An ode to destruction

It's been some Friday since Frédéric Bastiat wrote a famous text about a ruined shop window. In this example, he showed the illogicality and incorrectness of the reasoning of "admirers of destruction." Even so, over and over again, there are thoughts that "there will be something good in that ruined shop window" - and the tailor is still forgotten.

Scrap fees
Scrap fees

If a famous text Frédérica Bastiata you don't know, never mind. We'll remember him a little.

A little mischief breaks a baker's shop window. There are shards in the cakes and pastries, and the baker is now just looking sadly at the misfortune that befell him. However, the people who have gathered around are beginning to muddle. First, perhaps to calm the bakers.

As people think, they tell the baker that not everything is so bad. After all, thanks to the broken shop window, the glazier will have a job! How much does a new shop window cost? 5 crowns? That's quite a bit of money for the baker himself. But when the glazier gets the money, he is spend at some merchant's spend again… and so on! How many jobs were created thanks to one broken shop window!

Let's look further. If the broken shop window helped us so much, how about tearing down the baker's whole shop? Or how about tearing down the whole city right away? Whole states? After all, how much work will arise!

As now, people see a broken shop window, in a few days they will see a repaired shop window and see a richer glazier. People he sees and therefore thinks. But what about the baker? The baker previously had a shop window and 5. He wanted to spend the five thousand on a suit, for example. Bought So would suit the tailor - and lo and behold! The baker would have a shop window and a suit, the tailor would have the money he would spent at merchants, you would have them spent at other merchants… and so on! How many jobs newas created because of one broken shop window!

To sum up - a baker (company) could have a shop window and a suit. Now, however, the baker (company) has only a shop window. Was the breaking of the shop window and its forced repair correct the right act? Did it bring us wealth? Of course not. The company gained nothing by breaking the shop window, on the contrary - it lost its suit. The tailor lost five thousand. Why don't people take care of tailors? Because when the shop window is broken, the tailor doesn't come on the scene, so people don't see him. He sees only a satisfied glazier.

But let's look at what could have preceded the whole shop window situation. Let's say there are only a few strong glaziers in town. Unfortunately, people have enough glass and so do glaziers reduce profits. I will meet the glaziers for a meeting and get great idea - pay the little naughty to run around the city and smashed shop windows. This will bring new mobile clients to them and they will have work and profits!

They will learn about the whole event of our glaziers at the headquarters of the glaziers' guild in the capital. After the result, they will say that it is quite a nice thing that increases the profiters' profits. What can we do all over the country?

But paying small mischief all over the country is already quite difficult. Why would the whole guild bother with that. And so they said they would push the government. The leader of the Glaziers' Guild will appear before the government and inform them that the Glaziers are in a very bad position. So many people work as glazers and they all live terribly now. There is no sales, he continues. People consume little glass. We must support this, or poverty will spread, certainly crime among glaziers, the confident leader of the Glaziers' Guild thundering at a government meeting.

In the end, he makes a strong argument: today, thanks to new technologies, we do better glass than before! Yippee in the interest of the people replace your old glass, which has been made carelessly and with old technologies, with new ones, modern glass!

Members of the government nodded appreciatively. After all, glaziers and their employees are quite enough - and they are also potential voters. But what should we do, asks the Prime Minister. The guild leader immediately comes up with a brilliant idea - let's pay people to destroy their old glass and buy new glass! Taxes on the income of new employees and higher profits of glaziers will return, the policy of the guild leader assures. The ministers will eventually agree that it is great idea and support the proposal. It will be created shard!

Of course, people see how many new employees the glazers have hired, how many new glasses and shop windows the glazers have created. People see workers at furnaces, they see activity in glassworks. And so he believes how beneficial the shard had.

What people don't see is how many tailors lost their job. How many suits are did not produce. How many traders did not earn at the tailors' shop. How much new substance is did not bring. How many people did not win work when processing that substance. How many people did not get a job when importing the substance. People don't see that instead of having them shop windows, glasses and suits they only have today shop windows and glasses. People don't see how much they've lost.

Scrap fees

What other than loss is then scrap metal? People used themselves to use their own money to destroy their cars and buy new ones. People could have cars and for example refrigerators, washing machines, televisions, computers, clothes.

But that's the only way they have cars. So many places that no one got! So many factories that no one set up! So many homes that no one has built!

0 comments

  1. Or in other words. In the first case, the baker has a shop window and 5000 crowns for a suit, assuming the glazier has no money. In the second case, the baker only has a shop window - he no longer has a suit. However, the glazier also does not have a suit, because he has to pay a large part of the 5000 crowns for the material, energy, imports, etc. needed to produce the expenses - this is the money needed to create those jobs in the first part of the reasoning. It's the money wasted in the broken shop window.
    Therefore, the claim that by breaking the shop window the company will gain something as "eL" claims is odd.

  2. eL: but in the first case, the baker has a shop window and a suit, so the tailor has another shop window and the glazier can also have another suit. In the first case, we are still better off, because the money given for the first (broken) shop window is lost by breaking it.

    There is no "law of conservation of money".

  3. I will add the sentence that I refuted: "The company did not gain anything by breaking the shop window, on the contrary - it lost its suit."

  4. This reasoning is wrong at the beginning, where what is pointed out itself overlooks.
    Quote from the article: "Let's summarize - the baker (company) could have a shop window and a suit. But now the baker (company) only has a shop window. "

    It is overlooked here that in the second case the baker only has a shop window, but the suit has a glazier.

    Money always moves somewhere, but it always moves, it doesn't get lost. Even those glaziers who actually steal this method will eventually spend the money for something. What is wrong with this principle is just a way to win a contract.

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