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Available
Call number
Collection
Publication
Laissez Faire Books (2008), Edition: 50th anniversary, 205 pages
Description
Business. Nonfiction. HTML: A million-copy seller, Henry Hazlitt's Economics in One Lesson is a classic economic primer. But it is also much more, having become a fundamental influence on modern "libertarian" economics of the type espoused by Ron Paul and others. Called by H. L. Mencken "one of the few economists in history who could really write," Henry Hazlitt achieved lasting fame for this brilliant but concise work. In it, he explains basic truths about economics and the economic fallacies responsible for unemployment, inflation, high taxes, and recession, as well as illustrating the destructive effects of taxes, rent and price controls, inflation, trade restrictions, and minimum-wage laws. Economics in One Lesson is deceptively prescient and far-reaching in its efforts to dissemble economic fallacies that are so prevalent they have almost become a new orthodoxy. Many current economic commentators across the political spectrum have credited Hazlitt with foreseeing the collapse of the global economy, which occurred more than fifty years after the initial publication of this seminal work. Hazlitt's focus on non-governmental solutions, strong�??and strongly reasoned�??antideficit position, and general emphasis on free markets, economic liberty of individuals, and the dangers of government intervention make Economics in One Lesson every bit as relevant and valuable today as it has been since publication… (more)
User reviews
LibraryThing member lgfarlow
Where has this book been for the last 50 years? Certainly not in the hands of anyone remotely connected to the Unites States government! Economics in One Lesson by Henry Hazlitt was originally written just after World War II, after Franklin Roosevelt’s socialist ‘New Deal’ had been in place
The book comes in at 198 pages but ‘The Lesson’ is literally only the first five pages. The lesson summarized is this:
“The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups” (p. 5)
Ignoring this principle creates 90% of the economic fallacies in the world today according to Hazlitt. He calls this primary fallacy the fallacy of ignoring secondary consequences and it is more rampant today than it was at the time of the book’s first writing.
The remainder of the book is a series of examples of economic fallacies, all of which can be traced to ignoring ‘the lesson’ and all of which are more or less considered orthodoxy by the economic establishment today.
The first of these is: “War stimulates an economy and is good for business.” Hazlitt calls this the “fallacy of the broken window” the idea that because something has been destroyed (by war or whatever) it must needs be replaced, thereby stimulating the economy. He illustrates this with a parable where someone throws a brick through a shopkeeper’s front widow. Of course this ‘stimulates’ the business of the man who will be hired to replace the window. Unfortunately, this is as far as most economic analysis goes: the glass repair shop gets new business, may need to hire more people because of the extra work, ipso facto the economy benefits. However, this is a bit like looking at only one side of an algebraic equation. We’re forgetting ‘the lesson’ that we cannot overlook the effects on more than just this one group of people. True, Hazlitt would say, the glass repair shop gets more business. However, the shopkeeper must pay for a new window that he would not otherwise have had to pay for. This reduces his disposable income so that he spends less with other merchants than he would have had the window not been broken. The result is, though the glass repair shop may hire an extra man as a result of the broken window, the tailor the shopkeeper uses may have to lay a man off because the shopkeeper cannot now afford to purchase the new suit he was planning to buy. Net effect to the economy – zero. Though this is a very simplistic example (even Hazlitt would admit as much) the underlying principle is true and is violated by virtually every economic policy in place today.
Some of the other examples highlighted in the book which violate ‘the lesson’ are:
C Government secured loans
C Government price supports for farm products (or other things)
C Rent control
C Minimum wage laws
C Tariffs
In each of these cases, one or both of the principles from ‘the lesson’ is violated. Either future consequences of the action is ignored or consequences to other groups is ignored or both. In fact, Hazlitt points out several times that failure to consider other than the immediate consequences of these actions often negatively impacts the very people the action was intended to help!
Take for example rent control. The stated goal of this kind of policy is always to help lower income people afford housing. As a result, rent control often does not apply to so-called luxury housing or apartments, since after all, those people can ‘afford it’. The result is that people who might otherwise invest in more affordable housing do not for fear of having their investment regulated by the government to the extent that they cannot profit from it. Instead they build ‘luxury’ housing, if they build anything at all, that will be exempt from government control, thereby reducing the number of housing units available to the very people the government was trying to help. Another long term consequence of rent control is that at some point the controlled rents will not be enough for the property owner to continue to afford to keep up the property the way he might otherwise be able to, again, negatively impacting the people who live in the rent controlled properties, the very people the policy was intended to benefit.
