by Brian Defferding
Vice-Chair, Libertarian Party of Wisconsin
If TARP under President Bush was not already a signifier the United States has become a government-sponsored oligarchy, the COVID-19 stimulus signed by President Trump is concrete proof.
State governments enforcing various levels of shutdown and mandating closing of businesses was the first crack to the knee of seizing the means of production, and the bailouts, which will undoubtedly require more heavy phases of quantitative easing (the Federal Reserve creating credit out of nothing), is the death knell. All Presidents and members of Congress in the last twenty years have resorted to some form of disaster socialism, propping up prices in the market while perpetuating spiraling inflation (which fully manifests about a decade after quantitative easing works its way through the system).
Free market capitalism has never truly existed in the United States, despite whatever critics claim. If any last vestiges of a voluntary market was left, COVID-19 killed it.
But does this mean that the philosophy of Libertarianism is both wrong and dead? No. In fact, quite the opposite — this validates absolutely every reason on why Libertarians are correct in both their observations as well as in their actions. In short order I have seen more proof positive that voluntary action works in ways that the government simply cannot, more than any other time in recent American history.
VOLUNTARY ACTION IN OUR COMMUNITIES
The Nextdoor application on our phones now has a feature where you can list yourself as a local volunteer to help out neighbors. And you can list your services and times when you are available. If you need assistance, you can view a map of nearby volunteers, with their names and addresses and contact information. You help deliver groceries, or do yardwork for the elderly.
Neighborhoods are setting up their own food drives, like in Milwaukee, where seven people on the south side in under two weeks set up a grassroots food delivery service.
Organizations such as Ruby’s Pantry in Waupaca, Wisconsin collects nigh-expired food from grocery stores that are taken off the shelf and makes thousands of food bags monthly, meaning not a single item of food goes to waste, while those with $20 in their pocket will still have enough food to last them weeks.
NJ.com rather quickly posted local county nonprofits that set up food drives and help those in need. The Seattle Times did the same, posting what issues each operation in the Seattle-Tacoma area is in need of, whether it be funds or volunteer help. Rishi Moudgil, a founding director of the Detroit-based nonprofit organization GreenLight Fund Detroit, wrote recently:
The U.S. nonprofit industry employs 10% of our overall workforce, contributes a significant portion of our GDP, and often includes the most difficult jobs and services.
A year before the outbreak, residents in the United States gave $410 billion to charity according to Giving USA 2018 — which was an all-time high. Humankind constantly shows we have the capacity to do the right thing, and we follow through.
A few ladies got together and tried to figure out a solution to make a proper face mask to help mitigate the spread of the virus in public. After experimenting with over a dozen different fabrics, they figured out the common shop towel provides 2–3 times better protection than common cotton, and set up a GoFundMe for their efforts to make these en masse for the public because they are paying their workers a living wage. They have already raised over $110,000 as I write this.
This is what voluntary solutions are all about. Should not we concentrate our efforts on that? Is that not more worthwhile?
MARKETS GET ACTIVE TO HELP
As the World Economic Forum plainly stated, “Governments, central banks and the WHO will not defeat coronavirus alone; the private sector must play a key role.” And that they have.
Kentucky distilleries are changing their business models to create hand sanitizers to help mitigate the spread, and Vodka distilleries have joined the fight, in quite literally days. Now, distilleries in almost all 50 states are teaming together to fight COVID-19 in a way that is feasible to them as well as meet public demand. But it goes beyond what is economically feasible to these distilleries. Allen Katz, co-founder and owner of the New York Distilling company, stated, “We thought, at least this is a reasonable way to put ourselves to some use.” This does not seem to me as someone who is craving to make a profit during a crisis, but one where they want to be an integral part in making humankind better.
Internet service provider Spectrum upgraded their services and provided temporary free WiFi to students while also lowering their premiums for low-income families to under $10/month. They also almost doubled their internet speeds, which will be their standard service going forward.
Tech companies nationwide are pitching in their own way to fight COVID-19. Apple has launched their own app providing COVID-19 information and creating their own web of virus information. The Intel Foundation plans to provide $4 million to local communities providing food and shelter relief.
IBM, Google, Microsoft, HPE and others create a high performance computing consortium:
The idea is to meld the high-performance computing (HPC) systems supported by consortium members to help researchers run massive amounts of epidemiology, bioinformatics, and molecular modeling calculations. The experiments would take years to complete if done by hand, or months if handled on slower, traditional computing platforms, according to IBM.
