John and Ted, two brothers, are big NFL football fans. Tickets to the Super Bowl are going for $5000 each on StubHub and Ebay. Suddenly they win two tickets to the SuperBowl in a raffle. John says to Ted, "We can't afford to pay $10,000 to go to the Super Bowl." Ted replies to John, "But we're not spending $10,000. We got the tickets for free." Discuss.
If you're an economist, the answer to this seems pretty obvious. If you're a politician, or a member of the general public, it isn't. But it illustrates an underlying problem in the political process -- namely, opportunity cost. The cost of those "free" tickets really is $10,000 for the simple reason that you could sell those tickets and use the $10,000 for something else. If you really would spend $10,000 for Super Bowl tickets, you're fine, but the fact that you already have them in hand is irrelevant.
This is the fundamental illogic that Bjørn Lomborg points out about Global Warming activists. Given that resources are not unlimited, if you spend $10 Trillion trying to change the climate, is the benefit of that greater than how else you could spend $10 Trillion? It's pretty clear from his analysis that it's not.
Every good idea is not worth doing. Because in doing that good idea you must sacrifice other ideas that may have more value. Going to the Super Bowl is a good idea for John and Ted. But is it a better idea than what else they could do with $10,000?
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