Darkest before dawn

With roughly half its population in lockdowns that look set to stay in place for months to come, it is increasingly clear in mid-August 2021 that Australia’s relatively comfortable experience with COVID-19 in 2020 is very much a thing of the past. New Zealand may be heading in the same direction. In this depressing time, it is important to focus on how we reach a better future.

Laurence Davison Head of Content and Editor KANGANEWS

In composing this column, I found it impossible to think of a capital-markets-related topic that would cut through the leaden clouds that cover Australia and New Zealand. The atmosphere of gloom engendered by the pandemic is simply all-pervasive.

The population of Sydney has been in some form of lockdown for nearly two months already and it is increasingly clear that these measures will remain in place for at least as long again. Melbourne’s snap lockdown does not at this stage appear to be containing an outbreak of the delta strain imported from Sydney. New Zealand is on a knife-edge with its new lockdown. Even those parts of Australia not currently battling delta outbreaks are living with the day-to-day fear that cases will emerge. It is surely not a matter of if but when for the whole country.

Ascribing blame may be unproductive but there is plenty of it to go around nonetheless. Some goes to national governments that in 2020 made little or no effort to upgrade a hotel-quarantine system that was not fit for purpose against the alpha strain and was a recipe for disaster when delta arrived.

Most of the rest goes to the New South Wales (NSW) state government for a display of hubris that beggars belief. It saw the mistakes made in Victoria that led to its protracted lockdown in 2020 – and calmly repeated them. It is important to be clear, here: saying NSW should have locked down sooner to try to contain its COVID-19 outbreak is not being wise after the event. Plenty of people were calling for a lockdown weeks before NSW moved – a period of time that has proved, literally, fatal.

Granted, the NSW outbreak was Australia’s first experience with the delta variant. But refusing to take reasonable precautionary lockdown measures on the basis of having got away without them before should be a disqualifying stain on the administration’s reputation.

In effect, to run an elimination strategy with alpha requires a government to be either alacritous in its response or lucky; delta requires both. Victoria and New Zealand may be demonstrating alacrity without luck; NSW never gave itself a chance to be lucky.

“To run an elimination strategy with alpha requires a government to be either alacritous in its response or lucky; delta requires both. Victoria and New Zealand may be demonstrating alacrity without luck; NSW never gave itself a chance to be lucky.”


Still, we are now where we are and – as we will no doubt be reminded by those most responsible for this diabolical outcome – it is important to look forward. There are some reasons to be positive, hard though they may be to focus on from the perspective of lockdown.

The primary positive factor is that the NSW outbreak should finally remove any idea that Australia can have a future free of COVID-19. Looking back to the first half of the year, I recall being increasingly concerned that our leaders were failing to engage with the public on the idea that national borders would have to open at some stage – indeed, that their being so would be a desirable outcome – and that, when they did, virus elimination would no longer be a plausible option.

I don’t think my concern was unreasonable. In April, prime minister Scott Morrison assured Australians the country was in “no hurry” to reopen its borders even when vaccination was widespread. Of course, this was during the period in which Morrison was keen to tell people vaccination was “not a race” – an epidemiological view that no doubt coincidentally aligned with Australia’s failure to secure enough vaccine supply to win such a race, should it have existed.

The latest outbreak and the failure to contain it clearly takes elimination off the table. The NSW government has more or less explicitly abandoned any goal of getting its own case numbers down to zero and, as the experience in Victoria and New Zealand demonstrates, it is increasingly clear that ‘beating’ delta is a fool’s errand. It will get in, and eventually it will overwhelm even the harshest lockdown. One way or another, some form of ‘living with the virus’ is now the only option for Australasia’s future just as it is for the rest of the world.

In fact, in the long run if anything I am more concerned about places like New Zealand and Australia’s – currently – virus-free states, including Queensland, South Australia and Western Australia (WA), than I am about NSW.

Take WA: the state’s vaccination rollout is lagging the rest of Australia, albeit only by a few percentage points, largely it seems as a result of lower urgency among the population. State leadership continues to make somewhat ambiguous pronouncements about the status of its border even when vaccination reaches the 80 per cent level that appears to be a national target. This is not a recipe for successful future reintegration into the wider world, much as the ‘keeping the state safe’ narrative has so far been a political winner.

“For the time being, vaccine demand continues to outstrip supply. The first crunch point will come when vaccination moves past the early adopters and we start to find out what proportion of the population is vax-hesitant or outright vax-resistant.”


It is, in other words, easy to lose sight of the parameters of the possible. One way or another, Australia and New Zealand are now preparing for a future in which their adult populations are largely vaccinated against COVID-19 but where the virus is circulating. The vaccines themselves will massively reduce the number of people who get seriously ill or die, but they will not eliminate the worst outcomes.

To achieve the best possible version of this future, the first and most critical goal must be to maximise the uptake of vaccines. Inadequate availability of shots has left a dreadful time gap in Australia and New Zealand that necessitates protracted lockdowns just to keep the COVID-19 caseload low enough that health services can cope.

This is perhaps the worst aspect of the current situation. As recently as June, most people in Australia might have been forgiven for thinking they were on the pandemic home straight. A large proportion of them are now locked down probably until at least October or November while the vaccination rate crawls toward 80 per cent. New Zealand could be confronting the same outlook.

For the time being, vaccine demand continues to outstrip supply. The first crunch point will come when vaccination moves past the early adopters and we start to find out what proportion of the population is vax-hesitant or outright vax-resistant. The UK provides a positive outlook, as its vaccination rate continues to head toward 90 per cent even as uptake has slowed. The US, thanks to its poisonous political environment and disinformation complex, is a more cautionary tale: vaccination has slowed if not stalled with much of the country well below the herd-immunity level. Delta is ravaging the country as a result.

This will be the time when, more than ever, leadership is needed. The Australian government has already botched one aspect of vaccination messaging, managing to allow a large swathe of the country to form the belief that the microscopic risk of serious side-effects from the AstraZeneca vaccine is sufficient to refuse to take it.

The lack of effort put into convincing people to take this perfectly serviceable vaccine of course came in the middle of the “not a race” period, showing once again that this is an administration that would rather win tomorrow’s headlines than waste too much thought on what might happen down the road. We will in time pay the price for the federal government’s adherence to this approach when it comes to climate change, of course.

The truly antivax element of society is probably going to be too hard to reach. What our leaders need to tackle – and I have not seen much sign of it yet other than ad-hoc pleading in daily press conferences announcing a further deterioration of state COVID-19 outbreaks – is the cohort of people that is hesitant or just indifferent to the urgency of getting vaccinated.

I cannot claim to have much insight into the policy approach in New Zealand, but what I have seen so far in Australia is worrying. The federal government appears to have ruled out direct cash incentives for vaccination – largely because the suggestion came from the opposition, which of course can never be allowed to have a good idea – and it has yet to take any real leadership on employer vaccination requirements.

Perhaps the idea is to hope the population gets itself to 80 per cent before bringing out the stick or the carrot. Again, the failure to position for future circumstances is frustrating. What happens if Australian vaccination reaches 60-70 per cent of the adult population and then slows to a crawl – noting that this is almost exactly the position the US finds itself in? Will the government only decide at that point that it needs to make a publicity push? How long will lockdowns have to last if this is the case?

There are grounds for optimism in Australia and New Zealand. We can finally look to a plausible version of future reopening, and the vaccination rate has – excuse the pun – spiked when COVID-19 rears its head in a community. What we need now, once again, is leadership that is willing to anticipate future circumstances and prepare the population for them even if doing so requires explaining some difficult truths.