The man on the spot

He illustrates this by explaining what happens when, somewhere in the world, a tin mine collapses or some new opportunity arises for the use of tin. It does not matter which! The price of tin rises and consequently business managers throughout the world have to economise on tin or find alternatives. The price system enables the business manager to make decisions without needing to know the cause of the changes in demand. It is a conduit for the minimum information required to make decisions.

But the impact of the price mechanism is even more profound. It has enabled the division of labour on which our prosperity is based. It has enabled individuals to choose their employment and to use their knowledge and skill to their own and the community's optimum benefit.

Hayek's The Use of Knowledge in Society is an important contribution to economic thought. It provides the theoretical underpinning for the tale about the price miracle told so well by Leonard Read in I, Pencil.

Returning to the issue at hand, what is the most effective way for our society to respond to the pandemic? Could we usefully apply the principle of subsidiarity?

• What do you think might be the minimum set of tasks that we should leave to the government?
• Can our health departments be relied upon to run a hygienic and secure quarantine system?
• Do they have the skills to roll out a vaccine program?
• Can the ABC be relied upon to deliver timely and accurate health information to the public?
• Would a health department website be more effective?
• Or is the optimal solution to distribute health information through general practitioners and pharmacists?
• Who do you think would be the most competent person to decide whether a business should be open or not, whether you should work from home or not, how many people should attend the footy, or whether your school should be open?
• Can you be relied upon to wash your hands, and to isolate at home if you are sick?

The solution to our pandemic problem is to reduce government involvement and control to a minimum, and to find the best mechanism to ensure that the public is as well-informed as can be without overloading them with unnecessary information. Then we can leave the detailed decisions to the man (or woman) on the spot.