If you have been following the Fundamental Economic Concepts series you should now have a firm grasp on some of the most basic, yet important economic facts. Economics is the study of human action. At the core, it is strongly related to human decision making. No, economics will not tell you what things you should value. Likewise, good economic theory does not assume everyone is all-knowing or always acts rationally. However, a firm understanding of economics will give you valuable insight into how the world works - and in particular, what things are and are not possible. Without a doubt, if you have read and understand these concepts, you are head and shoulders about 99.9% of the politicians in Washington.

I urge all of you, as you formulate your own world view about what is the legitimate role of a government and of politics in general, to please consider this very important final lesson.

The twelfth and final part in this economics series is inspired by Henry Hazlitt's Economics in One Lesson. To combat both a political system that grants privilege to special interest groups and man's tendency to see only the immediate effects of policy on these special groups, Henry Hazlitt presents us with a single, powerful lesson:
  • 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.”
Consider the impacts to all groups, over the long term. Seems simple doesn't it? Look at the US today. This is a lesson that our politicians have long since ignored or forgotten.

In part two of Economics in One Lesson, Hazlitt illustrates his lesson by using real world examples to demonstrate the harmful consequences of twenty-four common, logically flawed economic beliefs about things like minimum wage, protective tariffs, and inflation. I highly recommend this book. If I was not so much against compulsory education, I would advocate forcing all elected officials to read this book before taking office.

Please check out the Fundamental Economic Concepts page for the entire list of parts 1 – 12. There you will also be able to find an detailed explanation of what causes the Boom and Bust cycles in an economy manipulated by a central bank like we have in the US  where our money is controlled largely by private oligopoly called the Federal Reserve.

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