Economics 101

Found these wonderful quotes today and thought I would share...


"Give a man a fish and you feed him for a day. Teach a man to fish and you feed him for a lifetime." -- Author unknown


"Every time you take a rich man down, you take a 100 poor men with him."


"I am for doing good to the poor, but I differ in opinion of the means. I think the best way of doing good to the poor, is not making them easy in poverty, but leading or driving them out of it." -- Benjamin Franklin


"If you put the federal government in charge of the Sahara Desert, in 5 years there'd be a shortage of sand." -- Milton Friedman


"I am favor of cutting taxes under any circumstances and for any excuse, for any reason, whenever it's possible." -- Milton Friedman


"When the United States was formed in 1776, it took 19 people on the farm to produce enough food for 20 people. So most of the people had to spend their time and efforts on growing food. Today, it's down to 1% or 2% to produce that food. Now just consider the vast amount of supposed unemployment that was produced by that. But there wasn't really any unemployment produced. What happened was that people who had formerly been tied up working in agriculture were freed by technological developments and improvements to do something else. That enabled us to have a better standard of living and a more extensive range of products." -- Milton Friedman


"Nobody spends somebody else's money as carefully as he spends his own. Nobody uses somebody else's resources as carefully as he uses his own. So if you want efficiency and effectiveness, if you want knowledge to be properly utilized, you have to do it through the means of private property." -- Milton Friedman


"When everybody owns something, nobody owns it, and nobody has a direct interest in maintaining or improving its condition. That is why buildings in the Soviet Union -- like public housing in the United States -- look decrepit within a year or two if their construction..." -- Milton Friedman


"(T)he supporters of tariffs treat it as self-evident that the creation of jobs is a desirable end, in and of itself, regardless of what the persons employed do. That is clearly wrong. If all we want are jobs, we can create any number -- for example, have people dig holes and then fill them up again, or perform other useless tasks. Work is sometimes its own reward. Mostly, however, it is the price we pay to get the things we want. Our real objective is not just jobs but productive jobs -- jobs that will mean more goods and services to consume." -- Milton Friedman


"There is all the difference in the world, however, between two kinds of assistance through government that seem superficially similar: first, 90 percent of us agreeing to impose taxes on ourselves in order to help the bottom 10 percent, and second, 80 percent voting to impose taxes on the top 10 percent to help the bottom 10 percent -- William Graham Sumner's famous example of B and C decided what D shall do for A. The first may be wise or unwise, an effective or ineffective way to help the disadvantaged -- but it is consistent with belief in both equality of opportunity and liberty. The second seeks equality of outcome and is entirely antithetical to liberty." -- Milton Friedman


"The great danger to the consumer is the monopoly -- whether private or governmental. His most effective protection is free competition at home and free trade throughout the world. The consumer is protected from being exploited by one seller by the existence of another seller from whom he can buy and who is eager to sell to him. Alternative sources of supply protect the consumer far more effectively than all the Ralph Naders of the world." -- Milton Friedman


"Were we directed from Washington when to sow, and when to reap, we should soon want bread." -- Thomas Jefferson


"A rising tide (in the economy) lifts all boats" -- John Kennedy


"The record of economic success during the 1980's is clear: 18.6 million new jobs were created, increasing U.S. civilian employment by 20 percent. Only 12 percent of these jobs were in low-paid restaurant and retail areas, while 82 percent were in high-paid technical, managerial and professional areas. Once Reagan's tax cuts kicked in (fiscal year 1982), the country experienced 92 months of economic growth without a recession. This represented the longest period of sustained peacetime economic growth in American history. America's most successful achievers do pay a higher share of the total tax burden. The top one percent income earners paid 18 percent of the total tax burden in 1981, and paid 25 percent in 1991. The bottom 50 percent of income earners paid only 8 percent of the total tax burden, and paid only 5 percent in 1991. History shows that tax cuts have always resulted in improved economic growth producing more tax revenue in the treasury." -- Rush Limbaugh


"What pays under capitalism is satisfying the common man, the customer. The more people you satisfy, the better for you." -- Ludwig Von Mises


"Don't knock the rich. When did a poor person ever give you a job?" -- Laurence J. Peter


"We don't have a trillion-dollar debt because we haven't taxed enough; we have a trillion-dollar debt because we spend too much." -- Ronald Reagan


"It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest." -- Adam Smith


"It is the maxim of every prudent master of a family, never to attempt to make at home what it will cost him more to make than to buy...What is prudence in the conduct of every private family, can scarce be folly in that of a great kingdom. If a foreign country can supply us with a commodity cheaper than we ourselves can make it, better buy it of them with some part of the produce of our own industry, employed in a way in which we have some advantage." -- Adam Smith


"Sellers in general maintain the quality of their products and services for fear of losing customers otherwise. But, when price controls create a situation where the amount demanded is greater than the amount supplied -- a shortage -- fear of losing customers is no longer as strong an incentive. For example, landlords typically reduce painting and repairs when there is rent control, because there is no need to fear vacancies when there are more tenants looking for apartments than there are apartments available." -- Thomas Sowell


