The European Politics of Covid-19 Did markets or the state fail?

• Author: Issing, Otmar

For those on the left of the political spectrum, the pandemic has delivered the proof: the market has failed. When the pandemic began, there were not nearly enough face masks available; now sufficient supplies of vaccine have not been secured in time. This position turns the issue upside down in an almost grotesque manner. Being prepared for the eventuality of a pandemic, something the World Health Organization had warned about for a long time, is clearly the responsibility of the state. However, there was scarcely time to lament a shortage of masks before the markets responded to the new situation with incredible speed. Numerous companies converted their production capacities. Instead of shirts or other clothing, they manufactured masks. A large number of individual producers also played their part in boosting the supply of face coverings.

The development of a vaccine to combat the new virus must go down as one of the most impressive demonstrations of the market's capabilities. Who would have thought that this feat could be achieved so quickly? How was it possible? The story of the two researchers at the helm of the German company BioNTech can serve as a prime example. In an interview, the couple explained how, one morning over breakfast at the start of the pandemic, they came up with the idea of immediately shifting their research, which had been geared towards fighting cancer, to the hunt for a coronavirus vaccine. Companies around the world reacted in a similar way to the outbreak of the pandemic. The starting gun had sounded for a global race to find a cure for this disease that threatens all humanity.

What more striking proof could one find for Nobel laureate F. A. Hayek's thesis of the market as a discovery process? In order to participate in this competition to find a vaccine, massive capital investments were required. The risk of failure was huge. Large losses would loom in the event of failure; the capital invested would be lost. It takes entrepreneurial courage to weigh the risk against the chance of success. This is precisely what happens in a dynamic market economy.

Yet no sooner has the market economy proven its efficiency, than calls can already be heard for the new vaccine to be declared a "public good." The vaccine is not a commodity like any other, these voices argue, and should not be protected by patents for the sake of private interests. Is it not downright indecent, in their eyes, to seek to earn money with a product...