In a "Globes" sponsored talk at Tel Aviv's David Intercontinental Hotel, financier and philanthropist Michael Milken said, "If you look only at assets, Israel has a third of the value of Exxon-Mobile, but if you look at human capital, Israel is worth 15 Exxons. Israel's human capital (according to a Milken Institute estimate) is worth $7.15 trillion."
Milken is visiting Israel to foster ties between the Milken Institute and Israeli life sciences and cleantech industries. He told his audience at the meeting that they were sitting on an invisible gold mine - human capital. He noted that global trends were operating in favor of Israel's economy, adding that the country should let human capital flourish and should foster it, and that if it does, Israel will become an economic powerhouse within a few years.
Milken said, "Each leading Israeli research institute in an oil well of a kind that will never run dry." He added that Israel's human capital was so prominent because of the high quality of its education system, the quality of its doctors, the participation of women in the workforce and in the sciences, and the enrichment of the sciences by immigration from Russia.
The former Wall Street executive reviewed his famous equation, which theorizes that "prosperity" is a function of financial technology, human capital, social capital, and real assets. He focused his words on Israel's human capital.
Milken pointed out that there were three prime components to improving a nation's human capital importing skilled labor, educating the population, and providing for its health. He pointed to several major corporations headed by CEOs who were not born in the countries in which their firms were located such as Pepsico and Union Bank CA.
Praising Israel's education level, Milken noted that 32% of Israeli students are graduate students, and that 56.5% of students are women.
Milken pointed out that Israel boasts the world's highest level per capita for life sciences patents, and said that Israel could be the "research laboratory for the world".
He added said that Israel was competing in human capital against rapidly developing countries such as China and India, as well as small, ambitious countries like Singapore. He presented figures indicating that if present growth rates continue, Indonesia, and Mexico will be among the world's top ten countries in 50 years at the expense of countries like Canada and France, and India and China will be the first places.
People who did not think that such shifts were possible should note that in 1850, China and India were the world's largest economies, Milken said. He cautioned, however, against making such far-reaching predictions on the basis of current trends alone. "If you extrapolate the growth in Elvis impersonators from the 50 at the time of death to the thousands today, in 50 years, one of every three persons on earth will be an Elvis impersonator."
Published by Globes [online], Israel business news - www.globes-online.com - on December 5, 2007
© Copyright of Globes Publisher Itonut (1983) Ltd. 2007