“The extraordinary government clampdown on economic life that we are enduring — in order to preserve hospital beds and the capacity of doctors and nurses — is the result, not just of the coronavirus, but of the severe restrictions on economic activity that have made our economy brittle and poorly-suited to adapt and respond to this natural emergency.”

That’s the important point economics professor Raymond Niles makes in a brief essay for the American Institute of Economic Research.

Governments are ordering business closures and social distancing to ration hospital beds and other health care resources for which previous government regulations had created supply shortages.

Niles cites state Certificate of Need laws, which ration health care resources by requiring state approval before providers can offer new services or buy new equipment, CDC and FDA regulations that have limited the supply of personal protection equipment (PPE), and licensing laws that prohibit doctors and nurses from working in other states.

“This is the context in which we face the coronavirus and it sets the stage for the subsequent choices we must make. Our government is not making the right choice of repealing these death-causing restrictions. It is only doing it in small, halting ad hoc steps and on a completely inadequate basis. The only proper choice for the government is to repeal all of these controls, or as many of them as possible, as quickly as possible.

“If the government did that, the explosion in entrepreneurial activity — in production of tests, vaccines, cures, hospital beds, innovative new treatments, and an abundance of PPE and other life-saving equipment — would be monumental and it would save thousands of lives.

“We are getting some of it, as doctors, entrepreneurs, manufacturers, and everyday people, with shackles on and maybe in some cases partially removed by government, struggle and produce. But we could be doing so much more.”

The shortage of PPE, ventilators, hospital beds and medical professionals has shown the need to reexamine reams of laws and regulations that have caused delays in responding to the coronavirus. New Hampshire legislators and regulatory boards ought to be making lists of such laws and rules to address as soon as possible.



On April 1, rents were due for the first time since Gov. Chris Sununu declared a state emergency on March 13. News organizations reported on Granite Staters struggling to pay rent after suffering significant income loss in March.

As communities come together to help each other through these difficult situations, it’s important to understand that renters in New Hampshire have been squeezed for decades by a problem identified years ago and never fixed: government-inflated rental rates.

Emergency aid and help from caring communities can provide short-term relief during the next few months. But long-term rent relief can come only by addressing the apartment shortage created by local government regulations. 

In 2002, a legislative commission created to study workforce housing concluded that local government regulations were making rents unaffordable for many families. (The commission’s report was titled “Reducing Regulatory Barriers to Workforce Housing in New Hampshire.”)

“Individual communities, each acting in its own economic self-interest, have disconnected the State’s local housing markets from the rest of our economy and created an artificial scarcity that has driven prices beyond the reach of a large and increasing number of working families,” the commission found.

In 2008, the Legislature tried to provide relief by passing a workforce housing law that required municipalities to create “reasonable and realistic” opportunities for workforce housing. 

Twelve years later, rents are still rising as municipal housing restrictions have continued to strangle the supply of rental units.  

Data collected by the New Hampshire Housing Finance Authority illustrate the problem. 

The average rent for a one-bedroom apartment in New Hampshire rose from $587 in 2000 to $1,055 in 2019. Had rents risen at just the rate of inflation, the price would be $871, or $184 less than the 2019 rate. 

The average rent for a two-bedroom apartment rose from $774 in 2000 to $1,347 in 2019. Had rents risen at just the rate of inflation, the price would be $1,149, or $198 less. 

Saving $198 a month on rent would come to $2,376 a year. Some people who can’t pay rent this month because their hours were cut or their employer closed might have been able to cover a payment that was $184 or $198 cheaper.

As the 2002 legislative report noted, rents are being pushed up by local government regulations that have created an artificial scarcity in the rental housing market. For decades, demand for apartments and multi-family homes has far outstripped supply. Not enough rental units are being built because local governments have made it extremely difficult to build them. 

That inescapable fact is reflected in the state’s shockingly low rental vacancy rate. A healthy apartment vacancy rate is around 5 percent. New Hampshire’s rental unit vacancy rate in 2019 was 0.6 percent. The rental vacancy rate for the United States at the end of 2019 was 6.4 percent, according to the Federal Reserve Bank of St. Louis. 

