Unemployed – hopeless – violent – this should not be the future of our young people

by Prof Dr Heinrich Wohlmeyer

We are currently experiencing the establishment of global unemployment, accompanied by dramatic consequences. On the one hand, this leads to the radicalisation of the “youth without a future”, both in the industrialised regions and also in the “developing countries”, as well as to the mass exodus of the desperate from the latter into the wealthy states, which have to deal with increasing unemployment themselves. In addition to this, social systems and national budgets in the industrialised countries are overextended.
The internationally recognised economist, sociologist and theologist Oswald Nell-Breuning, who died in 1991, consistently emphasised that humans need meaningful work in order to lead a fulfilled life. That is why he strongly criticised the ongoing “labour market policy” in the industrialised countries. One the one hand, this does not manage to create enough employment, on the other hand it forces people to accept, in order to survive, “precarious” working conditions, which do not satisfy them.
In line with Nell-Breuning and building on his work, a collective of renowned professors have in their study on “Arbeit ohne Umweltzerstörung – Strategien einer neuen Wirtschaftspolitik” (Work without environmental destruction – Strategies of a new economic policy)1 come to the conclusion, that a successful labour market policy must be embedded into a comprehensive corporate and economic policy. This was as early as 33 years ago (1983). However, the prevailing neoliberal economic policy has not only ignored this wake-up call, but has intensified its largely counter-productive strategies and measures – with the result that we now have around 20 million registered unemployed in Europe and 200 million worldwide (a realistic figure is likely to be one billion). The problem of youth unemployment is particularly pressing, since in the Southern European States its rate is 50% and above.
Looking at “developing countries” requires an additional perspective, which must also be briefly explained.
In the following, we shall try to sketch the available avenues of escape as briefly as necessary.

Looking at the “developing countries”

Every specialised economy with a variety of jobs requires that the basic need for food for all is covered by a productive, diverse agriculture. Therefore, the local agricultural sector, which has so far been neglected in international development policy, must be given priority. The commercial-industrial area can thus be originated, but it needs a trade protection policy during its phase of development. (Our economies have had such protection in the past as well.) This must be supplemented by an energy policy that uses the local primary energy sources – the abundant solar energy in particular. In addition to this, a liberating financial policy is needed, that allows local money generation and puts an end to the internationally imposed debt slavery, which restricts economic maneuverability.2
Notably education is an essential factor. This results not only in the ability to innovate economic and non-economic activity, but also in a significant decline in the birth rate.3 The latter is of such great importance because in the developing countries the birth rates currently exceed the economic growth and therefore the prospects of creating enough jobs.

Looking at the industrialised countries and the consequences of rising unemployment

At the present time, the “all-clear” is being given everywhere, because the short-term unemployment rate has declined by a few percentage points. However, all long-term studies show that, if the current framework is updated, up to 60% of traditional jobs will disappear within three decades, because automation and digitalisation are progressing rapidly. This will not only be at the expense of those “less capable of learning”, but also at the expense of skilled workers, because in particular repair, maintenance and recycling will break away in the programmed throw-away society.4
For the young people, who will find themselves caught up in a “global gladiatorial struggle”5, this means a future of the brutal struggle for survival, which for the weaker will be lost from the very beginning.
The reaction of the unsuccessful can lead to several extremes: to surrender (public welfare cases), to revenge on the society, by which one feels coldly treated, rejected and abandoned6, or to an attachment to economic parallel societies (e.g. the Mafia) or to ideologically-religiously motivated parallel societies, which also provide security and salvation and legitimise violence.
The documentary filmmaker Johanna Tschautscher, who has been so daring as to make a film about the Mafia, comes to the clear statement: unemployed young people from poor conditions and without positive prospects for the future are recruited by the Mafia. There they gain meaning and power. However, when they are integrated into the network, they can no longer escape without risk of death. The triad “unemployed – hopeless – violent” becomes clear.
If one understands full employment as the result of an economic policy which allows all members of an economy to reconcile their needs for goods and for work, then one has to question all current policy lines. Most notably the assumption, or better said assertion, that investment creates jobs, is not tenable. Given the current framework conditions (in particular the taxation of human labour – robots do not pay taxes), new equipment investments generally result in the “saving” of labour – i.e. in unemployment. The current European Central Bank’s policy of cheap money is therefore overall counterproductive.
In order to achieve meaningful full employment, a bundle of measures is required7:

