Well, not literally speechless; that would be so not Zycher. But in today's Wall Street Journal we are informed by some poor soul---oops, a journalist---writing about Hurricane Katrina that "amid the grief and heartbreak, it should be noted that growth often follows such catastrophe. Hurricanes Andrew in 1992 and Floyd in 1999, for example, both ended up boosting local and national growth rates as rebuilding efforts created jobs and increased spending."
If this is not the classic manifestation of the old broken-window fallacy, I know not what is. Why not nuke the whole eastern seaboard---I'd say California, but I live there---so that we can expand employment and spending in a rebuilding effort? Is this guy a moron? Or does he merely need to fill up twenty column inches with, well, whatever? That modern journalists are the political equivalent of hurricanes destroying public discourse everywhere they set foot would be amusing were their ignorance not so appalling.
If this is not the classic manifestation of the old broken-window fallacy, I know not what is. Why not nuke the whole eastern seaboard---I'd say California, but I live there---so that we can expand employment and spending in a rebuilding effort? Is this guy a moron? Or does he merely need to fill up twenty column inches with, well, whatever? That modern journalists are the political equivalent of hurricanes destroying public discourse everywhere they set foot would be amusing were their ignorance not so appalling.
The journalist is correct, growth will follow the hurricane. The question that he fails to address is whether the amount of "growth" is greater than the amount of harm done.
ReplyDeleteMaybe this is his/her way of looking for the silver lining.
Re planned obsolescense: I am interested in your line of thinking ... please give an example.
Before we spend fifteen posts talking past each other, define "planned obsolescence" and state why you think it is economically irrational.
ReplyDeleteAnd the contention that a hurricane causes economic growth because of all the construction jobs it creates is like saying if I come over to your house and bust your kneecaps, it's good for the economy because the doctor gets some work. It ignores the facts that (1) your knee wasn't broken before and now it is and (2) while the doctor was fixing your kneecaps he could have been doing something else, at least as useful if not moreso. You are just shifting resources, you're not creating growth.
ReplyDeleteMaybe T was thinking along the following lines:
ReplyDeleteLets take the guy who throws the rock through the window and replace him with a capitalist who designs the window in such a way that it breaks automatically, thus starting the succession of events in the BW fallacy.
Am I close?
No, it's not the same thing at all. Breaking something is not the same as designing something that is designed to wear out eventually. There are many sound economic reasons we don't want to use resources to make a durable good infinitely durable. There are tradeoffs between making the car more durable, making it more affordable, dealing with the extent to which consumers wish to deal with durable good life cycles, and so on. It is not a bad thing that computers have life spans, otherwise I'd still be using an IBM-XT.
ReplyDeleteBesides, it's not like an item like a car just disintegrates at the end of its calculated lifespan. You always have a choice to repair it, but you calculate a tradeoff between repairing and replacing.
In keeping with the window example:
ReplyDeleteIf I design a window that "breaks too soon" the shop owner has the option of taking his business elsewhere next time.
The capitalist IDEAL is that a second manufacturer of windows will see that the shop owner wouldn't mind spending a couple extra bucks for one that lasts a little longer.
Perhaps T's definition of planned obsolescence can fit under the umbrella of "INefficient allocation of resources".
It would be inefficient (and expensive) to design "windows" that last forever.
Are you suggesting the following:
ReplyDelete1) better technology exists to build widgets;
2) if a manufacturer were to use said technology and build better widgets eventually everyone would buy them and have better widgets;
3) greedy capitalists are avoiding doing #2 because it won't make them any money.
Hmmm ...
Re cars:
ReplyDeleteCars have improved:
1) efficiency(*) has gone up;
2) A/C is available even in entry level cars;
3) safety HAS improved (heard of the airbag, controlled crumple zones etc...);
4) emissions have been reduced dramatically.
5) because efficiency has gone up, so has mileage (as long as you control for the weight of the car).
(*) Yes efficiency has gone UP. Look at the amount of horsepower available per unit of energy input.