New Hampshire renters have been burdened for decades by regulations that have prevented the supply of rental housing from matching demand. In boom times, restrictions on the construction of rental housing give the appearance that growth is being limited at no cost. But the cost is always there, and it hurts the most during times like this when thousands of people are losing their jobs or having their pay reduced.

If New Hampshire communities want to be places where everyone can find a home, the supply shortage will have to be addressed.

Here’s a surprise. In New England, only the Republican governors of New Hampshire and Vermont have issued COVID-19 executive orders that direct all individuals to stay home unless otherwise allowed to go out.

That finding comes from a review of all of the New England governors’ executive orders that restrict travel and business activity.

To try to “flatten the curve” and reduce COVID-19 transmissions, New England governors have taken similar approaches, with some notable differences.

Though Massachusetts and Connecticut are listed by several news organizations as having issued “stay home” orders, Govs. Charlie Baker and Ned Lamont have issued “stay at home” advisories, not orders.

The governors of Rhode Island and Maine have ordered non-essential businesses to close, but the closest they got to a stay-home order came in Rhode Island Gov. Gina Raimondo’s March 22 executive order that closed non-essential businesses. 

“All business services personnel that can work from home are required to do so,” it states.

Business closures

Business closures and limitations on gathering size are the primary methods by which New England governors have restricted people’s mobility.

All New England governors have divided businesses and non-profits into “essential” and “non-essential” categories and have ordered non-essential businesses to close. 

And all have banned gatherings of more than 10 people. (Conn. Gov. Ned Lamont on Thursday limited gatherings to five people.)

Every governor created a long list of essential businesses, which makes these orders far less strict than they at first appear. 

So many businesses are listed as essential that it would be shorter to list the types of businesses required to close (as Maine’s order did) than to list those allowed to stay open. 

Late this week, Massachusetts and Rhode Island added additional travel restrictions. Rhode Island’s Raimondo ordered anyone traveling into the state from New York State to quarantine for 14 days. Massachusetts’ Baker asked everyone traveling into the state to quarantine for 14 days.

New Hampshire has not attempted to limit cross-border travel. Though Gov. Sununu has issued a stay home order, it contains numerous exceptions. And the list of essential businesses (here) is long. 


Maine Gov. Janet Mills, an aggressive regulator during the legislative session, has been the least aggressive issuer of COVID-19 executive orders in New England. On Tuesday she ordered non-essential businesses closed but has resisted many other orders, including a stay home or shelter in place order. 

Mills explained her reluctance to issue a stay-home order by saying at her Tuesday press conference, “there are public health risks to people staying in place as well as public health risks to people not staying in place. We want everyone to be cautious and courageous at the same time.”

Governors clearly were weighing lots of potential unintended consequences and tradeoffs. One consideration was whether people would stay home without being told. 

Cell phone data show that New Englanders were already starting to stay closer to home before more restrictive orders were issued. 

A COVID-19 social distancing scoreboard created by data analytics firm Unacast, which monitors cell phone GPS data, shows that most New England states experienced a sharp decline in miles traveled throughout March. 

New Hampshire was one of only a few states to receive an “A” rating for achieving at least a 40% reduction in miles traveled by March 23. Vermont also got an A. Maine was rated the worst in New England, with a decline of only 26%.

Unacast’s data show that, nationally, miles traveled declined sharply until last weekend, when they flattened and rose again. It’s possible that the expectation of more restrictions caused a short-term increase in travel, perhaps for shopping or to enjoy a last gasp of personal freedom before settling inside. 

That might have happened in New Jersey. That state’s shelter-in-place order was issued on March 21. The state quickly saw a V-shaped spike in miles traveled after the order. 

Limited action

The big takeaway is that every New England governor has tried to balance competing values and impose the least restrictive orders that might achieve the desired results. Their differences are largely a matter of degree. And that indicates a broad bipartisan consensus that even when trying to fight a deadly contagion, tradeoffs have to be made and government coercion limited. 

The orders

New Hampshire





Rhode Island

Forcing people to carry reusable food and beverage containers in public could accelerate the spread of microbes that cause infectious diseases, multiple academic studies suggest, the Josiah Bartlett Center for Public Policy shows in a new policy briefing paper. 

As government strives to suppress the spread of the novel coronavirus, policymakers should immediately repeal laws, regulations and ordinances that ban disposable food and beverage containers, utensils and plastic straws. 

