Bear with me -- this blog post will probably seem dry as hell, but I think it's important.
Frederic Bastiat wrote an essay called "What is Seen and What is Not Seen" -- one that I sadly think most people are not aware of. In a nutshell Bastiat notes that while the impact of a certain actions may have very apparent consequences that others are often overlooked. An example he cites is that of a shopkeeper's window that is broken. Onlookers may profess to be dismayed that the window has been broken, but secretly they are pleased as it means the window will have to be replaced -- benefiting the window glazier and others in turn.
What is seen is that money must be spent on the repair which in turn will benefit the community. But what is unseen, however, are the purchases that must be foregone by the shopkeeper to pay for the window. What if he had been about to buy a new pair of shoes, but now cannot afford to? Instead of having both a window and a shoe, he must now only settle for a new window. The cobbler loses revenue but most likely does not even know it.
To be able to pass sound judgement on issues people must be able to consider not only that which is obvious, but the unseen effects as well. Similarly people must also be able to think in the alternative. As Thomas Sowell argues in his book The Vision of the Anointed, there are no solutions, only trade-offs. To obtain one thing we must sacrifice something else. A perfect example of this is can be seen in the debate over drilling in the Alaska National Wildlife Refuge. By forgoing drilling we are making a trade-off -- (allegedly) no dead animals in exchange for no oil. We also have the seen vs. the unseen at work. The impact of drilling (for the sake of argument I am assuming the environmental camp is correct) is apparent with oil rigs being built and the environment devastated. What is unseen, however, are the jobs that aren't created, the oil that isn't pumped and the lower prices at the gas station.
This can be applied to so many issues, particularly environmental ones. Few people, if any, are in favor of dirty air, polluted water or fewer cute and furry animals. Most people in developed countries probably profess to be concerned about the environment and the general state of the planet. Therefore when a piece of environmental legislation comes up there is probably going to be signicant pressure for it to be passed. But is this good?
Take for example rules governing the amount of arsenic in our water. Is anyone in favor of arsenic? Doubtful. If ingested in sufficient amounts it can kill you, and we have an interest in keeping it out of our water. But does it make sense for 100% of arsenic to be eliminated? On the surface, perhaps yes. After all, if it's bad why not completely eliminate it? That proposition runs into trouble, however, when we consider the problem of diminishing returns. While eliminating (just throwing a number out, this isn't science) the first 95% of arsenic probably makes sense the remaining 5% might not as costs begin to increase substantially while benefits diminish. Is saving 5 extra lives worth, say, imposing costs of $100 billion? I would say not. (And no, life isn't invaluable -- if it was we'd make everyone drive 10 mph)
This is the problem with environmental extremism. While protecting the environment is plainly in our interest we eventually reach a point at which costs outweigh the benefits. And while we see the benefits to environmental legislation we don't see the costs nearly as often. Who has ever said, "I didn't get a job because of environmental regulation?" I'm guessing not too many people.
The Kyoto Treaty is another case in point. Let's assume that its successful implementation reduces global warming by 1 degree. Most people would probably say that is good. But at what cost? Estimates are literally in the trillions of dollars. Think of how many jobs must be foregone or eliminated. Think of the lost income and the loss to human welfare. Are the benefits worth it? And think in the alternative: is that the best use of $1 trillion? For that amount how many people could be provided with clean drinking water? Is that goal not more laudable than a slight impact on the earth's temperature?
Taking this example even further, while global warming may have certain costs -- fewer polar bears for example -- what about the benefits? For example, some places not currently suitable for certain types of farming would be if the temperature of the local climate was increased. Indeed, I believe some people have argued that the net impact of global warming may be positive. All angles must be considered.
Other non-environmental examples abound. Look at the role of tariffs. Several years ago the Bush Administration imposed tariffs on imported steel to assist domestic steel producers who warned of layoffs due to cheap foreign competition. That was the seen. Unseen, however, were the effects of more expensive steel. The cost of construction projects went up. To compensate for the more expensive steel perhaps someone elected not to have some fancy imported tile installed in their bathroom -- harming tile-makers. Meanwhile industries that consume steel -- such as autos -- had pressure placed on them. But how many news stories did you read about people who didn't get jobs they otherwise would have because of the tariffs?
Or look at Iraq. The costs are obvious, both in terms of lives and treasure. But how many terror attacks on the US have been stopped that otherwise would have been carried out since Al Qaeda is so busy in Iraq? How many buildings haven't been toppled? Maybe none. Maybe a lot. We don't know for certain must it must be taken into consideration. Seen vs. unseen.
And lastly, look at the damn baseball stadium here in D.C. For well over $500 million proponents claim that jobs will be created. And I certainly believe them -- for that kind of money I could probably create a few jobs as well. But how many jobs will not be created by businesses who are forced to shoulder higher taxes to pay for the stadium? How many schools will not be renovated because money is being spent on the stadium? How many police officers will not be hired? Such questions must be answered for a sound decision to be reached.
