Showing posts with label economics. Show all posts
Showing posts with label economics. Show all posts
Monday, August 16, 2010
Wednesday, August 4, 2010
The Broken Window Fallacy and Bastiat's Parable
the following is an excerpt from 19th Century French philospher Frederic Bastiat's essay collection That Which is Seen, and That Which is Unseen known as The Parable of the Broken Window.
I. THE BROKEN WINDOW
Have you ever witnessed the anger of the good shopkeeper, James B., when his careless son happened to break a square of glass? If you have been present at such a scene, you will most assuredly bear witness to the fact, that every one of the spectators, were there even thirty of them, by common consent apparently, offered the unfortunate owner this invariable consolation - "It is an ill wind that blows nobody good. Everybody must live, and what would become of the glaziers if panes of glass were never broken?"Now, this form of condolence contains an entire theory, which it will be well to show up in this simple case, seeing that it is precisely the same as that which, unhappily, regulates the greater part of our economical institutions.
Suppose it cost six francs to repair the damage, and you say that the accident brings six francs to the glazier's trade - that it encourages that trade to the amount of six francs - I grant it; I have not a word to say against it; you reason justly. The glazier comes, performs his task, receives his six francs, rubs his hands, and, in his heart, blesses the careless child. All this is that which is seen.
But if, on the other hand, you come to the conclusion, as is too often the case, that it is a good thing to break windows, that it causes money to circulate, and that the encouragement of industry in general will be the result of it, you will oblige me to call out, "Stop there! your theory is confined to that which is seen; it takes no account of that which is not seen."
It is not seen that as our shopkeeper has spent six francs upon one thing, he cannot spend them upon another. It is not seen that if he had not had a window to replace, he would, perhaps, have replaced his old shoes, or added another book to his library. In short, he would have employed his six francs in some way, which this accident has prevented.
Let us take a view of industry in general, as affected by this circumstance. The window being broken, the glazier's trade is encouraged to the amount of six francs; this is that which is seen. If the window had not been broken, the shoemaker's trade (or some other) would have been encouraged to the amount of six francs; this is that which is not seen.
And if that which is not seen is taken into consideration, because it is a negative fact, as well as that which is seen, because it is a positive fact, it will be understood that neither industry in general, nor the sum total of national labour, is affected, whether windows are broken or not.
Now let us consider James B. himself. In the former supposition, that of the window being broken, he spends six francs, and has neither more nor less than he had before, the enjoyment of a window.
In the second, where we suppose the window not to have been broken, he would have spent six francs on shoes, and would have had at the same time the enjoyment of a pair of shoes and of a window.
Now, as James B. forms a part of society, we must come to the conclusion, that, taking it altogether, and making an estimate of its enjoyments and its labours, it has lost the value of the broken window.
When we arrive at this unexpected conclusion: "Society loses the value of things which are uselessly destroyed;" and we must assent to a maxim which will make the hair of protectionists stand on end - To break, to spoil, to waste, is not to encourage national labour; or, more briefly, "destruction is not profit."
What will you say, Monsieur Industriel -- what will you say, disciples of good M. F. Chamans, who has calculated with so much precision how much trade would gain by the burning of Paris, from the number of houses it would be necessary to rebuild?
I am sorry to disturb these ingenious calculations, as far as their spirit has been introduced into our legislation; but I beg him to begin them again, by taking into the account that which is not seen, and placing it alongside of that which is seen. The reader must take care to remember that there are not two persons only, but three concerned in the little scene which I have submitted to his attention. One of them, James B., represents the consumer, reduced, by an act of destruction, to one enjoyment instead of two. Another under the title of the glazier, shows us the producer, whose trade is encouraged by the accident. The third is the shoemaker (or some other tradesman), whose labour suffers proportionably by the same cause. It is this third person who is always kept in the shade, and who, personating that which is not seen, is a necessary element of the problem. It is he who shows us how absurd it is to think we see a profit in an act of destruction. It is he who will soon teach us that it is not less absurd to see a profit in a restriction, which is, after all, nothing else than a partial destruction. Therefore, if you will only go to the root of all the arguments which are adduced in its favour, all you will find will be the paraphrase of this vulgar saying - What would become of the glaziers, if nobody ever broke windows?
Monday, July 19, 2010
Ideal Realism and the Pro-Modern Era Defined (First Draft)
So then, what is Ideal Realism?
Almost exactly how it sounds. i could write a thousand poems on one particular subject. Half might be created with an array of traditional forms handed down to me from writers and critics spanning the ages. Half might be hit or near hit attempts at verse or prose free of these forms. all would likely be singular, differing in appearance, rhythm, tone and conceit. all would be me, the ideal. Ideal only because i am the originator of the poems, i am the instrument of my ideas. all would also be that one particular subject, the real. And i have to believe any subject, animate or other, myself or other, is equally an instrument of its own ideal form. The process of being me is real. The process of formulating who i am, by thought or action, in relation to a subject, ideal. If you give enough thought to these past two statements, you'll eventually emerge, as i have, with an understanding that as we exist, Ideal Realism is a constant.
