Here’s a perfect opportunity for someone with some real book learnin’ on the subject to demonstrate the broken window fallacy. But no, it’s left to me, an unlettered nobody, to supply the punchline to this economic in-joke. Well, me and Wikipedia: http://en.wikipedia.org/wiki/Parable_of_the_broken_window

Let A Thousand Nations Bloom

Things that make you go hmmmm:

Whether it’s recovering from a war or cleaning up after a natural disaster, periods of severe destruction are usually followed by sharp bursts of economic activity. Money pours in from government and insurers to repair infrastructure. Homes get rebuilt, debris cleared. As a result, the overall economic growth that follows a natural disaster can often outweigh the wealth it destroyed. Economists call this the broken window effect. “To an economist, breaking a window always boosts GDP,” says Michael Englund, chief economist at Action Economics. Englund thinks that Sandy could end up boosting fourth-quarter gross domestic product by as much as two-tenths of a percentage point. “The backfill activity will probably be bigger,” he says. “By the time the rebuild is over, I think we’ll see this as a net positive [for GDP].”

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