The planet is in a state of flux, economies are tumbling into recession, no-one (not even Donald Trump) can predict when the agony will end.
Suddenly, the streets are empty: life as we have known it is now very different. The nation is in lockdown.
As the London “Economist” put it:
“The struggle to save lives and the economy is likely to present agonising choices…As that sends economies reeling, desperate governments are trying to tide over companies and by handing out millions of dollars in aid and loan guarantees. Nobody can be sure how these rescues will work”.
Parliament, in one of its last legislative actions before it too went into lockdown, passed an imprest supply bill which, as Finance Minister Grant Robertson noted, was not “ordinary”.
“At $40bn of operating expenditure and $12bn of capital, this is a large authority to spend. But the scale of the spending is the price that we have to pay.
“It’s the price of making sure our public health system can operate and support New Zealanders. It’s the price of people keeping their jobs and keeping their homes. It’s the price of cushioning the blow to businesses and of keeping them afloat, and it’s the price of making sure that the core of an economy exists that we can build on to recover in the way that New Zealanders want us to do”.
The latest funding tranche comes on top of more than $20bn of initiatives to cushion the blow of COVID-19 on Kiwis’ health, jobs, businesses, and the economy.
Robertson sought to reassure his listeners that the government is providing the resources the health services need.
From the initial first addition of $500m to support the public health response to the COVID-19 outbreak,
“ … we are already seeing the impact of those resources in building up our public health units, in the arrival of emergency testing centres, in the initial intensive care capacity that we’ve grown, in the provision of equipment for hospitals, and in the support for GPs and primary care, along with significant additional video conferencing and telehealth consultations and the significant increase in capacity for Healthline”.
Robertson warns, though, that all of the support for hospitals and community providers to deal with the surge of patients and support for advice for people caring at home—all of it—is only the beginning when it comes to what needs to be done to support the health service.
And when he talks of ensuring “the core of an economy” continues to exist, he is underlining the kind of mountain the country will have to climb once the Covid-19 pandemic ends.
Some authorities think NZ will return to normal quickly and easily if the government succeeds with its lockdown. Others think before it is over unemployment could have climbed to 15% or more of the workforce.
Many of the businesses in the tourism and hospitality industries may not survive.
Even while the crisis deepens there are industries which are proving how vital they are as pillars of the economy.
This week trade data for February showed a 4.5% ($212m) increase in the total value of goods exported in February compared with the same month last year. Dairy products, particularly milk powder, at $4.9bn, led the increase. Statistics NZ also said that in the week ending last Wednesday exports rose 3.7% while imports fell 11%.
So when the time comes — and let’s hope it is soon — for the government to start planning how the economy can recover, it should be working hard to ensure the dairy industry, along with other key pillars of the primary sector, gets every encouragement to increase production.
The volume of criticism dairy farmers had to absorb because of the methane emissions of their herds and the dirtying of rivers and streams (when the dirtiest waterways are those in cities and towns, or close to them) reached absurd levels and affected industry morale.
Regional Economic Development Minister Shane Jones (and good on him) has called for the freshwater reforms proposed by Environment Minister David Parker to be deferred. He says it is not the time to “hobble” export-earning industries.
Proposals went out for consultation last year, returning in October and are currently before ministers for discussion.
Jones says with tourism effectively decommissioned by COVID-19, it is not time to impose further regulation on NZ’s other major export earner.
Jones would score more points in the regions if he went into bat for a resurrection of the irrigation schemes canned by the coalition government early in its term at the insistence of the Greens.
Those irrigation schemes are needed more than ever if the climate change warriors are correct in contending droughts will become more prevalent.
Their construction will provide valuable employment in rural regions hard hit by the COVID-19 pandemic.
What New Zealanders will have to absorb in the period the country is locked down is that their standard of living will be permanently depressed unless those vital export industries — dairy, meat, horticulture, fishing — are given every encouragement and stimulus to expand production in the years to come.
Dairy farmers are not the enemy, as climate change warriors make out. They could be our saviour in the years to come.
Perhaps the Finance Minister, when he does the hard yards in planning the recovery of the economy, will get to grips with this basic lesson from the crisis.