WHENEVER Treasurer Josh Frydenberg has been questioned about the limits of the $130-billion JobKeeper scheme - foreign workers, for example, are ineligible, as are casuals with less than a year in the job - he has referred to the cost of the program, saying its debt funding has to be repaid, and a line drawn "somewhere".
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While most economists have endorsed the package, University of Newcastle emeritus professors Bill Mitchell and Martin Watts have a different view, saying the program should be much larger, and paid, British-style, directly to workers.
Ordinarily, such criticism might attract little attention, but Professor Mitchell is one of the founders of an economic discipline known as Modern Monetary Theory (MMT), which after years on the fringes is suddenly being taken far more seriously as governments around the world crank up the printing presses (or more accurately, create lines of credit on computer screens).
Professor Mitchell, who joined the university in 1988, founded the Centre for Full Employment and Equity (CoFEE). Professor Watts, who arrived in 1991, was its deputy director.
The think-tank's title expresses their long-standing concerns, and the massive job losses brought about by the government's closure of the economy to fight COVID-19 has focused new attention on many of its long-standing principles and policies.
Professor Mitchell writes prodigiously online about MMT and related subjects and his critiques of the Coalition's coronavirus response do not leave readers guessing.
His response on Wednesday to reports that JobKeeper would avoid a projected unemployment rate of 15 per cent was headed: "A 10 per cent unemployment rate is not a 'tremendous achievement' - it is a sign of total policy failure".
Professor Mitchell says it's not a case of "applying" or "switching to" MMT, but using it as a "lens to see the true, intrinsic, workings of the fiat monetary system".
Critics describe it as ignoring the reality of debt, but Professor Mitchell says currency-issuing governments have no "financial" constraints, only political ones, and that when "life is threatened, as it is now, political constraints soon evaporate".
On that threat, Australia has slid to 32nd position on the global COVID-19 league table.
Yesterday, fatalities stood at more than 145,500, from 2.15 million detected cases, a fatality rate of 6.7 per cent.
ISSUE: 39,583.
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