Thursday, July 19, 2012

Getting things backwards. Again...

Three years ago, during the Cash for Clunkers disaster (and that was a pretty major program that Obama's not making reference to in his re-election campaign), I noted that the Obama administration had gone to an economic classic and used a cautionary tale as an instruction manual.
Bastiat wrote, over 150 years ago, of the broken-window fallacy, in which a smashed window is looked at as an economic stimulus while completely missing the opportunity cost associated with being unable to spend the window replacement cost on different economic stimulus. The current administration and Congress apparently didn't get to the end of the broken window story, just stopped in the middle, saying, "what a great idea!" They've turned window smashing into the only part of their economic stimulus package which seems to be stimulating anything...
Now Jeffrey Carter notes another instance of the Obama adminstration going to an seminal work of free market economic principles and ... taking the wrong side...

Barack Obama, last week:
There are a lot of wealthy, successful Americans who agree with me, because they want to give something back. They know they didn’t -look, if you’ve been successful, you didn’t get there on your own. You didn’t get there on your own. I’m always struck by people who think, well, it must be because I was just so smart. There are a lot of smart people out there. It must be because I worked harder than everybody else.
Let me tell you something – there are a whole bunch of hardworking people out there. If you were successful, somebody along the line gave you some help. There was a great teacher somewhere in your life. Somebody helped to create this unbelievable American system that we have that allowed you to thrive. Somebody invested in roads and bridges. If you’ve got a business. you didn’t build that. Somebody else made that happen.
From Atlas Shrugged:
“He didn’t invent iron ore and blast furnaces, did he?”
“Who?”
“Rearden. He didn’t invent smelting and chemistry and air compression. He couldn’t have invented his Metal but for thousands and thousands of other people. His Metal! Why does he think it’s his? Why does he think it’s his invention? Everybody uses the work of everybody else. Nobody ever invents anything.”
She said, puzzled, “But the iron ore and all those other things were there all the time. Why didn’t anybody else make that Metal, but Mr. Rearden did?”

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