Above uses plain human survival to judge on the economic record, it focusses on war, humantarian disasters, overpopulation, diseases, environmental deterioration. It is sobering to regard the more standard economic outcome. Table 1 reviews the unemployment in the European Union for 2003, reassembling the data after the enlargement of May 1 2004.
Table 1. Unemployment in the European Union in 2003
| Eurostat [[19]] | EU (after enlargment) | EU 15 |
| Total population | 451 million | 378 million |
| Unemployed | 19.0 million | 14.2 million |
| Idem, % labour force (age 15+) | 9.1 % | 8.1 % |
| Participation [20] | 72.0 % | 72.4 % |
The unemployment figure excludes many welfare state benefit recipients who could work when judged from other standards. For example, there is the well-known case of ‘disability’ with a major fraction of hidden unemployment, see OECD (2003). A hypothesis in public choice theory is that policy makers in the past solved part of their problem with unemployment by allowing an increase in these other welfare programmes. The recent focus in the policy debate is upon increasing participation again, shifting people from such arrangements back into the labour force. This debate however runs into the problem of unemployment again. Disability, sickness, early retirement and welfare relief might be reduced (by reducing problems in the bureaucracy, solving principal-agent problems, and by adjusting definitions, reducing entitlements), yet it might well cause higher unemployment again and thus only shift the problem. A major insight thus is that unemployment remains the root problem for macro-economic policy making. It is proper that we pose the question: why is it that the EU doesn’t achieve more employment ? This question can best be answered by taking a long run point of view - which is not the standard economic point of view.
We can conclude this chapter as follows. The economic record of the last century is mixed, and human suffering was large. For the future: there still are serious risks. Bad economic conditions don’t necessarily result into wars. During the Great Depression the US remained a democracy and didn’t resort to fascism. Though it came close ! [21] Nevertheless, there can be situations in which certain politicians can rise to power by exploiting social, religious and racial sentiments - which sentiments actually draw on economic distress and uncertainty. Such is actually the rule, and stable democracy is rather the exception. Though the probability of such developments might be limited, in the currently affluent West, their costs would be great, and hence the risk may be sufficiently large to try to do something about it. If the system already fails now, what may happen if circumstances would turn out to be far less favourable ?
Since Western societies since the Second World War already have much experience with standard approaches to enhance economic security, and are apparently failing to a large degree, it becomes time to look for a more fundamental approach. We may look into the very process of economic policy making itself.
6. An Economic Supreme Court
Since the problem is found to be equal across nations and across time, we may look for common factors. The basic factor that we can identify is the Trias Politica structure of Western democracies. The present checks and balances are imperfect. This structure appears to allow too much leeway for forces that are detrimental to the economic well-being of the population at large, their economic security and their possibilities for the pursuit of happiness. The structure of economic policy making allows politicians, bureaucrats and special interest groups too much room to distort the contribution of economic scientists.