Ruggie argues in his work that a wealthy state is one that provides full employment for its citizens. While employment certainly provides citizens with disposable income and allows for the state to spend less on social services, it also hinders productivity. The benefits of employment are clear; a steady salary, a sense of worth, and a decrease in crime to state a few. However, full employment forces work to be created where it is unnecessary in the given context. Why employ thousands of people with shovels to build a road when a few people with modern machinery can do the same job? I do not view a state’s proximity to full employment to be the standard for determining if a state is wealthy or not. I simply view the strength of a government’s institutions to be the deciding factor in determining whether or not a state is wealthy. If roads are paved, the trash is collected, the children are educated, the mail is delivered, and sick people have ready access to medical care; I consider a country to be wealthy. Full employment provides for the state to spend less on welfare and social programs, but it alone is not a direct sign a nation is wealthy.
Ruggie also states that he considers an individual with a job to be wealthy. In regards to monetary wealth, having a job is certainly provides for a continuous influx of income, which allows for consumption and the addressing of basic needs. However, there are many Americans who are employed, yet they do not earn a living wage. Few can argue that these individuals, who can barely afford rent and food, to be wealthy. To me, being wealthy involves the ability to purchase non-essential goods for personal utility. This is much more concrete than Mike’s belief that wealth is a much more personal concept. He views his relationships with his family and friends to define what wealth means to him. Regardless of what you define as wealth, I feel it is unrealistic to assume that all people who are employed can be considered wealthy, so I must respectfully disagree with both of Ruggie’s arguments.
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3 comments:
So by your standards:
"If roads are paved, the trash is collected, the children are educated, the mail is delivered, and sick people have ready access to medical care; I consider a country to be wealthy."
would you say that the US is wealthy?
I ask that with specific emphasis on the idea of medical care and what you define as "ready access".
I agree with your main point, but I'm really confused about "Why employ thousands of people with shovels to build a road when a few people with modern machinery can do the same job?" I think you mentioned the same idea on Tori's post as well.
Are there really not enough jobs to go around? I recognize that better efficiency and job outsourcing both play a part in the number of jobs available, especially in manufacturing, but I still have a hard time believing that unemployment is caused by the lack of jobs. And just for argument's sake, even if that was the primary cause of unemployment couldn't the government always create jobs by renovating roads, increasing park maintenance, etc? If a government is able to pay 100 men to do a one-man job, then it should also be able to pay 100 men to do a 100-man job. I would argue that unemployment is due to things like personal worker problems (illness, etc.) or the inability of employers to pay competitive and fair wages.
The only problem with this argument is in the misconstruction of "full employment." When Friedman discusses the non-accelerated inflation rate of unemployment, he's talking about a world without structural unemployment. Modern economic policy tends to rely on a sort of economic policy that aims to keep unemployment low, as it is argued that at full employment (controlled by interest rates) prices stay around their aggregate level. There will never be complete employment. A 0% rate means you don't have enough workers to fill your jobs. There will always be frictional and seasonal unemployment, and disaffected workers will always exist. The question tends to refer more to structural unemployment and ways to reduce it.
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