Here’s how much unemployment is costing the U.S. economy



Billions in benefits have been paid out to jobless Americans, and funding for unemployment has changed dramatically as the pandemic rages on.

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In the Digital Economy, Your Software Is Your Competitive Advantage


Many companies respond to digital competition by embracing methodologies like agile, building “innovation centers,” acquiring startups, or outsourcing app development to consulting firms. But the true disruptors know that in the digital economy, whoever builds the best software wins. Companies that want to compete need to empower their developers and adopt a “software mindset”:  Assign problems to your team, rather than tasks; run a lot of experiments — and tolerate failures; become obsessed with speed; and keep your developers close to your customers.

Fifteen years ago, when I worked as a product manager at Amazon, Jeff Bezos declared at an all-hands meeting that Amazon was not a retailer — it was a software company.

“Our business is not what’s in the brown boxes. It’s the software that sends the brown boxes on their way,” he told us. “Our ability to win is based on our ability to arrange magnetic particles on hard drives better than our competition.”

Not long afterward I left Amazon to found my own company, Twilio. But Jeff’s lesson has stuck with me ever since, especially when I visit our customers, many of whom are engaged in digital transformation. Those companies hope to emulate disruptors like Uber, Lyft, Airbnb, and Spotify, and to compete against giants like Amazon and Salesforce. But many fail to realize what Bezos knew long ago: in the digital economy, whoever builds the best software wins.

Unfortunately, many companies have never viewed software development as a core competency. They rely on packaged programs sold by independent software vendors and hire consultants to write custom code. The problem is that packaged programs are one-size-fits-all and can’t be customized very much. That might be okay for back-end systems like HR and financials, but for customer-facing parts of the business, using off-the-shelf software no longer cuts it. How can you differentiate and gain competitive advantage if you’re using the same software as everyone else? In that part of your business, your choice is no longer “build or buy.” It’s “build or die.”

That means organizations must build their own software development teams and empower developers to be creative problem-solvers. Companies can start by reskilling existing tech staff. These people are among your most valuable employees, but often are an untapped resource.

But companies also must recruit and retain top-tier software engineers. How does a non-tech company lure great developers? You must change the way you view developers. The best engineers won’t work for a company that treats them like “code monkeys” — stuck in some back office, churning out code on command. Top developers want a seat at the table. Involve engineers in strategic problem solving and decision-making. Give them a voice in shaping the future of the company, and the freedom and autonomy to be creative.

Elevating the role of developers involves a subtle (or sometimes not so subtle) shift of power and sometimes invites a backlash from parts of the organization that feel threatened by the rising influence of technologists. To make this work, you have to change the mindset of the entire organization. The commitment must start at the top.

An Inconvenient Truth

Incumbents often respond to digital competition by embracing methodologies like agility and putting thousands of people through training. Other common responses include building “innovation centers” separate from the parent company, acquiring startups hoping to disseminate their DNA throughout the organization, and outsourcing app development to consulting firms.

However, most firms find that after taking these popular steps, nothing has really changed — the digital disruptors are still making rapid headway because building software is just their DNA.

The good news is that it is easier to develop software today than it was a decade ago. Instead of writing apps from scratch, developers snap together microservices — small programs that each provide specific features like communications and billing. Modern developer tools and automation also speed things up.

The payoff can be profound. Building software in-house means programs can be perfectly tailored to the unique needs of your organization. Instead of begging Giant Software Co. for a new feature and then waiting months or even years to get it, you spin up a team of in-house engineers who get code into production in a matter of weeks, or even days.

For example, when Patrick Doyle became CEO of Domino’s in 2010, he determined that in a commodity business the best way to gain competitive advantage was to deliver a better customer experience. That meant having better software and great mobile apps for smartphones. Domino’s expanded its development organization 10-fold and integrated developers with marketing teams. Together they created innovative apps and features, including one that lets customers track the progress of their order from pizza oven to their front door. Great software enabled Domino’s to leap ahead of its competitors and become the biggest pizza chain in America. Since 2012 Domino’s stock price has soared to $400 from $32, outperforming Apple, Facebook, and Google over that time period.

