Answer: both private and public sector should budget the Education and Health.
By Prof. Vеselin POPOVSKY,
Jindal Global Law School, Professor & Vice Dean and Executive Director, Centre for the Study of United Nations
След 6-7 месеца от основаването си сайтът „Философският клуб“ преминава към двуезични публикации на статии и еспозета на български и английски език, на свои членове и съмишленици в България , Индия, САЩ, Латинска Америка и други точки на глобалния свят.
Нашата мисия е е да ви приобщим към всичко ново, нетривиално, в полза на цивилизационния напредък, какъвто и българинът, наедно с други народи заслужава да знае, да научи. Но най-вече да се опрем на опита на водещи учени, експерти, държавници, надмогнали гравитацията на ред догми и стереотипи , които спъват една значима и желана социална промяна и у нас в България, като равнопоставена европейска страна.
Тук публикуваме на английски език изказването а българския професор Веселин Поповски, дакан в Jindal Global University, India, който взе участие в Четвъртата сесия на нашия клуб. Тема на дискусията бе:
• Образование, култура и наука: кой да решава как да се организират и финансират тези публични услуги – пазарът, или държавата?, модерирана от Георги ВАСИЛЕВ, швейцарски бизнесмен, инвеститор в България , основател на „Философският клуб“.
Публикации в оригинал ще последват на сайта „Философският клуб“ – от наши член- кореспонденти и съмишленици от всички краища на света, за които границите, още по малко езикът, в един глобален свят, не са бариера. Сайтът ни очаква и публикации от български автори на англискйски език.
Време е светът да чуе един нов просветен български елит. А от тук и да се включим в дискурса за един по добър и отговорен свят. Още повече, че като култура, му принадлежим повече от 1300 г. И никакви местни „влъхви4 не могат да ни отчуждят от глобалния напредък на идеи, технологични постижения, че и ново мислене.
Бележка на редактора.
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I am the Dean of the Law School at O.P. Jindal Global University in India –– and my School is now ranked as Number 1 Private Law School in India.
The story of its creation is very instructive – this private university was created 6 years ago through the generous donation of a single donor – Naveen Jindal – CEO of ‘Jindal Steel and Energy Co.’ – one of the largest corporation for steel and energy in India.
At the time – in 2008 – Raj Kumar, who is a very well educated Indian – Oxford and Harvard law graduate – was professor in City University Hong Kong, and wanted to return to India and accomplish his dream – to create a private law school that matches the world’s highest educational standards.
He approached Naveen Jindal and asked for 100 million dollars. Naveen replied ‘if you ask me for 100 thousands, I can give you straight way, but for 100 million I need to think about and consult my board. Raj Kumar agreed to wait and added: ‘if your decision is positive, we can name the University after your father and 100 years later, he will be known as “John Harvard of India”.
It may take much shorter than 100 years – as of today Jindal Global Law School is already top law school in India with aspirations to become top in Asia too. All this could happen because of both the support of the national government in Delhi and the minister of education personally, and the state of Haryana municipal support, allowing the land to be purchased, regulated and the university campus to built up. So it takes both the public and the private efforts together for the education to flourish.
Before India I worked for 10 years in Japan at the United Nations University, founded by a similar 100 million USD initial donation of the Japanese government in 1975. And before that I worked in the University of Exeter, the only University in Devon, southwest England.
So, I had a chance to work in all three types of universities – private, public and municipal – in four countries and based on my experience I conclude that Education, Health, Science and Culture are four crucial fields for the successful nation-building and the budgeting of these four important fields should be made by both state and business sectors. And I would also add ‘Sport’ as a fifth field, that need a special care from the state.
These sectors are special as they directly long-term improve the nation’s capabilities. Some may consider them ‘non-profit’ as they do not directly make people rich in material sense, but long-term they make everyone healthy, education, happy and also rich.
One example, Korea was at the same economic level as of Ghana in the 1970s, but after it started making heavy investments in high education, it became a rich country. China also invested heavily in these sectors over the last 30 years and this helped to overcome poverty significantly.
The state therefore can directly budget the education, science, culture and health, but also it can create supportive environment – through regulations, incentives and tax relief – for businesses to invest in these five fields.
Now, focusing on Bulgaria – and I admit that after living 25 years abroad my knowledge on Bulgaria is limited – let me give one example with ‘Sport’, the fifth field: in the 1988 Olympic games in Seoul Bulgaria scored 8th in the world in total number of gold, silver and bronze medals – an amazing achievement, having in mind the size of Bulgarian population!