Within the canon of western literature, the movement of realism was an attempt to deliver an objective view of reality by portraying it in an unadorned but accurate fashion. This to say that it is possible to consider a subject without bias or interpretation and also to then present it as it is on its own, without adornment. To leave to it to the viewer or reader to discover a romance or an enlightenment.
In the contemporary world, journalism and its style of writing have supplanted the realist movement with its ambition to deliver a 'faithful representation of reality.' Literary movements have since moved both up and down this ladder. And still neither realism nor journalism has been able to bypass two glowing ailments of their cause.
The first ailment is bias. Bias in its simplest form is, at least here, defined as the real true and maybe hidden reason the writer picked that subject at all. Bias is motive. Perhaps yes, the subject as expressed by a realist, is apparently the real thing, appearing beforehand for the realist's consideration. Perhaps also, and likely, the subject did not simply appear in vacuum and the realist likely did not just happened to have on hand the means to record exactly who or what that real thing is.
Practically speaking though, realists and journalists venture out looking for real things, using their own judgment to determine what to capture and what to leave off the page. In cinema and photography, this is called framing. Since the advent of these latter forms of art, writers also utilize framing. And this choice or framing, made by journalists, writers, artists, etcetera, is called bias. Bias is inescapable and subsequently the undoing of the realist intention.
The second ailment is called observer effect or observer-expectancy effect, which is similar to bias in that the realists' or journalists' goal of actual representation is automatically thwarted. Observer effect is a concept discovered in physics first, then applied to psychology and information technology (the real world, the mind world, and the e-world) whereby the behavior or attitude of the subject is affected by the observer. Some will claim this effect only occurs when the observed is aware of their status as such. However, it may be true (and I believe it is) that if an atom in a petri dish behaves differently when observed, then so must an atom in the sun. Of course, discovery of universally applicable laws comes perhaps only after discoveries of the exceptions to universality.
Journalism has accounted for its failings by embracing them. Professional journals will announce unabashedly what their bias is, they will behave in a biased manner because that is truthful and also lucrative. In western literature, realists similarly accepted their bias when they ceased to announce themselves as realists and started to embrace the Modern Temper, calling themselves modernists.
The Modern Temper was a sawing off of the muzzle belonging to the traditional literary canon. There were rules comprising the literary tradition, yes, but showcasing the rules being broken was what modernism was all about. To present a thing not as it is, but as it is shocking! Such was modernism.
There came another sea change halfway through the 20th Century and, tada, Post-Modernism was born. Post-Modernism was not a rule breaker but a rule questioner. Where the Moderns looked to their forefathers and said, "this was you and THIS IS ME!da da da $&^*(BLAST)!!", the Post-Moderns asked and answered, "so, where were all the females and homosexuals and brown and yellow people in the last thousand years? hiding out and forgotten about!" The Post-Moderns were unfazed by rule breaking, that was their birthright. They were preoccupied with redefining the rules of tradition to allow for an all-inclusive literary canon.
And here we return to Ideal Realism and the Pro-Modern Era we hope to furnish by it.
So what is Pro-Modernism?
Well in this Pro-Modern Era, we are like our Modern brethren where we believe in shock, but rather we say "everything is always shocking," and thereby hope to do everything proper justice. And like our Post-Modern brethren, we accept in our regard the precious multitude of everything and realize, or rather try to, all the many spokes that run center to the wheel. And Ideal Realism is the tool that allows us to be both selfish, starting with ourselves as subject, and selfless, allowing the outside world to subject us as much or as little as we would subject it.
Pro-Modernism, when it is at last widely understood and practiced, will be seen as a handshake between all that is best of Modernism and Post-Modernism, giving these movements full credit for each being half of the crowning achievement of a thousand years of art and literature. Pro-modernism is a forsaking of angsty tract and depiction, an embracing of positive thought energy, and perhaps also a catalyst for a new wing in the Great Library we are ever achieving. If it ever boils out from the arts and into the sciences, social and economic in particular, it should be like an agent that encourages pro-activity in means and pure self-renewing excitement in ends.
And that is all i have to say about Ideal Realism and the Pro-Modern Era for now. I may someday revise or amend this treatise, so to better impress the points herein, or to further develop the concept. For now, my long sentences of succinct rhythm and my own meager understanding of Ideal Realism, as it occurs in the body of my work, will have to suffice.
i should very much like it and would be honored if you would further consider the greater conceit of this writing, and accept this one challenge in your own daily chore---acknowledge yourself as both origin and endpoint, but do so knowing that your subject is equally the same. Therein, if you can imagine a line of sight as a thread, you shall be witness to and part of the formation of infinity in art and, really, all things tying together and, dare i say, at last! ........^...*...
