THIS POST IS PART OF A SERIES ON THE NEED TO REBUILD ARIZONA’S PUBLIC HEALTH INFRASTRUCTURE.
We know that large manufacturing and processing facilities present a big risk of rapid spread of COVID-19. We are seeing outbreaks of hundreds, even thousands of cases caused by “essential” businesses continuing business as usual in anything-but-usual times. To get America back to work, we need to change business-as-usual to account for the new reality. Employers currently lack the right incentives to make that happen without direct government intervention.
What does business need to do to operate safely? They need to test their workforce in a scientifically sound manner to quickly identify outbreaks and contain them, and they need to mandate the use of PPE to prevent spread among workers, and to and from the public.
Why won’t it work to simply mandate those things as a cost of doing business? Because any cost of business gets minimized. That’s just economic law. If you say to a business concern, “you can operate your business, but you must absorb this cost to do so”, they will do everything they can to minimize that cost, pass it to the consumer in higher costs, or reduce employee costs, to compensate. That is not what we should want.
We should want business to enthusiastically embrace the new requirements; to want to maximize safety, not minimize costs. We want firms incentivized to do the RIGHT thing; protect their workforce, and protect the public. We do not want conflicting incentives to compete, we want natural altruism toward workers and the consumer to rule the roost.
We must therefore socialize the costs of compliance with new health requirements on business. Take away the perverse incentive to minimize costs, and incentivize competition to maximize the effect of natural altruism toward others.
We must also resist any movement to immunize businesses against the cost of allowing their workforce and/or the public to become infected due to their negligence. That’s just another way to allow minimizing of safety costs.
Governor Ducey should create a permanent revolving fund to pay for employers to test and protect their workforce in a scientifically rigorous way, so that in connection with public testing, contact tracing, and public isolation facilities, they can keep their workforce safe. The permanent fund should pay for all business-related PPE and testing for every business in the state. We must start with industries that are “essential” and thus now operating, and that have the largest and most vulnerable workforces, those that work closely in closed facilities and are public-facing.
Eventually, as we stand up new categories of business, they must all participate, be trained, and be supplied by the State. The resource limits of testing capacity and the availability of PPE will be the constraints on opening new sectors of the economy, not an arbitrary date or infection rate. Because the cost is borne by the State, the State has proper incentives and power to coordinate supply chains and reduce costs, and not allow profiteering off limited supplies.
The only way we are going to get this virus under control, and keep it under control until there is a vaccine, or viable treatment options for those it would harm and/or kill, short of merely waiting until enough of us have been infected, and possibly died, to establish herd immunity (which is offensive and deeply immoral), is to change the way we live our lives, which includes the way we go to work with others. This will be a long and expensive process, including a major new cost to the State which will likely require new revenue sources to pay for it.
Our Legislative leadership and our Governor need to step up and create a mechanism to socialize the cost of a more-or-less permanent new bio-safety regime for everyone.
We are in need of real, practical leadership to get Arizona’s economy back to work safely. It won’t be easy or cheap, and it won’t happen quickly if we want it to happen safely.
Step up, Arizona’s leaders. Save lives.