  • In the area of financial policy, the present dynamism in national income of a shift towards capital gains at the expense of mass income must be broken, so that mass demand will increase correspondingly. This is possible through a reform of money creation and through orderly international debt relief.8
  • In the case of trade policy, the destination principle must be applied: If a product or other service is not produced under social and ecological conditions similar to those of the country of destination, the goods will not be allowed market access or will be burdened with a countervailing duty corresponding to the cost difference. If this measure is not taken, employment will move to those providers who exploit man and nature “most efficiently”.
  • In tax- and social policy, there must be a redeployment backed by trade policy, towards taxes on capital turnover, energy and raw material consumption, as well as towards the taxation of large-scale assets. Taxes on “machines” are also only effective if secured by trade policy. But an internet duty of one millionth of a cent per bit is possible. Despite the granting of free amouts and the exemption of social and scientific services, this would make for about 30 billion euros – about 40% of the Austrian federal budget.9 There would therefore be sufficient latitude for reducing the cost of human labour and for the so-called “informal sector”10. Even those social compensations not previously granted, such as the remuneration of the work of mothers and fathers (maternal salary), would be affordable.
  • Input-sided reconstruction of national budgets would also make it possible to finance a basic income for all citizens. This would not only eliminate the humiliating stigma of unemployment, but also allow the free choice of an appropriate (heartening and uplifting) professional income combination (one would not have to accept every “job” to survive).

         A basic income (basic social security), however, must be supported by common-sense ethics if it is not to be abused. This attitude must be conveyed above all by the educational system. Attitudes such as “I shall get as much as ever possible out of the social network, without making any contribution of my own,” should be put under social ostracism, and positive commitment should be applauded.
         For the sake of completeness, it should be mentioned that the granting of a basic income has to be secured by trade- and social policy, if the country that grants it is not to be overrun.
We see, therefore, that a set of measures is available that must be persistently pursued if we do not want to slide into unbearable human suffering and social catastrophes.
The measures currently applied internationally (in particular cheap money) or nationally (especially temporary employment programmes) are, unfortunately, only economic policy pacification pills that will not change the negative overall dynamics moving in the direction of rising unemployment.     •

1     S. Fischer Verlag, Frankfurt am Main, 1983; H. Ch. Binswanger, H. Frisch, H. G. Nutzinger, B. Schefold, G. Scherhorn, U. E. Simonis, B. Strümpel
2     Concerning this, there is a “motion” (caveat and recommendation) to the “High Level Political Forum 2017” held within the framework of the Economic and Social Council of the United Nations (ECOSOC) in July 2017 and to the “Ministerial Meeting on the topic of eradicating poverty and promoting prosperity in a changing world “, the text of which can be accessed at the RSK. See Article p.5).
3     A study of the Wittgenstein Centre for Demography and Global Human Capital in collaboration with the International Institute for System Analysis (IIASA) and the Institute for Demography of the Austrian Academy of Sciences “Global Human Capital 2015” shows that by 2060, the expected growth of the world’s population could be reduced by around one billion people by means of increased educational efforts - especially for women.
4     See “Die Presse”, Economist, p. 15, 14. June 2017 “Mostly skilled workers lose jobs”
5     This is the wording of a student in an economic seminar. It applies because for the purpose of quietening the unemployed, the following mantra is repeated stereotypically: “If you are efficient and always ready to make an effort, then you will have a job!” So will you kindly blame yourself instead of the system. But if there is insufficient employment altogether, this “advice” is downright cynical, and the student is right: As a gladiator, you have to kill others in order to survive and be admired in the international arena.
6     See the court psychiatrist G. Haller’s analysis, after the gruesome attack in Manchester on 22 May 2017: Die Presse, 24/25 May 2017, p. 1, “Die Psychologie der Attentäter” (“The Psychology of the Assassins”).
7     These are presented in more detail in my memorandum “Handreichung - Manifest – UnverzichtbARE Echpunkte einer weltweit zukunftsfähigen Gesellschaftsgestaltung“ („Recommendation – Manifesto - Indispensable cornerstones of a sustainable organisation of society”) which is available at the RSK.
8     Since the credit balances offsetting the debts have been created out of nothing, they can also be returned to nothing without any economic damage.
9     The same applies to Germany and Switzerland.
10     The “informal sector” is the area of quasi-employment relationships not practised in the formal sector because the costs there are too high. Examples are the civilian assistance services, or the cooperatives in the Trentino region which perform general and regional cultural activities with otherwise unemployed people.

(Translation Current Concerns)