Attempts to ban “single-use” plastic grocery bags, water bottles and straws, as well as non-recyclable utensils and to-go containers, have spread worldwide in recent years. New Hampshire legislators make annual efforts to impose such bans or restrictions, and several municipalities already have banned plastic grocery bags. Concord, Mass., banned single-serving plastic water bottles in 2013.

As these bans were debated, concerns about public health tended to be dismissed, even though studies have shown genuine potential health hazards. This briefing paper outlines the public health reasons why policymakers should reject these bans.

The full briefing paper can be read here: JBC Disposables Ban Coronavirus.   

If you haven’t stocked up on toilet paper, hand sanitizer, disinfectant wipes or milk yet, good luck. By the time you read this, your local supermarket might well be out. At noon on Friday, the Bedford Market Basket had some scattered half gallons and a single gallon-jug of milk left. (It was chocolate, indicating poor judgment on someone’s part.)

Supermarket shelves are empty all over New Hampshire as Granite Staters raid stores for milk and various sanitizing products. It’s as if the state’s been sacked by obsessive-compulsive pirates with rickets. 

But it wasn’t pirates (alas). Shelves are empty because basic market price mechanisms did not kick in. 

When demand surges as it did this past week, price increases typically follow. Higher prices discourage hoarding and encourage suppliers to boost production. But supermarket executives know that if they discourage hoarding by raising prices, people will accuse them of “price gouging.” So they don’t raise prices. Predictably, shortages result. 

A Union Leader story that credited the shortage to “panic buying” featured a Hannaford sign taped to a bare shelf. The store “may have frequent out of stocks on many toilet paper products for the foreseeable future,” it warned.

Well, of course. When toilet paper costs exactly the same during a period of peak demand that it did the week before, buying more than you need comes with zero additional cost. You might as well buy a bunch now “just in case” because it’s the same price now as it was last week and it will be next month. 

A price increase would make some people think twice about buying more than they think they’ll need. That would leave more for people who have a greater immediate need. 

Unwilling to raise prices, stores have tried to discourage hoarding by imposing purchase limits. “There is a daily purchase limit on this item of 2 per customer,” read one sign at a local Hannaford on Friday. It sat on an empty shelf. Such limits are a form of rationing. They’re just not as good a form as price adjustments are. 

Shortages, by the way, are also a form of rationing. They’re just a really bad one.  

“Price gouging” can have different meanings. Raising the price when one has a monopoly on a good or service is one. Raising prices in a competitive market when demand surges is another. The second meaning is the misleading one. People equate the two, but they aren’t the same.

Studies done on gas price increases after hurricanes Katrina and Rita found that the prices were regular supply and demand fluctuations, not arbitrary impositions, as in the case of the monopolist. A 2007 price gouging study published in the Journal of Competition Law and Economics analyzed the impact on the economy if price gouging laws had been in effect after those two hurricanes. The authors estimated that “economic damages would have been increased by $1.5–2.9 billion during the two-month period of price increases.”

That’s because laws that ban “price gouging” are really just price caps. And price caps create shortages during periods when the market price otherwise would rise above the cap. 

Economist Milton Friedman made exactly this point when writing about the U.S. gas shortages in 1973. 

This week’s supermarket sell-outs are caused by the failure of prices to find their natural market equilibrium. If government forbade sellers from raising prices, the result would be the same. 

Thankfully, New Hampshire has no anti-price-gouging law to make shortages even worse.

The state’s first vaping tax took effect on January 1, just nine weeks ago. On Thursday, the House approved a bill to more than quadruple it. But the revenue is unlikely to be the bill’s biggest effect.

House Bill 1699 raises the tax on the liquid used for e-cigarette vaping to 40% of the wholesale price. The current rate is 8% for open systems (fill your own) and 30 cents per milliliter for closed systems (cartridges). 

On a 12-8 vote, the House Ways & Means Committee asserted that the increase was justified because of the potential negative health effects of nicotine contained in vaping liquid.

“The nicotine delivered by electronic cigarettes is a toxic addictive chemical derived from the tobacco plant,” Rep. Richard Ames, D-Jaffrey, wrote for the committee. “We know it is addictive. But we don’t yet fully understand the extent of the damage to vital human organs, particularly the lungs and heart, that may be caused by its inhalation through the vaping process. We don’t yet know its effect on the human brain, particularly its effect on the still developing brain of a young person.”

