[yawaramin]

> Speaking as an economist, I tend to get nervous when other economists talk about circumstances where "morality trumps economics."

Some examples where morality trumps economics that might help to calm you:

- Child labour is illegal in the civilized world

- Slavery is illegal in all or most countries (despite slave labour being more, um, economical than paid labour)

- Emergency services like fire, police, paramedics don't demand payment up-front.

> Companies can't just push one lever to maximum and expect nothing else to change.

They should expect profits to fall. That can happen during a pandemic. Act of God and all that.

> But most importantly, we don't need it. Yes, we've seen some small-time punks buy up too much hand sanitizer, but the big manufacturers are being decent.

And we should gamble our lives on the continued decency of profit-maximizing corporations.

[nickff]

In many countries, child labor wasn't banned because of moral reasons, it was banned as an anti-competitive measure against un-mechanized factories.

Slavery was enforced (and subsidized) by many governments; it wasn't exactly a creature of the free market. Segregation was similar. Indentured servitude may be a different matter, though it brings up some more complicated questions.

"Not demanding payment up front" has nothing to do with morality; I've gone to many nice restaurants where they didn't charge me up front, and they weren't doing it because they were saints. The history of fire-fighting is also interesting, as it was private for quite some time in many places; insurance companies don't like buildings burning down.

You say that companies should expect profits to fall, but do you expect the companies to drive themselves into the ground (thus leaving their employees unemployed) in an attempt to do a little to help? Most companies spend about 50% of their revenue on labor, and have a profit of less than five percent. That means that a 10% increase in labor costs (think overtime) means they make no money, so they really can't afford to reduce their margins much, and remain an extant firm.

You say we shouldn't gamble our lives on the continued decency of for-profit corporations, but I have more confidence in their ethics than those of the common man. As we saw with toilet paper (and hand sanitizer), the average person will hoard anything they are afraid will not be available tomorrow. Companies have shown more restraint in this crisis and others.

[yqx]

> Slavery was enforced (and subsidized) by many governments; it wasn't exactly a creature of the free market.

Chicken or egg. You can make this argument either way. The fact is that slavery has been around for a lot longer than the governments that "enforced" it and it eventually took governments to abolish it completely.

> As we saw with toilet paper (and hand sanitizer), the average person will hoard anything they are afraid will not be available tomorrow. Companies have shown more restraint in this crisis and others.

Luckily in a well functioning democracy it would not be the toilet paper hoarders that'd be charged with coming up with ethical legislation.

It's not either or. Legislation doesn't solve everything, but neither does a completely free market (which doesn't and couldn't exist anyway).

[yawaramin]

> In many countries, child labor wasn't banned because of moral reasons, it was banned as an anti-competitive measure against un-mechanized factories.

OK, then child soldiers. Or chemical weapons. Pretty much anything outlawed by the Geneva Convention–all economical ways to wage wars, trumped by morality. Not as anti-competitive measures against killer robots.

> I've gone to many nice restaurants where they didn't charge me up front,

Restaurants also typically don't risk their lives for you, so not really relevant.

> You say that companies should expect profits to fall,

That's what I said.

> but do you expect the companies to drive themselves into the ground (thus leaving their employees unemployed) in an attempt to do a little to help?

That's not what I said. It helps if you stick to what I actually said.

> Most companies spend about 50% of their revenue on labor, and have a profit of less than five percent.

We're not talking about most companies. We're talking about big industrial PPE manufacturers like 3M, which reported net income of about $5b dollars in 2018, and because of accounting tricks,[1] probably under-reported their income. They have a profit margin of about 50% for at least the past five years.[2]

> That means that a 10% increase in labor costs (think overtime)

We're not talking about a uniform, across-the-board 10% increase in labour costs, we're talking about targeted cost increases specifically for PPE manufacture.

> they really can't afford to reduce their margins much, and remain an extant firm.

Based on the actually relevant numbers, it looks like they'll be just fine.

[1] https://www.forbes.com/sites/greatspeculations/2020/02/26/hi...

> You say we shouldn't gamble our lives on the continued decency of for-profit corporations, but I have more confidence in their ethics than those of the common man.

I'm just curious, who do you think makes up these for-profit corporations, some kind of special saints? As opposed to 'common' people?

[2] https://ycharts.com/companies/MMM/gross_profit_margin

[lxmorj]

Your penultimate point doesn't address that this isn't about expectations. It's asking companies to actively cause their own profits to fall. Raw material prices are being bid up - but even assuming you fix those prices somehow - you can't price fix labor prices while scaling up. Most production companies can't scale without running OT or hiring new employees, both of which will drive cost-per-unit up significantly. In a competitive industry, it's not crazy to think the difference between profitable and unprofitable is less than the increase cost of overtime pay.

3M may be large enough and have enough similar production lines that they can shift production around and still make a marginal profit on the scaled up production, but that's not a given. Smaller companies or more specialized ones would have to decide to increase production to their own detriment. Some might do that out of goodwill, but your last point correctly calls that out for the gamble it is.

[yawaramin]

> Smaller companies or more specialized ones would have to decide to increase production to their own detriment. Some might do that out of goodwill, but your last point correctly calls that out for the gamble it is.

There is no gamble here. Maybe you're misunderstanding the article but again here is what it says:

> Ordering large supplies at fixed prices is the right policy.

Emphasis: ordering is the suggested policy. Not forcing companies to fill orders. Companies able to fill those orders will do it because those are the only orders that make sense for their scale. Small companies unable to ramp up production will produce what they can and fill smaller orders that make sense for their scale.

[kortilla]

Slavery isn’t a good example because that requires government enforcing the ability for people to own people as property.

[mytherin]

That makes no sense. People can enslave others without any "government" being involved, and they have done so for thousands of years. The people enslaving the others just need bigger weapons so the slaves cannot revolt.

Government can prevent people from being enslaved. But without a government being involved, slavery will still happen. In fact, it will happen much more often as is evidenced by the fact that modern day slavery happens primarily in countries where governments are not powerful enough to stop it.