Among the issues most commonly discussed are individuality, the rights of the individual, the limits of legitimate government, morality, history, economics, government policy, science, business, education, health care, energy, and man-made global warming evaluations. My posts are aimed at thinking, intelligent individuals, whose comments are very welcome.

"No matter how vast your knowledge or how modest, it is your own mind that has to acquire it." Ayn Rand

07 April 2014

Good Ted Cruz Comment on ObamaCare

From Senator Ted Cruz of Texas:


This is a take-off on the original broken window fallacy explanation given by the economist Frederic Bastiat (1801 - 1850).  Bastiat explained that wealth is destroyed and our standard of living is lowered whenever government promotes destruction in order to provide jobs in reconstruction.  This is a lesson high tax and government spending people such as the Keynesians generally have not learned.  High taxes and government spending are destructive of the wealth that would otherwise reside in the private sector and are almost universally never more than a partial replacement.  In fact, much of the money spent by government has only negative effects on wealth and the standard of living, because the money is only used to hurt the vast majority of the people.  While a few programs may replace 50% of what was destroyed, one must never forget the 50% that remains lost.

Of course the same explanation applies to natural disasters, which was a lesson unlearned by the many who claimed that at least Hurricane Sandy provided some jobs.  A job can easily be provided by destroying net wealth and by lowering the standard of living.  Indeed, we could all easily return to being farmers or hunter-gathers and be most assuredly busy all of the time with the effort to survive.

No comments: