Templeton Times: What Governors Can Do

Friday, April 10, 2020

What Governors Can Do

April 10, 2020

Which state has the courage to become the Sweden of the US, and take a different (read: better, freer) approach to coronavirus?
As of yesterday, five US states remain at least reasonably “open” in terms of their implemented measures to fight the pandemic. Arkansas, Nebraska, and South Dakota have no state orders in place closing businesses and forcing residents to stay home, while Iowa and North Dakota shut down
“nonessential” businesses but have not issued stay-at-home orders.
Three states, Oklahoma, Wyoming, and Utah, have partial lockdowns in place.
The other forty-two states have varying orders in place, and some regions such as the San Francisco Bay area have issued their own stricter shutdown policies. Population-wise, nearly 95 percent of all Americans today live under some kind of restrictions on movement and business, decreed either statewide or by counties and cities.

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There is a tremendous opportunity here for state and local politicians to distinguish themselves. South Dakota governor Kristi Noem in particular has been steadfast in resisting political pressure to order a statewide lockdown, and surely most Americans readily understand how sparsely populated Western states might approach a pandemic very differently than big urban cities.
What should that approach look like? Here are some broad brushstrokes:

First, one brave governor (or county supervisor, mayor, etc.) gets the ball rolling by forming an impromptu coalition of states interested in staying open or reopening. Political pressure to go along with other states is strong, and the federal government has a long and sordid history of bullying states into compliance with national edicts using the carrot and the stick. The Trump administration thus far has been surprisingly reluctant to issue a nationwide shutdown, and governors looking for daylight should seize on this. They will need each other to stand against the tide—see, e.g., this broadside, against Noem.
Hold a press conference to announce the coalition, pick a marketable name for the effort (something like “South Dakota—Open for Business!”), and hold weekly calls open to media. Discuss conditions, options, and ideas, but make it clear that each state is wholly independent and that decisions are necessarily localized—this is not an interstate compact.
Announce guidelines, not orders, to citizens along these lines: people over seventy are strongly encouraged to self-quarantine in a strict manner. Those over fifty who have existing medical vulnerabilities to the virus are encouraged to do the same. Healthy people under fifty are welcome to return to daily activities but are strongly encouraged to wear masks (proven to be effective in several Asian countries). Of course many residents will self-quarantine regardless, and some businesses will choose to shut down regardless, per their individual choices.
Reopen government courts, and set a deadline of sixty or ninety days hence for resumption of contract enforcement (including evictions). Ask the state bar association to set up statewide centers for landlords and tenants to meet and renegotiate—using realistic numbers—rental agreements. Hard-line landlords can go to court, and hard-line tenants can refuse payment, but evictions benefit neither party in the immediate term.
In stages, reopen public schools and universities based on local conditions. Hold parental votes online to determine whether each school district will continue online classes or revert to physical attendance.
Announce that restaurants, bars, and retail outlets are open as usual, with the strong caveat that provable cases of virus transmittal will be heard in state courts under a broad doctrine of premises liability. This will encourage the kind of measures by owners that have been seen in Taiwan and Singapore, ranging from using digital thermometers at store entrances to relentless scrubbing of surfaces in restaurants.
Immediately bid out a statewide insurance claims facility for coronavirus deaths so that in worst case scenarios families will be compensated for loss of loved ones. Insist that payments are retroactive to cover deaths prior to the bid, and use the model of airlines after crashes (quick payouts, little paperwork, claims personnel with good bedside manner). Payouts of $1 million would not be impossible to insure against in low-population states, where deaths likely will remain well under five thousand. Insurers themselves can go to the reinsurance markets, and insurance companies would have every incentive to test, treat, and take measures necessary to keep citizens alive. They would become de facto partners when it comes to securing medical equipment, hospital beds, and personnel. Insurance companies also would have a strong incentive, unlike politicians, to determine what constitutes death “from” the virus as opposed to death with the virus simply present in the body. Use bond revenue (discussed below) to cover premiums.
Immediately bid out to pharmaceutical companies for a supply of hydroxychloroquine, azithromycin, and other promising drugs. Eliminate unnecessary state restrictions on prescribing and dispensing such drugs, and consider making them available over the counter until infections subside. Distribute them widely across the state, and charge break-even (cheap) prices for generic versions.
Issue state bonds for sale to private equity investors, hedge funds, foundations, and individuals. Take a deep breath, and secure them with real estate owned by the state—make government, rather than taxpayers, sacrifice for once! Price them aggressively, with higher than market rates of interest (but not junk bond rates). Make these bonds nontaxable by the issuing state itself, both with respect to income and capital gains. Use the funds to provide insurance, medical equipment, hospital capacity, testing centers, and protective gear as needed.
Encourage regional airlines, or major airlines serving the state, to relocate aircraft there and resume “domestic” flights (and/or flights between “open” states).

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None of these ideas is particularly difficult to implement per se, but do any governors have the political will to do so? They should if they take an honest look at the landscape of a country that is coming unglued. Every day there is less and less to lose by trying something different. In a crisis, bold usually wins. So the choice at present appears to be bold freedom or bold tyranny.
Americans are reconsidering federalism and even nullification in an era of intensely polarized anti-Trump sentiment. The Left argues for soft secession in the form of “Bluexit” from the hated red states; conservatives such as Angelo Codevilla call for strategic defiance of the feds in what he terms a “Cold Civil War.” Golden State governor Gavin Newsome even recently referred to California as a “nation-state,” and why not? With 40 million people, a huge economy, tourism, Hollywood and Silicon Valley, ports and coastlines, and major universities, not to mention beaches, deserts, and mountains, the state easily could be an independent nation.
We were already in uncharted territory, but the coronavirus truly laid bare the deep and intolerable political divisions wracking our country. Governor Noem and others could begin the healing process now, literally and figuratively, by showing us a way forward without DC. The virus could be the catalyst for a new map of America.