Broken window fallacy?

[Bastiat's The Law]

So, I was having a friendly debate with someone about our foreign policy. One of my favorite ways to debate socialists is using the broken window fallacy. it just makes so much sense and can show why certain things like war, welfare, and taxes are inherently wrong and they decrease an economy's net wealth.

However, without debating the morals of going to war with other nations, and simply focusing on the economic aspect of it, my friend had a question for me that I honestly could not, and still cannot, answer:

What do you make of conquests in which you acquire territories and/or have other nations pay reparations? Would it then not be a net increase?

Being the open-minded person I am, I conceded that I believed he was right. Again, without taking into consideration morals, is there any flaw in his logic? Would the spoils of war afterwards not make up for the net loss during the war and more?

Please help me understand.

Worked in WWI when Germany had to pay reparations, err, opps.

 

[osan]

So, I was having a friendly debate with someone about our foreign policy. One of my favorite ways to debate socialists is using the broken window fallacy. it just makes so much sense and can show why certain things like war, welfare, and taxes are inherently wrong and they decrease an economy's net wealth.

However, without debating the morals of going to war with other nations, and simply focusing on the economic aspect of it, my friend had a question for me that I honestly could not, and still cannot, answer:

What do you make of conquests in which you acquire territories and/or have other nations pay reparations? Would it then not be a net increase?

I do not see the difficulty, unless I am misapprehending the gist of the question. Most of the time destruction results in a net loss of value. Economies "grow" when value is added. I go to the sand pit, load my cart with sand, take it back to my studio, put the sand in the kiln and after it melts I start making glass objects. I have taken a raw material generally viewed as being of some net value, say X, and transform it into something of a new value, X'. So long as X' > X the net worth of the world has been augmented, all else equal. This is what we call "added value".

Warfare rarely, if ever, results in material added value. This is especially true with modern, mechanized, engineered warfare due to the extensive destruction that results at the press of a button. In the long aftermath of war there may again be added value conditions prevalent in a give place, but before that can happen, the negative ledger entries of the destruction must be balanced with reparative activities. All those activities add zero value to the books, save to reinstate some former level of net worth. A good example is the Word Trade Center site. The rebuilding has not augmented the overall value of, say, Manhattan real estate (just to focus on a single result of the activity) until what has been built precisely matches (by some standard of measure) that which was lost. At that point you are back to relative zero-sum. Anything you add thereafter may be considered as added-value.

Does this make sense?

Therefore, while one party may benefit from "war reparations", they may still be devoid of added value because what was expended (war costs) went into nothing materially positive. It was devoted to killing and wreckage of that which presumably had value prior to hostilities and the destruction of which attenuated the ledger balance. So then, for example, Germany's reparations to the UK probably added little, if any, because that money would have presumably been spent on rebuilding all that Germany destroyed during hostilities. Germany, of course, loses out completely because those monies were unable to be applied to the repair of their own devastated cities and industry.

Much as the destruction of net worth by the little bastard hired by the local glazier to break shop windows so he will benefit from the destruction, the same may be said of nations engaging in warfare. The notion that was put forward that the war in Eye-Rack was a GOOD thing for the world economy because Haliburton was awarded billions in heavy construction contracts flies in the face of anything remotely related to truth an intuitive good sense to honest men whose intellectual faculties are nominally intact. The example of warfare does indeed track very closely with that of the broken window fallacy. There is NOTHING good about war. It is ALWAYS a net loss even when justified. Destruction of value is costly and it almost never makes things better. There used to be a gorgeous brownstone (Lutheran? Methodist?) church on 63rd st. in Philly. I used to drive past it often and would marvel at its lovely architecture and construction. One day as I drove past I was utterly horrified, and I mean that literally, to see an excavator demolishing this profoundly beautiful structure. Its replacement? Just what the world needed - another strip mall. There's the Broken Window Fallacy at work, IMO.

