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Comment by m0xte | Hacker News Reader

I’ve always said that governments should use our tax money to design and validate key health and infrastructure components and only outsource manufacturing and only to local businesses. Governments are so utterly broken and inefficient that they can’t do it.

However even if they produced a design now we have supply chain problems globally.

Edit: I seem to have stirred up capitalist defence here. To clarify: The government runs healthcare here in the UK. They have a responsibility for making sure there is supply of equipment available for us. This isn't some car pooling company that says "there's no cars available until next Wed", this is healthcare. And as for production, the government should have agreements in place with manufacturers to switch to infrastructure build out.

We've screwed up flood defences, energy, healthcare so far. Lets stop now.

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> Governments are so utterly broken and inefficient that they can’t do it.

Mostly when your entire platform is that governments are broken so you do your utmost to make them broken to prove your point. All governments have issues, but there are many that aren't "broken" like the US, and more and more so the UK.

Have you considered that maybe broken inefficiency is not necessarily a property of governments in general? The local optimum might be to avoid having the government do things, but the global optimum is to fix your government.

If you look at history, I'm not sure it's possible for a government to get better. I'm not aware of any historical examples. Revolution can happen, but that means a new government.

They clearly work well enough they every functioning society on earth utilizes one. What is your counterexample in which a government-less society flourished?

I wonder how that project would have gone had the design been the deliverable instead of ventilators.

It wouldn't necessarily have been trivial for another company to pick the design up and produce it, but it would have been possible.

> I wonder how that project would have gone had the design been the deliverable instead of ventilators.

The big company that bought the small one would simply have claimed that the design was their intellectual property and nobody else could build it.

Yes, that's one thing contracts are used for, to specify what you get in exchange for payments, in a durable way.

But the government agreed to cancel the contract at the big company's request. I don't see how the deliverable being the design instead of the ventilator itself would have changed that.

Sure.

If I had a government slush fund to develop a low cost ventilator, I would try to structure the payments in the contract to be based on milestones with concrete deliverables. Not a tenuous agreement to buy a bunch of ventilators at below market price (it's implied in the article that the sales to the stockpile wouldn't justify the project for the company).

There's of course a possibility that the government wrote the most aggressive contract they could find someone to work on. But I doubt that is what happened.

> There's of course a possibility that the government wrote the most aggressive contract they could find someone to work on. But I doubt that is what happened.

Why do you doubt that?

Agreement to cancel could be made conditional upon publishing the design and releasing it into the public domain.

If the big company detests that idea, well, they don't get out of the original contract.

> Agreement to cancel could be made conditional upon publishing the design and releasing it into the public domain.

It probably could have been (that would depend on the details of the terms of the original contract), but it wasn't.

There is no big or small company, just a government registered design and companies who can produce it if requested.

This story, if accurate, is simply an illustration of how low-regulation capitalism works. "Working as intended." Profit is the only motive, and thus as long as the company/investors profit, then it is a success.

The fact that national or global human well-being suffered is irrelevant (so long as we accept that capitalism (as currently implemented) is the right way).

Now, there's a strong likelihood that the government officials with the power to prevent the sale of the company, or alternately the power to prevent the cancelation of the contract, were lobbied (and financially supported in various ways counter to the benefit of the people those officials represent). Otherwise, it's hard to imagine the government just casually agreeing to abandon a project that was already demonstrated to be near success (and the outcome of which was already demonstrated to be important).

The USA has the worst government that money can buy

Government patents and the heavily regulated medical cartels = capitalism?

Not to be a Communist when I say "not real capitalism", but it seems there's no pro capitalism political party in the US.

The Republicans certainly give lip service to it but both parties seem more corporatist than anything else.

> Governments are so utterly broken and inefficient that they can’t do it.

Exactly. Which means we should not be depending on governments to do it. This is exactly the sort of thing that private startup companies should be doing, without trying to involve the government's bloated and inefficient bureaucracy.

> even if they produced a design now we have supply chain problems globally

For this particular crisis, yes. But not for the next one, if we start now.

Wait... isn't that exactly what the article says they tried to do?

The government tried, but then canceled the contract at the request of the big company that had bought out the small company they originally had the contract with.

Exactly. The issue in some sense isn't government, it's the corruption of government by corporations that have been allowed to become to big and to powerful, to the extent that the US Government itself has been deliberately defunded. (Sure, I know Government spending grows every year, but so does the money supply and corporate profits. Control for monetary expansion, and the US Government's portion of the economy has been steadily shrinking.)

> The issue in some sense isn't government, it's the corruption of government

Ok, so how do we keep the government from being corrupted? Nobody has yet solved that problem, and people have been trying for centuries.

> Control for monetary expansion, and the US Government's portion of the economy has been steadily shrinking.

The money supply is not the same as the economy. Government spending as a percentage of GDP, which is the closest estimate we have to "the size of the economy", has been growing, not shrinking.

Well the first thing you do is ban professional politicians and lobbying.

The trick is doing that while still having some semblance of free speech, and allowing constituents to talk to their representatives about what problems they are seeing.

As I commented upthread, your solution is to just change the entire system of government. Sure, that should be simple. Not.

Big problems require drastic changes.

> Control for monetary expansion, and the US Government's portion of the economy has been steadily shrinking.