But nicotine researchers have repeatedly pointed out that nicotine should be treated as less harmful than tobacco smoking.

“We need to de-demonize nicotine,” Ann McNeill, professor of tobacco addiction at the Institute of Psychiatry, Psychology and Neuroscience at King’s College London, told Scientific American in 2015.

The reason is that switching from cigarette smoking to vaping produces dramatic reductions in health risks and has been associated with declines in tobacco use.

A study McNeil published in 2018 concluded that the health benefits of switching to e-cigarettes were so profound that e-cigarettes should be prescribed by doctors as smoking-cessation tools. 

“When people smoke tobacco cigarettes, they inhale a lethal mix of 7,000 smoke constituents, 70 of which are known to cause cancer. The constituents in tobacco smoke that cause the harm are either absent or at much lower levels… in e-cigarettes so we are confident that they are substantially less harmful than cigarette smoking,” McNeil told the BBC.

“People smoke for the nicotine — but contrary to what the vast majority believe, nicotine causes little if any of the harm. The toxic smoke is the culprit and is the overwhelming cause of all the tobacco-related disease and death.”

The health argument being used for HB 1669 perpetuates the misconception that there’s little difference in the health risk between tobacco smoking and vaping. 

In fact, there’s a huge difference, and a growing body of research shows that vaping helps smokers quit, leading to improved health outcomes. A study published in the New England Journal of Medicine last year found that e-cigarettes “were more effective for smoking cessation than nicotine-replacement therapy, when both products were accompanied by behavioral support.”

The presence of nicotine in vaping liquid plays a significant role in helping smokers make the switch from tobacco to less-harmful e-cigarettes. A 2016 National Institutes of Health study and a 2015 Society for Research in Nicotine and Tobacco study found that smokers preferred e-cigarettes with higher nicotine content, suggesting that e-cigarettes with higher levels of nicotine helped people quit smoking by offering a satisfying substitute for tobacco. E-cigarettes with lower nicotine levels were less effective. 

Were the state leaving people alone to make their own decisions, the health outcomes would be a matter of individual choice. But in this case legislators are attempting to use the tax code for the express purpose of changing people’s behavior.

That puts the government on the hook for the outcomes. Given the strong link between vaping and smoking cessation, any government effort to discourage vaping would likely lead directly to worse health outcomes for smokers. 

Because the research showing vaping to be an effective smoking cessation method is well publicized, skeptics might conclude that a more powerful motivation for such a tax would be the revenue. (As with nicotine, collecting and spending tax revenue can be habit forming.)

Two weeks after a supporter of the Green New Deal won the New Hampshire primary, a new study finds that paying for only a few of the Green New Deal’s largest mandates would cost the median New Hampshire household more than its entire annual income in the first year of implementation.

“The Green New Deal is a politically motivated policy that will saddle households with exorbitant costs and wreck our economy, said Kent Lassman, president of the Competitive Enterprise Institute (CEI) and co-author of the study. “Our analysis shows that, if implemented, the Green New Deal would cost New Hampshire households more than $74,000 in just the first year alone. Perhaps that’s why exactly zero Senate Democrats, including Senators Jeanne Shaheen and Maggie Hassan, voted for the Green New Deal when they had the chance.”

The study, by CEI and Power the Future, analyzed the cost of just a portion of the Green New Deal’s energy mandates. It estimated New Hampshire’s costs at $74,723 per household in the first year. That’s slightly ($666) higher than New Hampshire’s median household income.

The Green New Deal sets extraordinarily ambitious goals for combatting climate change. It would mandate that all power come from zero-emission energy sources, the electric grid be converted to a “smart grid,” every building in the United States be retrofitted “to achieve maximal energy efficiency,” the government “eliminate pollution and greenhouse gas emissions from the transportation sector as much as is technologically feasible,” the government remove greenhouse gases from the atmosphere through “low-tech” solutions (planting trees, potentially), and the government eliminate greenhouse gases from the agricultural sector as much as is technologically possible.

Those are just the environmental goals. The legislation also guarantees, among many other things, a job with high pay and paid family leave, strengthened labor laws, a halt to “the transfer of jobs and pollution overseas” and high-quality health care, affordable housing, economic security and affordable food for every American.

