Fake Economics

Ever since that day, I’ve been reading a continual stream of fake economics statistics like this NYPost story that claims New York City will lose $83 Billion due to the 9/11 disaster. This is a blatant lie. Let me explain a few basic economic facts.

Imagine we own a corner lemonade stand. Our booth is a table and some glassware we bought for $1 at a garage sale. We sell $2 of lemonade a day, and it costs us $1 in materials, so our profit is $1 per day. If the neighbor kid comes over and smashes our stand to bits, our total economic loss is $1. If he comes over and steals our sugar and lemons for that day, our loss is $1. But under no stretch of the imagination is it legitimate to say that since you are out of business, you’ve just lost $365 for the next year’s lost lemonade sales. Nobody ever guaranteed you an income.

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