ING, one of the world’s biggest banks, began a similar transformation when Ralph Hamers became CEO in 2013. Taking cues from tech startups, Hamers turned ING into a digital-first organization. He invested heavily in software development and encouraged software engineers to take risks and be creative, which included developing homegrown programs to replace commercial packages. In 2018 small team of ING engineers developed a bespoke program to replace an expensive packaged software system used by the bank’s customer service representatives. The in-house software outperforms the old packaged software program and costs substantially less. Best of all, ING can keep adding new features whenever it wants.

A similar dynamic is playing out at Target, U-Haul, and Allianz, the world’s largest insurer. These organizations are adopting a “software mindset,” which draws on some core principles:

Assign problems, not tasks. Traditionally, people on the business side come up with ideas and hand them to developers who are tasked with turning them into code. Instead, let developers contribute to the solution of business problems. Who knows better how to apply software to your business than people who deeply understand technology?

Tolerate failure. Experimentation is the prerequisite to innovation. Create an environment where developers run lots of small experiments and where failure is celebrated rather than punished. Run blameless post-mortems to discover why an experiment failed and what you can learn from that experience.

Become obsessed with speed. Startups push new code constantly, every day. Companies can no longer spend months developing new programs. Hunt relentlessly for ways to shave the time it takes to go from “great idea” to working production code.

Keep developers close to customers. Remove organizational barriers that separate developers from the people who actually use their software. When developers talk to customers they can deliver better, more useful features in less time.

Every organization will embrace the builder’s mindset in its own way. But these principles provide a framework for building a world-class software development organization, so you can respond faster to customer needs, adapt to a constantly changing market, and keep up with the Amazons of the world.

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The gap between Australian house prices and incomes is only likely to grow | Australian economy


Australians love of housing continues with even more vigour during the Covid recession – powered by government incentives and record low interest rates, which look set to remain low for many years.

In November a record $23.96bn in new housing loans were taken out. This record reveals how weird this recession is – there is higher unemployment, but it is mostly driven by forces that have little to do with the underlying strength of the economy.

It means that for those still with a full-time job things are pretty good – especially if you are thinking about buying a home.

And so in November last year, the level of new housing loans was 24% above where it was 12 months earlier:

The big boost has come from owner-occupiers – up 31% over the 12 months compared to just a 4% growth for investors.

This lack of investor loans however is just a continuation of what has happened since 2016 when the surge of apartment building came to an end. In November the total of owner-occupier loans was 38% above what it was in January 2017, while investor loans were down 38%:

And among owner-occupiers the big surge has come for those looking to build a new home.

It has to be said that the government’s homebuilder grant of $25,000 for new builds and substantial renovations has worked as intended.

Since it came into effect in June last year, the number of home loans for the construction of houses has doubled from 3,491 in June to 7,107 in November.

So great has been the surge of home loans to build houses that in November the number of such loans was well above even the level that occurred during the GFC when the Rudd government also introduced measures to boost housing construction:

And yet there has also been a big jump in the purchase of established homes. This is less to do with government policies and grants and more to do with the record low interest rates.

It is true that even before the pandemic interest rates were at record lows, but the impact of the Reserve Bank dropping the cash rate to 0.1% might have had the opposite psychological impact that pushing it to 17% in 1989 had.

Back then rates were already high but that final increase knocked the stuffing out of those with a mortgage, and it scared the hell out of those thinking about taking out a home loan.

Similarly, if you were ever worried about holding off taking out a loan because of fears about interest rates, the RBA cutting the cash rate to 0.1% removed them. Even the most risk averse borrower was thinking now it’s the time to take out a loan.