What? No it hasn't. It has kept pace with GDP since the end of WWII (prior to WWII it was much smaller), and the rate of GDP growth is higher than the rate of inflation. The size of government in the US has been growing continuously in real terms since before Eisenhower.

Why should hospital X buy 100 ventilators...just in case, unless the gov made them do it?

> Why should hospital X buy 100 ventilators...just in case

Well, of course. That's what we're talking about, right? Somebody has to do the long-term planning for emergencies like this one.

I understand that most of us thought it was the government's job to do this long-term planning so individual facilities wouldn't have to, but this article shows that the government failed at that job. Unless we have some reason to think the government wouldn't fail next time, it seems like the only alternative is for private entities to do it.

But private entities can't do it, because the market forces them not to - those that the spend the money will be out-competed in the short term by those that don't.

> private entities can't do it, because the market forces them not to

Private entities don't have to be subject to the market. Someone like Bill Gates or Elon Musk could set up a privately owned company, not publicly traded, that would not be subject to investors' demands for consistent quarterly growth. Matter of fact, maybe that's what Bill Gates should switch his attention to from malaria.

The fact is, a private individual, or a small group of them, can have a longer time horizon than the government does, and a longer time horizon is exactly what is needed for something like this.

The government failed here but they are the only ones that can really prepare. A pandemic is as much as a threat as USSR, Bin Laden was, or China is, so just as they have these billion dollar planes they should prepare for Covid like situations.

It was already a small private company doing the contract. Another bigger company (that was publicly traded and therefore operating with shareholder profit as the primary if only concern) came along and bought the smaller private company. This happens to start-ups all the time.

What does this have to do with "government's bloated and inefficient bureaucracy"? The only government failure I see in this story is that they allowed the sale of the small company to the big one, or that they allowed the big company to get out of the contract.

I completely disagree.

If the government had done it in house they could have succeeded.

The problem here was the profit motive. Cheep ventilators endanger profits.

It is a side effect of free markets (I like free markets) that big firms get bigger, get more market power, kill off competition then price gouge. Health is a bad bad place to have free markets as the incentives are almost all wrong (exceptions: E.g. running clinics as a service for state run health systems turns out to work well here in Aotearoa - but even that is under pressure from consolidation)

Nationalise the whole ball of wax. Use waiting lists not wealth to ration access. FFS the richest country in the world is heading to a health catastrophe. What a bunch of idiots!

> If the government had done it in house they could have succeeded.

Ok, so how do we get the government to do it in house, and stick to it long enough so that the stockpile is there when the next disease crisis happens, which might not be for another 10 years? That's five Congressional elections and at least two changes of Presidential administration.

Government is not congress, or a president. It is civil servants beavering away.

> Government is not congress, or a president. It is civil servants beavering away.

The civil servants work on what Congress and the President set as priorities. They cannot execute plans that span multiple Congresses and Presidential administrations unless every single Congress and Administration over that time period agrees to support the plan.

They flew to the moon.

They built a horrifying arsenal.

I really do not see why they cannot build a health system. They have done so here.

Healthcare is a much larger proportion of the economy than NASA ever was. And if you're trying to put up the US military as an exemplar of US government efficiency and competence, no thank you.

> They flew to the moon.

Yes, because three successive Presidential administrations and six successive Congresses supported it.

More precisely, two successive administrations and about four successive Congresses supported it. The third administration began to back off, as did the fifth Congress; then the sixth Congress, along with the administration, stopped supporting it--and the moon missions stopped. Despite the fact that a large number of civil servants were making cogent arguments for why they should continue.

> They built a horrifying arsenal.

Yes, because every President and every Congress since 1945 has supported it.

Party politics is a separate shit show. It should be an elected council with no single representation. That would allow smaller, manageable policy changes rather than burn the entire universe every few years.

> Party politics is a separate shit show. It should be an elected council with no single representation.

Ok, so your plan for solving the ventilator issue is to change the entire system of government. Good luck with that.

There's no "free market" in healthcare; it's one of the most heavily regulated sectors in the economy. It's a known side-effect of regulation that big and politically-connected firms are advantaged over smaller and leaner ones, market power tends to increase in lockstep with the regulatory burden, and a lot of price gouging becomes feasible that wouldn't occur in a more contestable environment.

Not only is health care regulated, it isn't even a market in the correct sense, because the people actually getting the health care services--patients--don't even know how much the services themselves cost. Which means that nobody is in a position to judge whether the services are worth what they cost. This isn't a market at all, it's a recipe for disaster. Which of course is exactly what we have.

There is no profit to be made in building up huge stockpiles of ventilators that will only be used in the event of a freak disaster. Government has to pay for such things, because no economically rational private investor would.

> For this particular crisis, yes.

Really not even for this particular crisis. We can build more of something on a short timescale, it just costs more then. You have to build facilities you know are only going to run for six months and then be decommissioned, so you have to amortize their construction cost over half a year instead of 30 years. You have to build them on the double, which means paying a lot of overtime and buying land and raw materials without taking a lot of time to negotiate on price or worry about efficiency. But we could do it.

And then the ventilators would cost ten times more than they ordinarily do and idiots would accuse anybody trying to do this of price gouging. But it could be done. (Unless the idiots pass a law against charging more than the regular price during an emergency.)

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