Tasmanian Design Principles for Fiscal Policy in the Pandemic
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An Australia Institute paper May 2020
The Australia Institute, an independent public policy think tank based in Canberra, has released a paper suggesting what actions Tasmania could undertake to support economic recovery.
Their paper suggests that while the current economic downturn may resemble the beginning of previous recessions, the cause is so different, government responses must be structured differently to previous crisis responses. Traditional approaches to ‘stimulus’ cannot succeed in boosting output in effected industries.
This paper provides design principles for evaluating proposals to ensure that future spending packages are as effective as possible. In the short term, the government must pump not just money into the economy, but also into jobs. And in the long term, if the jobs that governments create in the coming year deliver lasting benefits then our community won’t be ‘saddled with debt’, it will be blessed with new assets. Just as the Great Depression delivered a road up kunanyi/Mt Wellington, so too can state government projects undertaken in the coming year provide both jobs now and community benefits for decades to come.