Article Image
IPFS News Link • Economy - Economics USA

The Broken Window Fallacy and Keynesian Economics

The Broken Window Fallacy and Keynesian Economics

This video demonstrates how keynesian economists view the destruction of capital (wealth) and assets as an economic expansion.

Government's often support keynesian economic policies because their underlying fundamentals allow the open continuation of malicious policies while simeultaneusly allowing the beuracracy to claim said policies are in the interest of protecting its citizens.

Socialism is defined as central government planning; when the government controls the use of capital and assets instead of the marketplace.

When the government allocates resources they create mal-investments (malicious-investments), these investments destroy capital and income producing assets. A government can never allocate resources effectivley due to the combined knowledge of the marketplace (millions of persons) outwieghing the combined knowledge of the beuracracy (hundreds of persons), and the motivation for each differentiates between the profit motive (motivation to increase ones standard of living), and the power motive (motivation to acquire power (to rule)).

The adoption of socialist policies by a government also destroy's market profit-motivation, reducing the efficiency of the effected economies income producing assets.

Societies that become socialist are always doomed to faliure. Since the only outcome of socialism is the destruction of capital, eventually there is no wealth left to destroy, and the society is forced to become capitalist again, in order to survive.