In today’s Pope Center Clarion Call, Troy Camplin observes that the center of gravity for the rebellion in Egypt seems to be un- and under-employed college graduates. The Egyptian government concluded that having a large number of college-educated people would be good since having more “human capital,” the presumptive result of higher education, is beneficial. The trouble is that there isn’t any direct relationship between the number of people who have college credentials in a nation and the creation of productive jobs that call for the skills and knowledge imparted in the classrooms. Economic growth is a coordination problem that is best solved by the spontaneous order of the free market. The price system does that coordinating, but whenever government interferes with it to increase production of Resource X or decrease production of Resource Y, we get economic waste.
Overproduction of college graduates is doubly bad since it not only wastes resources but creates a class of people who have unrealistic expectations for themselves. The mobs may bring down the authoritarian Mubarak, but it is unlikely that Egypt will get the kind of government it needs — one that depoliticizes everything.