Death By Government In Kentucky

What’s the Proposed Solution? -- More Government!

by Theresa Fritz Camoriano

In The Courier-Journal, we have recently been reading detailed studies of problems caused by Kentucky’s state government.  First, we learned that the state agency charged with the job of monitoring the safety of mines is not doing its assigned job properly, leaving miners and entire communities at risk, sometimes with deadly results.  Second, we learned that people in rural areas are suffering from a lack of nearby medical facilities, largely due to a state law that prevents new facilities from being built as long as existing facilities are not close enough to capacity.   Both of these situations result in death by government.  It is clear in each case that government interference with the free market is doing great harm.  So what is the proposed solution?  Why, more government, of course!

But how can we realistically expect government to solve the very problems that its interference has created?  If we are going to be realistic, we have to accept the fact that there are limits to the things that government can do effectively, and there are limits to the things that government should do in a free society.  In both of the aforementioned cases of death by government, a free market solution would be much better than the situation we currently have. 

In the case of overseeing mine safety, this simply is an area for which government is not well equipped.  Government officials can be influenced by mining companies to look the other way, or they can be too concerned about covering themselves and set excessively high standards, neither of which is good for miners or the economy.  Since the government officials are not financially accountable for their errors and are not operating in a free market, there are no market forces pushing them to provide the right amount of oversight.  On the other hand, a private, voluntary certifying organization would be much better at ensuring reasonable safety in mines, just as UL ensures the safety of electrical appliances without government involvement.  Mining companies could seek to be certified by the independent organization (or organizations), which would have to set reasonable standards and would have to back them up in order to stay in business.  If the standards were too strict, the mining companies would look to another organization to do the job, and, if the standards were too lax, the certifying organization would promptly go bankrupt, because it would be held financially liable for accidents caused by its negligence. 

Most miners would refuse to work in a mine unless it was certified by a reputable organization, which would push the mines to be suitably certified.  This arrangement would provide a reasonable amount of safety and would not be prone to overregulation or underregulation as occurs with government agencies.  Also, there would not be a blind faith in the certifying organizations as there currently is with government, which would be very healthy.

With respect to building new hospitals, the current state law is simply government protectionism for existing businesses.  One of the best forms of protection for consumers is free market competition, and that is just as true for medical care as for restaurant services or television sets.  When there is free competition, businesses must compete to offer consumers the best products and services in order to prosper.  The current law harms consumers by preventing competition.

Although elected officials may claim that this type of law is necessary to “protect” the public, that plainly is hogwash.  Regular old folks almost always get hurt when they are “protected” by the government from free market competition.  If Jewish Hospital or another company wants to risk its money to build a hospital, bringing medical services closer to those who need them, we should applaud its effort, not support our government standing in the way.  And if another hospital is put out of business because consumers believe its competitor is doing a better job, that’s just the way it goes in a competitive market, where consumers are king. 

Can you imagine if you wanted to open a restaurant but were told that you could not, because the other restaurants in the region were operating at less than 85% of capacity?  And can you imagine what the quality of restaurants would be like in that kind of protected market?  That would clearly be ridiculous.  The protection of hospitals from competition is equally ridiculous.  For some people in Kentucky, it is a matter of life and death.