I could go on with example after example.
This is by far the best book on economics I’ve ever read. It is nothing like a dry economics textbook and is very readable and clear. It is, in fact the readability of Hazlitt and the clarity of the principles he discusses that leads me to believe that most economic policies are driven, not by economics per se but by the political motives of the theorists and those who implement their schemes. This is a fact alluded to by Hazlitt as well.
In my opinion, this book should be required reading from the High School level on up as well as for anyone even remotely involved in state or federal government. I would suggest that it be required reading for every member of congress as well but they normally don’t like to be confused with the facts so that may be a pointless exercise. However, for those who view economics as a method of maximizing the quality of life for the average citizen rather than as a way to buy votes for themselves, this book will be a breath of fresh air.
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for several years. He was one of the voices raising objections to these policies at the time. This recent re-release could not be more needed or more timely. Fifty years after the first release we have an economic policy that makes the Roosevelt era look down right laissez faire. The book comes in at 198 pages but ‘The Lesson’ is literally only the first five pages. The lesson summarized is this:
“The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups” (p. 5)
Ignoring this principle creates 90% of the economic fallacies in the world today according to Hazlitt. He calls this primary fallacy the fallacy of ignoring secondary consequences and it is more rampant today than it was at the time of the book’s first writing.
The remainder of the book is a series of examples of economic fallacies, all of which can be traced to ignoring ‘the lesson’ and all of which are more or less considered orthodoxy by the economic establishment today.
The first of these is: “War stimulates an economy and is good for business.” Hazlitt calls this the “fallacy of the broken window” the idea that because something has been destroyed (by war or whatever) it must needs be replaced, thereby stimulating the economy. He illustrates this with a parable where someone throws a brick through a shopkeeper’s front widow. Of course this ‘stimulates’ the business of the man who will be hired to replace the window. Unfortunately, this is as far as most economic analysis goes: the glass repair shop gets new business, may need to hire more people because of the extra work, ipso facto the economy benefits. However, this is a bit like looking at only one side of an algebraic equation. We’re forgetting ‘the lesson’ that we cannot overlook the effects on more than just this one group of people. True, Hazlitt would say, the glass repair shop gets more business. However, the shopkeeper must pay for a new window that he would not otherwise have had to pay for. This reduces his disposable income so that he spends less with other merchants than he would have had the window not been broken. The result is, though the glass repair shop may hire an extra man as a result of the broken window, the tailor the shopkeeper uses may have to lay a man off because the shopkeeper cannot now afford to purchase the new suit he was planning to buy. Net effect to the economy – zero. Though this is a very simplistic example (even Hazlitt would admit as much) the underlying principle is true and is violated by virtually every economic policy in place today.
Some of the other examples highlighted in the book which violate ‘the lesson’ are:
C Government secured loans
C Government price supports for farm products (or other things)
C Rent control
C Minimum wage laws
C Tariffs
In each of these cases, one or both of the principles from ‘the lesson’ is violated. Either future consequences of the action is ignored or consequences to other groups is ignored or both. In fact, Hazlitt points out several times that failure to consider other than the immediate consequences of these actions often negatively impacts the very people the action was intended to help!
Take for example rent control. The stated goal of this kind of policy is always to help lower income people afford housing. As a result, rent control often does not apply to so-called luxury housing or apartments, since after all, those people can ‘afford it’. The result is that people who might otherwise invest in more affordable housing do not for fear of having their investment regulated by the government to the extent that they cannot profit from it. Instead they build ‘luxury’ housing, if they build anything at all, that will be exempt from government control, thereby reducing the number of housing units available to the very people the government was trying to help. Another long term consequence of rent control is that at some point the controlled rents will not be enough for the property owner to continue to afford to keep up the property the way he might otherwise be able to, again, negatively impacting the people who live in the rent controlled properties, the very people the policy was intended to benefit.
I could go on with example after example.
