Fake Broken Windows

“Fake But Accurate” for Real This Time? | Power Line: "What an ironic turn of events for the website that helped speed Dan Rather’s retirement from CBS to borrow the New York Times‘ infamous rationalization that a document was “fake, but accurate,” but that certainly appears to be the case with the Paul Krugman earthquake tweet that we linked to in the “Picks” section the other day:

People on twitter might be joking, but in all seriousness, we would see a bigger boost in spending and hence economic growth if the earthquake had done more damage.

Quite a few people noted this passage and wondered whether this was a parody (such as the sharp folks at ZeroHedge) but the problem is that Krazy Krugman could really say something like that, so it got passed around.  But now someone named Carlos who runs a blog called Campaign Fix has come forward claiming to be the author of this hoax.  Except, while this particular Krugman line is made up, it is entirely consistent with Krazy Krugman’s views in the past, as Campaign Fix notes"

Read it to understand where I get the "broken windows" from.

And there's an excellent comment:

I'm not sure Bastiat is the proper response to Krugman's theory that disasters can be stimulative. The real point of Keynesian stimulus is that it's a trick: the 'animal spirits' are aroused, as in a war or the alien invasion scenario, such that the losses incurred by the disaster itself are overcome in fairly short order by the change in psychology among consumers and entrepreneurs. The problem, at least with garden variety stimulus, is that everybody sees through the trick. Consumers and entrepreneurs widely believe that stimulus now means higher taxes and/or inflation in the future. Even if they're wrong about the future inflation and taxes (they're right IMO), it doesn't matter: the Keynesians' hoped for change in psychology is nullified by their belief.

Keynesianism is dependent on a plentiful supply of sheep to fleece in other words...