The study leaves out all of the non-environmental goals and examines only a portion of the environmental mandates. It estimates costs for converting residential housing to Green New Deal efficiency standards (leaving out all commercial and industrial buildings, which are covered in the law), replacing non-compliant household vehicles with electric vehicles, making ground shipping compliant with the Green New Deal, and switching to green power. 

This extremely conservative estimate that excludes most Green New Deal mandates comes up with a per-household cost for New Hampshire of $74,723 in the first year, $47,310 in years 2-5, and $39,821 per year after year five. 

After reaching these figures, the authors conclude that “the Green New Deal is an unserious proposal that is at best negligent in its anticipation of transition costs and at worst a politically motivated policy whose creativity is outweighed by its enormous potential for economic destruction.”

You can read the study here.

The takeaway message from Gov. Chris Sununu’s State of the State address on Thursday was that New Hampshire, like comedian Larry The Cable Guy, gets her done.

The governor even said at the end of his address, “Let’s Get It Done.”

By solving problems through innovative, decentralized, low-cost methods, the state enables high levels of economic opportunity and growth, the governor said.

“Over the last year, New Hampshire families have benefited greatly from record levels of economic growth. Our focus on our workforce, while making high-paying, quality jobs available has paid enormous dividends.

“Business taxes are at their lowest this century, and more people are working than ever before. The model works — and it’s proven.”

We generally agree with that assessment of the New Hampshire model. But out of curiosity, we checked state economic data published in the state’s monthly New Hampshire Economic Outlook for this month, then compared it to the same report from February of 2017, the month after Gov. Sununu took office. These February issues report data from December of the previous year. We found that:

  • From December of 2016 to December of 2019, New Hampshire added 29,520 people to the labor force and 30,720 to the state’s employment rolls.
  • The number of unemployed individuals shrank by 1,210 persons, from 18,940 to 17,730.
  • New Hampshire’s unemployment rate fell from 2.8% to 2.6%.
  • Wage growth was up from an average wage of $890.46 to $939.21. That growth is lower than the rate of inflation as measured by the Consumer Price Index, but above the rate as measured by the Personal Consumption Expenditures method, which better accounts for the added value of improved consumer goods.

New Hampshire has experienced strong economic growth since the end of the last recession, and this growth has continued during Gov. Sununu’s tenure.

The governor can take credit for keeping business tax rates down and preventing numerous growth-harming taxes and regulations from becoming law during the last two legislative sessions. His defend-the-economy mindset has prevented the state government from reversing these positive economic trends.

Generally speaking, high business tax rates reduce, economic growth, opportunity and innovation.

A 2017 study by professors from Columbia, Duke and Harvard, for example, found that higher corporate tax rates led to lower corporate profits, which in turn led to lower domestic investment and, subsequently, lower economic growth.

And a 2018 study by economists from the University of Chicago and Harvard found that “taxation of both corporate and personal income negatively affects the quantity, quality, and location of innovation at the state level and the individual inventor and firm levels.”

Since taking office, the governor has focused a lot of his energy on protecting the economy from legislative proposals that would impeded growth, hiring, innovation and economic opportunity. That approach is working well for the state, which has hit record levels of employment in the past year and is, at long last, attracting young people again.

In other words, that approach is getting her done.

It’s Primary Weekend in New Hampshire, when Granite Staters ask questions of candidates, national reporters ask questions of Granite Staters, and the entire political universe asks, “What the heck, Iowa?”

On Monday, the Great Iowa App-ocalypse occurred. In an evening of dumbfounding incompetence, the Iowa Democratic Party may have done what Michigan, California, Florida, Delaware and woke progressives nationwide have failed failed for generations to achieve — slay the Iowa caucuses.

In response, Gov. Chris Sununu, Secretary of State Bill Gardner, and other state officials held a press conference to announce that New Hampshire election officials have got this.

“The 2020 presidential primary will take place against the backdrop of New Hampshire’s long history of conducting elections that are fair, with complete integrity, well run and with a very high level of voter participation,” Attorney General Gordon MacDonald said.

