As I watched the COVID-19 pandemic unfold last year, I had a sense of deja vu. Not that I’ve lived through a rapidly spreading global disease that shut down the economy before, but I have witnessed what happens when a variety of well-meaning government agencies get involved in the private sector.
It’s typically not great.
Take for example solar cell manufacturer Solyndra. It looked like they had the technology of the future in creating cylindrical solar panels that were supposed to capture more power in a smaller area. When the company started to struggle, the government stepped in with a $535 million loan from the U.S. Department of Energy. Solyndra also received a $25 million tax break from the state of California.
Not only could Solyndra not compete against other solar panel producers who used far less expensive materials, but it turned out that they lied to the government to obtain the loan, and taxpayers never got their loan money back from the bankrupt company.
So when, in 2020, I watched the government close down small businesses, inject trillions of artificial dollars into the economy and shut down alternatives to an experimental vaccine with limited testing, let’s just say I did not wait around hopefully for public regulations to shift in my favor.
Just like other businesses, health care companies are expected to grow year over year. This includes public hospitals and nonprofit charities. This growth only happens when illness is a major factor in the lives of everyday people. They are literally invested in people remaining sick.
This may seem like a prime target for government regulation. In theory, government oversight should help to bring down health care costs. In actual practice, however, government involvement hasn’t led to better access to health care or lower costs.
Government programs, especially fiscal incentives, are meant to encourage the innovation we need to solve big problems. Unfortunately, the opposite often happens.
Just this year, the federal government announced that they would spend more than $3 billion on therapeutics to treat COVID-19 and other potentially wide-spread viruses, like Ebola and West Nile. As we need better ways to treat these diseases, the investment seems like a smart move. Unfortunately, most of that money is going towards solutions that are already developed, such as the Merck drug Molnupiravir, which is currently in clinical trials.
A vast range of treatment and prevention options for COVID-19 exist. Unfortunately, many of the 3-letter government agencies are not approving products backed by research to be used as treatments, for the simple reason that they are not “drugs.” Many of them are seasoned remedies or simple hygiene practices.
We need startups, small business owners and entrepreneurs with big ideas that simplify the way the health care system functions and truly help people stay well. They won’t find the encouragement they need in a government that is already heavily involved with big pharmaceutical and insurance companies who want to keep things moving in the same direction. They can find it, however, in the general public, hungry to take back control over their health and personal care choices.
If government involvement isn’t the right move for your business, what can you do instead? Instead of waiting for government studies to validate your product ideas, or public policies to catch up with innovation, listen to the experts in your private circle who can guide you on the right track. Look outside your immediate field to find out what is going on in the world and with various technologies. Even better, invest dollars and fund your own studies to find out what is working and what isn’t.
There is no question that we need some amount of government oversight. However, after two decades as an entrepreneur, it has become clear to me that hoping government intervention will be the answer to business problems, particularly for small companies, is a waste of time.
Trust instead in yourself, your problem-solving skills, your ability to filter through expert information and your experience with your own industry. Your talents have gotten you this far, and they will take you a long way yet.
Nate Jones is CEO and founder of Xlear, a manufacturer of xylitol based oral and nasal hygiene products, America Fork.