For many this has not just meant a home loan but also a car loan – the number of which has completely recovered from the drop in April last year:

Partly this is because the option of a big spend on an overseas holiday has completely dried up, and as a result loans for travel remains barely above zero:

But will these low rates last?

We know that increases in home loans lead to an increase in house prices, and the Reserve Bank would not wish for a divergence of house prices while unemployment remains high – for such a level is unsustainable and risks a collapse once government grants end.

It also will lead to a decrease in housing affordability as incomes will not keep pace with house prices.

In the past that would have meant an increase in rates, but not now.

Shane Wright reported on Monday in the Sydney Morning Herald that the RBA is instead looking at tightening lending standards should house prices continue to rise.

It will need to do this because there is no prospect at the moment of any increase in wages and inflation that would force the RBA to lift rates.

The most recent market inflation expectations suggests inflation growth will be well below the RBA’s target of 2% throughout this year:

Last November, the Reserve Bank announced that it “will not increase the cash rate until actual inflation is sustainably within the 2 to 3 per cent target range”.

This was a change on its previous advice that it would not do so until it was “confident that inflation will be sustainably within the 2–3 per cent target band”.

As of now, actual inflation has not been above 2% for over five years – and when it was wages growth had been long above 2%:

The RBA has noted that to get inflation back above 2% “wages growth will have to be materially higher than it is currently” and this “will require significant gains in employment and a return to a tight labour market”.

In essence that means unemployment back around 5%. As a result the RBA “is not expecting to increase the cash rate for at least three years”.

And so home loans are likely to continue to grow and so too will the gap between house prices and household income.

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Economy will grow without help: Frydenberg



Josh Frydenberg is confident the economy will continue to strengthen and that the unemployment rate will fall further.

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Vaccinations, boosting economy top Cuomo 2021 agenda – Long Island Business News


Gov. Andrew Cuomo pledged New York will vaccinate millions and jumpstart its flagging economy in 2021 as part of his annual address to the state that began Monday.

The governor’s address — which will continue throughout the week — comes as the state tries to balance reopening its economy with ending a pandemic whose death toll is now nearing 40,000 people, according to data collected by the John Hopkins University School of Medicine. New York’s hospitals and nursing homes have recorded nearly 4,100 new deaths of people with COVID-19 over the past 30 days, and the state is now seeing more new COVID-19 cases per-capita than 35 other states.

Hospitals statewide have added thousands of additional emergency beds and are now caring for about 8,500 patients — less than half the mid-April peak of 18,000. But Cuomo warned continued spread — potentially exacerbated by a highly contagious COVID-19 variant widespread in the United Kingdom — could devastate hospitals around the state.

“We are hurt, we are frustrated, we are in mourning, we are anxious,” said Cuomo, who delivered his televised address to a small in-person audience. “We are shocked that an invisible enemy could reach such death and destruction especially in this, the most wealthy and powerful nation on earth.”

The Democrat opened up vaccine eligibility to essential workers and individuals over 75 years old in a Friday announcement — a shift that followed criticism of his restrictive approach of first waiting to vaccinate all healthcare workers.

The governor announced he’s launching a new public health corps that will bring aboard 1,000 fellows to help roll out vaccinations. He also pointed to a new state website launched Monday that allows New Yorkers to check their eligibility and find out where they can sign up for a vaccine.

Cuomo called on the federal government to boost shipments to states and urged the incoming Biden administration to release more doses. New York has used just half of its roughly one million vaccine doses so far, and Cuomo said New York won’t have enough doses for roughly four million eligible New Yorkers until mid-April, based on the state’s federal allotment of 300,000 vaccines per week.

The pandemic is still hitting large swaths of the state: about 136,000 people have tested positive for COVID-19 since Jan. 1 alone, while nearly 8,900 new COVID-19 patients have entered hospitals. The governor has set high standards for new restrictions on businesses and houses of worship in hard-hit areas of New York that could only kick in once hospitals are nearing crisis capacity levels, and is urging the state to emphasize boosting its ailing economy.

