Review by Olivia Broadway, Queen City Freedom Fellowship
Economics in One Lesson is a libertarian classic. Though the title may lead you to believe it to be a dry book of economic theory, the book is anything but that. Hazlitt begins the book by presenting the reader with "the lesson" in chapter 1, and he spends the rest of the book explaining how the lesson applies to real situations. He does this in layman’s terms, using examples most of us can relate to, without jargon or complicated graphs, so it is easy to read and understand.
What is this 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. Hazlitt encourages us to think longer term and more broadly about the downstream impact of our decisions. For example, who really benefits from tariffs? Sure, the protected company or industry benefit in the short term, but what about everyone else? Hazlitt points out that tariffs hurt our exporters, and they make "the industries in which we are comparatively inefficient larger, and the industries in which we are comparatively efficient smaller…In the long run, [a tariff] always reduces real wages, because it reduces efficiency, production and wealth." The chapter on inflation also stood out as a timely reminder of the disastrous effects of an increase in the supply of money.
Economics in One Lesson was originally penned in 1961 and updated in 1978. The effects of our economic policy decisions were predicted decades, if not centuries, ago. Indeed, there seems to be nothing new under the sun. I highly recommend this book to anyone trying to understand what is going on in our economy. This lesson is still as true today as it was in 1961.
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