Coronavirus

Black Markets in COVID-19 Vaccines Were Inevitable Once Government Got Involved

A politicized vaccine distribution process intended to take price out of the picture has given the edge to the rich, connected, and powerful.

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In the U.S., a botched and politicized COVID-19 vaccine distribution process seems to be fueling a black market in vaccines.

Anyone with knowledge of their fellow humans could have seen this coming. Limited supplies and controlled distribution of a product in high demand incentivize people to jump the line, or to make money by offering to help others do so.

"There absolutely will be a black market," New York University bioethicist Arthur Caplan commented at the beginning of December. "Anything that's seen as lifesaving, life-preserving, and that's in short supply creates black markets."

Caplan spoke well before government officials—who have monopolized distribution of the Pfizer and Moderna vaccines and purchased billions of dollars' worth of doses—dropped the ball on getting the stuff into Americans' arms. The vaccine has been in short supply as only something handled by government agencies can be.

"It was a planning error and I am responsible," U.S. Army General Gustave F. Perna, chief operations officer for the Trump administration's Operation Warp Speed vaccine program, said in December after state governors complained of a shortage of inoculations. Perna had to say something after Pfizer officials made it clear the problem wasn't on their end.

"This week, we successfully shipped all 2.9 million doses that we were asked to ship by the U.S. Government to the locations specified by them," the company revealed in a December 17 press release. "We have millions more doses sitting in our warehouse but, as of now, we have not received any shipment instructions for additional doses."

To be fair, states and localities contributed to the massive screw-up.

New York Gov. Andrew Cuomo threatened providers with penalties if they let anybody jump the government-mandated line for shots, but also promised to slam them if doses were wasted because of inability to meet the criteria. "Cuomo presented area hospitals with a double bind: Fail to use all of your vaccines and be fined up to $100,000, or vaccinate people out of order and be fined $1,000,000," Billy Binion noted for Reason.

In Florida, state and county online reservation systems crashed and phone lines booted those who sought to make an appointment to receive the vaccine. "Due to overwhelming demand, we have reached capacity with our COVID-19 vaccination for the community," the Broward County Board of Health announced on December 30. "Scheduling will resume in the coming weeks."

In the end, federal promises of 20 million vaccinations administered by the end of the year were off by a lot, with the actual number just over 2 million.

But there were people who had no trouble getting their doses: politicians. Members of Congress—regardless of their ages—were among the first to be offered the vaccine.

At the end of December, The Washington Post interviewed a medical resident who "watched with frustration last week as inoculations were administered to scores of government leaders … while she and her colleagues were initially left unprotected because their hospital had received fewer than 1,000 doses of the scarce resource."

As it turns out, if you're going to have a political process for distributing a scarce resource, politicians who command that process can prioritize themselves over everybody else. The supposedly "fair" system of government distribution gets gamed very quickly.

"The argument for free markets is not that they are perfect," points out economist John Cochrane. "The argument is that the known alternatives are much worse. And we have seen a catastrophic failure of government at all levels around the world to handle this pandemic, especially in delivering tests and vaccines."

Cochrane believes governments should have got out of the way of companies that could have sold people what they need to deal with the pandemic, including vaccines. "The government could buy too," he offers, but "allowing the vaccine to go to the highest bidders—and allowing people to get it at CVS or administer it themselves—would have rolled vaccines out much faster."

We got politics instead. But prices find a way when governments can't deliver—which is pretty much always. Caplan's prediction that "there absolutely will be a black market" was right. It's not just politicians cashing in political capital—it's plenty of people with old-fashioned cash.

"At least three South Florida hospital systems—Jackson Health, Mount Sinai Medical Center and Baptist Health—have already reached out and offered vaccines to some donors in advance of the general public," the Miami Herald reported in early January. David S. Mack, the chairman of a Florida nursing home, reportedly arranged for wealthy friends—some who flew in on private jets from New York—to get shots ahead of the pack.

A politicized vaccine distribution process intended to take price out of the picture has given the edge to the rich and powerful.

When people willing to operate illegally enter the market for scarce goods, they seldom stop at breaking one law. Vaccine doses are now being stolen, presumably for resale. Just before Christmas, New York officials claimed a provider "may have fraudulently obtained COVID-19 vaccine, transferred it to facilities in other parts of the state in violation of state guidelines and diverted it to members of the public."

