India’s Government Created Covid Disaster

Since the month of March 2021 suddenly the cases of Covid-19 are increasing in India. So far close to 2 crore people have contracted this mysterious disease out of which 99% have recovered and 1% have sadly died (Data source). World over media is portraying this situation as a disaster because of the fact of hospitals running out of oxygen, medical supplies and beds and pictures are splashed in media where crematoriums are having queue of dead bodies supposedly of Covid patients; I am sure many of those dead are non Covid patients who died because of lack of healthcare for them in the frenzied time of Covid where all already scarce resources are unduly monopolised by the Covid-19 disease.  

However looking at the data one can hardly say that Covid-19 is ravaging India. Out of population of 140 crore people, close to 2 crore people have so far contracted this disease, and that if we believe the incredibly flawed testing regimen of RT PCR etc. In relative terms, some 1% Indians have contracted this mysterious virus in last one and a half years. This is hardly ravaging or alarming. 

The real problem actually is government and its centrally planned management of Covid in India which has made things worse. The situation looks alarming because of the awfully inadequate and horribly inefficient Indian public health and centrally planned system not able to cope with the given situation of 1% people contracting this virus. The problem here is not Covid per se but the heavily monopolised centrally planned statist response to this disease in India. Government has taken over complete management of this so-called pandemic and that is why we see the artificial scarcity of oxygen supply and hospitals running out of beds etc., problems. These are all results of government management of this disease. Anyone familiar with the science of economics knows that socialist central planning never works whether that is planning of the economy or the health system. Government is an institution which can only create artificial scarcity when there exist no actual scarcity. As Milton Friedman so rightly said, 

If you put the federal government in charge of the Sahara Desert, in 5 years there’d be a shortage of sand.  

And exactly that is what is happening in India right now. Modi government has put itself in charge of the whole Covid 19 pandemic and their management has created artificial scarcity of oxygen and other medical supplies. Under the excuse of phony idea of public health central and various state governments have monopolised covid-19 disease management. And we know such socialist central planning can’t economically calculate where resources are needed to be allocated. In the absence of market price and profit and loss system, efficient allocation of resources is impossible. Government is also a giant machinery of wastage of resources. Whatever oxygen and medical supply is available is being squandered in the process of allocating them. Public health officials and politicians are involved in black marketing the scarce oxygen and drug supplies. Another way in which Modi government is creating scarcity of medical resources is their totally irrational insistence of their pet policy of Make in India. Indian scientists are complaining about this to Modi government. In their appeal to Modi government, they said,

It added that restrictions on importing scientific raw materials ” to make India ‘self reliant’ is a key goal for Modi and his government ” was an obstacle.

“Such restrictions, at this time, only serve to impede our ability to deal with COVID-19,” it said.

Not only this, central government is arrogantly declining offers of help from neighbouring countries like China. And that is adding in the scarcity problem. 

In such artificial scarcity environment, corruption is thriving, which is a natural response of the market. Remember such corruption is a natural outcome of government monopoly of the whole health system. In the absence of efficient market system for allocating resources, now corruption is doing that work at a higher price and with much less efficiency. Sadly that is the only alternative available in such heavily centrally planned Indian economy. And as is happens, a black market has opened up to supply these scarce resources to the needy. Now because government controls have created artificial scarcity of oxygen supply, in black market prices have naturally sky rocketed. Prices only reflect the underlying scarcity of the given good. In a free market this temporary higher price will be necessary to attract fresh higher supplies of oxygen. We know the law of supply dictates that higher prices will prompt suppliers to supply more oxygen in India, and that will solve the problem of lack of oxygen and other medical supply. If we had a free market system in India then higher prices of oxygen and other medical supply would have prompted domestic and foreign suppliers to bring their supplies in India to make profit. And that would have removed the scarcity quickly saving many lives. But such market adjustments are not possible because government is in charge of the whole affair and they won’t allow price system to work freely. Also there is no profit and loss system working in the absence of truly free market in health sector in India and so suppliers have no incentive to ramp up their production of these scarce medical goods. 