Being the open-minded person I am, I conceded that I believed he was right. Again, without taking into consideration morals, is there any flaw in his logic? Would the spoils of war afterwards not make up for the net loss during the war and more?

Please help me understand.

Certainly not because the game becomes ZERO-SUM at best, and is often negative sum for the reasons cited above. As I write before - destruction costs in innummerable ways, the most obvious form being in gross material terms. So no, your opponent was not only incorrect, he was grotesquely so. It takes a special brand of blind to see it the way he does and sadly, far too many people are blind in this way.

 

[Nastynate]

Wouldn't it be more economically feasible to have unrestricted trade with said target country then to go in and annex them?

 

[FSU63]

Wouldn't it be more economically feasible to have unrestricted trade with said target country then to go in and annex them?

Yes, I realize that now.

 

[ClydeCoulter]

From a selfish point of view, ie my country? Or total wealth on the earth vs the number of human beings?

One mans gain at the point of a gun is another mans loss.

 

[erowe1]

So, I was having a friendly debate with someone about our foreign policy. One of my favorite ways to debate socialists is using the broken window fallacy. it just makes so much sense and can show why certain things like war, welfare, and taxes are inherently wrong and they decrease an economy's net wealth.

However, without debating the morals of going to war with other nations, and simply focusing on the economic aspect of it, my friend had a question for me that I honestly could not, and still cannot, answer:

What do you make of conquests in which you acquire territories and/or have other nations pay reparations? Would it then not be a net increase?

Being the open-minded person I am, I conceded that I believed he was right. Again, without taking into consideration morals, is there any flaw in his logic? Would the spoils of war afterwards not make up for the net loss during the war and more?

Please help me understand.

I don't get the argument.

Look at it on a global scale of the world's resources.

So state A uses a whole bunch of resources and destroys and then rebuilds a whole bunch of stuff in state B. Your friend thinks there's some way to conceive of it that this results in more resources being in existence than there would be if state A used those resources that it had, and instead actually produced something new, and let state B keep its resources and also go on producing new things?

 

[RJB]

I guess we'll have to look hard for another country like Iraq where we are promised that our troops will be greeted with flowers.

 

[acptulsa]

I'm not talking at all about Iraq and Afghanistan. I was talking about more along the lines of what the Nazis were trying to do with Poland.

You've never heard of the Polish Underground? Or the French Resistance?

Is that not some serious gambling? How did those occupations, after being expensive in the short term, work out in the long term?

Come on, man. France exacted harsh reparations from Germany after WWI. They also lost a generation of young men. Literally. Look at these wounded men coming back from the middle east. Is that not a broken enough window for you?

Empires fall. And the corporations that are gaining from 'our' Afghani pipelines and 'our' petrodollar just aren't even paying back the expenses of war, much less sharing any profits. It's just another redistribution of wealth from the poor to the rich, and from our grandchildren to out current overlords. There's no way to justify the way it used to be done, and there's no way to justify the way it's done now.

 

[Acala]

One mans gain at the point of a gun is another mans loss.

Well-said. Wealth comes from trade not theft.

 

[Barrex]

Warfare rarely, if ever, results in material added value...

I wouldnt be so quick to call people blind. You make assumptions about war, reparation, wealth transfer and so on. I already explained this in my previous post (strange looking math thingy).

Couldnt disagree more. Mongols, Ottomans, Persians, Roman, British.... most if not all empires history screams that your assumption is wrong. Bank robber that is successful never gained material added value? That is what states(kingdoms, empires etc...) do. Rob other states of their goods (land, resources, cattle, people/serfs/slaves, water...). Why? They end up better of than they would be without war.

Historically "war reparations" come from paying tribute. Defeated country gives wealth to victorious one- another form of wealth transfer. It has nothing to do with justice. It only matters who won and how much victor demands.

Wars diminish worlds economy. That doesnt mean that one side in war isnt better of than it would be without war.