“We simply cannot stay closed until the vaccine hits critical mass,” Cuomo said.

New York’s unemployment rate has improved in recent months: from 15.3% in April to 8.4% in November. Still, that’s higher than the national unemployment rate, which has shrunk from 14.7% in April to 6.7% as of November.

Cuomo pledged to invest in green energy to help create more jobs, and to increase revenue by legalizing mobile sports betting and recreational marijuana, which could bring in $300 million years in annual revenue after several years.

New York lawmakers and Cuomo have planned to reduce state spending by as much as $8 billion to make up for the state’s expected large drop in sales and income tax revenue.

And Cuomo has held back at least $2.4 billion in state payments to localities as of September: that includes $486 million in aid to higher education, $475 million for transportation, $289 million in health care, $252 million for human services and housing, $300 million in school aid and $362 million in education and arts funding.

It’s unclear whether the state will ever pay out that local aid.

Cuomo said it’s up to Congress to provide enough federal aid, and said he’s hopeful that the newly Democratic-led Senate will provide enough state and local aid to help with state-level shortfalls.

“I believe they will do justice,” he said.

But he’s facing pressure from Democratic legislative leaders and the party’s left wing to increase taxes for the state’s wealthiest rather than rely on potentially sweeping budget cuts or federal aid.

“It is urgent and necessary that our representatives in Washington bring home relief,” New York Working Families Party State Director Sochie Nnaemeka said. “But federal relief never was, and is not today, sufficient to meet the needs of people up and down our state.”

Meanwhile, minority Republicans who oppose broad new tax increases said New York has a spending, not a revenue problem.



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Australia’s economy is faring better than most – but that’s not saying much | Greg Jericho | Business


As we begin 2021, the economic questions mostly involve wondering when will things return to normal and what that normal will look like. The worst is behind us, but we have a way to go yet to be out of recession and a great deal further to go before we can suggest the economy is strong.

While border closures and suburban-area lockdowns remain we will continue to see odd economic happenings.

The latest retail trade figures are a case in point.

In November, as Victoria came out of its lockdown, retail spending in that state rose 22% in one month. Even the rest of the nation’s growth of 2.6% was well above the long-term median monthly growth of 0.4%.

Australia is doing quite well compared with other nations, and yet that is not saying a great deal.

Using US economist Claudia Sahm’s measure of recessions, which compares the unemployment rate with the lowest point of the past 12 months, the US is in a worse situation than Australia, but both nations are doing as badly as they were in the depths of the GFC:


While unemployment is a key indicator, given the moves to keep people employed technically through the jobkeeper payment, I think the underutilisation rate is more resonant of the real situation.

In November, 11.7% of men in the labour force were either unemployed or underemployed and 15.2% of women were so situated. While both were much lower than they were last June/July they remain well above the pre-Covid record highs:


And when using underutilisation rather than unemployment to measure recessions, in November things were as bad as they ever have been:


The situation however is not even across the country.

Victoria and New South Wales remain the worst hit, but Western Australia is essentially out of recession – and doing better than it was a couple years ago as it dealt with the end of the mining boom:


Similarly, South Australia is performing as well now as it was before the pandemic hit.

We see this also in the decline and recovery of hours worked per capita in each state. Adults in Western Australia are now working more hours per month on average than they were before the pandemic (as is the case in the ACT), while Victoria has a long way to recover:


When we look at the situation across age groups – every age remains in recession, with the 25-34 year olds in the worst shape:


So things remain bad, if better than they were.

But what can we look to as a sign that things are back to normal?

I have long been using the measure of hours worked per capita to chart the state of the economy.

Back in May I suggested that “until the level of actual hours worked is back to where it was before the shutdown, no one should be thinking about austerity”. That remains my position and while the November level of 83.9 hours is a massive improvement on the despairing level in May last year, it is still awful:


It deserves repeating that the level of hours worked in November was as bad as ever experienced since the 1990s recession.

