The Parable of the Retired Economist’s Pension

One day while teaching, Josh was asked, ”Teacher, is it fair to balance a government budget saddled with enormous war debt on the backs of retirees while those who benefit most from the budget also claim great benefits from the war that devastated the budget?”

Josh spoke thus:

A retired economist was explaining opportunity cost to a grandchild in the local ice-cream parlor.

“You can’t have both,” the retired economist was saying to the grandchild, “You can have one or the other.  That’s opportunity cost.  You have a choice between two things, and choosing one means you can’t have the other.”

“I can have both,” the grandchild said, “Mommy and Daddy said I could have both.”

“Mommy and Daddy didn’t say you could have both,” the retired economist said, “Because Mommy and Daddy weren’t here when you said you wanted both.  I was here, and I said you could have one or the other.”

The retired economist was reminded of a political debate concerning the cost of going to war.  The argument had been made that the war would be such a small part of the huge national economy that its cost would be unnoticeable.  Furthermore, one of the benefits of winning the war would be access to a resource vital to the economy’s expansion.  

The retired economist wanted to explain to the grandchild the government’s error in assuming that it was possible to have a war economy and a peacetime economy active at the same time.  

The grandchild wanted to explain to the retired economist that the grandchild could indeed have both, as the grandchild’s mother and father had allowed.

“Are Mommy and Daddy here?” the retired economist asked the grandchild.

“No,” the grandchild said.

“Are Mommy and Daddy going to pay for both?” the retired economist asked the grandchild.

“No,” the grandchild said.

“So I will be paying?” the retired economist asked the grandchild.

“Yes,” the grandchild said.

“And can I afford to buy you both?” the retired economist asked the grandchild.

“No,” the grandchild said.

“Why not?” the retired economist asked the grandchild.

“Because the government is screwing you out of your pension to pay for its stupid unwinnable war?” the grandchild parotted.

A number of patrons turned their heads at the grandchild’s use of the word “screwed.”  Some appeared amused.  Some appeared offended.  The retired economist ignored them.  

The retired economist knew that the grandchild did not understood the term ‘screwed,’ did not understand the economic issues surrounding the balance of domestic and military spending, did not understand the effect those issues had on the retired economist’s pension, did not understand the basic concept of opportunity cost.

The retired economist did enjoy hearing the words come out of the grandchild’s mouth.

“Give the child both,” the retired economist told the server behind the counter, “Screw the cost.”