Almost exactly how it sounds. i could write a thousand poems on one particular subject. Half might be created with an array of traditional forms handed down to me from writers and critics spanning the ages. Half might be hit or near hit attempts at verse or prose free of these forms. all would likely be singular, differing in appearance, rhythm, tone and conceit. all would be me, the ideal. Ideal only because i am the originator of the poems, i am the instrument of my ideas. all would also be that one particular subject, the real. And i have to believe any subject, animate or other, myself or other, is equally an instrument of its own ideal form. The process of being me is real. The process of formulating who i am, by thought or action, in relation to a subject, ideal. If you give enough thought to these past two statements, you'll eventually emerge, as i have, with an understanding that as we exist, Ideal Realism is a constant.
Within the canon of western literature, the movement of realism was an attempt to deliver an objective view of reality by portraying it in an unadorned but accurate fashion. This to say that it is possible to consider a subject without bias or interpretation and also to then present it as it is on its own, without adornment. To leave to it to the viewer or reader to discover a romance or an enlightenment.
In the contemporary world, journalism and its style of writing have supplanted the realist movement with its ambition to deliver a 'faithful representation of reality.' Literary movements have since moved both up and down this ladder. And still neither realism nor journalism has been able to bypass two glowing ailments of their cause.
The first ailment is bias. Bias in its simplest form is, at least here, defined as the real true and maybe hidden reason the writer picked that subject at all. Bias is motive. Perhaps yes, the subject as expressed by a realist, is apparently the real thing, appearing beforehand for the realist's consideration. Perhaps also, and likely, the subject did not simply appear in vacuum and the realist likely did not just happened to have on hand the means to record exactly who or what that real thing is.
Practically speaking though, realists and journalists venture out looking for real things, using their own judgment to determine what to capture and what to leave off the page. In cinema and photography, this is called framing. Since the advent of these latter forms of art, writers also utilize framing. And this choice or framing, made by journalists, writers, artists, etcetera, is called bias. Bias is inescapable and subsequently the undoing of the realist intention.
The second ailment is called observer effect or observer-expectancy effect, which is similar to bias in that the realists' or journalists' goal of actual representation is automatically thwarted. Observer effect is a concept discovered in physics first, then applied to psychology and information technology (the real world, the mind world, and the e-world) whereby the behavior or attitude of the subject is affected by the observer. Some will claim this effect only occurs when the observed is aware of their status as such. However, it may be true (and I believe it is) that if an atom in a petri dish behaves differently when observed, then so must an atom in the sun. Of course, discovery of universally applicable laws comes perhaps only after discoveries of the exceptions to universality.
Journalism has accounted for its failings by embracing them. Professional journals will announce unabashedly what their bias is, they will behave in a biased manner because that is truthful and also lucrative. In western literature, realists similarly accepted their bias when they ceased to announce themselves as realists and started to embrace the Modern Temper, calling themselves modernists.
The Modern Temper was a sawing off of the muzzle belonging to the traditional literary canon. There were rules comprising the literary tradition, yes, but showcasing the rules being broken was what modernism was all about. To present a thing not as it is, but as it is shocking! Such was modernism.
There came another sea change halfway through the 20th Century and, tada, Post-Modernism was born. Post-Modernism was not a rule breaker but a rule questioner. Where the Moderns looked to their forefathers and said, "this was you and THIS IS ME!da da da $&^*(BLAST)!!", the Post-Moderns asked and answered, "so, where were all the females and homosexuals and brown and yellow people in the last thousand years? hiding out and forgotten about!" The Post-Moderns were unfazed by rule breaking, that was their birthright. They were preoccupied with redefining the rules of tradition to allow for an all-inclusive literary canon.
And here we return to Ideal Realism and the Pro-Modern Era we hope to furnish by it.
So what is Pro-Modernism?
Well in this Pro-Modern Era, we are like our Modern brethren where we believe in shock, but rather we say "everything is always shocking," and thereby hope to do everything proper justice. And like our Post-Modern brethren, we accept in our regard the precious multitude of everything and realize, or rather try to, all the many spokes that run center to the wheel. And Ideal Realism is the tool that allows us to be both selfish, starting with ourselves as subject, and selfless, allowing the outside world to subject us as much or as little as we would subject it.
Pro-Modernism, when it is at last widely understood and practiced, will be seen as a handshake between all that is best of Modernism and Post-Modernism, giving these movements full credit for each being half of the crowning achievement of a thousand years of art and literature. Pro-modernism is a forsaking of angsty tract and depiction, an embracing of positive thought energy, and perhaps also a catalyst for a new wing in the Great Library we are ever achieving. If it ever boils out from the arts and into the sciences, social and economic in particular, it should be like an agent that encourages pro-activity in means and pure self-renewing excitement in ends.
And that is all i have to say about Ideal Realism and the Pro-Modern Era for now. I may someday revise or amend this treatise, so to better impress the points herein, or to further develop the concept. For now, my long sentences of succinct rhythm and my own meager understanding of Ideal Realism, as it occurs in the body of my work, will have to suffice.
i should very much like it and would be honored if you would further consider the greater conceit of this writing, and accept this one challenge in your own daily chore---acknowledge yourself as both origin and endpoint, but do so knowing that your subject is equally the same. Therein, if you can imagine a line of sight as a thread, you shall be witness to and part of the formation of infinity in art and, really, all things tying together and, dare i say, at last! ........^...*...
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