But after that less and less attention has been paid to sports, as Bulgaria entered a long painful transition , the public sector stopped investing in sports and the private sector was still immature, and today Bulgaria cannot get a single medal at the Olympic games.
Similarly the education, culture and science are in a poor shape in Bulgaria today with reduced funding from the state and not yet enough sponsorship from private individuals.
And this is the right time and place to pay high tribute and praise such extraordinary individuals, like Gueorgui Vassilev, who generously invested his personal funds to disseminate science, knowledge and culture through establishing Transmedia.bg and this Philosophical Club.
But not many Bulgarian businessmen, unfortunately, do so. Therefore in Bulgaria the state should invest heavily in these five sectors.
I would add that not only the state should sponsor these five sectors, but also the state can show a leading example in investing in forward-looking pioneer innovative technologies.
A recent book by Mariana Mazzucato ‘Entrepreneurial State: Debunking the Public v. Private Sector Myths’ (Anthem 2013) argues for a larger role of state intervention in fostering economic growth. It points to the substantial role of state-led interventions in the development of important technologies, fostered by the state.
- For example, Apple had a state grant in its early years, and Google’s original algorithm development was assisted by a National Science Foundation grant.
- The Federal and US state patronage contributed substantially to the development of important novel technologies. The successful efforts go beyond routine research support, tax credits and educational efforts to active participation at many levels to translating research into successful products.
Mazzucato captures this by describing the role of the state as dealing with Frank Knight’s famous concept of uncertainty – only the state can make the sustained investments and create the market environment for novel technologies – in the essentially unpredictable world of science and technology. Only when uncertainty has been transformed into calculable risk, then will the conventional market mechanisms assist the development of new technologies.
The public should get a better return for its tax-supported investments in novel technologies, something that could expand the development of new technologies and foster growth.
Mazzucato is in line with some of the seminal contributions of Ken Arrow, Dick Nelson, and Keith Pavitt, among others, who also prove that many important innovations are based on financing from government.
The state-financed technological breakthroughs are picked up later by the private sector, and these are the success stories of Apple, Google and others.
The governments in Germany, US, Japan, Denmark, China etc. invest heavily and effectively in research, they act as entrepreneurs taking the highest risks.
On the opposite, some businesses in the medical electronic and other fields have radically reduced their funding of the longer term research on which breakthroughs depend.
Business and venture capitalists are short term orientated. When innovative companies are hugely profitable they buy back shares or raise dividends but do not invest in long-term future.
Therefore it is very important to recognize the essential role government plays as a fundamental force in innovation. This role goes beyond developing new knowledge.
The state in many cases also finances the development of a new technology to the point where it is applied and achieve critical mass. The state is involved in the supply side but in important cases also on the demand side. It chooses the winners.
Many people believe that the free market and entrepreneurs are the driving force in innovation, but this is a „myth“.
Companies in general but especially highly profitable global companies go out of their way to reduce taxes. Statistics show that global companies are highly successful on this point.
The tax income in addition to being reduced is also not going to the countries that have financed the new technologies that played an important role in generating the profits.
It is naive to believe that states enforce tax regulations on global companies and one way is to attach a royalty obligation to a technological innovation. The first buyer, as the public at large financed the innovation, should after few years of exclusive rights, license other companies to use the innovation.
Also state-financed development banks can provide financing for the early scientific development, a good example is KfW (www.KFW.de).
To sum up, the state has a large role in budgeting science, education and health, and also in creating regulations and incentives for the private donors also to finance these important sectors.
Author’s background: Prof. Vesselin Popovsky worked from 2004 till 2014 as Senior Academic Officer at the United Nations University in Tokyo. Prior to that he was Director of the EU project ‘Legal Protection of Individual Rights in Russia’ (2002-2004); Lecturer, University of Exeter, UK (1999-2002); Research Fellow, NATO Democratic Institutions Programme (1996-1998) and Bulgarian diplomat (1988-1996) serving in Sofia, New York and London.
He is also author or editor of: Spoiler Groups and UN Peacekeeping (Routledge 2015), Access to International Justice (Routledge 2015), Emotions in International Politics (Cambridge UP 2015), Ethical Values and Global Climate Integrity Systems (Ashgate 2015), The Security Council as Global Legislator (Routledge 2014), International Rule of Law and Professional Ethics (Ashgate 2014), Building ASEAN Identity on a Transnational Dimension (Interbooks 2014).
Prof. V. Popovsky has also contributed to major international initiatives, such as the International Commission on Intervention and State Sovereignty; and the Princeton Project on Universal Jurisdiction.