At any other point in the past 25 years we would be viewing the state of affairs in November as a sign of an economy in complete distress.

It’s why the commentary that Australia is no longer in a recession because GDP grew in the September quarter is quite laughable.

Another aspect to keep watch over is the percentage of men aged 25-64 who are working full-time. Every recession since the 1980s has seen this level fall and not recover.

Even prior to the pandemic, the level of prime-aged men working full-time was below the post-1990s recession median of 74%, let alone the mining-boom peak level of 75.9%:


The current level is around a full percentage point lower than the pre-pandemic point, but since 2012 there has been a historically low number of men in this group working full-time.

If we are to use GDP to look at recessions and economic performance, we could do worse than use the adjusted nominal GDP growth, which involves adding annual real GDP and inflation growth.

Given a target average GDP growth of 2.75% to 3.25% and the Reserve Bank’s inflation target of 2% to 3%, we should be aiming for this adjusted nominal GDP growth to be at least 4.75%.

In September it was minus 3.1%:


And again, we should note that prior to the pandemic both GDP and inflation growth had long been below par.

It is a good reminder that, while we are doing better than we were, we need to do much more. Just getting back to where we were before the pandemic also remains a decidedly poor aim.

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U.S. economy suffers job losses as COVID-19 ravages restaurants, bars



FILE PHOTO: Construction workers wait in line to do a temperature test to return to the job site after lunch, amid the coronavirus disease (COVID-19) outbreak, in the Manhattan borough of New York City, New York, U.S., November 10, 2020. REUTERS/Carlo Allegri

January 8, 2021

By Lucia Mutikani

WASHINGTON (Reuters) – The U.S. economy shed jobs for the first time in eight months in December as the country buckled under an onslaught of COVID-19 infections, suggesting a significant loss of momentum that could temporarily disrupt the recovery from the pandemic.

The plunge in nonfarm payrolls reported by the Labor Department on Friday was concentrated in the coronavirus-sensitive leisure and hospitality sector, which lost nearly half a million jobs. But with other industries including retail, manufacturing and construction performing better, the economy is unlikely to tip back into recession.

Nearly $900 billion in additional pandemic relief approved by the government in late December will probably provide a backstop. More fiscal stimulus is expected now that Democrats have gained effective control of the U.S. Senate, boosting the prospects for President-elect Joe Biden’s legislative agenda. There is also optimism the rollout of coronavirus vaccines will be better coordinated under the incoming Biden administration.

Congress on Thursday formally certified Biden’s victory in the Nov. 3 election, hours after hundreds of President Donald Trump’s supporters stormed the U.S. Capitol. The employment report is one of the final scorecards delivered during the Trump presidency and stands as a reminder of the tumultuous economic crisis that marked his last months in office.

“This is a pause in the recovery, not a full-on stall,” said Chris Low, chief economist at FHN Financial in New York.

Payrolls decreased by 140,000 jobs last month, the first decline since April, after increasing by 336,000 in November. The economy has recovered 12.4 million of the 22.2 million jobs lost during the pandemic. Economists polled by Reuters had forecast 77,000 jobs would be added in December.

COVID-19 cases in the United States have jumped to more than 21 million, with the death toll exceeding 357,000, according to a Reuters analysis.

The leisure and hospitality sector lost 498,000 jobs last month, with employment at bars and restaurants tumbling 372,000, accounting for three quarters of the drop. Restaurants and bars in many states, including New York and California, were shut during the holidays to slow the spread of the virus. Excluding the leisure and hospitality sector, payrolls rose at roughly the same pace as in November.

There were also decreases in private education jobs as many universities and colleges closed after the Thanksgiving holiday. Government employment declined for a fourth straight month, with losses spread across federal state and local governments.