CEOs for many companies are now facing forced losses from government shutdowns and will be likely either in the red or see a loss of cash flow, but luckily there is a slice of freedom left where they are still allowed to change their business model. Harvard Business School experts all addressed how COVID-19 may forever change businesses going forward, but one thing is for certain that they all come to a consensus to: They still have the capacity to innovate and find leadership in these difficult times to meet public demand. They have to – that is how businesses thrive.
Hamza Mudassir from the University of Cambridge surmises COVID-19 will turn supply-chains into resilient ecosystems in and of itself, pushing for the need of less human-to-human contact with deliveries such as delivery drones and self-driving cars and trucks. Say what you want about capitalism: It adapts.
While all major sports have been canceled indefinitely, a conglomerate of owners and athletes are stepping in to cover the loss of pay for their franchise staff and faculty. Not just celebrity owners like Mark Cuban either, but entire teams like the Pittsburgh Penguins have been throwing in parts of their salary to cover the loss of pay for all of their staff.
CEOs like the ones of Texas Roadhouse and Columbia Sportswear are either giving up their salaries or giving themselves massive paycuts to keep their operations moving as well as keep their employees paid. Their examples should be praised, promoted, and shared.
The Gates Foundation committed to $100 million to fight the pandemic. The Chan Zuckerberg Initiative also expanded their repertoire with Biohub in fighting COVID-19 with acquiring state-of-the-art diagnostics machines and expand testing in the area.
Candid, an organization that brings information about philanthropy to the public for free use, first estimated that $1.9 billion will be donated to fight COVID-19 at the beginning of March 22, 2020. That estimate almost doubled since then, with $2.9 billion estimated as of March 30th.
Of course we should not be relying on philanthropy only to fight this virus, they simply play one role out of many different roles that operate in a voluntary world — much like the local nonprofits and localized networks I noted above as a few examples. But private grants directed at specific tasks can result in faster, more effective results than government dollars , which all depend on who is elected in charge and who is appointed. Bill Gates accurately predicted in a 2015 TED Talk that we are not ready for a global pandemic, and visited President Trump later to convince him to stock up on the necessary infrastructure. We all know how that went over.
Bill Gates might have the opinion it is the job of government to be responsible to answer and respond to such virus outbreaks. I feel what we should ask is — should we be dependent on that? What if they actually held back other smaller private sources that could have also helped mitigate outbreaks? Should we centralize power and hope we elect the right people? For a person such as Bill Gates who revolutionized bringing information and data to ordinary households, virus outbreaks hold no exception in principle.
Bill Gates likely also knows governments have difficulty in transferring information quickly and efficiently, and they resort to one-size-fits-all policies that do not work well for every community. That’s where decentralization has an advantage. Federal governments historically speaking are very inept with getting the necessary local information required to be expeditious, and if they did, it may also result in privacy concerns.
GOVERNMENT IS HOLDING BACK PROGRESS
A serious question that needs to be addressed is whether or not our government actually made it more difficult for Americans to have testing available to the general public.
As of March 30th, 2020, testing for COVID-19 is still scarce, and testing labs to read results are even more scarce. Currently in Wisconsin, there are only two testing labs that can read COVID-19 test results. This traffic jam will affect everything in how to mitigate the spread. Because of its scarcity, this means testing is only ordered by a physician (which then jams up physician time), and only with those having severe symptoms. Furthermore, the tests will be expensive. Private testing labs must be certified by the state in order to read testing kits, thus right now other testing labs are waiting on the state to get them certified to do the work, but in the meantime, tests are bottle-necked to small select labs that are given the OK by the state.
While we cannot test everyone, we can certainly test enough — what’s happening right now is government prohibiting different variations of testing and also testing labs.
Alec Stapp, the director of technology policy at the Progressive Policy Institute, mapped out a painstaking timeline on how exactly the FDA and the CDC completely bungled through their testing kits in February when the outbreak started in the U.S. Not only were the FDA slow in testing the kits, the kits the CDC provided didn’t work. Might I add, funding for the CDC was higher during Trump’s Presidency than it was with Obama’s.
Due to the government’s shortcomings, they are punishing us all by assuming we all have the virus or are a carrier of it, and ordering us to close businesses and stay home. Would you not think that is even the least bit screwed up? Where is the recourse for that?
While South Korea becomes the leader in fast-active testing for the public, there are plenty of other testing concepts that can help with tracking the virus. In the United States, testing must be first approved by the government regulatory body that is the Food and Drug Administration.
