The Dismal Science and Me
Reading the classics of economic literature, and relating it to what I see going on in the world today.
By marfdrat on March 16, 2012
This message probably can’t be repeated often enough. There are still hordes of people in our society who share the misguided notion that destruction brings prosperity: they believe when natural disasters, or wars, or terrorist attacks, or government programs to destroy used cars occur, there’s a silver lining because all the money spent to fix all that destruction (or buy new cars) will bring about prosperity for those involved in fixing it.
By marfdrat on February 7, 2011
Last time we talked about public works projects. They’re often necessary, and fulfill some important need for the citizenry. Large-scale projects, in particular, provide physical, visible, memorable evidence of the results: the Hoover Dam is a fine example of what can be accomplished, as are any number of bridges or other edifices. We also discussed the “unseen” aspect of public works projects: what is spent on these marvels of engineering is capital removed from the pockets of individuals, and not spent on items that produce economic growth.
Posted in The Dismal Science and Me | Tagged confiscatory tax policy, dismal science, Economic growth, Economics, government spending, Government waste, Henry Hazlitt, production, tax rates, taxes | 1 Response
By marfdrat on January 18, 2011
Last time we reviewed Hazlitt’s discourse on the “blessings” of destruction, and used as a modern-day (and all too recent) example the “Cash for Clunkers” program. Used cars were traded in for taxpayer-subsidized rebates on the purchase of new cars. The ostensible rationale given for the program was “to stimulate” the automobile industry in America (there were myriad other designs and political machinations built into this enterprise, but they lie outside the scope of this discussion). Indeed, new cars were purchased (though it is arguable whether they would not have been purchased otherwise, if only later), and workers in various businesses related to the manufacture of automobiles were paid salaries, which they subsequently spent on household goods, or groceries, or any of the other things we require or desire in life.
By marfdrat on January 4, 2011
The Broken Window demonstrated one of fallacies given by Hazlitt as inadequate economic thinking: taking into consideration only the visible effects of an occurrence, and ignoring the unseen. When the bystanders opined that the baker’s broken window was a blessing for the glass man, they ignored the loss of the shop owner, and what he might have done with the capital required to replace the glass. No real economic growth occurred in the transfer of $1000 from the bread man to the glass man. Hazlitt says the Broken Window fallacy is repeated on a daily basis; it’s interesting the scale at which this fallacy is perpetrated on the tax-paying public, who are all too willing to accept the seen benefits, and fail to examine the unseen.
By marfdrat on December 14, 2010
I wrote about two weeks ago of economics and its relationship to what’s going on in the world right now, and Henry Hazlitt’s book Economics in One Lesson: The Shortest and Surest Way to Understand Basic Economics. This is an exercise for me to work through his excellent book, and relate it to what I see in the world.
Posted in Economics & Politics, The Dismal Science and Me | Tagged bastiat, economic theory, Henry Hazlitt, keynesian economics, keynesianism, the broken window, the seen and the unseen | Leave a response
By marfdrat on December 1, 2010
I’m intrigued by the dismal science -economics- and its influence (or lack thereof) on current policy and legislation discussions. I liked economics courses in college (I was one class short of a minor); where my classmates saw confusing-looking graphs, and difficult to understand concepts, I saw clarity and sensibility. It seems to me that many of the decisions made by politicians, and endorsed by their constituencies, concerning matters of great financial import to me and millions of other Americans are made in spite of what appear to be relatively simple economic truths. One thing is for sure: economics can be