The Principal Source of Wealth

That is the skills, knowledge and motivation of the human beings in the community or nation, or on the planet. Human beings create wealth. Period. There is no other causal source of it. This is proven by so many examples, but it should be self-evident and obvious with minimal thought. The earth existed for billions of years, but where was the wealth in it ? That wealth did not exist. Until modern humans walked the earth, likely first about 100,000 years ago, there was almost no wealth on the planet.

Another example: The New World. For many thousands of years after the first modern human walked on the Earth, the New World was void of people. When people came, wealth was slowly created. But when human beings with more skills and knowledge arrived after 1492, the wealth of the New World increased at a much greater rate. What was the difference ? The knowledge, skills and motivation of the humans beings living there had increased by a quantum leap with the new arrivals.

Singapore has little land or natural resources, yet its people are relatively wealthy. That's because of their own skills, knowledge and motivations. Ditto Hong Kong.

Culture is part of the skills, knowledge and motivation that produces wealth. A nation with a culture that oppresses and effectively enslaves its women and /or certain castes automatically, ipso facto, loses that same proportion of its potential for wealth. Cultural institutions like slavery and serfdom impeded the growth of national wealth, as do special privileges for aristocratic classes.

Greece has problems. What is the solution ? Re-examine the sources and uses of human capital in Greece. All Greece possesses to increase its wealth - to solve its debt problems - are its people and its sole source of wealth is its people. What is debt ? Debt is simply a transfer in time for the rights to use goods or services: debt neither creates nor destroys wealth. Too much debt means simply that the nation (or community) is consuming too much wealth now versus what it can produce in the future.

Early retirements at high pay DOES reduce national wealth. The nation or community loses the productive capacity of the retiree for those years when he/she would other wise be able to work productively. That's a lot. Many, many other state activities reduce wealth of a community. If one focuses on the human source of wealth, these become apparent very, very quickly.

To solve a nation's debt problems, look to its people. To restore a community, look to its people. That's where all its wealth inherently comes from - the skills, knowledge and motivation of its people.

Word of the Day

"Canaille" - noun [$10] pronounced kuh 'ni with a long 'i' - loan word from French
Canaille means the rabble, the populace.
Sentence: Around 100 B. C., Gaius Marius saved Rome by recognizing the potential for, and using Rome's canaille in the legions. And in doing so, he likely preserved the future path of the modern world to that which we now have.