be optimistic, but it’s by no means sure.”
Nor is he convinced that Australia is over the worst, despite our declining infection rates.
“We’re going to have to wait at least 18 months or two years before we know what’s really on the cards,” he says.
If one looks back to the devastating Spanish flu pandemic, which killed as many as 50 million people worldwide in the three years from January 1918, there were multiple waves, running with the seasons. In Australia, says Collignon, the second wave of that flu was worse than the first. And then there was a third.
He notes also that during the 1918 pandemic, more people died of secondary bacterial infections than of the flu itself.
During the current pandemic, that appears to be a problem, too.
Evidence from China, as well as a study of intensive care patients in the United States just published in the Journal of the American Medical Association, shows close to half of the people who died from Covid-19 developed such secondary infections.
Australia’s low death rate, Collignon suggests, may not be solely because we have a better hospital system than many countries, but also because there is less antibiotic resistance in the community, leading to fewer of those secondary infections here.
This is, as he freely admits, only speculation at this stage. But with so little known about this virus, speculation is inevitable.
What is the case fatality rate? According to the most recent data from Oxford University’s Centre for Evidence-Based Medicine (CEBM), it varies wildly. In Italy, for example, it is almost 13 per cent, but in Singapore, just 0.31 per cent.
Why do some people with a high “viral load” have no symptoms, while others die?
Does recovery from the disease confer future immunity and, if so, for how long?
Why do so many more men die than women? Why do few children get sick, and how effective are they as vectors for spreading the disease to others? How many asymptomatic cases are out there? What drugs might be useful as treatments? Is the overall mortality rate 3 per cent, or 1 per cent, or 0.1 per cent?
The one thing we do know is that Covid-19 is overwhelmingly a danger to the elderly and the immunocompromised.
Analysis from Italy, cited by CEBM, showed “the average age of deceased and Covid-19 positive patients was 79.5 years (median 80.5, range 31-103)”.
That Italian study, which looked at 355 fatalities, found only three had no prior medical conditions. Nearly half of them had three or more. In only 12 per cent of cases did the death certificates attribute “direct causality” to coronavirus.
Which is to say many died with coronavirus, but not necessarily of coronavirus.
This tells us something about why Italy, in particular, but probably also other countries, are recording exceptionally high case-fatality rates.
It suggests something else, too, and there is no delicate way to put it. At least in developed nations – and the story may yet prove to be different in poor countries – many of those who died with this virus had little time left.
Of course, there are cases of people aged 20 and in otherwise good health who die from Covid-19, but they are so rare, Collignon says, “that it makes international news when there is one”.
“Even between 50 and 70, it is relatively uncommon,” he says, “unless you’ve got underlying medical conditions.”
While some have called for an economically utilitarian, socially Darwinian approach by which we sacrifice our elders, this is not what Collignon is suggesting.
Instead, he is saying we need to be very careful about the degree to which we constrain people’s freedom of association.
“My real worry is that if you overdo this, and particularly if we put in rules that don’t actually make biological sense, people are going to become resentful – particularly the 20- and 30-year-olds who actually transmit this more than anyone else, but have a low risk themselves,” he says. “We will need to keep social distancing for the foreseeable future, and that, I think, means bars and clubs and that sort of crowding is off the agenda.”
But people driving around in their cars, or sitting on park benches, or catching a wave at the beach, are not a risk, provided they obey distancing rules.
“We have to keep people on board till at least October or November, and maybe for two years,” says Collignon. “You can’t turn everybody into hermits. You have to consider the social and other consequences to livelihoods, social life, increased violence, you name it.”
To date, the public has been generally tolerant of the impositions on personal freedom, and overwhelmingly supportive of the economic measures introduced by the government. Newspoll last week found 90 per cent support for the JobKeeper program among Coalition voters and 84 per cent support among Labor supporters.
And the crisis has seen the public’s approval of the prime minister, so recently damaged by his bungled response to the bushfires, sharply up, too. Morrison’s approval rate jumped from 41 per cent in March to 59 per cent in April, according to the latest Guardian Essential poll.
In a survey of leaders’ popularity across a range of countries, The New York Times found support was up almost everywhere – even Italy’s Giuseppe Conte had 71 per cent approval, up 27 points despite the devastation of coronavirus.
As the Times also noted, though, this “rally round the flag” response seldom lasts once the immediate crisis passes. Then, pre-existing concerns re-emerge, often amplified by the difficulties of coping with the changes necessary in recovery.
