How Many Times Must This Lesson Be Learned? - Political Fever

RSDavis · #1 (**permalink**) 09-01-2008, 08:52 PM

How Many Times Must This Lesson Be Learned?
by RS Davis
The Freedom Files

Hello Freedomphiles! Some myths never go away, and one of the classics is, predictably, already emerging in the coverage of Gustav. CNN reports:

Economists agree that in the long run, a major hurricane or other natural disaster can actually help lift economic activity because of insurance payments and federal assistance.

This is exactly what Henry Hazlitt was talking about when he - hearkening back to the great Frederic Bastiat - wrote about the broken window fallacy, in his amazing book, Economics in One Lesson.

I would explain it to you, but no one does it as well as the incomparable Hazlitt:

A young hoodlum, say, heaves a brick through the window of a baker's shop. The shopkeeper runs out furious, but the boy is gone. A crowd gathers, and begins to stare with quiet satisfaction at the gaping hole in the window and the shattered glass over the bread and pies. After a while the crowd feels the need for philosophic reflection. And several of its members are almost certain to remind each other or the baker that, after all, the misfortune has its bright side. It will make business for some glazier. As they begin to think of this they elaborate upon it. How much does a new plate glass window cost? Two hundred and fifty dollars? That will be quite a sum. After all, if windows were never broken, what would happen to the glass business? Then, of course, the thing is endless. The glazier will have $250 more to spend with other merchants, and these in turn will have $250 more to spend with still other merchants, and so ad infinitum. The smashed window will go on providing money and employment in ever-widening circles. The logical conclusion from all this would be, if the crowd drew it, that the little hoodlum who threw the brick, far from being a public menace, was a public benefactor.

Now let us take another look. The crowd is at least right in its first conclusion. This little act of vandalism will in the first instance mean more business for some glazier. The glazier will be no more unhappy to learn of the incident than an undertaker to learn of a death. But the shopkeeper will be out $250 that he was planning to spend for a new suit. Because he has had to replace a window, he will have to go without the suit (or some equivalent need or luxury). Instead of having a window and $250 he now has merely a window. Or, as he was planning to buy the suit that very afternoon, instead of having both a window and a suit he must be content with the window and no suit. If we think of him as a part of the community, the community has lost a new suit that might otherwise have come into being, and is just that much poorer.

The glazier's gain of business, in short, is merely the tailor's loss of business. No new "employment" has been added. The people in the crowd were thinking only of two parties to the transaction, the baker and the glazier. They had forgotten the potential third party involved, the tailor. They forgot him precisely because he will not now enter the scene. They will see the new window in the next day or two. They will never see the extra suit, precisely because it will never be made. They see only what is immediately visible to the eye.

This book should be required reading in all schools.

Kudos to Over Unity for providing me with this link, where you can read the entire book online.

Zephyr · #2 (**permalink**) 09-01-2008, 09:12 PM

Yeah, but an economic benefit doesn't measure if the hurricane actually killed and injured people.

Which, I know, is beside the point.

You're absolutely right.

pjohns · #3 (**permalink**) 09-02-2008, 02:26 AM

Quote:

Originally Posted by RSDavis

The people in the crowd were thinking only of two parties to the transaction, the baker and the glazier. They had forgotten the potential third party involved, the tailor. They forgot him precisely because he will not now enter the scene. They will see the new window in the next day or two. They will never see the extra suit, precisely because it will never be made. They see only what is immediately visible to the eye.

This is a very good point; and it has applications beyond the merely economic ones. For instance, when barbarity is appeased (think: the 1979 Iranian hostage crisis), many people think only about the lives of those whose faces they can see (in recent pictures, say), and think not at all of the lives of those Americans that may be placed at risk in the future, due to our lack of resolve.

malrenalds · #4 (**permalink**) 09-02-2008, 02:34 AM

Quote:

Originally Posted by pjohns

This is a very good point; and it has applications beyond the merely economic ones. For instance, when barbarity is appeased (think: the 1979 Iranian hostage crisis), many people think only about the lives of those whose faces they can see (in recent pictures, say), and think not at all of the lives of those Americans that may be placed at risk in the future, due to our lack of resolve.

the Iran contra thing happens all the time. We pay countries to no develop nuclear weapons. An it can be argued that we save billions in potential losses trying to fund a cold war with them.

pjohns · #5 (**permalink**) 09-02-2008, 05:18 PM

Quote:

Originally Posted by malrenalds

the Iran contra thing happens all the time. We pay countries to no develop nuclear weapons. An it can be argued that we save billions in potential losses trying to fund a cold war with them.

