The Conversation

Ted Cruz and the 'Broken Window' Theory of ObamaCare

When I was marveling at the spectacle of Barack Obama killing six million insurance policies, then celebrating the "achievement" of selling those people more expensive coverage at gunpoint, I compared it to Obama running a tire shop with a line of tire-puncturing spikes deployed on the road outside.  "Wow, shame about how your wheels just blew off!  Lucky for you we sell tires here!  You'd best buy a set, before the cop up the road arrests you for driving on four flats!"

Senator Ted Cruz (R-TX) made the same point with a reference to the classic "Broken Windows" fallacy outlined by Bastiat:

He doesn't explicitly mention Bastiat in his infographic, but I suspect Cruz chose his words carefully when he named it "The Broken Window Theory of ObamaCare."  In the original parable, Bastiat writes of a shopkeeper whose window gets broken by vandals.  Someone tries to cheer up the shopkeeper by touting all the economic activity that will now ensue - a new window must be made and installed, the glazier will buy many things from other businesses along the way... why, the whole village will be so much richer because of the economic activity inspired by that broken window!  Those vandals were actually delivering economic "stimulus" with their stones!  The road to prosperity is littered with the glass of broken windows!

This kind of idiocy is actually the dominant economic theory of the modern Left; they think Bastiat was writing an instruction manual, not warning about an economic fallacy.  There's nothing to "celebrate" about the April Fool's Day ObamaCare milestone - it's horrifying, for exactly the reason Cruz puts forth in his infographic.  A government program that spends hundreds of billions of dollars taking away free choice from millions of people, then herds them into Big Government programs (including Medicaid, an outright welfare program) under threat of legal penalty, is not a "success."  

Bastiat explained one of the reasons why, when he punctures the Broken Window fallacy: opportunity costs.  The village idiots celebrating that shopkeeper's broken window as economic "stimulus" are ignoring all the things the shop owner, and the people he'll hire to replace his window, might have done instead of fixing that act of vandalism.  Government programs are often "celebrated" by absolutely ignoring the monstrous opportunity costs they impose on society.  What else could we have done with the staggering sums of money poured into ObamaCare, from the billions plowed into federal and state exchange websites - some of which still don't work - to the hundreds of millions of dollars blown on ObamaCare advertising, or the rising costs of administering the program itself?

Look at it this way: if Obama's infamous "like your plan, keep your plan" promise had been kept, he would have been "celebrating" 850,000 ObamaCare enrollments at best on April 1.  Insuring 850,000 new customers might still be portrayed as an achievement... but not when it costs over a trillion dollars.  Leftist ideology speaks of goals that are worth any price to achieve; out here in the real world, we know cost is a vital measurement for the success of any endeavor.  We really ought to spend more time thinking about the costs our Ruling Class orders us to ignore.


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