But retail employment rose by 121,000 jobs. Factories hired 38,000 workers and construction payrolls increased by 51,000 jobs. There were also gains in employment in professional and business services, transportation and warehousing, health care and wholesale trade industries.

Weak payrolls joined soft consumer confidence and spending in underscoring the brutal impact of the coronavirus on the economy, which sank into recession in February. The data increases the likelihood of another rescue package by March.

Stocks on Wall Street were trading mostly higher on hopes of more government money. The dollar rose against a basket of currencies. U.S. Treasury prices were trading mostly lower.

SOME SILVER LININGS

With the virus hollowing out lower-wage industries, average hourly earnings surged 0.8% after gaining 0.3% in November. The average workweek dipped to 34.7 hours from 34.8 in November.

Though the unemployment rate was unchanged at 6.7% in December, that was because of people misclassifying themselves as being “employed but absent from work.” Without this misclassification, the jobless rate would have been about 7.3%.

Despite last month’s job losses, the labor market is steadily improving. A broader measure of unemployment, which includes people who want to work but have given up searching and those working part-time because they cannot find full-time employment, fell to 11.7% from 12.0% in November.

The number of people who have permanently lost their jobs declined by 348,000 to 3.370 million. That was the biggest drop since December 2010. Still, it will probably take years for the scars from the pandemic to heal. Nearly 4 million Americans have been unemployed for more than six weeks, accounting for 37.1% of the jobless in December.

“These scarring effects pose downside risks to the recovery and could lead to elevated long-term unemployment and weakened labor market attachment for years to come,” said Lydia Boussour, a senior U.S. economist at Oxford Economics in New York.

The labor force participation rate, or the proportion of working-age Americans who have a job or are looking for one, remains at a depressed 61.5%. The employment-to-population ratio, seen as a measure of an economy’s ability to create jobs, held at a low 57.4%.

Economists are optimistic employment will rebound in the months ahead and accelerate through 2021 amid expectations for increased inoculations and additional fiscal stimulus, including more infrastructure spending under the Biden administration.

“Savings are burning a hole in many people’s pockets after having to avoid travel, in-person dining and entertainment for nearly a year,” said Sarah House, a senior economist at Wells Fargo Securities in Charlotte, North Carolina. “Hiring could ramp up quickly once COVID cases are more under control.”

Many economists have upgraded their 2021 growth estimates following the recent relief package and two runoff elections in Georgia this week that gave Democrats effective control of the U.S. Senate. Biden’s party maintained its control of the U.S. House of Representatives in the Nov. 3 election.

(Reporting by Lucia Mutikani; Editing by Chizu Nomiyama and Paul Simao)



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Australian Economy Would Likely Recover In 2021 According To The Treasurer, What Involved Such Claims?

A promising hope has been pointed out by Treasurer Josh Frydenberg as he said he feels very optimistic that the economy will be recovering from the ashes of the pandemic in 2021. However, he noted that Australia is “not out of the woods” just yet.

As per his statement with the media, Mr Frydenberg affirmed that the $7 billion in the Federal Government stage two tax cuts that were brought forward last October has aided greatly in boosting the economy.

“We’re seeing the benefits of that money rolling out into people’s pockets $7 billion that’s coming into people’s pockets in the last six months. Another $9 billion over coming months as well.” He said.

He also cited that there were notably good signs that the impacts of pandemic restrictions towards employment have been gradually mitigated.

According to him “Eighty-five per cent of the 1.3 million Australians who either lost their jobs or saw their working hours reduced to zero at the height of the pandemic are now back at work. So there are some positive and hopeful signs across the economy. But we’re not out of the woods just yet.”

All that being said the Treasure has ruled out as he brought forward the planned stage three tax cuts, and also extending the Jobkeeper wage subsidy.

On the other hand, Peter Strong, CEO of Small Business Council told media that the government should consider the extension of Jobkeeper, especially for the heavily impacted industries such as hospitality as it ends in March.

