Free Enterprise: A Daring New Year Wish
A December 28 report in the Wall Street Journal illustrates (again) how a wish for free enterprise in America is not like carrying coals to Newcastle (see Charles Passy, “New York to Penalize Health-Care Providers $1 Million for Covid-19 Vaccine Fraud“). For Mr. Cuomo, who drinks at the zeitgeist of our times, “fraud” simply means what the government does not like. A few excerpts:
New York Gov. Andrew Cuomo said Monday he will sign an executive order to penalize health-care providers that administer the Covid-19 vaccine without following state prioritization protocols. … Mr. Cuomo, a Democrat, said that providers that ignore this will face fines of up to $1 million and a revocation of all state licenses. …
State Health Commissioner Dr. Howard Zucker said over the weekend that ParCare was being investigated by the state police for possibly obtaining the vaccine fraudulently and then transferring it to other parts of the state and administering it to the public without paying heed to the prioritization rules. …
Mr. Cuomo said he wasn’t surprised that issues are already arising with health-care providers potentially violating state mandates with vaccine prioritization.
“You’re going to see more and more of this. The vaccine is a valuable commodity,” he said.
The first two paragraphs cannot but remind us of the old USSR government, the mother of all persecut0rs of those who don’t respect “state prioritazition protocols.” Why shouldn’t groceries, say, be allowed to ignore “state prioritazition protocols” on food allocation? But fascism may be a more relevant reference than communism since the former allowed more tightly-controlled private businesses than the latter, as Lawrence Dennis argued.
The last two paragraphs remind us that, indeed, any commodity that many people consider valuable and which the state tries to control is going soon be the object of smuggling—what statocrats call “fraud”—for the benefit of individuals who want it and are willing to pay for it.
Should vaccines first go to cops or to teachers? To the old or to the young? There is no way for a government planner to make an efficient decision on this if only because there are some among individual teachers and some among the old who would be willing to sacrifice more to be vaccinated than other members of the groups to which the state arbitrarily identifies them. What if Google wants to buy vaccines for all its employees? What if a charitable organization wants to purchase some for its poor clientèle? As my co-blogger Scott Sumner just argued, the price mechanism is more efficient and even more just (if we want to jump in the undecided philosophical debates that have been raging for 25 centuries) than decisions made by politicians and bureaucrats.
Moreover, if the available vaccines were sold to the highest bidders (like beef, cars, or shoes) noting would (or, in the current emergency, should) prohibit the government from bidding in the same market, but without prohibiting others to do the same. The market exclusion that the governor of New York advocates seems alas natural to most people. It always strikes me how inclusion-obsessed activists work to exclude so many people.
The current situation is economically inefficient, morally questionable if not absurd, and dangerous for social peace. The federal government distributes the vaccines to the state governments, with all the vagaries of state distribution systems. State governments then add another layer, albeit variable, of inefficiency and authoritarianism by deciding who among their citizens will get the vaccine and who will, in the best case, have to wait their turn. (See Dan Frosch, Elizabeth Findell, and Peter Loftus, “As Covid-19 Vaccins Roll Out, States to Determine Who Gets Shots First,” December 9, 2020.)
Yet, isn’t an emergency situation like a pandemic different? A long (classical) liberal tradition from Adam Smith to Friedrich Hayek or Milton Friedman would answer yes. But—and here lies the big difference—liberals would not forbid free markets and voluntary cooperation to coexist with justifiable government intervention. A free market will insure, through the profit motive, that more vaccines are available, while not banning the free expression of individual preferences according to different personal circumstances. As I just argued, the government could bid against its own citizens, as when it buys anything (including labor services) on the market, but without prohibiting them from outbidding it.
Classical liberals and many more radical libertarians share a common ideal: the presumption of liberty, which can only be overcome when restrictions are necessary to protect liberty itself, or something to that effect. In a major crisis (and Covid-19 is probably one), such restrictions may be warranted if they don’t seriously undermine liberty—for now or for the future. This being said, there is room for disagreement in the liberal-libertarian tent. (In a Café Hayek post of yesterday, Don Boudreaux articulates a libertarian position on the conditions of the presumption of liberty.)
Everybody in the tent must wish that economic freedom and free enterprise will not continue to be so tightly shackled in 2021.