Tax Planning

COVID-19 Proves the Nanny State Does More Harm than Good

You might call it the “curse of good intentions”: an action we take upon ourselves or require others to take in the expectation it will improve things for us as individuals or for society.

I’m referring, of course, to metastasizing “Nanny State” laws and regulations that ban young girls from selling Girl Scout Cookies in their own front yard, force day care providers to get a college degree to babysit children, or shut down a budding seven-year-old entrepreneur’s  lemonade stand for not having a required permit.

The COVID-19 pandemic has proven once and for all that many, if not most, of these rules are unnecessary. Indeed, in some cases, rules enforced by the Nanny State directly led to an increase in the number of deaths attributable to the virus.

Consider the shortage of intensive care unit (ICU) beds that developed as America set out on its mission to “flatten the curve.” Unfortunately, in 35 states and the District of Columbia, hospitals must obtain regulatory approval to expand their facilities, including (in many cases) ICU beds. The approval process has nothing to with qualifications or safety. Instead, it’s a bureaucratic assessment to decide if additional healthcare capacity is “necessary.”

Acquiring such a “certificate of need” (CON) has evolved into a time-consuming and expensive competition between established healthcare providers and their would-be competitors. Aside from driving up healthcare prices with their restrictions, states with this requirement for hospital expansion are nine times more likely to experience ICU bed shortages. New York, which pioneered CON laws and then lobbied Congress to force other states to adopt them, projected a shortage of nearly 6,000 ICU beds. Indeed, 15 of the 20 states that faced ICU bed shortages force hospitals to go through a CON process when they expand.

Another way the Nanny State increased the severity of the pandemic was in the restrictions it imposed on access to diagnostic technology. A prime example is the “pulse oximeter,” a device invented in 1935 that measures blood-oxygen levels. But while pulse oximeters only cost a few dollars each, the devices are in short supply due to regulations enforced by the FDA. Indeed, while the Apple Watch and older versions of Samsung Galaxy phones have built-in capabilities to monitor blood oxygen levels, they’ve been disabled or discontinued to avoid violating FDA rules.

Another ridiculous manifestation of the Nanny State are licensing laws requiring people to pay thousands of dollars to legally work in their chosen field. In almost every case, established businesses lobby state and local governments to impose these regulations to restrict competition. Whether the resulting rules require hair braiders to obtain a cosmetology license to practice their craft, or a dog-walkers license to exercise our canine friends, they’re always economically destructive.

But they usually don’t kill anyone.

State physician licensing rules are different. Medical professionals are usually licensed on a state-by-state basis. If you’re a licensed physician in New Jersey, for instance, you can’t cross the George Washington Bridge into New York City, which became the epicenter for the pandemic in America.

In a public health emergency, though, you want every physician available to be able to treat the sick. Thus, 47 of 50 states temporarily waived licensing requirements for out-of-state physicians. They’ve also suspended restrictions on telemedicine for physicians licensed in other states. My only question is why it took a pandemic to make these changes happen. And assuming out-of-state physicians don’t cause grievous damage to public health, why not eliminate these rules altogether?

Meanwhile, meat shortages now popping up throughout the country are a direct result of Department of Agriculture guidelines requiring even the smallest meat processors to adhere to many of the same rules with which huge wholesale slaughterhouses must comply. Since at least two dozen major meatpacking and processed food plants are now shutdown throughout the country, millions of chickens, pigs, and cattle will be needlessly slaughtered without becoming part of the food supply chain. A workaround would be to allow small independent meat processors and slaughterhouses to sell directly to the public, but that’s currently illegal.

That the central planning engendered by the Nanny State in its response to the pandemic was such an abject failure should surprise no one. An economic system that relies on officials at the top of a hierarchy to make economic decisions on behalf of everyone else is doomed to failure. The collapse of the centrally planned socialist economies of the Soviet Union, Cuba, and Venezuela proved that point beyond a shadow of any doubt.

That’s why a large part of the Nanny State should be permanently shuttered. But I’m not holding my breath waiting for it to happen.

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