This is by far the best book on economics I’ve ever read. It is nothing like a dry economics textbook and is very readable and clear. It is, in fact the readability of Hazlitt and the clarity of the principles he discusses that leads me to believe that most economic policies are driven, not by economics per se but by the political motives of the theorists and those who implement their schemes. This is a fact alluded to by Hazlitt as well.
In my opinion, this book should be required reading from the High School level on up as well as for anyone even remotely involved in state or federal government. I would suggest that it be required reading for every member of congress as well but they normally don’t like to be confused with the facts so that may be a pointless exercise. However, for those who view economics as a method of maximizing the quality of life for the average citizen rather than as a way to buy votes for themselves, this book will be a breath of fresh air.
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LibraryThing member Veteropinguis
The subtext is right. Hazlitt writes clearly without being patronizing, and walks you through every step of his logic. All conceivable objections to the Austrian position are addressed without malice. I found it to be a very refreshing change from much of the modern writing on economics. While my
The book is not without its flaws. In my opinion, the chapter about the price system should have come much earlier than it did, since the price system is crucial to a true understanding of many of the issues he mentions in the preceding chapters. Also, a small glossary would have been helpful. Nothing major is required, but slightly in-depth definitions of capital, inflation, credit, and liquid funds -among others- would have been helpful. I had to reread chapters unnecessarily to try and deduce the meanings of several terms.
Still, it's nothing that a quick Wikipedia search can't remedy. In my copy, the binding is durable, the type is a pleasure to read, and the paper is very nicely textured. I don't usually mark up my books and when I do, I usually can't stand the way the paper feels; however, this paper is very easy on the fingers and pencil.
I was an ambivalent socialist before I read this; now, I'm a rabid Austrian. Get this book, and prepare to have your mind blown.
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experience is limited to the more polarized forms of writing such as newspapers, much of the modern economic writing that most people encounter is based off of either accusing all dissidents of having no morals, or of not caring about little babies in Africa. Hazlitt focuses on substance without flinging ad hominems in any direction.The book is not without its flaws. In my opinion, the chapter about the price system should have come much earlier than it did, since the price system is crucial to a true understanding of many of the issues he mentions in the preceding chapters. Also, a small glossary would have been helpful. Nothing major is required, but slightly in-depth definitions of capital, inflation, credit, and liquid funds -among others- would have been helpful. I had to reread chapters unnecessarily to try and deduce the meanings of several terms.
Still, it's nothing that a quick Wikipedia search can't remedy. In my copy, the binding is durable, the type is a pleasure to read, and the paper is very nicely textured. I don't usually mark up my books and when I do, I usually can't stand the way the paper feels; however, this paper is very easy on the fingers and pencil.
I was an ambivalent socialist before I read this; now, I'm a rabid Austrian. Get this book, and prepare to have your mind blown.
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LibraryThing member CitizenClark
This is _the_ best primer on free market, Austrian economics. Hazlitt's prose flows nicely while conveying sophisticated, elegant economic principles. Hazlitt's Economics In One Lesson is to English what Bastiat's The Law is to French--the language's pre-eminent defense of the market economy and
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individual liberty. Show Less
LibraryThing member whiteberg
Excellent introduction to ("Austrian") economics. Based on Bastiat's "What Is Seen And What Is Not Seen" but has it's own tone and an American perspective. Just as relevant today as it was in 1946, and 1978 when the new edition was written. The present Obama administration is repeating all the
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falliacies - some passages in this book is so current it is scary! Show Less
LibraryThing member tlockney
Such an oversimplified view. I tried hard to finish it, but... not going to happen.
LibraryThing member nancypantslady
In the current economic crisis our country is facing I felt a need to self-educate in the realm of economics, having been tragically failed by the sorry excuse for an education in economics that I received at my public high school in 12th grade. I didn’t want a book that pitted me for or against
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any certain current politician but rather weighed economic philosophies against each other on a rational level in an easy to read format so I figured a book written over 50 years ago would be safe from mentioning current politicians. As I have read through it, it has been remarkable to see how closely the situations we are seeing played out today were delineated and discussed in the book, almost as if it was written for today... I suppose it was written for today as much as it was written for 1946 because the principles of free market economics are just as true as they were a few thousand years ago and as true as they will remain into the future. Likewise the fallacies that so many politicians have historically embraced and continue to embrace are just as false and doomed to failure as they have ever been. This book fulfilled my non-partisan (non-name-mentioning) mandate quite well. This book is wonderful and easily digestible, not boring at all. I’m only half-way through it but it is so easy to read and makes such good sense that I want to pass it on. Show Less
LibraryThing member ewalrath
Again, this is a much higher quality book for a non-economics person than for one. If you are new to anarcho-capitalist economics, this book is very helpful for understanding its proponents. However, to understand the infuriating smugness, Defending the Undefendable is far more useful.
