Saturday, August 12, 2006

Polish Labor Economics 102


Ok, last time I wrote that Poland lacks the capital base to use the labor force it already has. Great, what does that mean? Its the economic version of being all dressed up with nowhere to go. Often, young people get some kind of education or another, but then get no meaningful employment. So, they reason with some fair justification, they need skills or experience. So this impacts the educational choices that young people have to make, ie they study computer programming, economics, hospitality and tourism, get an intership at an accounting firm, whatever.

This obscures what it is that young people (others too, but especially the young) really have to offer the economy at large; talent, ambition, and energy. By comparison "skills" are worth much less (with some exceptions). Experience is in general worth more than skills but still a lot less than talent. A skill that is in demand at one time is often out of date by the time a person could learn it from scratch anyway. More importantly, our ambition and energy comes closer to expressing who we really are or aspire to be, whereas often a skill is just impersonal technique.
Frankly I suspect that this delusion occurs all over the Continent, but is especially severe in Poland. In any case, that's where I am now and where I can see enough of it to comment on.

The thing about a weak capital base is that the jobs that it generates don't demand much in the way of talent or ambition. They are mostly just a function of drudgery, of one sort or another.

One area of intersection of the Catholic Social Tradition and Leftist ecnomics is the "priority of labor over capital". There is something to be said for this, in that people have real human needs and there is something ugly about the prospect of failing to fulfill them while at the same time adding money to some plutocrat's bank account. But if the revulsion is real, the underlying scenario isn't. Capital doesn't just compete with with human needs, it is also the means of fulfilling them. And not just the baser needs, but some of the higher ones as well. Our creativity, ambition, personality all require capital to be exercised properly.

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