Recent example: US made Iraq pay reparation for Kuwait war in oil. Amount set by US: What ever US (U.S.A. not "us" as in "we") decides. But if it is too emotional or close to some be objective lets argue how mongols lost so much wealth from waging war/conquering half of the world. See any holes that theory?

 

[Barrex]

From a selfish point of view, ie my country? Or total wealth on the earth vs the number of human beings?

One mans gain at the point of a gun is another mans loss.

Well-said. Wealth comes from trade not theft.

Did he really said/meant that?

 

[osan]

I wouldnt be so quick to call people blind. You make assumptions about war, reparation, wealth transfer and so on. I already explained this in my previous post (strange looking math thingy).

Couldnt disagree more. Mongols, Ottomans, Persians, Roman, British.... most if not all empires history screams that your assumption is wrong. Bank robber that is successful never gained material added value? That is what states(kingdoms, empires etc...) do. Rob other states of their goods (land, resources, cattle, people/serfs/slaves, water...). Why? They end up better of than they would be without war.

Historically "war reparations" come from paying tribute. Defeated country gives wealth to victorious one- another form of wealth transfer. It has nothing to do with justice. It only matters who won and how much victor demands.

Wars diminish worlds economy. That doesnt mean that one side in war isnt better of than it would be without war.

Recent example: US made Iraq pay reparation for Kuwait war in oil. Amount set by US: What ever US (U.S.A. not "us" as in "we") decides. But if it is too emotional or close to some be objective lets argue how mongols lost so much wealth from waging war/conquering half of the world. See any holes that theory?

It appears you misunderstand the nature of the fallacy itself. The fallacy essentially states that running around busting out the windows of shop owners is good for the economy because it keeps the glazier busy. The fallacy does not consider only the localized benefit of the glazier. Yes, the glazier benefits, albeit dishonestly, but the economy as a whole experiences a loss in net value as the result of the destructive acts employed to bring benefit to a single operator. This is clearly a zero-sum play. It is a somewhat back-handed way of picking the pockets of the shop owners. When all windows are intact and no new construction is occurring, the glazier is faced with the choice of finding something else to do or sitting and polishing his knob while waiting for something to drop into his lap. The dishonest glazier synthesizes a third alternative: the destruction of property that only he can replace, thereby guaranteeing himself the benefit of another's loss. Pure zero-sum.

The same applies in a very direct and tightly homomorphic manner to warfare.

 

[Barrex]

It appears you misunderstand the nature of the fallacy itself. The fallacy essentially states that running around busting out the windows of shop owners is good for the economy because it keeps the glazier busy. The fallacy does not consider only the localized benefit of the glazier. Yes, the glazier benefits, albeit dishonestly, but the economy as a whole experiences a loss in net value as the result of the destructive acts employed to bring benefit to a single operator. This is clearly a zero-sum play. It is a somewhat back-handed way of picking the pockets of the shop owners. When all windows are intact and no new construction is occurring, the glazier is faced with the choice of finding something else to do or sitting and polishing his knob while waiting for something to drop into his lap. The dishonest glazier synthesizes a third alternative: the destruction of property that only he can replace, thereby guaranteeing himself the benefit of another's loss. Pure zero-sum.

The same applies in a very direct and tightly homomorphic manner to warfare.

I know what broken window fallacy is. It is not best analogy if you want to answer questions in text of op. In this case it was more or less just a title of this topic .

Real questions are in original post:
What do you make of conquests in which you acquire territories and/or have other nations pay reparations? Answer: not moral. Entities can profit from it.
Would it then not be a net increase? Answer: Yes.
Again, without taking into consideration morals, is there any flaw in his logic? Answer:No.
Would the spoils of war afterwards not make up for the net loss during the war and more?Answer: Yes (in some cases: mongols... and no in other: Carthage... but then again Romans profited from plundering and monopoly on medite....).

Wars diminish worlds economy. That doesnt mean that one side in war isnt better of than it would be without war.