Shomron Center for Economic Policy Research

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Big Government, Not Big Pharma…

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The paper ‘Looks Like a Conspiracy but Is Not a Conspiracy: Big Government, Not Big Pharma, Explains the Response to the COVID-19 Pandemic’ has just been published by The Independent Review (Volume 29 Number 2., Fall 2024, pp. 347-360).

From the article:

The anti-scientific and seemingly illogical worldwide assault on freedom during the COVID “crisis” appears to have been a highly coordinated and even pre-planned action. Many have suggested that Big Pharma took over governments through direct and indirect bribery, as it was the immediate beneficiary of these policies. This reflection argues that Big Government, not Big Pharma or anyone else, was the ultimate source of the ineffective and misguided reactions to COVID-19.”

“Small groups with strong interests and a high degree of coordination can successfully impose tribute on society if the amount of an individual tribute is less than the sufficiently high costs of coordinating the collective actions of members of the society (Olson 1965). Usually, the position that allows both coordinating actions and imposing tribute on society is a position within the bureaucracy of the executive branch of the modern welfare state. The expansion of such groups can increase the regulatory and tax burden and slow economic growth (Olson 1982).

The situation is complicated by the ability of bureaucrats to bribe part of the electorate at the expense of the budget—that is, at the expense of other taxpayers (Jasay 1985).”

“Common interests, strong incentives, and classified knowledge make special coordination efforts unnecessary in the huge majority of cases perceived as a result of perfect coordination.

As a result, bureaucrats of big governments over the world do not usually need explicit coordination to make perfectly coincident or perfectly complementary moves against their societies and against individual rights.

The most important implication of this case study is the understanding of politicians’ and, primarily, bureaucrats’ incentives, which in turn sheds light on their actual policy choices during the COVID-19 pandemic that resulted in huge economic and societal losses (Singleton 2021). Our analysis offers a straightforward recommendation: We need a substantial reduction in the functions, power, and funding of the welfare state to mitigate the most severe consequences of future failures, whether they are preplanned or informally coordinated.”

The short, ‘Popular Science’ version is available at SSRN.

If you need the full text, please contact the authors <yanovskiy.moshe[at]gmail.com>

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