And some of those changes are going to be big and unprecedented. Take population growth, for example. Before Covid-19, Australia was growing by 300,000 to 400,000 people – about the population of Canberra – every year.
Of that growth, only about 100,000 was due to “natural” growth – births minus deaths. The rest was imported. Now that source of growth has stopped, abruptly, and will likely stay largely stopped – in the first instance because of the disease, but after that because there will not be enough jobs.
Treasury forecasts unemployment during the June quarter will hit 10 per cent; it would have been 15 per cent but for JobKeeper.
And that is very likely a low-ball estimate, in the view of other economists. Danielle Wood, Grattan’s budget policy program director, says it will be more like 20 per cent, and even higher among the young.
“If you look at the sectors that have taken the biggest hit from the public health response … [they are] accommodation and food services, recreation, retail,” she says. “The workers are disproportionately young people, people under 30.”
Even before coronavirus, youth unemployment and underemployment were high, still not recovered from the global financial crisis. The young were the prime victims of casualisation, the gig economy and wage stagnation. They were the ones who benefited least from the increase in asset prices, particularly housing, over the past couple of decades.
“We’ve had a huge skew … where older generations have grown their wealth, at least on average, very rapidly over the past 20 years. Whereas younger people’s wealth has barely moved over that period,” Wood says.
Long before Covid-19, she says, it was clear the current economic system was not fairly sharing the revenue-raising burden.
“Because there are a lot of tax concessions available to older people, and because assets are taxed fairly lightly, we saw that older people paid a lot less tax than younger people on equivalent incomes,” Wood says. “If you took a household over 65 on $100,000 a year, they’d be paying about half as much income tax as the younger household.”
In the wake of this crisis, big changes will happen, regardless of what the government does. More work will be done from home. Fewer meetings will require physical travel, as people attend by virtual means.
There are clear positives to that: less time and fossil fuels wasted in commuting, greater flexibility in working hours – and, of course, less risk of spreading disease.
But there is a downside, too.
An analysis produced by the Centre for Future Work this week found that about 30 per cent of jobs could be performed from home – but those occupations already are paid about 25 per cent more than occupations that cannot be shifted to remote locations. The centre warned that a further shift towards remote working could exacerbate this divide.
Indeed, it is already happening. The number of home-delivered meals is through the roof. And who delivers those meals? Low-paid gig workers. The shift to online shopping has accelerated. Whose jobs will be lost? Those of workers in bricks-and-mortar stores, and the owners of those stores.
So far, the government has supported those businesses and workers, it is generally agreed. But life support is not the same as stimulus.
Soon the government will have to shift attention from the health crisis to its economic consequences – unemployment, low demand, consumer and business confidence, and paying the massive bill incurred in protecting our elderly and vulnerable.
So far, it has been banking on the private sector awakening from its hibernation and solving the economic problem. But the longer the health crisis continues, the more likely it becomes that things will need to be closely managed.
Already there are pressing issues – the potential collapse of Virgin just one among many – that are pushing the government to consider questions that were unfathomable just weeks ago, such as nationalisation. These decisions will only become more vital as the services deemed “essential” to Australia’s quality of life struggle to outlive the shutdown.
Then, there remains the issue of how the country will pay for all this.
“We’re probably talking decades, not years,” says Wood. “I don’t think we should be rushing to consolidate the fiscal position, because the economy will be coming out of this pretty weak. I think there’s a case for stimulus spending.”
With interest rates on borrowings at a historic low, there is no need to panic about debt levels. The more important thing is to spread the burden equitably.
So far, there is little evidence to suggest the government will make any of the changes necessary to achieve that. It has said it will not abandon its massive, legislated-but-not-yet-implemented tax cuts, which skew to high-income earners.
The unemployment benefit that was doubled in response to the immediate crisis is slated to go back to its previous subpoverty-line level. There is no suggestion the government will do anything about the pre-existing inequities that advantage the old over the young.
No evidence it will be looking again at personal tax rates, or other measures such as property tax or franking credits, capital gains tax, negative gearing, the taxation of trusts or any of the other flourishes built into our system that work to the benefit of the old and wealthy and against the young and struggling.
These surely are considerations to be weighed when the time comes to start repaying the massive debt we have accrued, largely out of consideration of those older people.
After all, as Scott Morrison is wont to say: we are all in this together.
This article was first published in the print edition of The Saturday Paper on April 18, 2020 as "How this crisis will end".
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