Capitalism Is Still Working, Thank Goodness

By David R. Henderson. Excerpts:

"On January 17, WHO had published a protocol created by German researchers that gave instructions that would help laboratories develop the tests. But that very same day, Dr. Nancy Messonnier, the director of the U.S. National Center for Immunization and Respiratory Diseases, announced that the Centers for Disease Control (CDC) would produce its own version.

There’s nothing wrong with a competitive version, as long as others are allowed to compete. But others were not allowed. Possibly the reason the CDC insisted on producing its own tests is that it didn’t think the coronavirus would be a big deal."

"Someone who had specific information that the CDC did not was Dr. Helen Y. Chu, an expert in infectious diseases in Seattle. In an excellent New York Times news story on March 10, reporters Sheri Fink and Mike Baker tell the tragic tale. As a result of her months-long research in the flu, Dr. Chu and her colleagues had a collection of nasal swabs from people experiencing symptoms. She spent weeks trying to get permission from state and federal officials to test the swabs for the coronavirus. They turned her down. The CDC told her on February 16 that if she wanted to use her test as a screening tool, she would need permission from the Food and Drug Administration. But because of regulations put in place by the Centers for Medicare & Medicaid Services, the FDA could not approve.

Finally on February 25, in desperation, she and her colleagues did the tests without approval. And bingo: she found a positive test for a teenager who had not recently traveled. But for the regulation, she could have known this weeks earlier. And did the FDA see the error of its ways and give her credit? No. Dr. Scott Lindquist, Washington state’s epidemiologist for communicable diseases, says, “What they [the CDC and the FDA] said on that phone call very clearly was cease and desist to Helen Chu. Stop testing.”

Tragically, the CDC’s own tests didn’t work, thus losing Americans a crucial few weeks."

"On March 11, by which time a large percent of Californians had put their faith in “social distancing,” I received an email from Starbucks stating, among other things, that “we may adapt the store experience by limiting seating to improve social distancing.” Other restaurants I frequented announced the disinfecting they would do regularly. That was not perfect, of course, because the restaurants that contacted me didn’t commit to social distancing. But governments never gave the new systems a chance. San Francisco’s mayor, London Breed, announced on March 16 that she would close all businesses that she regarded as “non-essential.” Various county governments in urban areas of northern and southern California followed her lead and on March 19, Governor Gavin Newsom announced a similar lockdown for all of California."

"Until last week, hospitals were not allowed to get masks from China that are a close substitute for the N95 masks that are in short supply."

"many businesses deftly adjust by producing medical equipment and other items that are in short supply."

"The good news, according to investment site The Motley Fool, is that, as of April 7, 13 pharmaceutical companies were developing tests for the virus. And on March 17, one company, Roche Diagnostics, announced plans to ship 400,000 swab-testing kits per week. In fairness, I should point out that the FDA moved with record speed to approve the tests."

"On March 24, Ford, 3M, and GE Healthcare announced that they had teamed up to produce ventilators and plastic face shields. And it’s not just big companies moving rapidly. Individuals and small businesses are stepping up all over the country.

In Washington, Indiana, Bill Purdue has worked in a friend’s auto trim and upholstery shop that has been repurposed to produce face masks. A crafts chain called Joann Stores is making its over 800 stores available for as many as 10 people at each store to sew masks and hospital gowns.

Last Sunday night, CBS’s news show 60 Minutes had a wonderful segment in which a businessman in the New York area, Michael Bednark, told how his firm, which produced displays for retailers, turned on a dime and started producing 27,000 face shields per day for medical workers. He actually ended up hiring an additional 100 people."