*Let's get this spread all over the Internet. Someone is making complete
sense. Maybe Obama will pick up on it, huh? Joel Barker*

My home country of Norway has an unemployment rate of 3.2% (August 2009). The
U.S. rate is 9.8% (September 2009).

Why such disparity?

The difference lies in the fact that in Norway, you either work or you are in
training. This maximizes the productive capacity of the country and serves to
maintain a flexible work force. Furthermore, the training makes it possible to
pay some of the highest wages in the world. The minimum wage in Norway is
$20.00 per hour, as compared with $7.25 in the United States.

Norway has a social democratic government with a hair-thin plurality in
Parliament. Norway also is a market economy. Could we learn something from
them about employment policies, knowing they were formulated through consensus
of /all/ the political parties in Norway?

Let’s say the U.S. would aim for 3.2% unemployment, the same as Norway.
That would lower the current rate by 6.6%. If we also import Norway’s “work or
in training” program, that could put ten million unemployed Americans into
training, and with a very high probability, more quickly into new jobs.

The US did something quite similar at the end of World War II, when millions
of Americans flooded the labor market after having served in the Armed Forces.
About 2.2 million signed up for the GI Bill, passed in
1944 to make the transition to civilian life easier. It is one of the most
successful programs in U.S. history. The GI Bill looked at the /demand/ side,
and channeled funds directly to the people who needed the money for their
personal choices for education and training.

It jumpstarted the American Middle Class! Higher education had mainly been for
the elite; now it became an option for anyone who had served in the military.
Record population growth followed (this was the start of the /baby boomers/),
and subsequently many of these baby boomers were introduced to advanced
education and training through the example of their parents. Thus the largest
generation in U.S. history also became the best educated work force in the
world.

Let us review what the Bush and Obama administrations have done with regard to
improving the economy in 2008 and 2009.

President Bush asked for and received $700 billion to rescue the banking
system and another $25 billion to rescue two of the Big Three Detroit auto
makers. An economist would look at this as a supply side intervention.

Supply side interventions were also largely the thinking behind the Obama
Administration bill – the $787 billion went for Medicaid ($87B); energy
($54B); roads, bridges and construction ($90B); modernizing the education
sector ($141B); and helping workers with extended and increased unemployment
payments, including some funds for training.

Eighty percent of all capital is human capital. The three stimulus packages,
adding up to $1.512 Trillion, barely touched investment in human capital.

But investment in human capital yields the highest returns, just as it did in
1946 with the GI Bill. And just as it did in Japan in 1946, when the war
ravaged country looked for the best way to grow. Japan recovered from WWII by
investing in the only resource they had -- their own people
-- and became the second largest economy in the world.

Let’s see how we */could/* deal with U.S. unemployment. After all, an
unemployment rate of 9.8% is a drag on the United States economy. We could
have produced $1.4 trillion more per year with those people working rather
than being idle.

What would an investment in 10 million unemployed Americans cost?

Let’s do what the GI Bill did: Here is a voucher for you to finance any
education and training that you desire and that will help you get another job.
Let us make the voucher $20,000 per year for up to four years. That’s $80,000
per person -- $800 billion in total, about the same amount the bailouts of the
banking and auto sector cost U.S. taxpayers.

But the 10 million Americans are */people/* -- not delinquent mortgages, not
brick and mortar, and not machinery.

Let us be conservative and assume that they will go from zero (negative pay,
actually, if they drew upon personal savings while looking for
work) to average pay once the education was completed. Average hourly pay in
the U.S. is approximately $20 per hour. Ten million Americans will thus earn
$20 per hour X 2,000 annual hours X 10,000,000 people = $400 billion per year.
Over ten years, they will have earned at least $4 trillion. From this, they
will have paid some $1.4 trillion in U.S.
taxes. And that is a /profit/ of $600 billion in ten years after the entire
investment of $800 billion has been paid back -- with more gains to follow.

*/Not/* improving unemployment already costs us $1.4 trillion per year.
That is an entire current U.S. GDP over ten years. So our net return is really
$14.0 trillion + $600 billion, or $14.6 trillion, for an investment of $800
billion. That is a return of 24.3 times the investment over 10 years -- a
2,430% return on investment.

I’ll be surprised if the three combined stimulus payments packages implemented
by the Bush and Obama Administrations produce anywhere near this kind of
return on their $1.512 Trillion investment.

Why don’t we invest in the most important and precious resource we have
-- our own people? Why don’t we admit that meaningful work is a basic human
need that helps everyone when that need is met? Why don’t we focus on avoiding
the demeaning and undignified misery that unemployment implies, and avoid the
broken families, the increased suicide rate, the known linkages to depression
and disease, and the economic catastrophe that unemployment brings?

All those who have been unemployed through no fault of their own know what I
am talking about. The pain of being fired or laid off is real. It is like a
dagger through the heart for a proud and seasoned worker—it is the brutal
force of an uncaring market that we will never forget. Why not create a market
for willing learners to counteract this pain? And make the power of the market
go /our/ way? The jobs people will choose to prepare for are the jobs of the
future. Shifting the focus from what has been to what will come is adaptation
at its finest.

I don’t see a downside to a rule that says: “You either work, or you are in
training.” It is the closest we come to nature’s own survival
rule: If you can’t survive the way you are, mutate!

It is also the best investment we can make, and it has made Norway one of the
richest countries in the world. For several consecutive years, Norway, among
all the countries of the world, has been chosen by the United Nations as the
best country in which to live.

There is grace and dignity in being able to work. And there is grace and
dignity in receiving the opportunity to learn.

It is almost too good to be true that study and learning are the very best
ways that we can use our scarce resources when a recession is again upon us in
a future year. And when it comes, it is usually during the month of October,
when we are raking the dead leaves from a glorious Midwest summer.

All around us nature will be preparing for survival. It will be a good time
for us to follow nature’s example before the gathering storm.