Q: Of course, I was by no means a leftist before I came to the UK to study at the SEI as a Chevening Fellow, but now I’ve got even more liberal views on the economy, which were enhanced by the answer to the next question: What good are doing to the people those politicians who fear taking measures that would make thousands of workers jobless?
A: Absolutely none. Most ‘humane considerations’ of the leftists, which keep economically unviable (and often state-owned) companies alive, just not to let people out on the streets (or the pubs :-) are only meant to preserve their electoral chances. They hardly any economic justification.
On the long term, each electoral bribery like this (offering state contracts to a doomed company, just not to lose a certain constituency) backfires, as the younger one is fired, the sooner that person can requalify. When a factory is not closed down at the right time, it will, nevertheless, be forced out of the market by future competition.
Basically, there’s no good choice in choosing not to close down a factory expectedly, thus letting the heartless rules of the free market close it unexpectedly. Of course that I’m in favour of all the necessary social protection measures + workforce reconversion policies...
However, as long as a certain company (or even an entire industry) is on the way to bankruptcy, what can there be achieved by just delaying its fall?!
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