The good news is supposed to be that when the government gets out of the way “can-do capitalism” will have us roaring back to where we were before.
That’s the prime minister’s newest slogan, and we had better hope for more.
The unpleasant truth is that before the pandemic Australia’s economy was disturbingly and unusually weak. Can-do capitalism wasn’t doing what it should.
Reserve Bank chief economist Luci Ellis put it this way a few days after Morrison talked about freeing the engines of the economy to do their work.
In the decade or so leading up to the pandemic, there was a nagging sense that these engines of prosperity were running out of steam – investment was low, productivity growth was lagging, and many of the behaviours we associate with business dynamism were on the decline.
Outside of mining, business investment had been shrinking as a share of the economy for more than a decade.