Mindmeld, In the world of Keynesians, all expenditures are good ones, whether we can afford it or not. I don't know how Keynesians answer the charge that they believe in broken window fallacies. Some would argue that "breaking the window" would lead to the development of better, more high-tech "windows." Others would argue that the phrase "breaking the window" is too literal, and that as long as expenditures go toward "useful" projects, the net productivity of society goes up.
Neither of those two counterarguments really get the point of the broken window fallacy, which is that value supposedly has to be destroyed in order to "stimulate" the creation of new value. In the most simple case, the net effect is to end up back to the status quo. (In the case where the replacement window is better than the old, the owner may not have liked his old window in the first place, in which case he already placed a negative value on it.)
In the case of the ObamaCare web sites, let's say it should have taken $200M to develop, test, and deploy with few to no bugs, but in actuality it took $1.2B. Keynesians will claim that the difference of $1B represents a "stimulative" effect on the GDP because it circulates money that would have otherwise not been spent. But what did that extra $1B buy us? Nothing. And did that extra $1B just magically appear out of thin air? Of course not.
Just circulating money for the point of circulating money is futile.
Tenchusatsu |