As Josiah Bartlett Center President Andrew Cline pointed out in The Wall Street Journal mid-week, Gardner’s insistence on simplicity has served New Hampshire well. Gardner has insisted on a decentralized, low-tech system of paper ballots, voting machines not connected to the Internet, and local result announcements. The simplicity is itself a sort of elegance.

Voters can take a lot of lessons from Iowa’s failure and New Hampshire’s long history of success. (Let’s hope Tuesday continues the streak.) The biggest is the virtue of simplicity over complexity.

Complex, bureaucratic systems are prone to failure for multiple reasons. One is that they have more moving parts and therefore more opportunities for something to go wrong. Another is that they tend to suppress individual autonomy and ingenuity.

A system wholly reliant on expert designers and managers cannot be fixed in the field by a layperson if it breaks. That problem was illustrated well in Iowa Monday night.

It also discourages individual users from improving it through their own creative adaptations.

The complexity of the Iowa caucuses contrasts with the beautiful simplicity of the New Hampshire primary, where every vote is recorded on paper with a pen — and counts.

Though the caucuses are not socialist, they do bear the mark of “expert” planning. They keep failing not because Iowans are bad at voting, but because the caucus system first imposed by the Iowa Democratic Party in 1972 is a textbook example of a bad design imposed by planners who were not as clever as they thought they were.

Planned economies fail in largely the same way. Market economies might be complex, but not from the hand of a master planner who seeks to exert control. No one person has to know how the whole system works. It functions precisely because millions of people are expert in their own small area and no one is required to manage all of it as a whole — sort of like the decentralized system Gardner devised for the New Hampshire primary.

Planned economies, by contrast, don’t turn out so well. In “Heaven On Earth: The Rise, Fall, and Afterlife of Socialism,” author Joshua Muravchik shows how the planned systems designed by various utopian collectivists failed. From the very smallest communes to China and the Soviet Union, planners always made the people poorer and their societies weaker. They could never replicate the success of the unplanned market economies.

The abject failure of the long parade of planned community experiments is seldom taught today, which is why we are holding a talk at the Millyard Museum this Saturday night with a renowned expert on those failures.

Dr. Joshua Muravchik, author of “Heaven on Earth: The Rise, Fall, and Afterlife of Socialism,” is the featured speaker at our latest Civil Discourses event happening Sat., Feb. 8, at 6:30 p.m. at the Millyard Museum in Manchester. For more details or to make your reservation, please click here.

If you can’t make it, you should consider reading his excellent book.

Brace yourselves. The Senate on Thursday passed a business tax reduction — unanimously.

By a vote of 24-0, Republicans and Democrats agreed to eliminate the business profits tax (BPT) liability of thousands of New Hampshire businesses. Senate Bill 223 would increase the minimum gross income required to file a business profits tax return by 50 percent, from $50,000 to $75,000.

The bill was co-sponsored by Sen. Jeanne Dietsch, D-Peterborough, and Sen. James Gray, R-Rochester. Dietsch last year sponsored a payroll tax that she labeled “an income tax.” Sen. Gray in the past has sponsored right-to-work and anti-abortion bills.

The senators are on opposite ends of the political spectrum, but they found common ground on the idea that the state’s BPT kicks in too early at $50,000 worth of income. Their colleagues agreed and approved the bill by a vote of 24-0.

The Department of Revenue Administration would not estimate the bill’s impact on future tax revenue but did calculate that 4,102 taxpayers reported business tax revenue between $50,001 and $75,000 in 2016. “Of the 4,102 taxpayers, 3,774 had no BPT liability with the remaining 328 taxpayers reporting a total liability of $347,489.”

So the bill has the potential to keep hundreds of thousands of dollars a year circulating in the private sector.

Senate Ways & Means Committee votes against bill to defund education scholarships

Last week The Broadside reported on Senate Bill 663, which would replace business tax deductions for lower-income student scholarships with business tax deductions for higher-earning college graduates.

That reporting got noticed. At Wednesday’s hearing, parents, students, school administrators and donors to the state’s two scholarship programs turned out to explain the value of the scholarships. After lengthy and heart-wrenching testimony, Sen. Dan Feltes, D-Concord, moved to mark the bill Inexpedient to Legislate. Feltes is a sponsor of the bill. The committee voted 5-0 to recommend that the full Senate kill SB 663.