Yet, Mr Frydenberg said gaining control of the virus would best help the economy.

He said, “What will support hospitality beyond March is containing the virus on the health front. That is the best thing you can do for the economy is to get the virus.”

Adding to that, he also affirmed his expectation towards the Brisbane lockdown to be lifted today upon recording no new coronavirus cases for two successive days yesterday in the state.

How to reform the attention economy business model of Big Tech


Seeing reality clearly and truthfully is fundamental to our capacity to do anything. By monetizing and commodifying attention, we’ve sold away our ability to see problems and enact collective solutions. This isn’t new. Almost any time we allow the life support systems of our planet or society to be commodified, it drives other breakdowns. When you commodify politics with AI-optimized microtargeted ads, you remove integrity from politics. When you commodify food, you lose touch with the life cycle that makes agriculture sustainable. When you commodify education into digital feeds of content, you lose the interrelatedness of human development, trust, care, and teacherly authority. When you commodify love by turning people into playing cards on Tinder, you sever the complex dance involved in forging new relationships. And when you commodify communication into chunks of posts and comment threads on Facebook, you remove context, nuance, and respect. In all these cases, extractive systems slowly erode the foundations of a healthy society and a healthy planet.

Shifting systems to protect attention

E.O. Wilson, the famed biologist, proposed that humans should run only half the Earth, and that the rest should be left alone. Imagine something similar for the attention economy. We can and should say that we want to protect human attention, even if that sacrifices a portion of the profits of Apple, Google, Facebook, and other large technology corporations.

Ad blockers on digital devices are an interesting example of what could become a structural shift in the digital world. Are ad blockers a human right? If everybody could block ads on Facebook, Google, and websites, the internet would not be able to fund itself, and the advertising economy would lose massive amounts of revenue. Does that outcome negate the right? Is your attention a right? Do you own it? Should we put a price on it? Selling human organs or enslaved people can meet a demand and generate profit, but we say these items do not belong in the marketplace. Like human beings and their organs, should human attention be something money can’t buy?

Is your attention a right? Do you own it? Should we put a price on it? Like human beings and their organs, should human attention be something money can’t buy?

The covid-19 pandemic, the Black Lives Matter movement, and climate change and other ecological crises have made more and more people aware of how broken our economic and social systems are. But we are not getting to the roots of these interconnected crises. We’re falling for interventions that feel like the right answer but instead are traps that surreptitiously maintain the status quo. Slightly better police practices and body cameras do not prevent police misconduct. Buying a Prius or Tesla isn’t enough to really bring down levels of carbon in the atmosphere. Replacing plastic straws with biodegradable ones is not going to save the oceans. Instagram’s move to hide the number of “likes” is not transforming teenagers’ mental-health problems, when the service is predicated on constant social comparison and systemic hijacking of the human drive for connection. We need much deeper systemic reform. We need to shift institutions to serve the public interest in ways that are commensurate with the nature and scale of the challenges we face.

At the Center for Humane Technology, one thing we did was convince Apple, Google, and Facebook to adopt—at least in part—the mission of “Time Well Spent” even if it went against their economic interests. This was a movement we launched through broad public media-awareness campaigns and advocacy, and it gained credence with technology designers, concerned parents, and students. It called for changing the digital world’s incentives from a race for “time spent” on screens and apps into a “race to the top” to help people spend time well. It has led to real change for billions of people. Apple, for example, introduced “Screen Time” features in May 2018 that now ship with all iPhones, iPads, and other devices. Besides showing all users how much time they spend on their phone, Screen Time offers a dashboard of parental controls and app time limits that show parents how much time their kids are spending online (and what they are doing). Google launched its similar Digital Wellbeing initiative around the same time. It includes further features we had suggested, such as making it easier to unplug before bed and limit notifications. Along the same lines, YouTube introduced “Take a break” notifications.

