How an Economy Grows and Why It Crashes


part—we’ll pass a law to prevent islanders from comparing



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how an economy grows


part—we’ll pass a law to prevent islanders from comparing 
them to real fi sh!”
Tad Anemone chimed in, “Yes, that’s right. We’ll say our 
scientists have discovered a new disease among unprocessed 
fi sh, and we’ll require everyone to turn in their genuine 
fi sh for offi cially decontaminated fi sh as soon as they are 
caught!”


H O W   A N   E C O N O M Y   G R O W S   A N D   W H Y   I T   C R A S H E S
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The senators and technicians described how the 
decontamination process would explain why “offi cial fi sh” 
were not quite as fi lling. 
To keep people from seeing real fi sh themselves, and to 
supposedly increase fi sh production, the senators also decided 
to establish a Fishing Department, which would have sole 
responsibility for catching fi sh.
Goodbank could take no more of this. “This can’t work! If 
people stop fi shing for themselves and rely on the government 
instead, our total catch will diminish. Eventually we will run 
out of savings.” 
 “How can you be so sure?” countered Franky. “Our Fishing 
Department will be the wave of the future. We’ll put in only 
our most trusted friends as managers, and we’ll give special 
prizes to the workers who show the greatest civic spirit. And 
besides, we only need to keep it going through the next 
election. After that we’ll think up a more long-term plan….
I promise we will.” 
 “In the meantime,” said Hughey Humpback, “this new fi sh 
expansion procedure will give you enough fi sh to cover all of 
your outstanding obligations and pay all the interest on your 
deposits. We will even have fi sh left over to spend in ways that 
will fi nally do some good for our people!” 
Goodbank thought about it some more. “It can’t work. The 
people will get wise. They will worry about their savings and 
withdraw their deposits.”



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