LibraryThing member Andromeda_Yelton
The one lesson is, "things have unanticipated consequences". It's a perfectly fine book, but now I've saved you some time :).
LibraryThing member RonManners
With Economics in One Lesson, Henry Hazlitt provided a loaded arsenal for those who would do combat with the cloudy and mistaken economic wisdom of the day. In that respect, he is something of a refuter. He addressed every major economic fallacy, all prominently and widely held, and refuted them.
Taken from the Foreward.
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He showed why protective tariffs are not protective, why minimum wage laws hurt those they are intended to benefit, and why government attempts to stabilize and fix prices throw them out of whack. And in doing this he advanced the notion that markets freed from government intervention can best serve and improve society.Ludwig von Mises called him "our leader." Friedrich Hayek lauded him similarly. H. L. Mencken, not known for lavishing praise on many, revered Hazlitt as "one of the few economists in human history who could really write." But Henry Hazlitt was no economist. At least, not officially. No Ph.D. -or bachelor's degree, for that matter—adorned his walls. Hazlitt's insatiable curiosity about the way the world works led him, self-taught, to an understanding of basic economics astonishing in its breadth and scope."Taken from the Foreward.
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LibraryThing member LisaMaria_C
Not the book to get if you've already read extensively in different schools of economics. The author isn't an economist or academic; he had less then two years of college. Rather, Hazlitt was a journalist self-taught in the discipline of economics who wrote for the New York Times The Nation and
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Newsweek. His virtue is that he's clear and lucid and can bring across complex ideas in simple terms for the ordinary person--and as H.L. Mencken said of him, he was "one of the few" in economics "who could really write." And celebrated, even Nobel-Prize winning economists were among his fans: Ludwig von Mises, Friedrick A. Hayek, Milton Friedman. Based on Bastiat's "What Is Seen And What Is Not Seen," as his Preface stated, "This book is an analysis of economic fallacies so prevalent that they have almost become a new orthodoxy." And so many of those fallacies are still heard today, are still the grounds for current policy (rent control and minimum wage being two examples) that this 65 year old book is still sadly relevant. The book is worth the price just for the chapter "The Broken Window" alone, a parable which Steve Forbes in the Foreword to the 50 Anniversary edition rightly praises "ranks with Adam Smith's Pin Shop, Bastiat's Petition or Plato's Cave." Still the best primer around on the principles of free markets. Show Less
LibraryThing member JS888
Econ 101: One lesson followed by a lot of chapters explaining how that works with various topics. Chap 1 is the lesson, Chap 2 gives a single example, then the next chapters cover things such as public works, tariffs, parity pricing, price-fixing, rent controls, minimum wage laws, unions,
After finishing this slim book, look for Bettina B Greaves 2-vol "Free Market Economics" from FEE (The Foundation for Economic Education).
Relating this to politics is not covered in this volume, so I'll add that the typical left-right dichotomy you're used to makes no sense: Left is communism (aka Intl socialism), right is fascism (aka Nat'l socialism), center is democracy (or if you know a little more, it's called Fabian socialism). Trouble is the whole spectrum is socialism. If the whole spectrum is socialism, the spectrum is meaningless.
A real left wing-right wing spectrum would be: Far left is total govt (dictatorships such as communism, fascism, ceasarism, pharaohism, etc). Near that left is democracy (aka mob rule, or as Thomas Jefferson exaggerated, The worst of all possible forms of government - because it's a variant of dictatorship, just less noticeable) . Far right would be anarchy (different degrees). Near that right would be limited government, including the Constitutional Republic of places such as George Washington's USA, or the government of the Medes and Persians.
