The Covid-19 Ratchet Effects Are Becoming Clearer and More Concerning

On June 24, Centers for Disease Control Director Dr. Rochelle Walensky extended the national eviction moratorium for tenants unable to pay rent through the end of July. First enacted last September, the moratorium hoped to prevent further Covid-19 spread by helping tenants avoid traveling to find new housing or becoming homeless.

The announcement from the CDC’s website indicates, “this is intended to be the final extension of the moratorium.” They have had similar intentions before. As their FAQ on the moratorium notes:

“CDC issued its initial order temporarily halting residential evictions of covered persons for nonpayment of rent on September 4, 2020. That order was set to expire on December 31, 2020. On December 27, 2020, the President signed into law the Consolidated Appropriations Act, 2021. Section 502 of Title V, Division N of that Act extended the expiration date of the CDC Order until January 31, 2021. On January 29, 2021, the CDC Director, Dr. Rochelle Walensky, modified and further extended Order until March 31, 2021. On March 29, 2021, CDC modified and further extended the Order until June 30, 2021” 

But why do we need another extension?

The CDC itself estimates total Covid-19 cases are down 95.5 percent from January 10. Hospitalizations and deaths are in a similarly steep decline over the same period. Nearly half of the US population is fully vaccinated.

Concerns that ending the moratorium will lead to increased homelessness and Covid-19 spread also seem overblown. According to a survey conducted by the Federal Reserve Bank of New York in March, only about 18 percent of the last round of stimulus checks were used to pay necessary living conditions, including rent.

When policy decisions counter common sense, examining political incentives often provides answers. As I wrote with deep concern several months ago, the ratchet effect of Covid-19 policy was beginning to take effect.

As economist and historian Robert Higgs explains in his influential and alarming book Crisis and Leviathan, government power often expands during times of crisis. Sacrificing freedom for (supposed) security, a fearful public allows the government to increase its size and scope over domains of public life in the hope that things will soon return to normal. Eventually, the crisis ends, but government rarely revokes the powers it gained during the crisis.

The CDC gained the authority to prevent landlords from evicting tenants for non-payment of rent and extended its expiration date five times. And this is far from the only example.

Although mainly focused on his infrastructure bill, President Biden is still open to more stimulus payments. Many states continue to provide Covid-19 related unemployment benefits despite reopening and facing a shortage of labor. Travel bans from Europe and the UK continue despite medical research indicating there is a low risk of Covid-19 spread during a flight.

Creating the best post-covid world possible involves more than eradicating the virus. It also requires returning to pre-covid levels of government involvement in our lives. The ratchet effect stands in the way, and it lasts much longer than a pandemic.

Reprinted from The Independent Institute

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