Economics in One Lesson Essay

1093 WordsMay 14, 20125 Pages
"Economics in One Lesson" is an introduction to free market economics written by Henry Hazlitt and published in 1946. Hazlitt begins his monumental book by describing the problems with economic science, showing that its fallacies are greatly exacerbated compared to other scientific fields because of special interests in government. The special interest groups consistently advocate policies that they benefit from at the expense of everyone else. Many people, however, believe these fallacies because of man’s nature to see only the “immediate effects of a given policy, or its effects only on a special group.” Those people neglect the long-term effects and the implications on other groups by an economic policy. Hazlitt goes on to explain that…show more content…
Considering the role of government in lending and the overlap on taxation, Private lenders are more stringent in their lending policies and, consequently, have to turn down some high risk borrowers. The government is willing to lend these borrowers the money they need for capital to carry out their businesses. These borrowers will then be able to acquire the resources they need to produce what they need. What is overlooked at this point is the fact that, because these high risk borrowers were able to get what could have been acquired by low risk borrowers from private lenders, the resources ended up in the hands of less efficient producers who may not be as productive as the producers who qualified for private lending. Furthermore, high risk borrowers get the money from the taxpayers and taxpayers can not fet benefit from this lending and this means the practice to the benefit of a few at the expense of everyone else. For the short-term result, government lending can encourage entrepreneurship to create more GDP and bring benefit for the high risk borrowers. But for the long-term result, high risk borrowers may not produce and use money efficiently when get money from the government. The worse is that this only benefit for special groups. For the synergy of technology, production and employment, Many labor unions exist to argue against the need for self sufficient machines as this is a threat to
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