Breaking Bozeman

Wednesday my micro class covered Bastiat's broken window fallacy, one of economics' most important ideas because it's about opportunity cost. The thumbnail version is that disaster is not good for the economy even if it puts a lot of people to work: resources spent replacing what you lost are resources not spent on adding to what you have. It's an idea that's pretty obvious once you point it but as the paper in Bozeman, MT (who recently suffered a hailstorm) illustrates, that pointing out part is really crucial.

HT Frank Stephenson.