Covid, the US and the politics of economic recovery

Horrible news that more than 15% of the US workforce has filed jobless claims since mid-March is apt to be misinterpreted.  

Covid-19 is also an economic shock – and we are working through an economic adjustment.  This process works fastest and is seen most clearly where market forces – generating signals and guiding the adjustment process – are strong.  The recovery is also likely to be stronger. Continue reading “Covid, the US and the politics of economic recovery”

Acclaim for the PM boosts Labour in the polls – but voters may not be so kind as the recession bites

Reports   have been   circulating in Wellington  of  sampling  by  pollsters    which  show   support  for  Labour climbing   into  the 49-51%   range  and  for  National  slumping to  the  low 30’s.

To those enraptured by the  “kindness”  of the  Prime  Minister    and  impressed  by  the government’s  performance  during  the  Covid-19 pandemic, a  result like that would be  no   surprise.  Many  New Zealanders rejoice in the plaudits which overseas media heap on Jacinda  Ardern  as a  “world leader”   who  is  outperforming  her  peers in other countries.

An influential American magazine, The  Atlantic,  described Ardern as maybe the  most  effective  leader  on  the  planet.

In contrast, there is consistent criticism  of  Opposition   Leader  Simon  Bridges  from some  media   figures.   Left-wing  blogs come alive with speculation  of  a  coup   any   day   within the  National  caucus.

So is the forthcoming  election  one  that  an  Opposition  party   might  want to lose? Continue reading “Acclaim for the PM boosts Labour in the polls – but voters may not be so kind as the recession bites”

Whatever it is called, Gypsy Day will go ahead this year and cows will be mooved – but under strict COVID-19 controls

Agriculture Minister Damien O’Connor eschewed the words “Gypsy Day”, in a press statement yesterday that addressed dairy farmers’ concerns about what would happen on June 1.  He preferred “Moving Day” and said Moving Day will go ahead as planned this year, but with strict controls to help prevent the spread of COVID-19.

Reporting this news, Farmers Weekly explained that Moving Day is also known as Gypsy Day and occurs on June 1 each year when many dairy farming families, sharemilkers, contract milkers and employees move to new farms to start new jobs and milking contracts.

Yet another expression was incorporated in a Federated Farmers press statement headline on April 9:  GYPSY / MOOVING DAY.

In the statement, the feds said they were aware of the level of concern among dairy farmers over how the annual 31 May/1 June “Gypsy Day” or “Moving day” shift would work under the COVID-19 controls. Continue reading “Whatever it is called, Gypsy Day will go ahead this year and cows will be mooved – but under strict COVID-19 controls”

What can we learn from the UK mortality data?

Data reliability has bedevilled the task of analysing and responding to the Covid-19 outbreak.  So there might be something to be gleaned from recent UK mortality data.

It captures and breaks down the weekly deaths in England and Wales, which normally average a little more 10,000.

But in the week to 3 April there were 16,387 (60% above the average of the last five years) and 18,500 in the following week (some 80% over the average).  Continue reading “What can we learn from the UK mortality data?”

A2 Milk continues to experience strong revenue growth as consumers change behaviour

At  a  time  when  the  Covid-19 pandemic  is wreaking  havoc on lives and livelihoods,   and  sage   economists are telling us  the economic slump underway is “truly enormous”,  it is   almost  impossible   to  find   any  chinks of  light in  the encircling gloom.

ANZ economists  say the  pandemic has

 “  … stopped the global  economy   in its tracks  and the impacts of this crisis will be with us in months and years to come”.

Not  good  news  for  an  economy  which  is  already  feeling the effects of the  crash of  two  its  main export-earning  props.

But, wait,  what  about  the  bulletin   from    A2  Milk  on  Wednesday?

The company  which last provided  an update on  its trading performance on  February 27 reported  that, since then,  it has continued to experience strong revenue growth across all key regions, particularly for infant nutrition products sold in China and Australia.

We are now able to confirm that our revenue for the three months to  March 31 (3Q20) was above expectations. This primarily reflected the impact of changes in consumer purchase behaviour arising from the Covid-19 situation and included an increase in pantry stocking of our products particularly via online and reseller channels. We are unable to estimate the timing and extent to which pantry stocking may unwind. Continue reading “A2 Milk continues to experience strong revenue growth as consumers change behaviour”

Cannon to left of her, cannon to right of her, cannon in front of her – after Deb blundered

A political sideshow during the media’s continuing examination of Covid-19 and  lockdown issues has brought a Labour backbencher into the headlines.

The Taxpayers’ Union credits her with being one of the smartest MPs in the Labour Party but is demanding an apology from her for comments she made about struggling small business owners.

Left-wing blogger  Martyn Bradbury admires her too – but has admonished her on this occasion.

So has Finance Minister Grant Robertson.

Oops.  How did Deborah Russell – the MP in question – go astray?

Newshub reports she is facing backlash over remarks described by commentators as “offensive”.

Yawn.   Nobody can say anything nowadays without quickly learning that someone has found the remarks offensive,

So what – exactly – did she say? Continue reading “Cannon to left of her, cannon to right of her, cannon in front of her – after Deb blundered”

After the pandemic we must deal with global recession – but there will be corporate opportunities, too

New Zealand  businesses  which  found themselves looking into the abyss of a largely moribund economy  can  now  lift   their  vision  towards  revival,  as  the   government  signals  the  move  into  lockdown level  three.

To a  degree   the vision is still clouded:  one of  NZ’s  biggest   enterprises,  Fonterra,  has  warned  its farmer-suppliers  of the imminent global recession,  which  it  foresees   will  extend  deep  into  2021, while calling on  them  to  be  “cautious”   with    their on-farm   decisions.

Fonterra chairman John  Monaghan  says the global recession will impact people’s purchasing power and that will be reflected in prices for all products and services.

The scale of the impact is impossible for economists to predict right now.”

Clearly,  it won’t be easy, nor speedy, to recover  from the  lockdown,  and the  impact of the pandemic. Continue reading “After the pandemic we must deal with global recession – but there will be corporate opportunities, too”

MFAT is dealing with Trump and the world as it is on Peters’ watch, not as Kiwis might want it to be

Foreign Minister Winston Peters, despite his Northland isolation, has been working the phones with global counterparts from US Secretary of State Mike Pompeo to Pacific leaders.

His recognition that NZ has to deal with what it has and the way things are is said to have energised Ministry of Foreign Affairs and Trade in a way not experienced in recent times.

We might think the Australians have displayed less than the true Anzac spirit and the NZ vox pop doesn’t care much for Donald Trump, but he is President of the United States and MFAT doesn’t deal with what New Zealanders might wish for.

Lambton Quay contacts tell Point of Order the US Administration has been extremely helpful to NZ on several issues including extracting cruise liner passengers who would have been otherwise impossibly stranded,  with the White House pitching in to deal with state governors, port authorities, various US agencies and unhelpful mayors. All this has been done under the radar. Continue reading “MFAT is dealing with Trump and the world as it is on Peters’ watch, not as Kiwis might want it to be”

Wraps must be removed from critique of NZ’s capability for quickly tracing the contacts of Covid-19 victims

The public health system must be capable of quickly tracing all people with whom newly identified coronavirus victims have been in contact.

This capability must be a critical element in ministers’ video-link deliberations today as the Cabinet decides whether the country is ready to step down from level four to level three in the campaign to conquer Covid-19.

The government should also publish any analysis of this capability by people with relevant expertise.

Some of the experts – we are told – have raised serious concerns.

According to a weekend report in the New Zealand Herald:  

Scientists are sounding the alarm behind closed doors at the Ministry of Health over New Zealand’s readiness to move to more relaxed pandemic settings.

Their concerns centre on the ministry’s ability to rapidly trace close contacts of Covid-19 cases and an outdated surveillance system – described by one insider as a “dinosaur”.

If those weak spots cannot be urgently addressed, it could significantly affect the Government’s confidence in moving to alert level 3 when Cabinet considers the issue on Monday.

 The ministry received a report on the shortcomings in its contact tracing on April 11 but has yet to release it, the Herald reported.

The report, by University of Otago infectious diseases physician Ayesha Verrall,

 … was understood to be damning of the ministry’s tracing approach at the time of the audit.

The delay in publicly releasing it indicates the ministry is still scrambling to improve its tracing capabilities before Monday’s Cabinet meeting.

Director-General of Health Ashley Bloomfield said on Wednesday he had received Verrall’s report and officials were “furiously” responding to its recommendations.

