"If I throw a brick through my neighbor’s window, have I created a job?" Bastiat asked. Democrats today would answer yes, that’s a stimulus, because my neighbor has to spend money to pay a repairman to fix the window. That worker now has more money to buy other things, so we have created prosperity.
This newfound wealth, of course, is illusory. The broken window, once repaired, has produced no real increase in the nation’s economic assets. For every penny the repairman makes, someone has to borrow or take money out of his pocket to pay for the repair. A dollar, when given to the repairman, has the same value as when taken from the homeowner or businessman with the shattered window. The repairman has more to spend but someone else, inevitably, has less. Yet this is the equation at the heart of the Obama Administration’s stimulus package: Under the auspices of a beneficent government, we will break each other’s windows until the economy hits escape velocity and we all enjoy greater wealth.