The Other McCain

"One should either write ruthlessly what one believes to be the truth, or else shut up." — Arthur Koestler

The Sadly Underrated ‘Broken Window Fallacy’

Posted on | August 5, 2010 | Comments Off on The Sadly Underrated ‘Broken Window Fallacy’

by Smitty (h/t Fausta)

People object to the broken window fallacy in terms of economic opportunity cost. The baker in the example could have had a window and a suit.

Maybe the White House CoS can explain:

“You never want a serious crisis go to waste. What I mean by that is that it’s an opportunity to do things that you think you could not do before.”

So, in the purely hypothetical case where you control the hooligan, you can knock out the window of the political opponent, and hurt both the baker and the tailor who, might have mounted a campaign against you in the next election.

The good news is that such flagrantly unethical behavior never goes on. The unfortunate reality that political opponents get so many windows broken probably has to do with the fact that they are oppressors, whose forbears had indeed wronged the hooligan’s father.

To correct this problem, one good approach would be to raise the taxes on the baker and the tailor, and hire a social worker to counsel the hooligan. On proper throwing technique.

Update: Really. Ethics and taxes are for the little people. Now, that’s arguably taking it a bit too far, but the shenanigans surrounding the Deepwater Horizon are creepy to say the least.

Category: Economics

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