Let us spell a message to the Davos World Economic Forum before it gathers next week: Jobs are families. As unemployment rates reach record levels there can be no doubt that the current monetarist-market-oriented economic model contains vectors which create endemic instability, engender extreme instability in the labour market and send families lurching from one crisis to the next in a boom-and-bust climate. Perhaps the economists at Davos can do what they are paid for: produce an alternative that works.

The controlled economies of the COMECON block were derided in the west as being unviable. Yet they created continuous growth rates, development rates, financed excellent universal free education, excellent and free universal healthcare, free utilities, free public transports, free and guaranteed housing, communications, zero unemployment, leisure time activities, social mobility and indexed pensions. And policed the streets and provided security.

Hardly a bad deal? Ah yes, chortled the West, but how do you pay for it? Well, in answer to that how about we pretend the economy is a giant bank, then money is suddenly readily available isn’t it, and in great quantities? Like for example the three trillion dollars which had never existed for pensions and hospitals but which appeared miraculously to bail out the responsible bankers.

The economists at Davos should start to hang their heads in shame if they cannot come up with a model to improve the lot of hundreds of millions of people unemployed worldwide. If not, they should declare openly that the controlled economic model is better. Let us compare the zero unemployment of the controlled model with the current situation today.

According to the International Labour Organization’s annual report Global Employment Trends, released yesterday, the number of unemployed persons worldwide saw an unprecedented increase of 24 million between 2007 to 2009, reaching 212 million people.

Worse, according to data from the IMF, the outlook looks bleak for 2010, especially in the USA, E.U. and other developed nations, where the unemployment rate rose to 8.4% in 2009 (5.7% in 2007; 6.0% in 2008), while the number of people without jobs rose by 13.7 million, making up over 40% of the increase in global unemployment. The figure for 2010 is worse still, estimated at 8.9%.

Let us compare the zero unemployment rate of the controlled economy with the plight of workers in vulnerable employment, comprising 50.6% of the global workforce, or 1.5 billion people. 110 million people entered this sector in 2009. According to the report, a further 633 million workers earn less than 1.25 USD per day with another 215 million living on the margin of poverty and at risk of falling into that category.

Meanwhile youth unemployment reached 13.4%, the worst figure since records began in 1991, while productivity fell in most regions, creating deteriorating working conditions.

As ILO Director-General Joan Somavia points out, “As the World Economic Forum gathers at Davos, it is clear that avoiding a jobless recovery is the political priority of today. We need the same policy decisiveness that saved banks now applied to save and create jobs and livelihoods of people. This can be done through strong convergence of public policies and private investment”.

Possibly, it can. But it won’t. People aren’t banks. Therefore those who meet at Davos couldn’t really care less, as we shall see. What a wonderful system they have created.

Timothy BANCROFT-HINCHEY

Pravda.ru

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Pravda Archive

Only logged in users are allowed to post comments. Register/ Log in

The Market Oracle is a FREE Financial Markets Forecasting & Analysis web-site.
(c) 2005-2024 MarketOracle.co.uk (Market Oracle Ltd) - Market Oracle Ltd asserts copyright on all articles authored by our editorial team and all comments posted. Any and all information provided within the web-site, is for general information purposes only and Market Oracle Ltd do not warrant the accuracy, timeliness or suitability of any information provided on this site. nor is or shall be deemed to constitute, financial or any other advice or recommendation by us. and are also not meant to be investment advice or solicitation or recommendation to establish market positions. We do not give investment advice and our comments are an expression of opinion only and should not be construed in any manner whatsoever as recommendations to enter into a market position either stock, option, futures contract, bonds, commodity or any other financial instrument at any time. We recommend that independent professional advice is obtained before you make any investment or trading decisions. By using this site you agree to this sites Terms of Use. From time to time we promote or endorse certain products / services that we believe are worthy of your time and attention. In return for that endorsement and only in the cases where you purchase directly though us may we be compensated by the producers of those products.