Intervention won’t lead to economic recovery
More government actions will make it harder to emerge from downturn
As the economic costs of the Covid-19 shutdown begin to add up and our state begins to reopen, it will become increasingly important for policymakers to start looking at ways to rebuild the booming economy we had just eight short weeks ago.
New Hampshire has now received over 183,000 initial unemployment claims since March 15. Some businesses around the state are locking their doors for good, while others desperately hold on to what they’ve spent their lives building. Employees sit home, anxiously waiting to return to work safely.
The shape of the recovery will depend mainly on the government’s actions moving forward.
Government orders are solely responsible for this downturn, that much we know. The stay-at-home orders mandated businesses close, temporarily, in the name of public health and safety. These orders ground our booming economy to a near halt and caused Great Depression levels on unemployment rolls.
It will not be through government intervention that we recover from this disaster, though. Policymakers must be wary of well-intentioned policies that have unintended consequences.
For example, an increased minimum wage at this time would undoubtedly put more money into a few pockets, but would leave many others empty. New hires and those able to earn employment would benefit. Their benefit would come at the expense of those unable to find jobs at the newly increased cost. These policies would undoubtedly hurt the very people it intends to help. The low-skilled and entry-level workers would remain on the sidelines.
Cash-crippled businesses cannot afford an increase in the costs of doing business, which would prolong the recovery we all desperately need right now.
Any added restriction or regulation to businesses would have a similar effect. It sure sounds nice to be promised family medical leave insurance, mandatory paid sick time, or expanded workers compensation. Enacting these policies would make it more difficult, not less, to employ Granite Staters.
Policymakers must instead focus their attention on areas where barriers can be removed or reduced. Legislators can repeal the employer tax increases set to take effect as a result of this crisis as a straightforward first step. Businesses should retain their hard-earned money and use it to revamp, reinvigorate and renew, instead of handing it to politicians and bureaucrats to squander.
The government suspended many regulations during the virus. Legislators can and should repeal or modify these regulations, decreasing restrictions on enterprise. Allowing restaurants to continue take-out beer and wine sales, for example, removes a barrier to revenue that will grow our economy. Policymakers must examine more regulations to see if they prove to be an unnecessary hurdle that stifles growth.
Further, policymakers must examine licensing in the state at all levels. They should strive to reserve barriers to entry for only the most critical industries and services. No one wants to get operated on by an unqualified surgeon, but increasing restrictions for barbers, hair-braiders and estheticians doesn’t make sense.
The government must get out of the way if it wishes to get the unemployed back to work. Removing barriers will afford the jobless more avenues to retain employment and attain the American dream.
People across the state and country are hurting right now. It will be tempting for policymakers to lean into policies to help them, to care for them. The best thing the government can do to enable a strong recovery, though, is to get out of the way. Granite Staters are resilient – we can and will pull ourselves out of this depression. The government must allow us to do so.
Christopher Maidment of Peterborough is a small business owner and candidate for state representative.