Thoughts from Tradewinds
A Different Perspective on The Labour Theory of Value
Government can create and fill as many job slots in the public sector as it chooses - 5,000,10,000,15,000 or more so called jobs.. It is as simple as putting pegs into holes.. But one must now question are these productive or nonproductive jobs, and will they contribute to the real growth of the underlying economy?? These government created slots are filled with people that are really not productively employed.. In labor economics, this is often described as "Disguised Unemployment " which is commonly found throughout the third world, where people are placed or slotted into nonproductive jobs which often are part time positions.. Such unproductive employment is motivated mostly for political considerations despite being a drag on real economic growth.. The real issue here is that such "disguised unemployment" is a real cost or drag on the economy as these increased costs of labor are paid for by the productive tax paying public..
In contrast, productive employment in the private sector is paid for by the employer from net income or earnings while providing a direct contribution to boost the economy's overall level of real growth.. It can be argued that increased nonproductive, marginal employment is a miss-allocation of labor resources resulting in higher labor costs, lesser labor productivity as well as less real economic growth..
Let us not forget that Government can create and fill empty employment slots, but it cannot produce or create any real economic wealth.. Government is only a vehicle by which funds are transferred from the productive sector to the dependent sector of a nation's economy.. Without real growth in productive resources there can be no increased payment to government dependents as government cannot produce wealth..
Government's true role should be to provide the absolute and necessary functions of governance like the protection of private property, maintaining secure borders and protecting the lives and rights of its citizens.. What was once considered to be acceptable as proper and necessary has become almost unwarranted and wasteful as government becomes all encompassing in trying to control almost ever aspect of our daily lives.. Lets for once face the factual truth.. The last thing the deficit ridden Bahamas needs is more unnecessary, high cost, low productivity public sector employment composed of political cronies, misfit deadbeats and well connected has-beens.. In a free market economy, productive and gainful employment only results from increasing business confidence and anticipated economic growth and well being and not from the Nation's Parliament or the Office of the Prime Minister.. Time for the Bahamas to quickly shape up before the IMF and the International Rating Agencies decides to ship us down and out..
