Let’s start out with Article I, Section 7, Clause 1 of the U. S. Constitution:
All Bills for raising Revenue shall originate in the House of Representatives; but the Senate may propose or concur with Amendments as on other Bills.
and proceed on to Alex Tabarrok’s post at Marginal Revolution on Congress’s failure to fight SARS-CoV-2:
One of the most confounding aspects of the pandemic has been Congress’s unwillingness or inability to spend to fight the virus. As I said in the LA Times:
If an invader rained missiles down on cities across the United States killing thousands of people, we would fight back. Yet despite spending trillions on unemployment insurance and relief to deal with the economic consequences of COVID-19, we have spent comparatively little fighting the virus directly.
Read the whole thing.
I think the most likely explanation is that it’s obvious to the House leadership how passing bills that puts money into many Americans’ pockets will gain votes but a lot less obvious that “increasing the supply of PPE, expanding testing, developing treatments, standing up contact tracing, or developing a vaccine” will do so. And then, of course, there’s presidential politics. It’s an election year, you know.
I am often pretty cynical but If someone actually did all of these ““increasing the supply of PPE, expanding testing, developing treatments, standing up contact tracing, or developing a vaccine†I would hope it would be seen as a sign of competence. It would certainly attract some voters. Those who voted for Trumnlp because he “owns the libs” arent going to be affected anyway, just like the hard core left, but I have to think there are still some in the middle who would see these as positive. If nothing else all those things would enable a more successful reopening.
Steve
Just an update on our situation, we can no longer get test results in any helpful or meaningful time. We are OK on PPE but just for a couple of months out. We have now had the same 3M shipment cancel about 4 times. If the mask we designed that we can make on our 3D printer is not approved and we have a surge in our area to go with what is happening in the south and west we will go through supplies fast and not sure where we get more. Would really be nice if someone propped up another factory here in the US to make more. (The one we invested in has had some delays. Still hoping to see some soon.)
Also, we have lots of people vacationing in the South. They need to quarantine when they come back. Would be nice if we could test them and get back to work but lack of tests means we cant.
Steve
Spent the day thinking about this.
The chief problem is Congress’s main tool; i.e. the ability to borrow or print money, financial capital; is wholly mismatched to the task of combatting the coronavirus.
In a literal sense, financial capital by itself is pieces of paper or a bunch numbers in a computer, it is not a PPE generator. Where Congress’s spending is felt is that money can reallocate productive resources in the economy to the desired targets (increase PPE production).
Here’s the big problem; money only works if there is enough productive resources to reallocate. i.e. if 90% of PPE production is from China, and China has restrictions on how much PPE is exported, more money won’t create a bigger supply of PPE. Financial capital requires robust “industrial capital” to be effective in abruptly increasing industrial production due to a shock.
That marks the difference between today and 1942.
Indeed, as Steve alluded; the industrial capital is so weak today that is the US ability to create new factories is atrophied.
Another big factor is many of the strategies to combat coronavirus aren’t financially expensive, but require different types of “capital”; like “social capital”, “state capacity capital”, and “trust capital”.
For example, the country of Czechia went from 0% to 95% wearing masks in 2 weeks in March; citizens just went and created their own masks. Or Japan the Government asked citizens to reduce social contact by 80% voluntarily and it happened. That’s social capital and trust capital.
State capacity capital is like South Korea contact tracers being able to trace citizen movements without a court warrant, or fining people who don’t cooperate with contact tracers.
The problem is Congress has precious little of any of the other “capitals” that are required to deal with the coronavirus.
Your thoughtful comment deserves a more thoughtful response than this, CuriousOnlooker, but I think that on the one hand you’re underestimating U. S. productive capacity but on the other I agree with your point in regards to stimulating the economy. How much you can stimulate the economy with pump-priming is strictly limited by aggregate product, at least in the near term.
I don’t believe that productive capacity is the limiting factor in producing PPE domestically. I think that regulation is.
Your points about social and other capital are spot-on. The Germans, for example, are very rule-oriented. Compliance is bound to be high. Here? Fuggedaboutit.
I had a higher regard of American productive capacity several months ago… but the last few months have been a sobering lesson.
The pricing of PPE has been highly profitable for months; and now looks likely to be so for years to come; yet American production has not grown like in China / Taiwan / SK.
Well, I can’t open a webpage without seeing ads for masks and eye shields but these are not approved PPE. So possibly the shortages are resulting from regulation. Precious little of that in Chinese factories.