By: Kropotkin

Kropotkin
Fri, 15 Oct 2021 10:55:35 +0000

There are very simple economic relationships between many of the components described above.

A company which has the choice of using labour or capital investment equipment (read: technology) will go for a combination of supply and ease of use. A company which suddenly has access to a low-cost, high-quality workforce (read: Poles around 2005) will find that it can expand its activities easily. When this is coupled with a highly permissive regulatory environment (read: it’s easy to sack them if there’s a downturn), there is only one sane answer – use people.

In Germany, where I had much business around 2010, the huge cost of sacking people, the discriminatory environment (try opening a bank account if you are from another region, let alone a foreigner!) and the tax structure which favoured investment in machinery equally gave only one sane answer – avoid employing people.

The first situation leads to a low productivity, high employment environment. The latter leads to a high productivity (widgets per employee) static (or declining) employment society. They also contrast by being in the first case highly innovative (when you get a brain drain of clever young entrepreneurial German, French, Spanish, Italian people to London) and the second case throttling itself with moribund but protected businesses.

With Europe tying itself ever closer to the German model, we should be looking forward to a high-energy (nuclear) economy with government policy based strictly on benefits to the population in an improving environment (scrapping windmills and subsidies would be a good start).