Staying in lockdown a risky business, and border wars get testy

One thing becoming increasingly apparent from the growing end-the-lockdown divide is how respective views are based on (understandably) selfish perspectives. 

As Professor Scott Galloway of New York University observed last week: “[In the United States] if you make over US$100,000 a year, there’s a 60% likelihood you can work from home and only a one in 10 chance you’ve been laid off. If you make less than US$40,000, only about 10% of you can work from home and 40% have been laid off.” 

New Orleans is an example of the increasingly tragic divide — a story in The Wall Street Journal yesterday said that for every $1 in liquid cash held by white families, Hispanic families had 47c and black families 27c. 

Galloway said: “The fuel behind [the stay-in-lockdown view in the US] is the graduate education class that … hasn’t been hurt that badly and that being home isn’t that bad, so there is a different sense of urgency and perspective. And you have to empathise with people who are worried about putting food on the table.”

There is a real chance that tens of thousands of Americans will die if social distancing is dramatically reduced. The notion that Australia with barely a trickle of cases is remaining locked down is even more polarising. 

I was highly critical of Australia’s failure to lock down quickly (and strongly) in mid-March. However, it is quite possible that the failure to quickly normalise the economy is equally risky. Even more so when most cases (other than the Cedar Meats debacle) have come from Australians returning from overseas.

This was a problem we noted a month ago. Ignoring quarantined Australian travellers who pose a minimal — if any — risk, and despite a huge increase in testing, there are only a handful of cases each day. 

Meanwhile millions of people, mostly young, are relying on government handouts to pay the rent and buy food. 

Never fear, Joe Rogan is here

Last week we saw one of the more incredible media deals ever done. Joe Rogan, arguably the world’s most popular podcaster (but who until relatively recently was a little-known UFC commentator and Fear Factor host), signed an exclusivity deal with Spotify. 

Spotify’s investment isn’t especially surprising. The US$35 billion firm has made significant investments in podcasting recently, acquiring Gimlet Media and The Ringer. However, the scale of the deal is unusual. Sources claim that it’s paying Rogan upwards of US$100 million for the multi-year deal which will also allow it to be the exclusive video outlet for the Joe Rogan Experience podcast.

Rogan will still own the show and brand although it’s unclear if he will own any incremental listeners added during the agreement.

Some observers believe that Rogan — whose brand is worth upwards of $1 billion — was ripped off. The sharemarket seemed to agree. Spotify’s market value jumped by more than US$3 billion after the agreement was announced.

Consider for a moment: Seven West Media, which a few years ago was arguably Australia’s most valuable media property, is now worth $126 million. Southern Cross, which owns Australia’s largest radio network and a regional TV business, is worth $383 million. 

Joe Rogan, a dude with a podcast, is worth more than US$1 billion. 

Queensland brags as testing numbers sag

As the border lockdown argument heated up last week, Queensland’s Transport Minister, Mark Bailey, criticised his NSW counterparts and boldly claimed: “On the border issue, we won’t be lectured to by the worst performing state in Australia.”

He went on: “We’ve had provisions in place from the very beginning on our public transport system to minimise risks such as rear-door boarding, cashless ticketing and ensuring that people are well aware of how to socially distance. And those communications will increase in coming days.”

But is Bailey justified in his gloating? Almost certainly not. 

Case numbers alone are highly misleading — most Australian cases were returning overseas travellers — but they provide a handy starting point.

So far New South Wales has recorded 3086 infections, Victoria 1602 and Queensland 1060. More relevantly, in per capita terms, NSW has one positive test for every 2430 people, Victoria one for every 3932, and Queensland one for every 4811.

But numbers are also influenced heavily by testing. If you don’t perform any tests, as US President Donald Trump showed in March, you don’t record any positive cases.

Victoria has conducted 398,000 tests with 0.4%, compared with Queensland, which has conducted only 172,000 tests, recording 0.6% positive — perfectly in line with the rest of Australia. 

Had Queensland tested at the same rate as Victoria, it’s likely it would have picked up more low or asymptomatic cases, so it’s almost certain that Queensland has a worse record than every state other than NSW.

Oh, and it’s likely hotter and more humid climates slow COVID-19’s transmission. Given Queensland has a far more humid climate than NSW and Victoria, the performance of the Queensland government is even more questionable.

Minister’s support for Target is little to be proud of

The Nationals’ David Littleproud did his best to dispel doubts that the Coalition has basically morphed into the Communist Party of Australia.

Upon hearing the news that Wesfarmers was finally shutting 75 Target stores and converting another 92 to Kmart, the agriculture minister extolled Australians to boycott the retailer.

Wesfarmers took years to stem the bleeding at Target, losing billions over more than a decade while the retail sector continued to implode. This was hardly rapid-fire creative destruction. The business, like many other retailers, is terminal, destroyed by more efficient international competitors such as Zara, H&M and Uniqlo, and the continued growth of online retail.

Is Littleproud suggesting failing businesses be subsidised by shareholders indefinitely? Or should the government acquire them, alongside coal-fired power plants, just to ensure that National voters have plenty of shops to visit when they head into town?