welcom to America today with a new article about You Can Build Capital for a Better Life
I am, among other things, an economist. Like any other American who can read and write, I see an America going through a wrenching inflation. I do all of the shopping for groceries in our home. I see prices at the supermarket that make me faint with fear.
The price of dinner and lunch and breakfast seems to rise like a deadly snake as I pass down the aisles. I am also a bit of a statistician. I see an America where even a hard-working married couple in their 20s will likely never be able to afford their own home.
I see an America where even with rapidly rising wages, prices still stay ahead. I see an America where some have lavish homes and meals, and most have fear.
I am writing this about an hour after a shattering phone conversation with a friend of some 55 years who is applying for a job as a school crossing guard.
This man is a lawyer by training. He attended one of the best schools in America. But now he will be grateful if he gets work paying $13 an hour.
He failed to stay current in his field of law. He quarreled with his bosses. Most of all, he failed to save — and when he did save, he saved in the wrong kind of assets.
There are, of course, two Americas. There have always been two Americas — the rich, or at least well-to-do — and the working stiffs, who make a living, but barely.
What is the difference? In many ways, it has to do with capitalism. How do we get capital? It can come by inheritance, and that’s a fine way to get it. Or, it can come by creating your own capital.
That capital is largely education. In this great America, we can acquire that form of capital free of charge, without wealthy parents, by the generosity of the taxpayers.
They can pay for your education up through community college or higher. They can pay for you to acquire a skill set and credentials which will raise your income dramatically.
In this U.S., education is not just interesting; it is life or death. It is as important as food and water. I refer in particular to a man or woman who has a skill that a rich, free nation of aging men and women desperately needs.
That comes to mind when I recall a dear friend who was my home-care nurse after a recent surgery was botched and I was confined to a wheelchair. This man, of high intelligence, was born in the Philippines. Like many of his countrymen and women, he became a nurse. But he was not a registered nurse. He was a “caregiver.” For that, which meant mostly pushing my wheelchair, he got paid about $30 per hour.
As I said, he’s a smart guy. He did some research and answered ads on TV. He applied to the U.S. Navy. Here comes the kicker: This man, with four years of a totally unknown college in Manila, will be paid roughly $60,000 a year.
He will also get lengthy paid leaves, 100% paid medical care, and education benefits for his children. He can retire at almost full pay after 20 years. Why does he get paid so much? Because the nation needs him. And taxpayers do not care how much we pay him.
Nowadays, men and women who also do crucial work without which we would starve, namely grocery store checkers, get paid about $47,000 here in Los Angeles. They also get high-level medical care and retirement after about 30 years. Why? Because they are in a union.
The union can control the supply of workers in an essential field. The tiny.bit that the checkers’ salary takes out of your grocery bills is passed on to millions of shareholders. They hardly notice that thumb on the scale.
This equation equals diminished supply of labor and endlessly increasing demand for that labor, which will pay for a far better life than any unskilled laborer can expect. And this equation goes triple when we are talking about government work. Police in Los Angeles, counting overtime to control or try to control endlessly increasing crime, easily make six figures. The taxpayer cannot choose whether to pay it or not. He just wants to be safe.
There is a lesson there: Be on the short side of supply. You can do it by owning capital, and that capital is most readily acquired by education or being a member of a union. We cannot all have rich parents but we can have capital, and if you save in the form of corporate capital — namely, stock market index funds — you will inevitably have financial capital and a home when you are old.
You do not need to end up as an unskilled, nonunion laborer. It’s up to you.
Great wisdom is all about knowledge, and the best investment that gives the highest returns is the investment in human capital. It not only provides for the present but also holds a promise for the future. Profound education and learning move our lives from darkness to light. It not only illuminates our minds but also our souls.
Good education imbues us with the capacity to change our lives and empower us to transform the lives of others. Our education makes us free to choose and empowers us to secure any kind of employment. Education, therefore, makes us healthy and helps us become productive. A well-educated and healthy populace is a prerequisite for prosperity and well-being in any country.
This paper emphasizes that investment in K12 or HDI is essential for capital formation, to escape the trap of underdevelopment, sustain growth in the national economy, and promote real development and happiness in individuals’ lives.
Investment in human capital is key not only for creating a vibrant, healthy, and skilled workforce but also for reducing wealth inequality by giving equal opportunities to each and every citizen, whether from a rich or poor family.
It provides equal access to education and learning, helping to create a competent human resource which, in turn, helps the nation reach its developmental objectives and saves costs for dealing with negative outcomes of education deprivation.
The educated human resource can also contribute to enrollment in education, setting up vocational training, and allocating resources for specialized training and skilling, which are essential for improving the quality of human capital.