Democrats want to give the government more control over our healthcare system. Our experience with the coronavirus shows that this would be a big and costly mistake.
Does the coronavirus show that we need a bigger and more dominant government that assumes greater decision-making authority over “unfettered market processes”?
That’s what left-wing journalists, academics, and politicians argue. They say the coronavirus shows that free markets are incapable of addressing a public health crisis. Thus, in their view, to protect the health and well-being of the public, the federal government must play a more dominant role vis-à-vis the private sector.
As Columbia University political theory professor Jean Cohen told The Atlantic: “If you want to serve the public good instead of private profit making, you need government to come in and make sure that’s done.”
But the notion that “private profit making” and “the public good” are two separate and distinct things which necessarily are opposed to each other is ludicrous and in defiance of commonsense and all empirical evidence.
Profit Motive. In truth, the profit motive is precisely the means by which we incentivize people and businesses to serve the public good.
At least that’s how we do it in the United States of America and in countries that allow for free markets and private commercial exchange.
For example, we Americans enjoy a bountiful supply and an infinite variety of inexpensive and affordable food—not because the government has intervened and mandated it, but rather because private sector companies realize that there is money to be made by “serving the public good” and meeting this need.
Other countries, such as the former Soviet Union, have tried to “serve the public good” by empowering the government at the expense of the private sector, and the results have been disastrous. Freedom works; government control and coercion do not.
The iPhone and personal computer, likewise, were not produced by the government. They were produced by entrepreneurs who saw that there was money to be made by “serving the public good” and helping to fulfill our natural yearning for greater autonomy, control, creativity, and connectedness.
In fact, to the extent that we do suffer “market failure” (a favorite term of derision by left-wingers such as Professor Cohen), it is precisely because the government exerts too much control and power over decision-making processes that are best left to the private sector.
Government Failure. Indeed, what is typically called “market failure” is more accurately described as “government failure.” Case in point: the coronavirus.
The United States has been embarrassingly and shamefully tardy on testing for the coronavirus, lagging far behind other countries such as South Korea and Australia. Why? Because we relied upon the feds to administer and manage testing; and they, unsurprisingly, botched it
The Wall Street Journal’s Kimberley Strassel explains:
The single biggest mistake so far came from the government. The feds maintained exclusive control over early test development—and blew it. The Centers for Disease Control and Prevention’s failure delayed an effective U.S. response, and the private sector is now riding to the rescue.
But don’t take Strassel’s word for it. Here is what the head of the National Institute of Allergy and Infectious Diseases, Anthony S. Fauci, M.D, told radio host (and Trump apologist) Hugh Hewitt:
The regulatory constraints, which under certain circumstances are helpful and protective of the American people were not suited to the emergence of this particular outbreak…
I believe now that the [Centers for Disease Control and Prevention] (CDC), and the [Food and Drug Administration] (FDA), and the Department [of Health and Human Services]—that we’ve got it right now:
Because we’re handing much of it over to the private sector [and] to heavy hitter companies that do this for a living. And I think what you’re going to be seeing looking forward is a major, major improvement in the availability of testing.
“The government’s failures affected every step of the testing process, from the initial throat swab to the genetic sequencing,” report Dan Vergano and Ben King in BuzzFeed News .
“Even now,” they note, “state and local health departments have a confusing patchwork of requirements for testing.”
“Federal officials,” moreover, “waited until early March to invite large private labs, which can run thousands of tests a day, to begin coronavirus testing, leaving the U.S. with a backlog of swab samples even as case numbers double every two days.”
Unfortunately, failure in government is endemic because there are no competitive market mechanisms that force public-sector agencies to adapt and innovate as in the private sector.
Private-sector companies fear going out of business and adapt accordingly. Not so in the government or public sector, where agencies live on indefinitely no matter how badly they might fail.
“The botched rollout of COVID-19 tests,” observes Reason magazine’s Ronald Bailey, “is largely the fault of America’s medical regulatory bureaucracy—specifically, the Centers for Disease Control (CDC) and the FDA.
“As recently as Feb. 26,” he writes, “the CDC told state and local officials that its own testing capabilities were ‘more than adequate,’ the Wall Street Journal reports.”
However, according to Bailey,
A Utah molecular diagnostics company is all set to produce 50,000 coronavirus tests per day, though its having trouble obtaining “reagent chemicals” that are necessary for a latter stage of the procedure, according to Desert News.
