The same issue of American Conservative, which publishes the wonderful article by James Bovard on John Yoo and torture, also contains a cover story which basically acedes to the economics of Paul Krugman.

In the very first paragraph, the author commits the fundamental error of saying that Henry Ford “created” the American middle class by doubling the wages of his workers to $5 per day. Time and again, economists and economic historians have demonstrated clearly that this assertion is false, yet here it is again.

In order for the assertion to be true, all that is needed for creation of prosperity is for all employers to double, triple, quadruple, or what-uple employee pay, and all of us will be rich. This is ridiculous on its face, yet the fallacy continues to haunt us. Yes, it is another version of the famous Broken Window Fallacy.