Tuesday, January 27, 2009

Gentleman, Scholar, and Economic Stimulators

Apparently some local youths were doing their best to help the automotive sector, or at least the automotive repair sector, when they were arrested by Williamson County authorities. They were destroying property you see. It is like the boy Frederic Bastiat wrote about in 1850 who broke a shopkeeper's windonw. The townspeople saw how it, the vandalism, provided meaningful employment to the window repairer who in turn bought bread. This enabled the baker to buy shoes. It wasn't vandalism at all people started to see but good for the economy. It created work for people. It was an act of stimulus.
The fallacy of course is that the observers did not account for the cost to the shopkeeper. The cops in Williamson County did not overlook the damage done to private property, not to mention the potential for personal injury. Perhaps they read Bastiat.
There is plenty not to like about economic downturns but important to keep basic principles in mind when thinking about stimulus.

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