Can government create jobs? Does the state have a role in facilitating job creation? Or should it just get out of the way of business, cutting red tape and taxes so entrepreneurs can grow the economy?

The question of the state’s role in the economy has traditionally been one of the big dividing lines between the political Left and Right. However, since the late 1970s, there has been something of a consensus across the political spectrum that low taxes, light touch regulation, and a small state are the key ingredients for economic success.

Today, the consensus has broken down. The fallout from the 2008 financial crisis has effectively re-opened the debate. Proponents of more state intervention in the economy argue that only government can reduce growing inequalities, ensure fair distribution of public services like gas and electricity, and ensure quality, well-paid jobs. Critics of state intervention, meanwhile, point to the failed economic policies of Latin American countries like Venezuela.

What do our readers think? We had a comment sent in from Brian, who says that job creation is “the role of individuals and businesses. The politicians can use our money, collected through taxes to create jobs but that is nothing to do with the economy and everything to do with politics.” Is he right?

To get a response, we spoke to Nicolas Schmit, European Commissioner-designate for Jobs, and former Minister for Labour of Luxembourg. What does he think?

For another perspective, we also spoke to Mate Rimac, founder & CEO of Rimac Automobili, a Croatian car manufacturer which produces electric sports cars. As an entrepreneur, what would he say?

Who should be creating more jobs? Government or the private sector? Let us know your thoughts and comments in the form below and we’ll take them to policymakers and experts for their reactions!

IMAGE CREDITS: (c) BigStock – kadmy

18 comments Post a commentcomment

What do YOU think?

  1. avatar
    Nicola Gouldstone

    It is not a binary option. Both need to focus on solving the issues facing humanity.
    Job creation is no longer simply about creating financial wealth but involves ensuring a sustainable future for humanity.

    • avatar

      ???? :D Hail to the communist state? :D

    • avatar

      Good joke Michael.

  2. avatar

    Without any doubt, the job creation role belongs to the private sector, which is the only one proven to ensure performance based on competition. For that reason, the state being involved in comercial activities would only affect the free competition between private agents on the market making it unfair due to the advantages a state company might have. Nevertheless certain public services have to belong to the state, they are an important part and they do influence the labor market giving the state one more possibility to adjust salaries.

  3. avatar

    The private sector. Function of the State is Education Health Safety. None of these, are fullfield. The Education is Marxist, health is falling apart, and no safety with the invasion of migrants helped by leftists ONGs

  4. avatar

    We don’t want communism, so obviously the private sector should create jobs and the government should create policies that promote investment and job creation. The government should step in and create jobs only in case of unemplyment when the private sector has no jobs for some individuals. Public employment (public work, retraining) is better than raising generations of welfare recipients.

  5. avatar

    The govt should ensure that there is adequate protective labour legislation and that it is applied. Otherwise the job market will become even more of a jungle than it already is.

  6. avatar

    Government must create the conditions for jobs to be created they should only be inspecting that the world and its people are being treated fairly.

  7. avatar

    that will depend on we want to live in a capitalist or socialist society

  8. avatar

    Lol. Is it even a question….

  9. avatar
    EU Reform- Proactive

    Why take us backwards- as it so often happens? Why let us re-start from an already discredited & condemned historic baseline?

    Enough bad lessons learned!? (“The reasons of the failure & fall of Communism”)

    Even past & ardent disbelievers- Russia & China- abandoned such fallacies. Only lunatics, political sentimentalism & their supporters still celebrate Marxist ideology.

    Within our present free market- capitalistic system, the protection & safeguarding from theft of our scarce public funds by dishonest partnerships & collusion between government officials and the criminal facilitators……:

    ….being some big Corporations, its Consultants, its Auditors and the ever colluding big Banks- all having a helluva ball on behalf of the lesser informed = tax payers.

    A first honest & “good” task to consider would be:

    Scrutinize, control & abolish (who has the guts?) all global tax havens & huge money flows (=just a hide out for ill-gotten gains due to massive looting= theft)! Governments to unite, introduce legislation, synchronize & repatriate these monies. Then confiscate, redirect & spend it on R&D………

    ……which in turn will create lots of “sophisticated” jobs in future!

    That would be worthwhile for everyone- except the ones connected to these “reputable” but financial criminal syndicates. Name & shame them!

  10. avatar

    The Goverment is ,ultimately, developing jobs ,whethear it is by creating jobs directly or by creating the appropiate breeding ground for the private sector. Neither should be excluded.

    It has to do with the correct combination of both ,that has to lead back to the flourishing of society as a whole and not just the private sector.
    What shocks me is the anti-communist comments. The question was not about communism ,nor is communism the only system that supports jobs created by the government. .

    Also, the two videos already state the same narrative that creating jobs in the public sector will lead to corruption ” The politicians can use our money, collected through taxes to create jobs but that is nothing to do with the economy and everything to do with politics.” ….making the survey almost biased since the other narrative is not even introduced in the text!

    Capitalism has ignored external costs, such as pollution and climate change. This makes goods cheaper and more accessible in the short run. But over time, it depletes natural resources, lowers the quality of life in the affected areas, and increases costs for everyone.
    It should not be a binary option to debate.
    Capitalism promotes and approves of greed and communism leaves no room for the individual, at their worst. It should be a combination of both and that known combination of both is socialism.
    Except from surveys ,justifying your beliefs maybe you could also read books. Or think out of the box. Or think about the greater good longrun. That last comment goes for the anti socialist comments above.
    A governments ” need to focus on solving the issues facing humanity.
    Job creation is no longer simply about creating financial wealth but involves ensuring a sustainable future for humanity.” to quote another comment.

  11. avatar

    Europe has to decide whether to pay more for NATO to fight wars and create more refugees or invest for sustainable development, well beings of the people.

    • avatar
      Alex Laghai

      The issue is about creation of jobs in Europé. Why so many of above statements have nothing to do with creation of jobs. Anyway, we need to know that politics and creation of jobs is two side of the same a coin. Since the 1980s onwards, the Européan welfare states have eliminated millions of jobs in each and every country where most of our businesses closed the operations and moved overseas. The reasons were high taxes, high cost of labour and complex Labour regulations. Consequently, we created jobs in China, Vietnam, Begladesh, Malaysia, Cambodia, and elsewhere for their people and our own prople and immigrants went on benefit.
      To create job in Europé, we need to bring our productions back, and the only way to bring production back is lower the taxes and provide a better climate for business in Europé. You just have a pause of reflect over a simple question why 3 out of 4 small businesses cannot survive in the UK. The reason German economy is doing slightly better than the UK or Irland is because Germany has more production and lower tax system.

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