I cannot agrue with your point that this sort of thing "happens all the time"; although this was not Iran-Contra in 1979. The buyoff of North Korea, within the past year, comes to mind.

But appeasement is no more workable now than it was in the salad days of Neville Chamberlain. And it is no more palatable when orchestrated by a president of one party than by a president of the other party.

Zephyr · #6 (**permalink**) 09-02-2008, 08:43 PM

So, as an alternative we should attack N. Korea and Iran?

pjohns · #7 (**permalink**) 09-02-2008, 09:53 PM

Quote:

Originally Posted by Zephyr

So, as an alternative we should attack N. Korea and Iran?

A shooting war with Iran is an inevitability; the only real question is when it will begin, and under what circumstances. Personally, I would much prefer to confront Iran before it has time to fully develop nuclear weapons. (For more on this, See Kenneth Timmermann's splendid 2005 book, Countdown to Crisis.)

As I have noted in previous posts, Iran is not--repeat is not--guided by pragmatic or cost-benefit considerations in its foreign policy. This point cannot possibly be overemphasized. The reigning mullahs, who are devoutly immersed in radical Shiite eschatology, believe that the return of the long-deceased Twelfth Imam (or "Mahdi"--remember the now-disbanded Mahdi Army in Iraq?) can be hastened only by the conquest of all the world's "infidels." So from Tehran's standpoint, the death of millions--or more--would be a truly glorious event.

North Korea is quite another matter. Kim Il-Sung is interested only in the perpetuation of his own power, by way of the Dear Leader cult. But FNC reported today that the DPRK is now rebuilding its nuclear reactor. It appears that Uncle Sam has once again been duped.

In the end, I do not think that America should ever be willing to endure national humiliation or national emasculation, regardless of what may be the alternative. Nor do I believe we should ever elevate hope over experience. And experience should teach us that it is never a good idea to negotiate with rogue states.

Personally, I would cut off every vestige of diplomatic ties with Iran and North Korea--and Russia also, in the wake of its barbaric invasion of neighboring Georgia.

Technocratic_Utilitarian · #8 (**permalink**) 09-02-2008, 09:58 PM

So if it's humiliation or death for millions, you choose death? After all, you did say "whatever the alternative."

malrenalds · #9 (**permalink**) 09-02-2008, 10:50 PM

Quote:

A shooting war with Iran is an inevitability;

write down the time and date you said that. Because I believe you are wrong.

pjohns · #10 (**permalink**) 09-03-2008, 01:03 AM

Quote:

Originally Posted by Technocratic_Utilitarian

So if it's humiliation or death for millions, you choose death? After all, you did say "whatever the alternative."

False alternative. The part about "millions" makes it such. But if the choice is between national humiliation or war to preserve our honor and dignity--and even our way of life--I would choose the latter, without hesitation.

Although there was a good bit of dissension and infighting among the Founders (of the sort that is not generally covered in middle-school history textbooks), it is probably fair to say that Patrick Henry's famous declaration ("Give me liberty or give me death!") was emblamatic of the Founders' thinking in this regard. Those words are echoed in New Hampshire's state motto: "Live free or die!"

A couple of other quotes from that more courageous era follow:

"War is an ugly thing but not the ugliest of things; the decayed and degraded state of moral and patriotic feelings which thinks that nothing [say, living under tyranny or submitting to national humiliation] is worth war is much worse. A man who has nothing for which he is willing to fight, nothing which is more important than his own personal safety, is a miserable creature and has no chance of being free unless made and kept so by the exertions of men better than himself."--John Stuart Mill

"If ye love wealth greater than liberty, the tranquility of servitude greater than the animating contest for freedom, go home from us in peace. We seek not your counsel, nor your arms. Crouch down and lick the hand that feeds you; and may posterity forget that ye were our countrymen."--Samuel Adams

These quotes encapsulate my own views remarkably well.

Thread Tools
Show Printable Version Email this Page
Display Modes
Linear Mode Switch to Hybrid Mode Switch to Threaded Mode

Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)

User Name		Remember Me?
Password