He said it would be given to ministers in the next 24 hours and then made public.

However, the Ministry of Health said last night that there was no update on when it would be released.

ACT’s David Seymour is right to demand it be released now.

He has issued  a press statement to insist:

“The Government must release a damning report on the Ministry of Health’s ability to do contact tracing…” 

 He says Otago University infectious diseases physician Ayesha Verrall recently audited the Ministry of Health’s contact tracing capabilities.

The ministry received the report a week ago and Ministers were to receive it on Thursday.

 “When to lift the lockdown will one of the most consequential decisions any government has made in our recent history. The Government’s capacity to do contact tracing will be a critical factor in Cabinet’s decision-making.

 “If the Government is not open about shortcomings in its COVID-19 response, how can it enlist private sector help? How do workers and businesses plan their lives if they are being kept in the dark?

 “The public interest in seeing this information outweighs any reason the Government might have for withholding it.

In his statement, Seymour claims the Prime Minister’s rationale for hiding the report “is nakedly political”.

He references remarks by the PM quoted in the New Zealand Herald report cited above:

Prime Minister Jacinda Ardern said on Wednesday there was discussion among officials about whether the report should be released before the Government responded to its recommendations.

“But then immediately the question becomes ‘What have we done?’. So we’re putting [them] both out at the same time.

“I imagine fairly soon after the ministers having received it we will put it into the public domain.”

Seymour tartly comments:

“Jacinda Ardern appears to be concerned that if she releases Dr Verrall’s report, the public will have questions for the Government.

“This Government billed itself as the most open and transparent government in New Zealand’s history.

 “But it has refused to release Crown Law advice on the legal basis for the lockdown and Police’s significant new powers. Nor has the public seen any of the advice Cabinet relied on for its major decisions over the past month.

“The country is currently being run by a tiny group of Ministers and civil servants. The decisions being taken by them are quite literally life and death.

“The public deserves to be part of the conversation. The Government must start treating New Zealand adults and begin releasing critical information and advice on its COVID-19 response, including its capacity to do contact tracing.”

Seymour doubtless was hoping he would win a few brownie points among voters by demanding publication of the report, which means he – too – is bringing political considerations into the frame.

National’s health spokesman, Michael Woodhouse, has been politicking too.

He says the Government’s announcement of a ‘major investment’ for personal protective equipment is another example of it being too slow to act,

In the announcement, Health Minister David Clark brayed about the government stepping up its support in the response to Covid-19.

But the $200 million Clark mentioned [Woodhouse contends] was not new money or new investment – it was clearly set aside for PPE in the 17 March $12 billion package.

“The Government has chosen not to spend it yet, despite many frontline health workers crying out for more PPE.

“If the Government had spent this investment when it was first announced, then the majority of the PPE needed could have been in New Zealand already by now and be in use.

 “Instead, the Government has waited until 128 healthcare workers have tested positive for Covid-19 before finally fronting up with the equipment needed. The Government has also said this PPE is going to arrive over the next eight weeks which will be of little comfort to those who need it now.”

Woodhouse noted that the initial peak of cases had passed, but he maintained the government should expect significant demand for PPE for several months yet and plan accordingly, “rather than be constantly playing catch up.”

 

Cabinet’s challenge is to strike the right balance between halting contagion and getting Kiwis back to work

Finance Minister Grant Robertson trots out the phrase “go hard, go early”  in the battle against  Covid-19,  as  often as he used to declare  the  underlying fundamentals of  the  NZ  economy  are  “strong”.

Meanwhile   Health Minister  David  Clark   says   responding to  Covid-19   is a  “marathon,  not a  sprint”.

But  New Zealand  didn’t  “go early”.   The  Ministry  of   Health  on  January  24,  the  day after China  locked down  the  huge  city of  Wuhan because of the  outbreak of the disease,  said the  likelihood of a  sustained outbreak in  NZ  is  “low”.

It maintained that  line for  a month.  There was no  visible sign of the  ministry calling on ministers to scale up  stocks of relevant equipment, take precautions in retirement  homes,   or   increase the  number of Intensive Care Unit beds  and ventilators. Continue reading “Cabinet’s challenge is to strike the right balance between halting contagion and getting Kiwis back to work”