There is a wonderful article by Princeton health care economist Uwe Reinhardt on today’s New York Times Economix blog arguing that “make-work jobs” created by the increasingly complicated tangle of government regulations do not add value to the economy. Reinhardt includes in this category of “nonenjoyable GDP” the services of the army of tax lawyers and tax accountants created by the byzantine U.S tax code as well as the services of the sizable compliance staffs and numerous outside consultants that hospitals must hire in order to avoid running afoul of the incomprehensibly complex rules and regulations governing Medicare, Medicaid and other health care programs. Reinhardt does not mention Bastiat and uses his homegrown Slashed Tire parable instead of the venerable Broken Window parable to illustrate his point. But, hey, he is from Princeton.
Source link: http://archive.mises.org/18722/princeton-economist-rediscovers-bastiats-broken-window-fallacy-almost/