FORT WAYNE, Ind. (AP) — A sudden storm that rolled through northern Indiana last week likely left behind tens of millions of dollars of damage to homes and businesses in Fort Wayne, an economist said.
Michael Hicks told The Journal Gazette that property damage from a storm like last Friday’s could easily add up to $20 million.
Most economic studies are suspect, but off-the-cuff estimates of economic impact like this one seem especially bogus, little more than a swag. How do you decide what's a gain and what's a loss when it comes to storm aftermath? I have to replace the food in my refrigerator and freezer, which will cost, let's say, $500. That's a $500 loss to me but a $500 gain for the supermarket. So how do you count it when it comes to storm "damage"? In almost every aspect of the aftermath, you can see the same dichotomy. The costs to the utility in overtime and pole replacement, for example, are assets elsewhere in the economy.
Comments
Mr. Morris, I recommend the Fallacy of the Broken Window. I think both Bastiat and Hazlitt have it right.
Here it is ( http://freedomkeys.com/window.htm ) for those who don't find it daunting to wander further into the economic weeds. That fallacy says, in essence, that when you're trying to calculate economic growth, don't forget that there is a loss for every gain. I was saying the reverse of that about economic decline: Don't forget that there is a corresponding gain for every loss.
Ok. I understand the economic stasis. But then why is there all the economic doom and gloom forecasts over the Affordable Care Act? After all, your economic loss when buying health insurance is an economic gain to doctors, hospitals and insurance companies, isn't it?
I should be happy that my loss is somebody else's gain?