Less friction with trade partners will help Australia's recovery

Like many other governments, Australia's response to the coronavirus pandemic was a mixture of tough social measures and generous economic handouts to keep the economy from collapse.

Medically, it was a success: The number of infections was kept to below 7,500, with 102 people dead. But the impact on the economy was devastating: thousands have been left jobless, and the unemployment figure is expected to hit 8 per cent.

At the same time, the coalition government under Prime Minister Scott Morrison is deeply committed ideologically to principles of small government and balanced budgets. That it was prepared to incur debt that, by its own admission, would take a generation to pay off, speaks well of its pragmatism. But now, facing the prospect of a prolonged recession, there are signs that Mr Morrison would prefer social welfare cuts to reduce the budget deficit. There are proposals to end childcare subsidies as early as next month and to bring the jobs subsidy scheme to an early end.