We’re approaching the one-year mark since Covid-19 started to cause chaos in the US. It’s worth reflecting on what went well and what did not. Hint: we should be cautious about government power.
The shortages we have faced should make us thankful we are not in a communist or socialist society
When Covid-19 first hit, we saw shortages in hand sanitizer, toilet paper, and cleaning products. That was frustrating for many. In the US, we are used to going to a store and assuming they will have what we need. The virus altered that for a few products.
For us, that was jarring. But for much of the world, both now and throughout history, shortages are normal, and not just for a few products. In the former Soviet Union, shortages were an everyday occurrence. They were so bad that people would be forced to wait in line when certain products became available, which was considered a standard part of life for most people in the Soviet Union.
It isn’t just communist countries where people have not been able to find things in stores. The economy of Venezuela has collapsed under their socialist rule and now people struggle to purchase many of life’s necessities. In other generally well-functioning economies with large socialist sectors, like the U.K. or Canada, you often have shortages on health care services given their non-market setup.
Markets solve problems
The frustration caused by shortages on just a few products is understandable, given how commonplace excess isin this country. But we must not passively let that frustration fade. It should cause us to pause and appreciate the market system. We can walk into a store and buy things that we couldn’t possibly make on our own – like pencils, hand sanitizer, t-shirts, toothpaste, or toilet paper – and all for reasonable prices.
It is rare in the U.S. when we cannot assume a store or it’s rivals have what we want. We often lose sight of this, but those in non-market systems do not. So amazing are markets that when then Russian President Boris Yeltsin visited a U.S. supermarket, he was absolutely astonished and thought that if people in the U.S.S.R. saw what U.S. supermarkets were like that “there would be a revolution”.
Vaccine rollout showed power of private enterprise — and clumsiness of government
The creation and production of the COVID-19 vaccines was another amazing feat of the markets. I recall, as I’m sure many of you do, the mocking from many who thought it was impossible to have a vaccine developed and produced on a wide scale by the end of 2020. Others mocked the safety of the vaccines. The skeptics were wrong, thankfully, and millions of doses are now available. Once companies developed the vaccines, however, government rules took over.
The federal and state governments have dictated both who can administer the vaccine and who can receive it. The result has been a clumsy mess. The shots are not getting to people fast enough.
As of January 20th, only half of the 1.1 million doses that have been given to Pennsylvania have been administered. Many other states have been equally abysmal in their rollout. This will result in lost lives. A better route would have been obvious. Let the market work. In this case, Wal-Mart, CVS, and every other pharmacy that gives vaccines should have been able to administer them right away. And the state shouldn’t have crafted so many rules on vaccine prioritization. Sure, allocating some for essential workers is necessary, but making rules outlining when every man, woman, and child can get a vaccine has meant a longer wait until we hit herd immunity.
Free markets matter
COVID-19 impacted the supply chain and upended daily life. By doing that, it offered a glimpse into what life in socialist and communist countries is like. It showed us what private enterprises can do to serve the public interest. And it has created many instances of government trying and failing to do what only the market can do. In short, the past twelve months reinforced the value of private enterprise, free markets, and liberty, and proven why it’s always good to have a healthy dose of skepticism for government power.
Matthew Rousu is Dean and Professor of Economics in the Sigmund Weis School of Business at Susquehanna University. He is author of the book Broadway and Economics: Economic Lessons from Show Tunes. Views do not necessarily represent those of his employer. @MatthewRousu