This effects innovation in several ways: Companies will not produce en masse a product that the government can ultimately shut down. That is what happened last week, when startup companies like Everlywell, Nurx, and Carbon Health offered in-home COVID-19 testing, and the day it was going to become widely available, the FDA nixed it and ordered to have any existing test results to be destroyed immediately. This meant any time and money vested into this venture has been wasted and can turn into a giant loss for the startup.
There is a blood test available for as low as $47 that can determine in under 15 minutes if you either have or have had COVID-19. However, it is not FDA-approved and, therefore, is at risk of being shutdown by them. The concern for accuracy is legitimate, since a person who gets exposed to the virus recently in the past few days may not yet have antibodies developing, so it may show a false negative. While this is not a confident test for concrete proof, this type of test would be usable for those who have practiced self-quarantining to visit others who also test negative that have also practiced self-quarantining.
It is that looming approval from the FDA that makes innovation and experimentation difficult, especially on a financial level. What The Mercury News recently reported regarding the company Gilead Sciences in developing a cure:
Art Caplan of New York University’s Langone Medical Center, is that there just isn’t enough drug for everyone. It isn’t practical, he said, for drug companies to start mass-producing an agent that might not ever be approved.
“You can’t build a factory to make an unlicensed drug,” said Caplan, who leads NYU’s Working Group on Compassionate Use and Preapproval Access, which studies the ethics of access to investigational medical products.
“Gilead doesn’t have an unlimited supply,” he said. When a drug is still under investigation, “companies are almost always facing some sort of scarcity.”
This is what Gilead Sciences ran into when it came to working on a possible treatment to rid the virus from the human body. While corporate greed that the left often point out certainly played a role in the drug’s affordability, that is where public pressure steps in, and it did, as they dropped it from “orphan status” and allowed for generic competition — and competition will keep driving down prices. What ultimately keeps prices high is scarcity with high demand, so if the FDA grants single-distribution rights to Gilead Sciences on this treatment upon approval, they will certainly spike the price higher because the FDA forced out open competition. The FDA has become the gatekeeper with drug and treatments, and that artificially distorts pricing.
Thankfully it sounds like Abbot Laboratories will be launching and producing en masse a new testing device that can diagnose those who have COVID-19, and the FDA approved it. This will help lessen the curve as we start to get a better picture of how rampant this virus really is. But it is taking a lot of government failures and getting around regulatory barriers for the United States to see any gain.
GOVERNMENT CANNOT EVEN KEEP THE VIRUS OUT OF THEIR PRISONS
The one place where government’s most basic function and responsibility lie — our jails and prisons — is the place where COVID-19 is currently spreading the most. Los Angeles prison doctor Dr. Ross Quinn famously stated that prisons have become “petri dishes” for disease and viral infections. The American Civil Liberties Union has been pushing every state to implement a contingency plan and de-carcerate as much as possible to mitigate and contain the spread of COVID-19 in our jails and prisons, but despite their passionate plight, Governors are still allowing for prison transfers.
Wisconsin is a state that is currently already facing a higher-than-average incarceration rate compared to their neighboring states. It was recently revealed one of their prison doctors traveled from Italy and worked behind bars without a mask, gloves, or proper sanitary equipment. This turned into a nightmare as now many staff and those incarcerated have been tested positive for the virus. And the prison itself is woefully unprepared, as it was later revealed in an interview with an incarcerated person that the staff has no protective gear and no cleaning supplies, leaving them to improvise with whatever is around.
What I have ultimately seen over the last month:
- It is not wise to depend on your elected officials, even the ones you voted for, to properly fight a global pandemic
- Humankind has the capacity to help others without being forced to
- We have the ability to find a multitude of solutions to fight the pandemic in multiple levels — from your neighborhood; to information sharing; to the market; to your organizations and nonprofits you support
- Your elected officials still think they know what is best for you and will claim they should still be able to manage your money, your time, and rob yourself of self-determination
- After the government will break your legs, they will push that crisis upon you in order to achieve more power and frame it as an attempt to save you
- We may very well be on our way to another heavy inflationary cycle 10 years from now
The Institute for Health Metrics and Evaluation has determined that peak resources will be on April 15, 2020 for COVID-19 to affect the United States – and we will be back to “normal” by July.
Will there be a normal though? How much of your freedom will you really get back? What President will actually provide you with the ability to walk outside and see your friends or go to another large gathering again? What will happen with bars and restaurants after this, will they start seeing more visits from OSHA with more inspectors at their doorstep? Will this affect the cost of starting up a business and potentially prohibiting new opportunity?
Lastly, will the government allow for human connection again? Humans want to connect with others, it is our nature. We want to be free. The basic function of government is to take that freedom away.
This has been also published in Medium.com with permission from the author.