Spring Break
Econoblog: Our obsession with employment
Hire people to dig holes and fill them in
Matt Hickok
Issue date: 2/16/09 Section: Money Mayhem
America currently has an obsession with employment.
People are losing jobs in every area of the market, and politicians are doing the best they can to try and remedy the situation. So should the government try to create jobs?
To answer this question, we need to find out whether employment is intrinsically good or whether it is dependent on something.
If unemployment is high, is it a good idea for the government to hire people to dig holes, and then fill them back in? A lot of economists would say that this benefits the economy. The logic behind this view, is that employment should be a goal, not the result of production.
While politically convenient, this obsession with employment is dangerous to the economy. Only things which are in demand have value. In order to have economic growth, we have to make sure the production is geared towards things with this value.
The result of this production isn't just jobs, but valuable jobs. This is something which the government cannot possibly do. The only way to tell which jobs are profitable or not, is in the marketplace where businesses operate in a profit and loss system. If the production is profitable, the business is successful. If the production is unprofitable, the business fails. This requires the workers to find different jobs in the market. The only sustainable jobs are those which are profitable.
However, when the government creates jobs, it's an entirely different ball game. Government jobs do not require the jobs to be successful. Those jobs depend on taxation. Wealth is taken from the private sector and redistributed into these government jobs, many of which are unprofitable.
People are losing jobs in every area of the market, and politicians are doing the best they can to try and remedy the situation. So should the government try to create jobs?
To answer this question, we need to find out whether employment is intrinsically good or whether it is dependent on something.
If unemployment is high, is it a good idea for the government to hire people to dig holes, and then fill them back in? A lot of economists would say that this benefits the economy. The logic behind this view, is that employment should be a goal, not the result of production.
While politically convenient, this obsession with employment is dangerous to the economy. Only things which are in demand have value. In order to have economic growth, we have to make sure the production is geared towards things with this value.
The result of this production isn't just jobs, but valuable jobs. This is something which the government cannot possibly do. The only way to tell which jobs are profitable or not, is in the marketplace where businesses operate in a profit and loss system. If the production is profitable, the business is successful. If the production is unprofitable, the business fails. This requires the workers to find different jobs in the market. The only sustainable jobs are those which are profitable.
However, when the government creates jobs, it's an entirely different ball game. Government jobs do not require the jobs to be successful. Those jobs depend on taxation. Wealth is taken from the private sector and redistributed into these government jobs, many of which are unprofitable.
Be the first to comment on this story