Applied Economics: Thinking Beyond Stage One (ISBN 0-465-08143-6) is a 2003 nonfiction work by economist Thomas Sowell.
Sowell discuss how basic economics is generally misapplied because politicians think only in Stage One. Stage One is the immediate result of an action, without determining what happens then. He argues that many politicians cannot see beyond Stage One because they do not think beyond the next election. He gives as an example of Stage One Thinking, a State government which raises taxes on a business. The immediate result is more revenue for the State government. However, over the course of time, that business might move bits and pieces of the company to another state or new businesses may choose another state to place a new factory. Over the course of time, the State will lose revenue because businesses will go to other states.
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“The axioms of physics translate the laws of ethics. Thus, “the whole is greater than its part;” “reaction is equal to action;” “the smallest weight may be made to lift the greatest, the difference of weight being compensated by time;” and many the like propositions, which have an ethical as well as physical sense. These propositions have a much more extensive and universal sense when applied to human life, than when confined to technical use.”
—Ralph Waldo Emerson (1803–1882)
“When we start deceiving ourselves into thinking not that we want something or need something, not that it is a pragmatic necessity for us to have it, but that it is a moral imperative that we have it, then is when we join the fashionable madmen, and then is when the thin whine of hysteria is heard in the land, and then is when we are in bad trouble.”
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“The stage is about to be swept of corpses.
You have no more chance than an infusorian
Lodged in a hollow molar of an eohippus.”
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