‘Economic reality is not optional’

‘Economic reality is not optional’

Additional dangers lurk in the still-unfolding coronavirus pandemic than just the virus itself. And that might not be readily apparent to a public hunkering down, first seeing to family needs and not fully informed.

As noted earlier in the week, there is a manifest danger of elected and appointed leaders using a crisis to impose public policies that, in the name of “helping” the public, instead cause great economic harm in furtherance of ideological agendas.

We have seen this nationally this past week as one party attempted to include in a fiscal stimulus bill provisions that would, perversely, spend billions of dollars that would retard stimulus.

Unsustainable and overtly expensive “green energy” mandates come to mind. So, too, do stricter fuel economy mandates for an airline industry that is gasping for survival. The agenda-izing was overt.

What state- or local-level mandates might follow a similar, misguided course, no one yet can predict. But at least one prediction can be made:

Some government operations will use the coronavirus-created economic downturn as cover for past questionable financial practices wholly unrelated to the pandemic.

The Port Authority of Allegheny County and the Allegheny County Airport Authority come to mind.

In the former’s case, its bus cost structure long has been out of whack with transit services of contemporary agencies. In the latter’s case, its repeated attempts to command both the cargo and passenger services markets at Pittsburgh International Airport with public subsidies are well-documented failures.

But in recovery, even more public dollars cannot be used to cover up those failures of the past; bona fide market-based reforms must be enacted.

Is it naïve to believe that such a thing might come to pass? Perhaps. But for these agencies, among others, to be allowed to continue to operate as in the past – and to bolster them in “recovery” with even more public dollars – will only enable more public service dysfunction.

This crisis should be considered an opportunity to get things right, not double-down on failure.

As an old economist friend once offered:

“Economic reality is not optional, despite the false promises of politicians that they can work miracles. Unfortunately, people’s belief in economic miracles – indeed, their demand that politicians attempt to perform such – distorts their vision of, and responses to, reality. The result is reality made worse.”

Colin McNickle is communications and marketing director at the Allegheny Institute for Public Policy (cmcnickle@alleghenyinstitute.org).