Think in the alternative, and try to see that which is not obvious.
Frederic Bastiat wrote an essay called "What is Seen and What is Not Seen" -- one that I sadly think most people are not aware of. In a nutshell Bastiat notes that while the impact of a certain actions may have very apparent consequences that others are often overlooked. An example he cites is that of a shopkeeper's window that is broken. Onlookers may profess to be dismayed that the window has been broken, but secretly they are pleased as it means the window will have to be replaced -- benefiting the window glazier and others in turn.
What is seen is that money must be spent on the repair which in turn will benefit the community. But what is unseen, however, are the purchases that must be foregone by the shopkeeper to pay for the window. What if he had been about to buy a new pair of shoes, but now cannot afford to? Instead of having both a window and a shoe, he must now only settle for a new window. The cobbler loses revenue but most likely does not even know it.
To be able to pass sound judgement on issues people must be able to consider not only that which is obvious, but the unseen effects as well. Similarly people must also be able to think in the alternative. As Thomas Sowell argues in his book The Vision of the Anointed, there are no solutions, only trade-offs. To obtain one thing we must sacrifice something else. A perfect example of this is can be seen in the debate over drilling in the Alaska National Wildlife Refuge. By forgoing drilling we are making a trade-off -- (allegedly) no dead animals in exchange for no oil. We also have the seen vs. the unseen at work. The impact of drilling (for the sake of argument I am assuming the environmental camp is correct) is apparent with oil rigs being built and the environment devastated. What is unseen, however, are the jobs that aren't created, the oil that isn't pumped and the lower prices at the gas station.
This can be applied to so many issues, particularly environmental ones. Few people, if any, are in favor of dirty air, polluted water or fewer cute and furry animals. Most people in developed countries probably profess to be concerned about the environment and the general state of the planet. Therefore when a piece of environmental legislation comes up there is probably going to be signicant pressure for it to be passed. But is this good?
Take for example rules governing the amount of arsenic in our water. Is anyone in favor of arsenic? Doubtful. If ingested in sufficient amounts it can kill you, and we have an interest in keeping it out of our water. But does it make sense for 100% of arsenic to be eliminated? On the surface, perhaps yes. After all, if it's bad why not completely eliminate it? That proposition runs into trouble, however, when we consider the problem of diminishing returns. While eliminating (just throwing a number out, this isn't science) the first 95% of arsenic probably makes sense the remaining 5% might not as costs begin to increase substantially while benefits diminish. Is saving 5 extra lives worth, say, imposing costs of $100 billion? I would say not. (And no, life isn't invaluable -- if it was we'd make everyone drive 10 mph)
This is the problem with environmental extremism. While protecting the environment is plainly in our interest we eventually reach a point at which costs outweigh the benefits. And while we see the benefits to environmental legislation we don't see the costs nearly as often. Who has ever said, "I didn't get a job because of environmental regulation?" I'm guessing not too many people.
The Kyoto Treaty is another case in point. Let's assume that its successful implementation reduces global warming by 1 degree. Most people would probably say that is good. But at what cost? Estimates are literally in the trillions of dollars. Think of how many jobs must be foregone or eliminated. Think of the lost income and the loss to human welfare. Are the benefits worth it? And think in the alternative: is that the best use of $1 trillion? For that amount how many people could be provided with clean drinking water? Is that goal not more laudable than a slight impact on the earth's temperature?
Taking this example even further, while global warming may have certain costs -- fewer polar bears for example -- what about the benefits? For example, some places not currently suitable for certain types of farming would be if the temperature of the local climate was increased. Indeed, I believe some people have argued that the net impact of global warming may be positive. All angles must be considered.
Other non-environmental examples abound. Look at the role of tariffs. Several years ago the Bush Administration imposed tariffs on imported steel to assist domestic steel producers who warned of layoffs due to cheap foreign competition. That was the seen. Unseen, however, were the effects of more expensive steel. The cost of construction projects went up. To compensate for the more expensive steel perhaps someone elected not to have some fancy imported tile installed in their bathroom -- harming tile-makers. Meanwhile industries that consume steel -- such as autos -- had pressure placed on them. But how many news stories did you read about people who didn't get jobs they otherwise would have because of the tariffs?
Or look at Iraq. The costs are obvious, both in terms of lives and treasure. But how many terror attacks on the US have been stopped that otherwise would have been carried out since Al Qaeda is so busy in Iraq? How many buildings haven't been toppled? Maybe none. Maybe a lot. We don't know for certain must it must be taken into consideration. Seen vs. unseen.
And lastly, look at the damn baseball stadium here in D.C. For well over $500 million proponents claim that jobs will be created. And I certainly believe them -- for that kind of money I could probably create a few jobs as well. But how many jobs will not be created by businesses who are forced to shoulder higher taxes to pay for the stadium? How many schools will not be renovated because money is being spent on the stadium? How many police officers will not be hired? Such questions must be answered for a sound decision to be reached.
Think in the alternative, and try to see that which is not obvious.
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