Imagine yourself mired in a field of mud, unable to make forward progress. Now imagine that everyone you knew, plus all businesses you patronize, plus your children’s school was in this same field with you. Sounds a bit like the COVID-19 pandemic, doesn’t it?
To get ourselves un-stuck from this mud, we’ve used two powerful tools: government policy and private market innovation. Looking to the future, what has COVID-19 taught us about how to best use these tools?
Government policy is like a powerful bulldozer—one that can help get a big truck out of that field of mud. The key strengths of government policy are size and scale, making it most useful for a big push on a well-defined target. Government excels in size because it is able to muster large financial and administrative resources, and in scale by affecting a high percentage of the population at once.
If there was any well-defined target of high economic benefit during the pandemic, it was vaccines. This target was also of the “large truck” type—extremely hard to budge. Operation Warp Speed harnessed both size ($13 billion for vaccine development to Pfizer, Moderna, and J&J) and scale (funding vaccines but also supply chain factors such as vials and syringes) to speed up final delivery of this life-saving, economy-opening product.[1]
However, an equally influential government push was not financial aid, but instead clearing away barriers to private market progress through the Emergency Use Authorization (EUA) program for vaccine candidates. Researchers estimate that the first five months of the vaccine campaign saved nearly 140,000 lives in deaths avoided, or between $625 billion and $1.4 trillion in the value of statistical lives saved.[2] Compare those numbers to anything the government could muster with a purely financial push: The beneficial impact of government action to remove onerous barriers for private markets was far greater than any financial aid.
Read more about using our toolbox in my article, “Out of the Pandemic Mud,” published in Discourse Magazine this month.
[1] Read more about funding from OWS at the U.S. Government Accountability Office site: https://ows.gaoinnovations.gov/the-funding
[2] Vaccinations Against COVID-19 May Have Averted Up To 140,000 Deaths In The United States. Sumedha Gupta, Jonathan Cantor, Kosali I. Simon, Ana I. Bento, Coady Wing, and Christopher M. Whaley. Health Affairs 2021 40:9, 1465-1472.