In the Philippines, smuggled vaccines have reached not just the politically potent, but also the large numbers of workers in the country who have connections to China, from which inoculations are smuggled. "The vaccine could fetch between $200 and $300 on the black market, presumably for both doses," according to The Washington Post.

As is often the case in underground markets, though, there are questions about the purity and efficacy of illicit products. That's been the case in the Philippines, and there are now reports of scammers offering very likely counterfeit vaccines in the U.S.

Markets move in to make up for the failures of government-controlled systems and their artificial restrictions on supply. But they work at their best when allowed to operate openly and aboveboard, not in the shadows. By trying to keep prices out of vaccine distribution, officials hobbled the system for getting shots into people's arms. They also guaranteed that price would get involved anyway, but with a host of unfortunate complications.

NEXT: Brickbat: It's Science

Coronavirus Vaccines Public Health Government planning Government failure Free Markets Black Markets Economics Federal government Health Care Central planning Price controls

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82 responses to “Black Markets in COVID-19 Vaccines Were Inevitable Once Government Got Involved

  1. >injecting anything from the black market
    Yeah, I think you’re hyping this up. I’m not gonna inject myself with something is some syringe that a dude handed to me.

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  2. Trust us, we’re from the government… You can trust us to FUCK IT UP!

    (Government Almighty forbid we should leave ANYTHING to be done by free people in free markets, making their own free choices… Because, OMG, someone might MAKE A DOLLAR$$$!!! And we all know, money is the root of all evil… EXCEPT when Government Almighty moves it around!)

  3. Just before Christmas, New York officials claimed a provider “may have fraudulently obtained COVID-19 vaccine, transferred it to facilities in other parts of the state in violation of state guidelines and diverted it to members of the public.”

    Absent government involvement, the provider could have obtained the same vaccine and distrubuted it to the same facilities and made a nice profit which he could keep. Better still, Bill Gates could have bought up the entire supply of vaccine and distributed it to those he thought most deserving of it.

    1. But somebody buying up alot of a good just encourages more production. And we only want the correct people to have access

      1. Why bidens solution is to commandeer industry instead.

    2. Bet the provider had a less spoilage rate than Cuomo’s government sanctioned ones did.

  4. Well, as of today, government control is the new normal.

    Just to add an historical note, in the late seventies, there were no long gas lines until the day after the government price controls went into effect.

  5. Andrew Cuomo is doing his part to kick-start the black market by attempting an end-run around the federal government and offering to buy the vaccines straight from the manufacturer. Just like early in the pandemic when he demanded that the federal government hand over every single one of their stockpiled ventilators (and still bitched that that wasn’t enough), demanded the federal government order other states to hand over their stockpiled ventilators just so that New York could stockpile them in case they were needed, Cuomo doesn’t give a fuck about anybody in any other state other than New York, they can all just fucking die as far as he’s concerned. He wants 40 million doses of the vaccine and he wants them right fucking now, no matter how many of them will wind up in the garbage and no matter how badly anyone else may need them.

    1. But it looks like Cuomo’s actions have led to him being beloved by the media. And we wonder how pond scum manages to float to the top.

      1. Well, it’s not like he has the highest per capita Covid death rate of all the states. Just the 2nd highest.

        1. Only because NJ is so close to NYC. I give Cuomo credit for both states.

      2. That analogy is an insult to pond scum.

        1. LOL! 🙂 Amen to that!

      3. pond scum manages to float to the top.

        Shit floats too. Either analogy is apt.

        1. Depends on the shit.

      4. He did win an award, proving that he is the best at acting like he cares on TV.

    2. This is the same dipstick that took out a vaccine vial during one of his media fluffer press conferences–a vaccine that has to be stored at -92 degrees Fahrenheit and becomes useless after being out of storage for 30 minutes.

      1. Also, it’s important to keep in mind that all the ventilator hysteria happened AFTER reports had already come out about the massive mortality rate of people being put on vents. A couple months later, the media quietly noted that doctors had quit putting people on vents unless as an absolute last resort, because they were literally killing people by trying to stick every one of them on a vent.

        The science didn’t matter to these fuckbag governors or media whores, and it still doesn’t–they just wanted something to bash Trump about.