Co-Diagnostics’ COVID-19 test, which costs just $10 per patient and produces results in only 90 minutes, is already in use in Italy, Germany, the United Kingdom, Turkey, Greece, the Philippines, Thailand, Australia, Paraguay, Ecuador, Israel, South Africa and Canada.
But in the U.S. it had only been available for certain entities and research institutions, per guidance from the Food and Drug Administration (FDA).
It was not until Tuesday night, [Mar. 17, 2020], that the FDA gave Co-Diagnostics emergency approval to distribute the test more generally to U.S. hospitals. Deseret News’ [Art Raymond] reports:
"The company said U.S. shipments to date have been in accordance with the FDA's policy change on Feb. 29 that allows certified U.S. laboratories to use the Co-Diagnostics' test under certain conditions. "As a result of the change announced Tuesday night by the FDA, the company's test kit will soon be available for use by a wide array of U.S. laboratories, without first requiring emergency use authorization. Co-Diagnostics CEO Dwight Egan said the rule change puts his company in a position to have positive impacts on the critical need for COVID-19 testing capacity in Utah, the U.S. and around the world." The ramifications of this new FDA policy are significant for our company," Egan said in a statement. "This change will quickly afford Co-Diagnostics even more opportunities to serve the needs of laboratories nationwide, as we play an even larger role in responding to this pandemic. "We applaud the FDA's decision to recognize the dire need for increased access to high-quality COVID-19 tests, and to adapt as the situation demands in light of a public health emergency."
It’s smart for the biomedical company CEO to publicly thank the powerful agency that holds the keys to its fate. But no one else should be thanking the FDA…
People are quite literally going to die because the regulatory state was insufficiently adaptive to a crisis.
Democratic Smears. Yet, too often in this country, Democratic politicians such as Bernie Sanders vilify CEOs and entrepreneurs such as Dwight Egan as “crooks” and “thieves” motivated by avarice and “greed.”
The Journal’s Strassel rightly has little patience for this populist smear. The “crooks” at drug company Roche,” she writes,
had started on their own high-volume test in January, and were finally able to get approval from the Food and Drug Administration.
Google is up with a website advising people on symptoms; retailers like Walmart and CVS are converting parking lots for drive-through tests; private labs are standing by to process them.
As for other “moneyed interests,” no fewer than 30 Big Pharma and small biotech firms are racing for treatments and vaccines. Moderna turned around a vaccine batch in just 42 days.
Gilead Sciences is already in Phase 3 trials for its remdesivir treatment for Covid-19. Straight off President Trump’s announcement of FDA approval for antimalarial drugs to treat the disease, Bayer announced it would donate three million chloroquine tablets.
To be sure, government has an important role to play in protecting and safeguarding the public health. Securing the borders, for instance, is an important federal governmental function, and is necessary to keeping public health threats out of the country to the greatest extent practicable.
The government also can set national goals and priorities, while marshaling public-sector resources and coordinating public-private partnerships.
But having an energetic and effective government is very different from having a big and dominant government that preempts the private sector and tries to do things that are best done by commercial companies driven by the profit motive and responding to market signals and market incentives.
We need an energetic and effective government, not a big and dominant government. In fact, a big and dominant government typically is anything but energetic and effective, which is precisely the problem.
Critical Debate. This matters in a big and fundamental way because policymakers and the public will draw lessons and conclusions from the coronavirus: what worked, what didn’t, and what must change as a result. And it is critically important that they—we—not draw the wrong conclusions.
The problem was not that the private-sector failed; it was that the private-sector was bypassed and short-circuited.
And what must change is not our reliance upon private-sector companies, markets, and the profit motive. What must change is our deprecation of entrepreneurship and commercial interests in medicine and public health.
In fact, we need to make more effective use of incentives and competition in medicine, precisely to protect and safeguard the public health. Expecting the government to shoulder this burden exclusively is a surefire recipe for further disaster.
2020 Election. These questions are especially pertinent now because a presidential election is rapidly approaching, and the Democratic Party has lurched far to the left and embraced increasing government control of our healthcare system.
They do so in the name of “fairness” and “compassion.” But there is nothing fair or compassionate about an inert and dysfunctional public-sector monopoly that fails the American people when they are most in need.
We can and must do better. But we can only do so by embracing the private sector, markets and the profit motive, which are good and praiseworthy things, indeed.
Feature photo credit: Co-Diagnostics CEO Dwight Egan as shown on YouTube.
