American Elephants

Here’s one little lesson from economics that we all need to keep in mind.  On September 14, 2001, economist Paul Krugman wrote in the New York Times :

Ghastly as it may seem to say this the terror attack (of 9/11), like the original day of infamy, which brought an end to the Great Depression, could even do some economic good.

Sigh.  There is a basic fallacy in his thinking, what Fredric Bastiat called the broken-window fallacy.  And the Japanese attack on December 7 didn’t end the Great Depression either.

(h/t: Veronique de Rugy)