I agree that’s the main objection, and that’s why I wrote that taking a market approach magnifies existing inequality.
Which is true denotationally, but makes it sound like a dry, technocratic issue conotationally. In fact, the worst case scenario of such inequality is some people dying unnecessarily, while others profit from desperation.
hospitals would pay more for masks than construction companies.
Hospitals aren’t profit-making free-market entities everywhere. In a public health system, the hospitals either can’t up their bid due to limited funds, or they get extra funds, and the taxpayer has to the foot the bill for what is basically an inability of the market to allocate according to need.
Competent centralized economic planning probably also outperforms markets in general. But this is hard,
But competent emergency provision is a simpler problem, and a solved problem. It’s been implemented multiple times.
makes it sound like a dry, technocratic issue conotationally. In fact, the worst case scenario of such inequality is some people dying unnecessarily
It seems to me like you’re trying to bring emotional color to one side of this tradeoff, but not considering that it cuts both ways? The deaths of healthcare workers exposed to massive viral loads without sufficient PPE are also unnecessary. Each of these scenarios has deep tragedies.
the taxpayer has to the foot the bill for what is basically an inability of the market to allocate according to need
Higher taxes seems like a very reasonable way to handle this, and not an example of the market failing to function properly? The cost to society of the lockdowns alone is enormous, and hits poorer folks harder.
competent emergency provision is a simpler problem, and a solved problem
I agree that it’s simpler—that’s the whole point of this post! But seeing so many countries do poorly here doesn’t make me think it’s been solved?
The deaths of healthcare workers exposed to massive viral loads without sufficient PPE are also unnecessarily.
So what’s the fix?
Higher taxes seems like a very reasonable way to handle this,
They are not necessary, because the stuff you are short of did not suddenly become more expensive to produce. You are trying to use prices to allocate equipment to people who need it the most, and then spending money unnecessarily to fix the problem that that doesn’t work.
The cost to society of the lockdowns alone is enormous, and hits poorer folks harder.
The cost in money or the cost in lives?
But seeing so many countries do poorly here doesn’t make me think it’s been solved?
Who’s doing it poorly? The US is doing it less than most wealthy countries, and is
doing worse than most.
the stuff you are short of did not suddenly become more expensive to produce
I think that’s a major place we disagree? If producers know their products will sell for more, options to ramp up production start making more sense.
This would be different for a very short disaster, like a tornado, where all the supplies you will use are ones that have already been manufactured. But for something more sustained, like covid-19, we’re still running production facilities, which can be scaled up in a range of ways. You can start running 24hr schedules, working weekends, bringing in extra people to run the line faster. You can pay people to work 12-hour shifts for a month straight without going home: https://www.washingtonpost.com/nation/2020/04/23/factory-masks-coronavirus-ppe/ More money can’t solve everything, but it can solve a lot of things.
If producers know their products will sell for more, options to ramp up production start making more sense.
The consumer usually does not foot the cost of increased production. Why would they? In fact, the consumer can reasonably expect lower prices as a result of economies of scale.
The money has to come from somewhere. It usually comes from lenders. If producers can guarantee sales, lenders are happy.
If you build a bigger plant you generally spend more up front but less per unit, while if you take your existing plant and pay workers to go on 24hr shifts your costs may go up a lot. And if you pay for rush handling when things break (couriers for broken parts to minimize downtime) and rush shipping of incoming materials (since slow cheap shipping takes a long time to catch up with your increased production) that’s another increase. When you push hard to maximum production you should expect diseconomies of scale.
You’re suggesting that the costs instead come from lenders?
But then production will be limited by the point where the marginal cost of a unit exceeds the price before the emergency (assuming financing is free), instead of the point where the marginal cost exceeds the value during the emergency. That is, you’ve unnecessarily limited production.
Which is true denotationally, but makes it sound like a dry, technocratic issue conotationally. In fact, the worst case scenario of such inequality is some people dying unnecessarily, while others profit from desperation.
Hospitals aren’t profit-making free-market entities everywhere. In a public health system, the hospitals either can’t up their bid due to limited funds, or they get extra funds, and the taxpayer has to the foot the bill for what is basically an inability of the market to allocate according to need.
But competent emergency provision is a simpler problem, and a solved problem. It’s been implemented multiple times.
It seems to me like you’re trying to bring emotional color to one side of this tradeoff, but not considering that it cuts both ways? The deaths of healthcare workers exposed to massive viral loads without sufficient PPE are also unnecessary. Each of these scenarios has deep tragedies.
Higher taxes seems like a very reasonable way to handle this, and not an example of the market failing to function properly? The cost to society of the lockdowns alone is enormous, and hits poorer folks harder.
I agree that it’s simpler—that’s the whole point of this post! But seeing so many countries do poorly here doesn’t make me think it’s been solved?
So what’s the fix?
They are not necessary, because the stuff you are short of did not suddenly become more expensive to produce. You are trying to use prices to allocate equipment to people who need it the most, and then spending money unnecessarily to fix the problem that that doesn’t work.
The cost in money or the cost in lives?
Who’s doing it poorly? The US is doing it less than most wealthy countries, and is doing worse than most.
I think that’s a major place we disagree? If producers know their products will sell for more, options to ramp up production start making more sense.
This would be different for a very short disaster, like a tornado, where all the supplies you will use are ones that have already been manufactured. But for something more sustained, like covid-19, we’re still running production facilities, which can be scaled up in a range of ways. You can start running 24hr schedules, working weekends, bringing in extra people to run the line faster. You can pay people to work 12-hour shifts for a month straight without going home: https://www.washingtonpost.com/nation/2020/04/23/factory-masks-coronavirus-ppe/ More money can’t solve everything, but it can solve a lot of things.
The consumer usually does not foot the cost of increased production. Why would they? In fact, the consumer can reasonably expect lower prices as a result of economies of scale.
The money has to come from somewhere. It usually comes from lenders. If producers can guarantee sales, lenders are happy.
If you build a bigger plant you generally spend more up front but less per unit, while if you take your existing plant and pay workers to go on 24hr shifts your costs may go up a lot. And if you pay for rush handling when things break (couriers for broken parts to minimize downtime) and rush shipping of incoming materials (since slow cheap shipping takes a long time to catch up with your increased production) that’s another increase. When you push hard to maximum production you should expect diseconomies of scale.
But those costs still don’t have to be passed on to consumers.
You’re suggesting that the costs instead come from lenders?
But then production will be limited by the point where the marginal cost of a unit exceeds the price before the emergency (assuming financing is free), instead of the point where the marginal cost exceeds the value during the emergency. That is, you’ve unnecessarily limited production.