"Tariffs that save jobs in the steel industry mean higher steel prices, which in turn means fewer sales of American steel products around the world and losses of far more jobs than are saved." -- Thomas Sowell


"Four things have almost invariably followed the imposition of controls to keep prices below the level they would reach under supply and demand in a free market: (1) increased use of the product or service whose price is controlled, (2) Reduced supply of the same product or service, (3) quality deterioration, (4) black markets." -- Thomas Sowell


"Politics offers attractive solutions but economics can offer only trade-offs. For example, when laws are proposed to restrict the height of apartment buildings in a community, politics presents the issue in terms of whether we prefer tall buildings or buildings of a more modest height in our town. Economics asks what you are prepared to trade off in order to keep the height of buildings below some specified level. In places where land costs may equal or even exceed the cost of the apartment buildings themselves, the difference between allowing ten-story buildings to be built and allowing a maximum of five stories may be that rents will be twice as high in the shorter buildings. The question then is not simply whether you prefer shorter buildings but how much do you prefer shorter buildings and what price are you prepared to pay to mandate height restrictions in your community. A doubling of rents and three additional highway fatalities per yet? A tripling of rents and six additional highway fatalities per year? Economics cannot answer such questions. It can only make you aware of a need to ask them." -- Thomas Sowell


"In a small town, an idiot breaks a shop window. He's called a vandal, until someone points out that a window installer now must be paid to replace the window. The window installer then will have enough money to buy a new suit. A tailor will then be able to buy a new desk. And so on. The whole town apparently gains from the economic activity generated by the broken window. Of course, if this made sense, cities should hire people to run though town, breaking windows.

But it doesn't make sense. It's a fallacy because the circulating money is seen; what is not seen is what would have been done with the money if the window were still whole. The shopkeeper, instead of paying the window installer, might have expanded his business, or bought a new suit or a new desk. The town is worse off because of a broken window." -- John Stossel



"Minimum prices in general tend to discriminate against the lesser skilled person or the less preferred item. Let's say ten workers show up and you only can hire five. Well, you can't discriminate based on price because you have to pay them all eight dollars an hour. So you may hire according to what you like. So if you prefer Catholics to Jews or whites to blacks, you'll have a tendency to indulge your preferences. You can apply that phenomena to anything. If we made a law, let's call it a "minimum steak law", that is, fillet mignon and chuck steak both sell for $10. Well, the cost of discriminating against chuck steak would be zero, because you have to pay $10 anyway. The way that less preferred things compete with more preferred things is by having a lower price. Even though people prefer filet mignon to chuck steak, chuck steak doesn't have any problems selling at all." -- Walter Williams




"We might think of dollars as being "certificates of performance." The better I serve my fellow man, and the higher the value he places on that service, the more certificates of performance he gives me. The more certificates I earn, the greater my claim on the goods my fellow man produces. That's the morality of the market. In order for one to have a claim on what his fellow man produces, he must first serve him." -- Walter Williams


"(Tariffs) help some steel workers keep their jobs, but it turns out to be a losing proposition on balance. The reason why steel workers and their companies want tariffs on foreign steel is so they can raise the price of steel produced by US companies. So, it will save some jobs in the steel industry, but one has to look at the "steel using industry." The companies in the US that buy steel to produce their products are hurt by the tariffs. You find unemployment in those areas because of the higher costs of their inputs, which makes them less competitive on world markets. So what one has to look at is not the seen, but the unseen. Yes, you can see as a result of tariffs that more jobs are saved in the steel industry. What goes unseen are the jobs lost elsewhere because of the steel tariffs. Tariffs save some jobs at the expense of many, many, other jobs."


"Suppose I hire you to repair my computer. The job is worth $200 to me and doing the job is worth $200 to you. The transaction will occur because we have a meeting of the mind. Now suppose there's the imposition of a 30 percent income tax on you. That means you won't receive $200 but instead $140. You might say the heck with working for me -- spending the day with your family is worth more than $140. You might then offer that you'll do the job if I pay you $285. That way your after-tax earnings will be $200 -- what the job was worth to you. There's a problem. The repair job was worth $200 to me, not $285. So it's my turn to say the heck with it. This simple example demonstrates that one effect of taxes is that of eliminating transactions, and hence jobs." -- Walter Williams


"How many times have we heard "free tuition," "free health care," and free you-name-it? If a particular good or service is truly free, we can have as much of it as we want without the sacrifice of other goods or services. Take a "free" library; is it really free? The answer is no. Had the library not been built, that $50 million could have purchased something else. That something else sacrificed is the cost of the library. While users of the library might pay a zero price, zero price and free are not one and the same. So when politicians talk about providing something free, ask them to identify the beneficent Santa Claus or tooth fairy." -- Walter Williams


"Here's Williams' roadmap out of poverty: Complete high school; get a job, any kind of a job; get married before having children; and be a law-abiding citizen. Among both black and white Americans so described, the poverty rate is in the single digits." -- Walter Williams