To grasp the meaning of this left-right issue better, read Gary Allen's first two chapters of None Dare Call It Conspiracy.
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inflation. Last chapter restates the lesson.After finishing this slim book, look for Bettina B Greaves 2-vol "Free Market Economics" from FEE (The Foundation for Economic Education).
Relating this to politics is not covered in this volume, so I'll add that the typical left-right dichotomy you're used to makes no sense: Left is communism (aka Intl socialism), right is fascism (aka Nat'l socialism), center is democracy (or if you know a little more, it's called Fabian socialism). Trouble is the whole spectrum is socialism. If the whole spectrum is socialism, the spectrum is meaningless.
A real left wing-right wing spectrum would be: Far left is total govt (dictatorships such as communism, fascism, ceasarism, pharaohism, etc). Near that left is democracy (aka mob rule, or as Thomas Jefferson exaggerated, The worst of all possible forms of government - because it's a variant of dictatorship, just less noticeable) . Far right would be anarchy (different degrees). Near that right would be limited government, including the Constitutional Republic of places such as George Washington's USA, or the government of the Medes and Persians.
To grasp the meaning of this left-right issue better, read Gary Allen's first two chapters of None Dare Call It Conspiracy.
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LibraryThing member PastorBob
This book should mandatory for every North American student before they graduate high school and vote. Economics does not need to to remain in the hands of elitist politicians and academics. Hazlitt cuts through the fallacies, gets to the core issues,and explains where we're going wrong, and why we
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need to change. Show Less
LibraryThing member SydneySpaniel
poorly written and repetitive, but the concepts are described in easy to understand examples
LibraryThing member jwhenderson
The best introduction to free market economics I have ever read. Written for the non-academic, Hazlitt uses short chapters to explain Economics, with a focus on common fallacies. It has served as a major antidote to fallacies in the popular press, and has appeared in dozens of languages and
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printings. It's still the quickest way to learn how to think like an economist. And this is why it has been used in many classrooms for more than sixty years. Often writers have subsequently attempted to beat this book as an introduction, but have never succeeded. Hazlitt's book remains the best. Even if you own this book already, or have several past editions, you will want to have this book as your own as a wonderful testament to its place in the world of ideas. Show Less
LibraryThing member beatgammit
I liked the message overall, but it was quite wordy and could've been accomplished in 1/4 the pages.
I also didn't like the shallow treatment of prevalent economic ideas, which I found a bit intellectually dishonest.
However, the delivery was clear and the information was useful, so I enjoyed the
In general, I liked it, but I think it could be improved on.
I also didn't like the shallow treatment of prevalent economic ideas, which I found a bit intellectually dishonest.
However, the delivery was clear and the information was useful, so I enjoyed the
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book. It's probably the most approachable book on the topic that I've read, and I didn't feel like the author did too much "hand waving" as other texts seem to do.In general, I liked it, but I think it could be improved on.
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LibraryThing member christopher.hicks
Calling this a lesson in economics is blatantly deceptive. This is a polemic against government intervention in the economy. As a student in economics I found the use of this title for something plainly pushing one perspective to be confusing and unhelpful. The only reason it gets two stars is
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because it is a coherent argument. It is too bad they weren't confidant enough in their argument to have an honest title. Show Less
LibraryThing member nittnut
It is important to note that this is not a definitive economics text, rather a primer on the principles of free markets. It is clearly written and easy to read. Hazlitt points out many fallacies in "common knowledge" and public policy regarding economics. Even though it was written in the 1940's
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and updated in the 1970's, it is still completely relevant today. In fact, it may cause the reader to feel some despair over the current trends in public policy. In particular, I found the chapters on inflation to be very informative and interesting. Highly recommended, especially for a clear understanding of basic economic principles. Show Less
LibraryThing member szarka
Many people I respect have mentioned Economics in One Lesson as a book that had a profound influence on them. Had I read it much earlier in my life, I might well feel the same way. I still don't think it's the first book I'd recommend to someone curious about economics today. But it might be the
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second or third. Well worth a read. Show Less
Subjects
Language
Original language
English
Original publication date
1946
Physical description
205 p.; 6.25 inches
ISBN
0930073193 / 9780930073190