        1. That is a bit harsh don’t you think. People with severe covid pneumonia have very low pO2 levels which would be alarming in other conditions. Radiology shows lungs filling up with gunk and quickly.

          Turned out standard treatments were less effective than noninvasive measures like CPAP and prone positioning or lower pressure vent settings if you have to go there.
          Don’t forget many of these patients develop other secondary pneumonias or pulmonary edema so it can be a very tough call.

          1. No, it’s not harsh at all. These people in WeFuckingLoveScience! Land are always happy to talk shit about how much they Fucking Love Science!, but when real, actual science was available, they punted because they were listening to the idiots in the media instead of science.

            These doctors literally killed thousands due to their negligence.

    3. “Cuomo doesn’t give a fuck about anybody in any other state other than New York,”

      And there are a whole lot of people in New York he doesn’t give a fuck about either.

      1. He doesn’t give a shit about anybody in NY. He just loves power boners.

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  7. Vaccine black markets? Not after today. President Biden will #ShutDownTheVirus.

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  9. Pfizer vaccine has to be deep frozen.What smuggler is going to invest in such a device.It and Moderna has a shelf life of hours after being mixed so you have to be able to give the vaccine in 6 hours.

    1. Nobody said the black market boys were going to give you the real deal.

      1. ^This^

        I suspect most black market “vaccine” is probably just saline solution or worse.

        1. but it’s still 80% effective at preventing symptoms, similar to one dose of the real vaccine

  10. Anyone with knowledge of their fellow humans …

    Well that rules out anyone who works in government at any level.

    1. Do you ever listen to yourself? Do you never wonder where things went wrong in school for you to believe the sweeping, mindless generalizations you actually believe? Or do you know precisely when that was?

    2. Read Machiavelli.

      1. I had machiavelli for dinner last week. It was delicious. The trick is add fresh basil to the tomato sauce.

  11. I think you people with your ridiculous nonsensical arguments are incentivized to have asshole morons in government instead of competent people. I only say that because I don’t believe you’re emotionally mature enough to handle being proved wrong, so you’ll take being proved right and call it a win. It’s why your absurd headlines and idiotic libertarian griping can’t seem to tell the difference between a government that fails to control a pandemic while it puts all its resources into protecting the delicate feelings of a stupid fat mental case and one that doesn’t do that shit.

    1. I’m not exactly sure what you’re lashing out at but how do you see a crowd of people clamoring for a product on one side, the free market producing oodles of that product on the other side, and government standing in the middle doing it’s damnedest to prevent the flow of desired goods and then lay the blame squarely on libertarians for calling out that failure?

      If you believe that the first priority should be to get as many doses of the vaccine out to as many people as possible in the shortest amount of time, why not just let the pharmaceuticals sell the vaccine on the open market for whatever price they think they can get for it?

      1. My argument is they are already putting it out as fast as they can. It has nothing to do with price. You can pay LaBraun 4x as much but he won’t play basketball any better.

        The problem is the government botched the rollout and covered it in red tape. Maybe they should have just put fedex, Amazon and UPS in charge. That would have been a market solution.

        The government could still pay them and for the vaccines. That is immaterial to me. All I want is to kill this bug and get this crap over with as soon as possible.

        They also seem to have failed in communication with the providers. This could all have been set up day one.

    2. For someone who’s winning, you whine like a little bitch.

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    3. I agree. The CCP totally failed in controlling the virus and Xi Jingping IS a stupid fat mental case.

      1. You said something right, except Xi isn’t stupid, unfortunately for Trump who lost the trade war he started with him.

        Why did he do that? Why did he convince you that a virus has a nationality? Is it because you’re using your chimp brains instead of your people brains, which can’t see threats if they’re not in the form of another monkey who looks slightly different from you?

        1. Viruses had traditionally been named after the place they came from.

          1. Not the convention anymore.

            Also Trump doesn’t know that.

      2. I have to agree with Tony on this one. One thing you don’t want to do is underestimate Xi and the Chinese. They are far from stupid.

  12. Members of Congress—regardless of their ages—were among the first to be offered the vaccine.
    How much karma would it take to start seeing bad side effects in 3 months?

    1. I actually don’t have a problem with them signing up to be human guinea pigs. In fact we should encourage them to do so more often.

