I am not sure whether “Demonomics” is Demon Economics or Democrat Economics. It is probably a distinction without a difference as some of the recent comments by leading Democrats defy logic. I have to wonder how these people not only got as far as they did, but stay in positions of power. Perhaps the biggest example has been how the Democrats have been hawking another extension of Unemployment Compensation payments. House Speaker Nancy Pelosi postulated that,
“It injects demand into the economy. It creates jobs faster than almost any other initiative you can name.”
A famous economic fable by Henry Hazlitt is the Broken Window Fallacy where folks believe that there is economic stimulus achieved by breaking the window of a baker shop forcing the owner to replace the glass. The Crusty Conundrum is my foray into economic fallacies…
Our story starts at the Ché Pizza Parlor, a new age pizza parlor in that they make socially responsible pizza and deliver them in hybrid compact cars. One day the owner was in a pinch when one of her delivery persons called off to go protest something. You see Ché Pizza provided its employees with “social justice” time much like traditional employers provided vacation or leave time. Left with no other options the owner donned her cap and started to make deliveries.
Frederic Bastiat was an infamous economist from France. Bastiat was infamous because he was able to show the fallacies behind many government and false economic policies and he often did it with humor. One of my favorite tactics that he uses is to take an economic argument to the extreme to expose the fallacy. I have used this to “silence” the naïve. I love it when they finally “get it.”
I started to write this posting a month ago. As I started my research about the broken window economic “fable” I found out that it is attributed to Henry Hazlitt. He was a noted economist that I had never heard about. I really wanted to find out about his thoughts and purchased his book, Economics In One Lesson.
More about the book in a later posting, but here is an abbreviated version of the broken window: