Coronavirus and the Seventh Theorem of Government

danieljmitchell.wordpress.com/2020/03/23/coronavirus-and-the-seventh-theorem-of-government/

March 23,
2020

I wrote yesterday how cumbersome bureaucracies and foolish regulations have hindered
an effective response to the coronavirus.

This isn’t because governments are run by bad people.

Some of them probably are that way, of course, but the real
problem is that politicians and bureaucrats are dealing with
a perverse incentive system.

They’re largely motivated by power, money, publicity,

staffing, and votes.

And that leads to some very unfortunate outcomes, as Betsy McCaughey explained in
her syndicated column.

Landing in the hospital on a ventilator is bad. But worse is being told you can’t have one.
…learning that the state’s stockpile of medical equipment had 16,000 fewer ventilators
than New Yorkers would need in a severe pandemic, Gov. Andrew Cuomo came to a fork
in the road in 2015. He could have chosen to
buy more ventilators. Instead, he asked his
health commissioner, Howard Zucker to
assemble a task force and draft rules for rationing the ventilators they already had. …
Cuomo could have purchased the additional 16,000 needed ventilators for $36,000 apiece
or a total of $576 million in 2015. It’s a lot of money but less than the $750 million he
threw away on a boondoggle “Buffalo Billion” solar panel factory.

For what it’s worth, I’m not blaming Governor Cuomo for a failure to buy more
ventilators.

In the same situation, I also may have decided that it wasn’t wise to spend $576 million
for an event that most people thought was very unlikely.

But I am blaming him for supporting ever-bigger government in New York and getting
ever-more involved in things that aren’t legitimate functions of a state government.

That applies to the solar factory mentioned in the article, and it also applies to other
vote-buying schemes such as mass transit boondoggles, expanded rent control, and
anti-gun snitch lines.

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And when he expands the size and scope of state government, he increases the
likelihood that there won’t be the energy, expertise, or resources to address problems
where government should play a role.

Such as dealing with a pandemic.

Which motivates me to unveil a Seventh Theorem of Government.

In addition to the example of Cuomo and ventilators, there’s also a story from Belgium
that underscores how bloated governments are less capable.

But I’ll close by noting the Seventh Theorem is not driven by anecdotes. There’s plenty of
academic evidence showing that smaller governments are more competent.

P.S. As suggested by proponents of “state capacity libertarianism,” there is a possible

exception to the Seventh Theorem.

Some of the world’s poorest nations have small public sectors – at least according to
official measurements. It’s certainly possible, at least in theory, that such countries would
benefit if they had larger governments that were capable of providing core public goods.

Indeed, international bureaucracies commonly argue that these countries should

increase their tax burdens to provide “financing for development.”

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However, the real problem in such nations is rampant corruption, low societal capital,
and inadequate rule of law. Which is why it’s not a good idea to generate more money for
politicians in those countries.

P.P.S. Here are my other theorems of government.

The “First Theorem” explains how Washington really operates.

The “Second Theorem” explains why it is so important to block the creation of new
programs.
The “Third Theorem” explains why centralized programs inevitably waste money.
The “Fourth Theorem” explains that good policy can be good politics.
The “Fifth Theorem” explains how good ideas on paper become bad ideas in reality.
The “Sixth Theorem” explains an under-appreciated benefit of a flat tax.

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