3 ms·
I like to use the book 'economics in one lesson' by Henry Hazlitt to show why. The book has some flaws, and missing about 30 years of new ways to do it, but it
by sumtechguy 5y ago
I like to use the book 'economics in one lesson' by Henry Hazlitt to show why. The book has some flaws, and missing about 30 years of new ways to do it, but it shows the secondary effects many policies have. The basic premise of the book is 'broken window'. Which is 'take something from someone else and it will cause economic velocity'. But in the end effect is you are still overall worse off then you were when you started.
An easy example is take something simple like 'give food to the hungry who can not afford it'. Sounds nice. Easy to do. Does not really seem to hurt anything. But that can have a inflationary effect on food prices if done too much and too rapidly. Thus creating more 'hungry' people who can not buy food, as maybe their wages are not keeping up. Then causing more money to be injected in to 'fix the issue' again causing inflation. Creating a cycle that can only be broken by hurting a lot of people. That is just one side effect. There are several others. Rent control is similar.
The trick is how do you 'fix' things without creating bad cycles? It is not as easy or handwavy as many make it.