All in all, the on-going Covid disaster in India is a complete making of the governmental central planning of this disease. Government involvement and monopoly has exaggerated this diseases beyond all proportions. You remove the government from the scene and Covid poses no big danger as market system responds adequately to fulfil needs of the patients. If government didn’t monopolise the management of this disease then I am sure many of those who died because of lack of oxygen and other medical supplies would have been alive today. As usual, government has blood on its hands. They not only bungled up everything, but exaggerated this problem by their horrible lack of response and insensitivity to the plight of people. Central and state governments were busy conducting elections when there was a need to ramp up their horribly inadequate public health system. In last one year when cases were not very high, they did nothing to prepare for any adverse situation. The whole affair is a clear example of the fact that the state aka government doesn’t care for people. They exist only for their own benefit of exploiting us for their parasitical living.

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12 thoughts on “India’s Government Created Covid Disaster

  1. Jay says:

    About not wanting to receive help from China, didn’t India already lift the restrictions on oxygen supply. I read an article about it, will post the link if you’re interested.

    • Mises India says:

      You should have already posted it. And my point was not about India lifting restriction on oxygen supply. My point is what in the world government is doing restricting or not restricting oxygen supply in the first place? Why are they in charge of such crucial decisions? That government involvement is what the root cause of this disaster is. And I mentioned specifically help from China. Did they accept that help? No. Why? Modi’s decision. On what basis? Politics. Not saving lives.

      And do you understand the concept of “cost”?

      • Jay says:

        I tried to post the link, but couldn’t. By the way, the article was about India shifting it’s 16 year policy. I tried many times trying to post the link but couldn’t. If you’re interested, it is an article written by Indian express about India shifting it’s 16 year policy of not importing goods from China.

        • Jay says:

          And about government having the decision, well the constitution is written that way where government will get to decide trade relations outside it’s borders. So the government will justify it on those grounds

          • Mises India says:

            Justification comes from Moral sciences and not some constitution, which has no authority. You probably have no idea what ideas we discuss here.

        • Mises India says:

          What shifting policy? Since Modi came to power he is restricting foreign trade overall. You need to see the ideas in its totality. Don’t cherry pick anything. And try to understand the concept of Cost first. If you knew what it is, you would’ve never made these comments. You are beating around the bush. Focus on the jungle.

    • Mises India says:

      That author misses the whole point. Those hospitals are not private hospitals, but government licensed monopolies. There is nothing private in India. Without government license, you can’t start a hospital or for that matter even a small lemon stall. Because of those licensed monopoly hospitals, there is lack of market and competition which allows those licensed monopoly hospitals to jack up prices when demand goes up. That is a natural response of the market forces. When supply is less and demand goes up, prices will shoot up. The problem is, there is no open market for new hospitals and other health facilities to come in and reduce price and profit share of those licensed monopolies.Blaming the failures of government licensed monopoly socialism on market is always the ploy of such left liberal intellectuals like that author. He, and you also, doesn’t understand Capitalism and free market system.

      And state government and central governments are no different. My article is about the State (aka government) itself. In many places, centre is doing politics with states e.g., Delhi. But that’s not the point. The point is that state socialism is what has created this disaster. Discussing state and centre again misses the whole point of socialism as the root cause of this problem.

      Second, oxygen supply chain issues are issues after all. Mere production is not enough. Things produced must reach their customers on time. The whole point of my article is that only that a market enterprise system will quickly bring oxygen supply from anywhere. Profit motive is that powerful which sends humans on asteroids to get some mineral which sells at a higher price on earth. Bringing oxygen from Gujarat to Delhi will be a no big deal for that system. Unfortunately because Indians have never experienced a true market enterprise system so they can never imagine what wonders it can do. They never try to understand it theoretically also.

      And second wave of Covid is not a surprise. That argument is dubious and a pathetic apology for the murderous statist system. IMA Vice President himself blamed PM Modi personally as a ‘super spreader’ who is responsible for the second wave. When world over countries were experiencing the second wave and at that time Indian government was busy in conducting elections and Kumbh melas.

      The problem with people like that author is that they do not understand economics. They are shameless apologists for the government system. For them government failures never exist. How much more socialist they want India to be?

      • Jay says:

        I think an undue blame is placed on kumbh Mela for second wave of covid. There were also many Muslims celebrating Ramadan and there being lots of crowds during Ramadan too. A more likely problem was/is instituting lockdowns itself. If people have to develop herd immunity, they have to stop conducting lockdowns. It is stupid and counterproductive. Not celebrating festivals, whether it’s kumbh Mela
        or Ramadan.

        • Mises India says:

          You are again beating around the bush. The point is not Kumbha mela or Ramadan. The point is government not following its own diktats or being serious about this disease for which they themselves destroyed the economy and millions of lives.

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