Bastiat On Clunkers

clipped from www.latimes.com Ce qu'on voit et ce qu'on ne voit pas.voit et ce qu'on ne voit pas. That may exhaust my French phrase quota for the year, but it's worth it. The saying is the title of an essay by the 19th century French economist Frederic Bastiat and means "that which is seen, and that which is not seen." Bastiat's essay is most famous for the "parable of the broken window," in which a young boy shatters a shopkeeper's window and, after some initial outrage, the villagers conclude that the rascal helped the local economy. Why? The problem with this argument can be gleaned from the title of Bastiat's essay. By counting the money the shopkeeper spends to replace a perfectly good window (that which is seen), we ignore the money he might have spent on something else (that which is unseen). The shopkeeper might have instead dropped six francs on new shoes or a book or on a bonus for his assistant. Those who celebrate the broken window as a generator of growth take "no account of that which is not seen."