    2. Pfizer began phase 2 in April. I think we would know by now. Besides a delayed long term reaction like that hardly seems possible.

      I think it is good they did this. It sets a good example for people.

      When they get enough for the general public there should be a PR campaign to encourage people.

      1. Yes, I look to Congress critters for encouragement in all my life decisions.

  13. Yeah, should have just let the drug companies distribute the doses. Governments could give grandma and health care workers a priority card and a voucher for same day appointments.

    1. Walgreens CVS and I think Walmart will be giving it. I saw Walgreens already has it up on their website.

      They already do testing.

  14. What under 65 pussies are going to get any vaccine for the Kungflu?

    I dont wear a mask and wont get a vaccine for a virus that is less dangerous than the Flu for me. I dont get a Flu vaccine either.

    1. SleepyJoe gonna force it on you if you want to travel , or go to the store, or have a bank account probably.

  15. The problem isn’t government making the purchases and distribution. Only government has that kind of clout. This is a public health crisis and we are all sick and tired of it. It is one of the things you would want a limited government for.

    The problem is it is OUR government doing it. They are doing it horribly. There is no plan. They had a year to figure this out.

    This is a reason why you don’t want universal health care here. That works fine in some places. We always seem to screw up and make things worse.

    1. Sticking by my long held assumption that it can work as long as you don’t elect Republicans.

      For the same reason you don’t hire a nanny who hates children. Or a lawn guy in a wheelchair.

      1. When you see every problem as partisan politics you are not going to solve any of them. This has nothing to do with that Tony. Amazon can get me anything in two days. It is a matter of communication and logistics.

        1. I was an independent thinking nonpartisan once too. Then I realized all it got me besides a sense of superiority was a lack of a right to vote in any primaries.

          I happen to live in a time when the Republican Party is the biggest immediate threat to human survival. That they also take every possible opportunity to shit on minorities and steal public wealth in the name of freedom is just contributing to a theory of how evil and stupid go together.

          My partisanship is somewhat ironic but also rational. Because it’s not about the shirts vs. skins, it’s about two ideologies that are on offer to control the most powerful force in the world, and one of them doesn’t believe in science.

          1. I present to you: RDS – Republican Derangement Syndrome.

            Get a grip, Tony. At least we know youre scared now. And partisan. And also not a scientist.

      2. Do you ever listen to yourself? Do you never wonder where things went wrong in school for you to believe the sweeping, mindless generalizations you actually believe? Or do you know precisely when that was?
        In response to Tony.
        The irony is thick as his skull.

  16. AND WHO politicized the COVID-19 vaccine. one guess and it wasn’t Trump

    1. Robert Kennedy?

  17. Right cause keeping the gov’t out of it would so keep the rich out of the equation

    stupid

  18. Why won’t the FDA approve Ivermectin for prophylaxis? If it’s proven to keep the protein spike from adhering, what’s the problem? If the virus cannot adhere to cells, it can’t do any harm. It’s an old and much cheaper option.

    1. Have you ever known the government to go with the cheaper solution?

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    2. So far as I know it has never been tested for prophylaxis. It has hardly been tested for symptomatic covid although I have seen reports that some trials are ongoing.

      It does inhibit replication in the lab but only at very high concentrations from what I have found. This could be a problem in actual use as it would require many times the known therapeutic dose.

      Also the vaccines are being sold to governments between 20-38$ per dose which is cheap and they have proven effectiveness.

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  20. Seems like a good idea would have been to charge the wealthy exorbitant sums ($100k/person?) in order to jump to the front of the buy-your-way-in line. That could have been just 10% of the initial batch. The other 90% would have gone to the responder-and-those-in-need line. The only downside would have been some idiot (who believes they are going to die) spending their life’s savings for the vaccine. The upside is that politicians, movie stars, athletes would have had to pay for the vaccine as opposed to getting the vaccine for free from some worshiper.

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  22. “Dropped the ball getting the stuff into Americans’ arms” the way you guys write is so basic.

  23. How protected am I after the first shot alone? Doctors say there is likely some protection from the first shot but, as the majority of participants in the Pfizer and Moderna vaccine trials received two doses, there isn’t yet enough data to say definitively how much protection and how long it lasts… laso tea healthenergyguru.com

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