In the second in a series of explainers in which the Economist (almost) embraces socialism, the newspaper turns to the great humanist question of the soul of man under socialism. They begin by describing Gary Becker’s theory of human capital:
Companies talk of investing in factories, governments in infrastructure, and people in houses. But there is a softer, less tangible focus of investment that, in many cases, is more important: knowledge and skills. Companies try to cultivate these in their workforces, governments in their populations, and people in themselves.
The means of production are not simply the roads and rails, the farms and cities, the offices and shops. The means of production are embedded within the mind and muscle of the workers themselves – without which, not a single wheel can turn.
The Economist has this backwards, actually – “human capital” is labor, and labor is not capital. Rather, capital is dead labor, which, vampire-like, only lives by sucking living labor. But in the comradely spirit of accepting all new socialists where they are, let’s use the Economist’s terms for now. Like many new socialists, the Economist has hit upon the great moral truth that exploitation is a great evil, but cannot describe it except using language that was developed in order to justify that same exploitation. Still, they describe it with great moral clarity:
To explain what was going on, Becker distinguished between specific and general human capital. Specific capital arises when workers acquire knowledge tied to their firms, such as how to use proprietary software. Companies gladly pay for this because it is not transferrable. But they are far less willing to pay for general human capital, since it can be applied to many different jobs.
On the job, capitalists deny workers the knowledge and personal development that they would choose for themselves, in favor of knowledge that is only useful when paired with systems the capitalists control. Workers who wish to educate themselves in ways that are not immediately useful to their employers must exploit themselves off the job as well:
Instead, individuals must to a significant extent invest in general capital themselves, whether directly through tuition fees or indirectly through lower wages at the start of their careers.
The Economist realizes that human beings cannot flourish under these conditions. The only solution, they realize, is to establish institutions of learning and culture under the stewardship of government and civil society, with missions dedicated to human flourishing and outside the control of private capital:
Governments that, rightly, view human capital as a benefit for wider society can help fund its acquisition through public-education systems.
Of course, public schools (or public sewers) alone are not enough to make a socialist society. But the Economist has made a great step towards understanding that the incentives of profit, exploitation, and private fortune cannot serve the greater interests of humanity. They stop just short of the realization that it takes socialism to make people free:
…the message is simple but vital: invest in people.
The only thing keeping the Economist from renaming itself the Social Humanist is their failure to imagine – as socialists do – the flourishing of art, culture, and knowledge as anything other than “investment.”
The Economist stands before Vermeer’s The Concert, taking a moment to admire that solemn tribute to craft and music, before pulling out a switchblade and slashing the priceless canvass from its frame to find out how much it’s worth.