Free Republic
Browse · Search
News/Activism
Topics · Post Article

To: John O
Oh god. Is accounting new to you? Is economics foreign to you? Do you understand the concept of a public good, or a non-zero sum benefit or loss?

Some actions of government or investment or markets, increase the total size of the value pie shared by all of us combined. Others reduce the value of that pie. Others leave it unchanged.

Actions and policies that add value overall are economic, even if and when they change who the winners and losers are who reap those gains. Buggy whip manufacturers making lower profits when cars are invented does not harm us as a whole. "But hey, it is a loss of their profits, that's an outright loss to their pockets, its horrible it must be stopped!!!" is not economic analysis.

Government transfer are largely neutral in overall value. They can have a secondary cost on incentives that is negative - which are more severe the least productive or deserving the end beneficiary is - and sometimes entail useless bureaucracy costs to implement, which are dead weight losses to everyone. Those are legitimate economic concerns against them. That they moved money from A to B is *not*. It isn't a net loss to society that someone else has the benefit - a car manufacturer - instead of the sainted makers of buggy whips.

The economic perspective is precisely to look at the whole pie effect of policies, and not on the one-entry accounting of their benefit or cost to one individual. Every action you can mention can be made to benefit somebody or other, who would on that basis support it - which way lies sorrow.

45 posted on 02/02/2010 3:04:36 PM PST by JasonC
[ Post Reply | Private Reply | To 42 | View Replies ]


To: JasonC

You’ve turned your own argument on its head.

It is the government who is moving money to the “buggy whip manufactures” and their unions right NOW and taking it from the companies and individuals that the market is rewarding for their innovation. Government is choosing the winners and losers against the market. That makes us all a little poorer and the longer it goes on the more we lose.


53 posted on 02/02/2010 3:24:15 PM PST by DB
[ Post Reply | Private Reply | To 45 | View Replies ]

To: JasonC
Is accounting new to you? Is economics foreign to you? Do you understand the concept of a public good, or a non-zero sum benefit or loss?

The whole point of the rest of your post was to describe how income redistribution is neutral to the greater society. This sounds good in theory but has always proven to be false. Communist societies have a lower standard of living for almost all their "citizens" while capitalistic societies have a higher standard of living for all thier citizens. Government transfer of wealth (communism) always hurts the society it is inflicted upon.

Your previous posts used the term "loss" without defining the scope. Loss to society or loss to the individual. It is obvious that a transfer from one individual to another is ALWAYS a loss to the "donor" individual. He no longer has his assets.

It is less obvious, but equally true, that a forcible transer from one individual to another is a loss for society. Communism never works. (The negative incentives of communism cannot be overcome. Remove the profit motive and people no longer work.)

76 posted on 02/03/2010 5:41:25 AM PST by John O (God Save America (Please))
[ Post Reply | Private Reply | To 45 | View Replies ]

Free Republic
Browse · Search
News/Activism
Topics · Post Article


FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson