education

Employment Policy

I’ve been thinking quite a lot about the question of employment.

It’s an unfamiliar line of thought for me — I’ve always held to the libertarian line on unemployment: it’s a result of an obstructed market, let the market clear and unemployment will not exist by definition. Subsidise unemployment through the welfare system and you’ll get more of it.

That isn’t wrong — within the libertarian framework it’s completely true. But I’ve left the framework behind. Political power will be gained and held by people who believe that gaining and holding power are always a first-order consideration. I hope for a government whose hold on power is so solid that it does not depend on interfering in the market for labour, but that is not relevant to any present government or any feasible near-future one. Welfare is here to stay (even if based on private charity rather than the state, it would still have market-distorting effects), and unemployment will therefore always need to be addressed.

In the meantime, we’re faced with questions like the one a commenter asked back when I was kicking around AI possibilities:

Don’t you think we’re already way past the point where diminishing returns of replacing human activity with automated activity kicked in? Most people are just not that smart, they can’t all be designers and scientists (or can’t be made smart quickly, it is not important which is true as practical results are similar in both cases), and it appears to me that we, the societies of the developed countries, don’t know how to employ these people.

Yes, in a free market these people would have jobs, even if at a wage below what is generally seen as the poverty line. But, if I’m going to be more serious than simply advocating that, I need to face the question: is the combination of politically necessary price control in the labour market with technological advance making high unemployment unavoidable?

I don’t think it has to. There are other causes to high unemployment, some of which can be treated rapidly, and some which are more long-term projects.

High taxation is one of the biggest. Doing work yourself instead of employing someone is by far the greatest area of tax avoidance. I’ve spelled out the arithmetic before: I can do an hour’s work for myself, or I can do more of my normal job and use the income to pay someone to do it. The former is tax free, the latter, at minimum, involves 40% tax on my extra income, then 20% tax on what I pay out. I have to earn £1.68 to put a pound in someone else’s pocket, without taking into account NI or VAT, which may or may not come into it as well, pushing the effective tax on the extra activity up towards 100% of the real cost. That applies to jobs around the house (leading to the dreaded DIY); it also applies, less obviously but probably more significantly, to any good or service I buy where the supplier could, by employing extra labour, provide a better or more complete service. It applies to having the supermarket deliver my goods rather than make me carry them, or even to them having someone work on a checkout rather than wave me to a self-service.

Lower taxes would directly lead to lower unemployment. Also, lower taxes on economic activity would directly lead to lower unemployment — I’ve never written about the question, but I’m pretty sure the Land Value Tax crowd are basically right. Land Value Tax is still a tax, and is still bad, but it’s less economically destructive than the taxes we currently have.

That’s one area then for attacking unemployment: reduce tax, and shift what’s left from income, sales & profit taxes to land.

Next? Well, the education system. It’s not that it’s failing to teach people “what they need to get jobs”. Rather, the purposeless and ineffective attempts to control unacademic children are actively teaching them not to work. Being forced to do schoolwork is a fairly crappy training for doing real work, but today the bottom stratum aren’t even getting that training. The result is they’re unemployable, not for lack of skill so much as lack of socialisation. It may be only a few percent, but the risk to the employer of getting one of them, and the costs if you do, push a large swathe of the lower classes out of employability.

A demonstration of what I mean came to my mind a couple of weeks ago: a hundred years ago, some huge proportion of the population worked in domestic service. I’ve been meaning to look it up: Tim said yesterday it was 25%.

That dropped sharply from the First World War to about zero by the 1960s, in large part due to the high demand for unskilled labour from mass manufacturing industry. Now that demand has subsided (for good, and inevitably — as also pointed out yesterday by Tim, busy chap). What is the reason why we can’t have domestic service back? We’re always hearing about how ridiculously stinking rich the the rich are getting, so it can’t possibly be that they can’t afford what the moderately rich of a century ago were happy to pay for. The answer is all too obvious — the equivalent today of the people who were domestic servants a hundred years ago are people that no sane rich person would allow into his house under any circumstance. The late twentieth-century education system prepares normal people for the easily-supervised assembly line jobs that no longer exist, but not for any role requiring any degree of trust or self-discipline. (Having said that, the mass of civilised but somewhat dim people doing largely pointless make-work in the bureaucracy would possibly be capable of roles as butlers or housekeepers supervising the helots… worth thinking about).

The education system doesn’t need to be improved, it just needs to be in large part abolished. Actually doing useful work, for the family or for someone else, is not only a better preparation for being a useful adult than our schools are, it’s probably a good deal more personally satisfying and rewarding as well. The norm should be for people to be in full-time employment by the age of 16, and 13 or 14 is probably a good idea in a lot of cases. The wealthy can do what the hell they want as long as they pay for it themselves, and a sane education system not lumbered with uneducable teenagers should be able to grab anyone from any background with the right talent into a more academic channel, as was routine in this country up until the introduction of comprehensive education in the 60s-70s.

This is a tricky change to introduce, not least because if you already have high unemployment, throwing the bulk of the 16-21 age group into the job market is going to make things worse in the short term. But in the longer term, I think it would improve the situation. Unemployment is not simply the result of lack of work available, but due to the unfitness of a chunk of the population for what work could be available, due to artificially created and prolonged adolescence. The problems raised by Robert Epstein and Lenore Skenazy are relevant here.

Other options? Well, there’s the immigration question. Again, the libertarian reasoning is entirely correct: if an immigrant is making a living, that means he is producing more value than he is consuming; in aggregate he is making all of us better off. But if immigrants are overwhelmingly competing with poor people in providing services to rich people, on top of that aggregate benefit there is a transfer effect from poor to rich. If it is politically necessary to compensate the poor for this transfer, and if the mechanisms for doing so are unavoidably clumsy and inefficient, then the aggregate benefit can be entirely eaten up. I’m not convinced that that is practically the case, but all the steps in the argument are plausible, and so I am not convinced that it isn’t.

The same form of argument could be made for other forms of protectionism: after all, foreigners compete with natives whether they actually come here or not. But I draw the line at that with moderate confidence. There are so many different ways in which overseas trade affects the domestic economy, all of them beneficial in the aggregate, and while some of them may harm some particular interest or other, the wide distribution of harms means that for almost everyone, the net effect of free trade is positive, and for the aggregate, the effect is so enormously positive that it should not be rejected.

And the same even more strongly for technological development — it is so hugely beneficial that restraining it in order to protect a politically influential constituency from competition is always a bad policy. The reason for paying attention to unemployment and being realistic about the necessity of reducing it is to make it politically easier to hold onto the huge benefits of technology and trade, which it is disastrous to give up.

(The effect of current tax and industrial policies is mainly to encourage more investment in capital goods rather than employing low-skill labour. There is no need for that. But neither is there a need for opposite policies).

State Education

Having unleashed some nasty bouncers on the libertarian movement, Giles Bowkett follows up with a gentle long hop.

Libertarianism assumes the presence of many cultural conditions that cannot exist without pervasive free education. A Libertarian society would therefore lack the necessary pre-conditions of a Libertarian society.

Let’s accept for the sake of argument that we need people to be educated. That no more requires “pervasive free education” provided by the state, than we need “pervasive free food” to prevent us starving, or “pervasive free petrol” to move around. If something is that important, people will pay for it.

Ah, but private education is expensive – thousands of pounds a year. Yes and no. Because state education is free, private education is mostly aimed at those who aren’t too worried about price. But there are a lot of exceptions. Tens of thousands of children in the UK get private tutoring in addition to their schooling, and I’m aware of a number of cases where one hour a week of tutoring (at a cost of £25 or so) is enough to move a pupil from bottom of class to top of class in one or two subjects.

James Bartholemew claims that in the mid 19th century, before state education was introduced in Britain, “over 95%” of children got 5-7 years of education, mostly at charitable free or low-cost schools. I’d like to see his source for that, but I’ll probably have to buy his book, which I’ve never got round to doing.

(5-7 years isn’t a lot by modern standards, but it’s as much as was needed at that time. We’re a lot richer now, and could pay for more education if it were efficient and beneficial).

Modern education, as I’ve mentioned before, is expensive because it’s based around the idea of looking after the children, all day, every day. That’s for good reason, but not any reason to do with education. If you were trying to make most efficient use of teaching resources, rather than just allowing parents to go to work, six or seven hours a week would be sufficient for children to keep up the same standard as they currently do at school.

Of course, if we were to move to a cheap, efficient market-based education system, we would be left with the problem of what our children were to do all day. I would favour them working, at least from the age of 12 or so, but there are in fact many possibilities. We have a nasty coordination problem at the moment. Because everyone who cares about their children’s safety sends them to school, if they are not there, they are on their own, and at some risk. As long as children are together, doing something with some kind of adults involved, they are at least as safe as they are at today’s state schools.

Virtual Worlds

Lord Puttnam says that we may be damaging children by allowing them to grow up in virtual worlds.

