Economic depression, delusion and the media

It's a chicken and egg problem. Which came first? The delusionary business commentators, who believe the economy will magically 'spring back' if the virus leaves these fatal shores or the Pollyanna media, who refuse to write and broadcast that Australia is entering the greatest Depression in its history.

Delusion and denial are now the weight-bearing support beams of Australian democracy.

In the greatest threat to the global financial system, business spin doctors are flogging online seminars about the future of work, the future of cities, the future of real estate. They mix the data up in a bucket to satisfy each audience's expectations.

I call them the Dunciad, after Alexander Pope's poem of the same name.

The Dunciad was an excoriating attack on the political and literary figures of the early 18^th century. It describes how powerful idiots bought about the moral and intellectual decline of Great Britain and Europe. Now turn the clocks forward 250 years.

Business editors and media moguls don't want you to believe a major Depression will hit by October, even though:

• American unemployment has passed 26 million people and is rising;
• $500 billion was wiped from the ASX in the March quarter;
• Global trade has slumped 30 per cent;
• And unemployment in Australia is projected to top three million people.

They suggest these figures are just 'headwinds', the result of 'low business confidence.' Before long, 'green shoots' will sprout and the economy will be 'down-wind sailing' again.

To them, the looming economic catastrophe, which will beggar millions of Australians, is, as the Black Knight said in The Holy Grail, "just a flesh wound."

The great liberal democratic experiment born from the American and French Revolutions is dead. Reason is in retreat as political chaos marches on Britain, Western Europe, America and Australia. Trust in politicians, financial institutions, the media and the church, has crumbled.

Collective ideals such as equality and fraternity, which have been the bedrock of western societies and parliamentary democracy for more than 200 years, buckle beneath our feet.

Social capital, which helped our forebears survive the Great Depression, has been erased by neoliberalism.

As Leonard Cohen sang in 'Democracy':

From the homicidal bitchin
that goes down in every kitchen
to determine who will serve and who will eat…

Let me give you an example of political delusion from the ruins of my old home state of South Australia.

For 40 years, there has been a concerted effort by the local media and a cabal of business leaders, to make SA seem 'normal'. When by any social and economic measure, it makes the hillbillies in the back blocks of the Appalachian Mountains, look like sophisticates who stepped out of a F. Scott Fitzgerald novel.

Adelaide's media is still banging on about how $90 billion worth of submarines, will save the state. Even non-navy types like me know that social isolation in a submarine isn't a goer. The Chinese are also developing detection weapons to sink submarines below the dive depth of the French-designed Barracuda vessels. You read that first here.

Let's admit that we all can be delusional. It oils the rusty wheels of ego. Many of us hover over the sweet vapours of delusion, that we are made for grander stuff, rather than spending 20 years crunching the numbers on the 5^th floor of a dodgy financial services provider.

But there is more to it than that. Editors and corporations don't want the media agenda fixed and focused, on the incalculable damage the virus is wreaking across all classes and tiers of Australian society.

Sure, they'll runs stories on how corporations allowed aged care homes to be run like Soviet gulags; how private education providers ripped billions of dollars from the battler's VET FEE-HELP accounts or how the major banks and insurance companies, sunk their fangs into our savings.

They will certainly run stories about 'flattening the curve' until the cows come home. It's as if epidemiologists now sit in the News Editor's chair. "What story shall we run tonight?" "How about a self-congratulatory story on flattening the curve?" "How about a story on the fear, death and doom, if we don't?"

The long term economic ramifications of 'curve flattening' have gone missing. Any analysis of the collapse of global supply chains has gone with it. Deflation? Don't worry about it.

The last thing the government, media moguls and business tycoons, want to see is stories of young, middle-class people on the street, of houses repossessed by the banks, of millions of people looking for work.

Because this so radically undermines what's left of an already shaky status quo, social cohesion may unravel.

Another reason, not much reported by Australia's media, is that young people are living under the heel of a hegemony, imposed by uninterested politicians and comfortable members of the post-war generation.

They have watched as the Boomers were showered with senior payments, indexed against average male earnings, tax exemptions on the family home and superannuation tax breaks.

Less than half of 25-34-year-olds own their own home, compared with 61 per cent back in 1981, according to the Australian Housing and Urban Research Institute.

Work for the Dole, the casualisation of the workforce and mounting HECS and VET Student loans, are all burdens young people face today, which older generations didn't. There's no more telling example of intergenerational intransigence than the failure to produce a cohesive energy and carbon emissions policy.

Now, like poor Don Quixote's barn horse, Rocinante, the kids will spend the next 30 years, carrying the tax burden. They'll part-pay for the Boomers expensive MRI's, hip replacements and therapy for depression, and government debt will hang around their necks like a yoke.

One of the strange quirks of history is that while we know plenty about what led to the Great Depression, the arrival of the virus has almost entirely wiped from our recent memory, the fact that Australia's economy was already flagging and that household debt was a massive 200 per cent of income.

Politicians and powerbrokers know that it's better to run self-congratulatory pieces on 'flattening the curve', rather than focusing on the bitter economic seeds the virus has sown for the future.