The Imprisoned-Criminal Fallacy

The Keynesian scammers of the fiat cartel told Nayib Bukele that eliminating crime would reduce GDP. Yet in reality, it raised GDP.

This is because crime is destructive rather than productive. Crime doesn’t create economic goods; it just takes them from those who created them and gives them to those who commit crimes. Locking up criminals does not reduce production, but for Keynesian fiat scammers, it seems to reduce spending because criminals are no longer spending while locked in prison, and the Keynesian scammers only care about spending because they do not understand the concept of production.

In the real world, spending is not actually reduced, because the productive victims of crime now get to keep their money and spend it themselves. The criminal goes to jail, and the tomato seller he extorted gets to keep his money and spend it on things he likes. Not only is spending not reduced, but production actually increases when the criminals are locked up, as President Bukele points out. Locking up criminals shifts society’s incentives away from crime and toward production. It becomes much harder to earn from crime, so you have to turn into a productive human and do something useful for others.

Equivalently, Keynesian scammers think broken windows are ‘good for the economy’ because they lead to increased spending: when a window is broken, the window owner needs to spend money getting it fixed, and that makes the window maker richer, causing him to spend more himself, with a multiplier effect that ripples prosperity throughout society. This is hilariously stupid because without breaking the window, the window owner would spend the window repair money on another thing, and he would have the window

References:

-Frédéric Bastiat, That Which Is Seen, and That Which Is Not Seen (1850) — the original broken window fallacy: