Preparedness instead of containment

Delivered on By Justin Pyvis

Good morning! There were wild scenes in the nation’s capital on Saturday as up to 10,000 people took to the streets to protest vaccine mandates as part of a “Convoy to Canberra”.

After asking protestors to conduct themselves in a “peaceful and respectful way”, ScoMo was quick to point out that “all other mandates that relate to vaccines have been imposed unilaterally by state governments”.

An A+ for deflecting any responsibility there, even though he’s not wrong – almost all pandemic restrictions and mandates are under the purview of state governments.

We have plenty more on these increasingly common anti-vaccine mandate convoys – which is at least how they originate before morphing into something quite different – in today’s Food for thought below. πŸ‘‡


Reading the tea leaves

Daily % change

AUD/USD

71.6

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AUD/CNY

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AU Bond

2.10

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US Bond

1.96

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ASX200

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S&P500

4,419

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Brent (bbl)

95.0

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Iron ore (t)

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Bitcoin

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Ethereum

2,894

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Note: Brent oil, gold bullion and iron ore prices are the second futures contract. Bond yields are 10-year Treasuries. The S&P500 is a snapshot 30 minutes before close.

TheΒ US S&P500Β finished the week on a sour note (-1.90%) as tensions between Russia and Ukraine heated up, with Russian President Vladimir Putin reminding everyone that he has nukes.

Also spooking markets was US National security advisor Jake Sullivana, who warned that there’s a “credible prospect” that Russia could invade Ukraine before the Beijing Olympics wraps up on 20 February (and before warmer weather turns the ground turns to mud, making it more difficult for heavy military vehicles to advance).

Locally, theΒ ASX200 fell -0.98% as all but the materials sector ended in the red, with tech stocks leading the losses (-3.8%) following the fastest US inflation reading in 40 years.


Food for thought

New Zealand's Freedom Convoy was shut down relatively quickly.
New Zealand's Freedom Convoy was shut down relatively quickly. Source

Canada’s “Freedom Convoy 2022” is trucking on into its 16th day and has been joined by similar movements across the world, most recently in Canberra on the weekend and New Zealand last week.

They all seem to have one thing in common, at least initially: opposition of ongoing government policies such as vaccine mandates and restrictions.

If that’s all it was, they would have a point – the ‘emergency’ phase of the pandemic is definitely over. As Jonathan Rauch recently wrote in Persuasion:

“Everyone realizes that the virus, with its repertoire of mutations, is here to stay. Panels and articles on the new normal are cropping up. Governors are adjusting their approach. Protocols that seemed at least vaguely justifiable a few months ago now seem ridiculous. Does anyone think it serves any purpose to wear a mask in a restaurant until you’re seated, then take it off when beverages are served? To tell vaccinated college students they shouldn’t leave the county or eat outdoors at a restaurant? To bar travel from entire countries in hopes of keeping out variants that are already here or will arrive from somewhere else?”

We now have effective vaccines (against severe disease) and treatments. In most countries people have had plenty of time to get vaccinated, with those who remain unvaccinated electing to take on higher personal risk by choice.

That means the trade-offs have changed since the depths of the pandemic last year and the costs of restrictions are harder to justify, with even externality arguments much weaker given that vaccines provide little, if any, protection against transmission.

Vaccine mandates are a blunt tool that are almost never the correct option – there’s plenty of policy room to manoeuvre for a competent government to achieve widespread vaccination between doing nothing and imposing mandates. By avoiding the extreme of a mandate, they also avoid costly side-effects such as the backlash we’re seeing embodied by these convoys – the blockades in Canada may be costing businesses tens of millions of dollars a day, not to mention the social costs of a visibly divided society.

But the convoys themselves aren’t exactly full of freedom, sunshine and rainbows. In the space of a few days New Zealand’s convoy “went from a targeted protest of vaccine mandates to a vehicle for fringe and even violent extremist ideologies over the course of the event”:

“They got tacit support from politicians like Winston Peters as well as white supremacist groups like Action Zealandia. While the organisers' official communications focused on unity, others used the platform to call for a siege of an animal vaccine factory in Timaru. At the event, signs about love and community sat alongside references to executions of politicians. Some protesters brought nooses with them.”

‘Freedom convoys’ that… disrupt people’s freedom and are quickly hijacked by other interests likely aren’t the appropriate response to vaccine mandates. But they’re probably going to persist for as long as governments refuse to acknowledge that it’s time “to pivot to a post-emergency regime focused on preparedness instead of containment”.

Times have changed and governments need to get with the programme, or risk creating even more social division.


Bits and bytes

πŸ—³οΈ There were strong swings against the ruling Liberal party in four NSW by-elections over the weekend, with former Liberal stronghold Bega flipping for the first time since the seat was established in 1988.

πŸ•΅οΈβ€β™€οΈ A “credible intelligence report” claimed that Russia has plans drawn up to invade Ukraine on 16 February.

πŸƒβ€β™‚οΈ The Australian embassy in Kiev, Ukraine has been evacuated “Given the deteriorating security situation caused by the build up of Russian troops on Ukraine’s border.”

πŸ™ƒ There is a large gap between what technocrats believe they know and reality: When asked by federal MP Andrew Leigh if the RBA had ever “made a policy or analytical mistake”, RBA governor Philip Lowe simply evaded the question.

😨 A University of Michigan survey found that US consumer sentiment fell to the lowest since October 2011, “largely due to rising inflation, less confidence in the government’s economic policies, and the least favourable long term economic outlook in a decade”.

⛷️ Chinese/American Olympic gold medal winning skier Eileen Gu responded to a comment criticising her ability to use Instagram in China when Chinese people are blocked from it by saying “anyone can download a vpn its literally free on the App Store”, only for her post to then get censored.

πŸ’‰ Data published on Friday by the US Centers for Disease Control and Prevention showed that “booster shots lose much of their potency after about four months”.

☒️ France will build up to 14 new nuclear reactors by 2050, with the first two operational by 2035, as part of the government’s strategy to reduce greenhouse gas emissions.

πŸ”¬ A study from the Peterson Institute for International Economics found that China purchased none of the $US200 billion it promised to spend on US goods and services as part of the “Phase 1” trade deal between the two countries.

πŸ„β€β™‚οΈ Surfing superstar Kelly Slater is in fact vaccinated and will compete in Australia in April this year. The World Surf League confirmed that “Slater had never publicly claimed to be anti-vax, rather that he had strong feelings around vaccination mandates and policy”.

πŸ›‚ WA Premier Mark McGowan confirmed that his government would make booster shots mandatory “to enter restaurants, pubs and gyms”, although no date has been set.

πŸ”Œ The US government will spend $US5 billion over the next five years to construct “500,000 public EV chargers by 2030, roughly 400,000 more plugs than are available today”.

πŸ“ˆ The UK economy expanded by an estimated 1% in the final three months of 2021 despite surging Omicron cases, after the “self-imposed lockdown to ‘protect Christmas’ has turned out to have only a mild impact on growth in December”.

πŸ‘©β€βš–οΈ Four years after being referred by the Australian Competition & Consumer Commission (ACCC), federal prosecutors withdrew a cartel lawsuit against Citigroup, Deutsche Bank and four former executives due to insufficient evidence, with one commentator describing it as a case “of grand regulatory overreach” by the ACCC.

πŸ“½οΈ Haaaard pass. MoviePass, a cheap movie streaming service that closed in 2019, “is returning as an app that will track users' eyes when they watch adverts… [to] make sure the user is not ignoring the advert”.

πŸ¦— Australia defeated Sri Lanka in their second T20 after the scores were tied, forcing a one-over eliminator.