A Coronavirus Lesson: Government Is Not the Problem

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For 40 years a four word tagline masquerading as a political philosophy has dominated American politics:

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This phrase has won blind obedience from Republicans and often cowed Democrats from promoting sound public policies. The coronavirus makes clear just how wrongheaded that notion is.

For starters, the Trump Administration’s decision to disband a National Security Council unit President Obama wisely created to coordinate a federal response to a major health crisis is as boneheaded an action as one can imagine. Medical experts warned of the rising risk of a worldwide contagion. Yet, for a few dollars of budget savings Republicans crippled our ability to react smart and fast to an emergency with devastating consequences for some 327 million Americans.

The lack of coordinated federal policy towards the coronavirus has left states competing with each other for scarce medical resources. Healthcare professionals putting themselves at risk to care for the infected are entitled to a full complement of protection. The shortage of masks requires a government initiative as powerful as any during war to produce them fast at the scale needed. Same for ventilators and any other equipment in short supply required to save lives. Only government can move the resources it takes to increase the number of hospital beds and intensive care units where the virus has hit hardest. The search for drugs that can help treat patients now and for a vaccine calls for a competent government coordinating efforts with research institutes, hospitals, and universities.

Some workers will resist testing for corona and self-quarantining when required because they lack paid sick leave and have no way to meet their bills if they do not work. The United States is alone among rich nations in this nineteenth century laissez-faire thinking that declares every person on their own to justify significant holes in the national safety net.

The absence of health insurance for millions is another glaring deficiency unique to America among wealthy countries. When people who contract corona get sick they need medical treatment desperately, and the rest of us need for them to receive it to minimize the spread of the disease. Since hospitals are required to provide emergency care the sick will be tended to, often later than necessary with more serious cases, and the financial burden will be imposed on communities randomly. Often that means poor places suffer the most.

With much of the nation substantially locked down millions have lost their jobs and their income. We know from a Federal Reserve Bank study that nearly 40 percent of Americans do not have $400 to tide them over in a financial emergency. In 1970 workers took home almost 66 percent of our national output. Now it is closer to 60 percent. The difference of $1.2 trillion works out to almost $10,000 per American family per year. This is a consequence of capitalism without a conscience that rewards elected officials with campaign contributions for restricting unions, allowing the federal minimum wage to deteriorate from $22 of purchasing power in 1969 to $7.25 today, while providing preferential tax treatment for capital gains on investment returns and other unfair policies.

https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us-workers-real-wages-have-barely-budged-for-decades/
https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us-workers-real-wages-have-barely-budged-for-decades/

As the corona crisis worsens, airlines and other big businesses are lining up for government bailouts to prevent the devastation that would follow from massive bankruptcies. Yet, over the past decades tax policies, a lack of socially minded regulations governing corporate behavior, and the self interest of senior managers motivated these same companies to distribute billions in dividends to wealthy investors and to spend billions more in the unproductive exercise of buying-back shares of their own stock to increase the value of the ones remaining outstanding. So weak government allowed publicly traded companies to juice their returns by sacrificing the capital base that could have protected them. Now those same companies want strong government action to rescue them. The situation is desperate enough that it must happen, but public bailouts must come with equity stakes in the corporations for the benefit of taxpayers.

Republicans scream socialism when the government takes an ownership stake in a private corporation. Yet, no capitalist would invest in a company without the promise of a return. The government should not either. When the economy is restored to health, shares can be sold into the market and the cash used to for public purposes.

The obvious need for a smart, effective government that the coronavirus crisis makes clear should set the stage for a renewed commitment to making sure we have one worthy of a great nation. The one eulogy we should all welcome from this crisis is for the ignorant view that government is the problem.

Sources:

Associated Press: https://apnews.com/ce014d94b64e98b7203b873e56f80e9a

Scientific American: https://www.scientificamerican.com/article/experts-warn-of-possible-sustained-global-spread-of-new-coronavirus/

New York Times: https://www.nytimes.com/article/face-masks-coronavirus.html

NBC News: https://www.nbcnews.com/politics/politics-news/number-americans-without-health-insurance-rises-1st-time-decade-n1052016

Federal Reserve: https://www.federalreserve.gov/publications/2019-economic-well-being-of-us-households-in-2018-dealing-with-unexpected-expenses.htm

Pew Research Center: https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us-workers-real-wages-have-barely-budged-for-decades/

Quartz: https://qz.com/1819776/here-are-the-coronavirus-bailouts-being-prepared-around-the-world/

#NewYorker, historian, author & believer in government & business working *together* towards a better quality of life for all.

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