I agree entirely. Childhood is where children learn to be adults. Putting them in a fake environment away from real adult humans denies them the chance to adapt to the real world.

However, Puttnam seems to be hung up on something to do with computer games. I’m much more concerned about schools.

Rather than inflict my own clumsy prose on you all, here’s Paul Graham:

If I could go back and give my thirteen year old self some advice, the main thing I’d tell him would be to stick his head up and look around. I didn’t really grasp it at the time, but the whole world we lived in was as fake as a Twinkie. Not just school, but the entire town. Why do people move to suburbia? To have kids! So no wonder it seemed boring and sterile. The whole place was a giant nursery, an artificial town created explicitly for the purpose of breeding children.

Where I grew up, it felt as if there was nowhere to go, and nothing to do. This was no accident. Suburbs are deliberately designed to exclude the outside world, because it contains things that could endanger children.

And as for the schools, they were just holding pens within this fake world. Officially the purpose of schools is to teach kids. In fact their primary purpose is to keep kids locked up in one place for a big chunk of the day so adults can get things done. And I have no problem with this: in a specialized industrial society, it would be a disaster to have kids running around loose.

What bothers me is not that the kids are kept in prisons, but that (a) they aren’t told about it, and (b) the prisons are run mostly by the inmates. Kids are sent off to spend six years memorizing meaningless facts in a world ruled by a caste of giants who run after an oblong brown ball, as if this were the most natural thing in the world. And if they balk at this surreal cocktail, they’re called misfits.

Read the whole thing. I want to rant on about this, but there isn’t a single thing I can say that Graham doesn’t say better.

See also Robert Epstein’s book, which I haven’t read, but I listened to this podcast with Epstein from the Glenn & Helen show.

It is a frustration of mine that whenever I start to talk to anyone about education, the conversation always seems to turn to schools. Schools are pretty much irrelevant to education. Schools are for babysitting, social conditioning and political indoctrination – valuable functions in many cases, of course, but not much to do with education.

Recognition of this fact seems to be beginning to build. See this piece in the Washington Post arguing that Americans, who learn exceptionally little at school, learn well after school. See also The Overselling of Higher Education

I happened to read a novel the other day set in 190x Spain. I didn’t know anything about the period – Spain was a complete blank to me from Napoleon to the Civil War. I happened to spend an hour or two poking about on Wikipedia, and I chatted about it with my wife in the evening. I now know as much about the period as if I had spent half a term on it at age 14. (True, what I “know” is not 100% reliable – but in my experience that is as much the case for secondary school lessons as it is for Wikipedia).

A Case Study

In my first article, I wrote that:

… there are many political battles in various European countries which appear to be between “native” Europeans and Muslim immigrants. In fact, these political issues are argued between left and right within the native political community, with the immigrants themselves as interested but largely powerless bystanders.

As a case in point, Wretchard at Belmont Club today picks up the story of Islington Council in London wanting a school to change its name to remove the word “saint”.

At first glance, this backs up Wretchard’s point about Europe abandoning its Christian roots, but there is more to the story than meets the eye.

First, Islington Council is about as representative of European culture as the UC Berkely Student Government is of America. James Kempton, the “children spokesman” who was quoted in the story, was elected to the council with 1129 votes, on a turnout of 29%. Local government in Britain is a complete joke; with virtually no powers, elections are treated purely as opinion polls on the national government, and corruption and incompetence are rife. The current Islington council is moderate compared to its predecessors, who declared Islington a “nuclear free zone”, and were notable mainly for running children’s homes in which the children were routinely sexually abused by staff. (In a sick twist, the leader of the council at the time is now “Minster for Children” in Tony Blair’s government).

Second, this story is really about the state education system in Britain. The government does such an appalling job of running schools that atheist parents all over the country are turning up to church to qualify their children for church-run schools. The ideal for a parent is a school that is paid for by the state (so they don’t have to pay), but run by the church, to protect it from the malign influence of the state system. The school in question is one of those. Because it is a decent school, the local authority wants to claim it as theirs, whereas the Church of England, which has made it a decent school, doesn’t see why it shouldn’t get the credit. Hence the argument over the name. The people who would supposedly be “offended” by the school being called the “St Mary Magdalene Church of England Primary School” are nowhere to be seen.

Update: Of course, this sort of thing is not seen here as “typically European”, it is rather seen as importation of American-style political correctness. There is some truth in this, as this post The War On Christmas on Chigago Boyz shows.