In a nutshell, the fallacy says that breaking windows is good for the economy, as it creates the need for replacements, and thus "creates jobs." This is of course nuts. At the end of the replacement process, we're worse off by having consumed whatever resources it takes to produce a window and we can't use those resources for whatever we would've used them for had the window remained intact. Presumably spending resources on windows isn't our first choice, so we're also worse off by whatever the "utility" difference between our first choice and windows.
Right now, I'm also trying to find time for this article by Murray Rothbard, Concepts of the Role of Intellectuals in Social Change Toward Laissez Faire. More advice for activists.