by Nate DePalm
It is not necessary or beneficial to sacrifice human lives to save the economy.
Nor, is it necessary or beneficial to sacrifice the economy to save lives.
The Misunderstanding
Many in the media have painted any attempt to improve economic conditions during the pandemic as a deplorable act of making thousands of Americans the subject of human sacrifice to the almighty dollar.
“Should Older Americans Die to Save The Economy? …” – The Washington Post
“Letting People Die to “Save” The Economy Is A Losing Idea” – Forbes
“If it’s public health versus the economy, the only choice is public health. You cannot put a value on human life. You do the right thing. That’s what Pop taught us.” – New York Gov. Andrew Cuomo
With #NotDying4WallStreet trending on Twitter, it seems like these ideas have spread from the media to public opinion.
The notion that America must choose between saving the economy or saving lives is a gross misinterpretation of the events at hand. And, acting on this misunderstanding has a high potential to make public health worse, not better.
This faulty context reveals that many Americans may not understand what the economy is or its relationship to combating infectious disease.
What The Economy Is
Many Americans in the debate seem to view “the economy” as synonymous with Wall Street, CEO’s, and Corporate Profit. Maintaining economic activity is viewed as prioritizing purely economic ends rather than societal needs for public safety.
This couldn’t be further from the truth.
This notion confuses the means for the ends.
Nobel Prize-Winning Economist Friedrich Hayek points out in his classic book “The Road To Serfdom” that there are no purely economic ends, only economic means of pursuing all other ends.
For example, a person’s paycheck is often mistaken as the purely economic ends for his work. But his paycheck is not the end, it is the means of pursuing his values, such as providing shelter, food, PPE’s, and medical care for himself and his family.
Therefore, if you reduce or eliminate his income, you reduce or eliminate his ability to pursue those elements of combating infectious disease for himself and his family.
On the business side of the equation, revenue is also often mistaken as a purely economic end of business activity. But again, revenue is just the economic means of pursuing other ends, such as income for its workers, continuing production, and innovation.
Just as with the individual, if you force a reduction or elimination of revenue, the company can no longer pursue those ends.
When we talk about “the economy,” we aren’t talking about dollars or Wall Street executives. We are talking about the level of real opportunity available to every person to pursue quality of life.
The Economy & Public Health
Some level of losses for businesses occur naturally as a result of fear and uncertainty during the pandemic. These losses may be painful to a company, but they can be beneficial to society as they act as an incentive for companies to adapt to shifting societal needs to reduce further losses.
For example, during the coronavirus pandemic, society’s need for new cars drastically declined. This resulted in painful losses for companies like General Motors. GM responds by shifting its focus from producing automobiles to producing what society needs more: namely respirators and face masks, in an effort to reduce losses.
This is not just a theoretical possibility, it has already happened.
Many companies have already shifted to producing respirators, face masks, hospital gowns, and hand sanitizer, including Apple, General Motors, Ventec Life Systems, Ford, Tesla, Dyson, 3M, Prudential, Unilever, Hanes, Gap, Jameson Irish Whiskey & Absolut Vodka, Louis Vuitton, Prada, Virgin Orbit, Brooks Brothers, American Giant, Snap Inc, and countless small companies and entrepreneurs.
Many have even distributed them at production cost or at no cost at all.
It makes no difference if these individual companies or entrepreneurs are producing these public health supplies in pursuit of revenue, public relations, or simply out of the kindness of their hearts to help reduce shortages of equipment in dire need for public safety.
The end result is the same either way: massive increases in supplies and equipment that communities desperately need for public safety. After all, the only way for a company to make money in a free market economy is by producing what the people need.
Apple alone has already produced and donated 20 million masks. Hanes has produced and distributed 60 million masks and General Motors is producing 50,000 face masks per day.
As these companies produce more and more of these products, the increase in supply will inevitably drive prices down making them even more accessible to everyone.
Remember a month ago, when America was experiencing dire shortages of lifesaving PPE’s like masks, respirators, and hand sanitizer? Have you noticed that we are hearing less about these shortages?
That’s thanks to these companies and their employees.
If these companies had been ordered to close or their employees ordered to stay home in the name of public safety, not only would the workers be without income, reducing their ability to provide safety and security for their families, but these shortages would have been exacerbated instead of eased, thus making the public and our medical workers less safe.
Now imagine if all of the other companies and employees deemed unessential were allowed the option to participate in this process.
When we talk about “the economy”, we aren’t just talking about the rich. We are talking about you and your means of providing for yourself, your family, and your community.
The state of the economy reflects the level of opportunity for individuals like yourself to attain standard of living and quality of life as well as the level of opportunity for society to produce what it needs.
Once this is understood, it doesn’t stretch the imagination to see how necessary economic health is to combating infectious disease.
A country with more medical facilities, functioning medical equipment, and active medical staff is more prepared to fight COVID-19 than a country with less.
Families are more capable of avoiding COVID-19 when they are more capable of keeping their homes than families in an economy where they are not.
Individuals in an economy with less unemployment and higher average income are better off protecting their health than individuals in an economy with high unemployment and low incomes.
All of these factors are determined by the economic health of a nation.
It’s time to reshape the debate. It is not a question of sacrificing lives to save the economy or sacrificing the economy to save lives.
We don’t need to choose one over the other.
Economic health is the strongest asset for public health because economic activity is the only means of bringing all the necessary components of fighting infectious disease into abundance.
Therefore, it is in the best interest of public health to keep our economic health strong to slow the spread of COVID-19 and prevent unnecessary loss of life.
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Nate DePalm is an entrepreneur & passionate economics enthusiast.