These changes show that companies are willing to make sacrifices, even in the realm of billions of dollars. Nonetheless, we have not yet changed the core logic of these corporations. For a company to do something against its economic interest is one thing; doing something against the DNA of its purpose and goals is a different thing altogether.

Working toward collective action

We need deep, systemic reform that will shift technology corporations to serving the public interest first and foremost. We have to think bigger about how much systemic change might be possible, and how to harness the collective will of the people.

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How the vaccine roll out will affect the global economy


Television crews will jostle to get footage of the first Australians getting the needle and there will be a frenzy of debate and discussion. We’re going to hear a lot more about how social media giants like Facebook, Twitter and Google handle misinformation from anti-vaccine groups. There will also be a renewed debate about whether getting the jab should be mandatory and if we can let people travel once they have one.

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There will be disagreement and emotions will run high.

But most of all, there will finally be a sense that at some point we can get back to our lives. It will hopefully reduce outbreaks, improve the labour market and, eventually, open our borders more widely to the rest of the world.

This is exactly why getting the vaccine rolled out smoothly is going to be critical for the economy. Positive forecasts for this year are relying heavily on the vaccination to pull us through a difficult period.

$4.7 trillion and counting

The World Bank’s 2021 Global Economics Prospects report released last week expects a 4 per cent expansion in the global economy but includes the caveat that this figure relies on the vaccination getting across the line.

This won’t reverse all of the financial pain. The global economy contracted 4.3 per cent in 2020 and most countries have fared far worse than Australia. Global GDP in 2021 is likely to be 5.3 per cent below pre-pandemic forecasts, which basically means this health crisis has cost the world $4.7 trillion.

World Bank Group president David Malpass described the outlook in a statement as a “subdued recovery” still facing “formidable challenges”.

“To overcome the impacts of the pandemic and counter the investment headwind, there needs to be a major push to improve business environments, increase labour and product market flexibility, and strengthen transparency and governance,” he said. Basically, the vaccine won’t cure our economic woes on its own.

But the report still expects immunisation to be a significant factor in supporting the recovery in terms of confidence, consumption and the gradual improvement in trade.

In a positive scenario, rapidly rolling out vaccines that are highly effective could mean a “faster easing of the pandemic, triggering a sharp rise in consumer confidence and unleashing pent-up demand,” the report says.

“Industrial commodity exporters and countries with greater exposure to trade and tourism would be expected to benefit most from a faster resolution of the pandemic.” Clearly, this would benefit Australia hugely.

But in the more negative scenario outlined by the World Bank, where the vaccination deployment could be slowed by logistics and reluctance towards immunisation, there could be more outbreaks and economic growth could recover at a slow 1.6 per cent level over the year. This would be even lower, at 0.6 per cent, in advanced economies.

Don’t be misled, even with the vaccine the global economy will still be smaller than it would’ve been without the pandemic. But it’s the first of many steps towards rebuilding.

Beware the PR challenge

Getting the rollout of the vaccine correct will be the fight of our lives, in terms of both health and the economy. It is a momentous challenge for policymakers who are well aware of how critical this program will be and still have to grapple with the expectations of the public.

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Outside of very difficult decisions about who gets the vaccine when, which is not as straightforward as it might first seem, the rollout is obviously a huge public relations challenge.

Four million people are likely to be vaccinated by the end of March. The federal government is clearly aware there are some sections of the community who are more reluctant than others to accept the jab and has started spending millions to tackle this concern. This spending will pay dividends if it puts minds at ease.

There will also need to be plenty of analysis and planning about how the vaccine will affect the nation’s ability to open up, avoid future lockdowns and how to best protect those who are unable to have the jab.

So for those who feel like they’re holding their breath, waiting to breathe a huge sigh of relief, it’s not quite over yet. But we are a step closer to a moment both history and all of us living through COVID are unlikely to forget.

Ross Gittins is on leave.

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