make the case for the Job Guarantee policy, the book begins with a thought experiment before moving on to the diagnosis and economic analysis. It asks the reader to imagine what the Job Guarantee policy might look like in very practical terms and the impact it might have on unemployed people and their families. We consider under what circumstances someone might need to access the program and what kinds of projects could ensure that they would always walk out of the unemployment office with a basic living-wage job offer.
The reason for this approach is that unemployment has become far too abstract and paradoxically impersonal. Few things are as personal as losing one’s job, and yet most economists and policy makers talk about unemployment much like meteorologists talk about the weather. Unemployment is treated as if it were a natural occurrence, about which governments can do little beyond providing temporary protection like unemployment insurance. Millions might have to endure joblessness as the economy slogs through a prolonged recession, but when the weather clears unemployment will dissipate again. Still, the inevitable drumbeat of globalization and technological change dictates that some people will necessarily stay (structurally) unemployed. Or so the story goes.
Unemployment is thus de-personified and internalized as a tolerable natural occurrence in a globalized world. It has become common to personify it only when unemployed people are blamed for their own lot – another myth this book aims to debunk. When economic conditions are favorable, unemployment and poverty are often believed to be the result of poor initiative (jobseekers have not upgraded their skills), or some other individual moral failing (substance abuse, criminal record, “bad choices” of one kind or another). Unemployment is thereby reanimated, but not humanized.
Some readers may share this view and it is hoped that this book will change their minds. Even in the best of times, decent job opportunities are in short supply for a great many people, due to stacked circumstances beyond their control. The consequences are devastating, yet largely avoidable. The questions I want to raise are these: What if we devised a system that – rain or shine, “moral failings” or not – guaranteed job opportunities to anyone who wanted to work, irrespective of their experience, training, or personal situation? What would such an economy look like? Would the sky fall? Would it create economic conditions and consequences worse than the ones we already face? Or would it usher in a great many benefits that we may not have considered before? Would a world with a public option for jobs be any worse than one in which even the “good economy” leaves millions without decent employment? Or would it provide a new basis for economic security and stability?
To begin answering these questions, Chapter 1 makes a very simple proposal: to ensure that the unemployment offices (the so-called American Job Centers) begin to act as genuine employment offices that provide living-wage public service employment opportunities on demand.
Chapter 2 documents the many catch-22 situations unemployed people face in the labor market. It challenges us to think of the right to a job in the same way we think of the right to retirement security or the right to primary and secondary education. Modern fine-tuning policies (both monetary and fiscal) that treat unemployment as “natural” and “unavoidable” perpetrate the above-mentioned vandalism on people, communities, and the environment. Once we take into account its social, economic, and environmental costs, it becomes clear that unemployment is already “paid for” and the price tag is high.
Chapter 3 argues that guaranteeing employment represents a new social contract and macroeconomic stabilization policy that falls within a long tradition of government guarantees. By combining key features of other public options and price support schemes, the Job Guarantee would have transformative effects on the economy. It would establish a new labor standard with an uncompromising living-wage floor for all working people, while stabilizing employment, inflation, and government spending more effectively than current practice. It would also replace, once and for all, unemployment as an economic stabilizer. The chapter enumerates the other benefits of the Job Guarantee, including but not limited to its impact on state budgets, inequality, service sector employment, and the lives of those who do not seek paid work.
Addressing the question of cost, Chapter 4 provides the reader with a new perspective on affordability, and sheds light on why most guarantees are usually provided by the federal government. This chapter considers the economic meaning of the term “the power of the public purse,” and separates the real from the financial costs, as well as the real resource constraints from the artificial financial constraints. It also provides estimates of the size of the Job Guarantee budget and presents the results from a macroeconomic simulation of the program’s impact on the US economy.
Chapter 5 turns to the question of implementation and design and explains how the proposal offered here differs from others. It illustrates why the Job Guarantee is inherently green, and provides examples of specific projects that could be developed and managed using a decentralized and participatory model. It recommends that the Job Guarantee is organized as a National Care Act that prioritizes care for the environment, care for the people, and care for the communities. The chapter also addresses some frequently asked questions and highlights important lessons from similar real-world job creation programs.
The concluding Chapter 6 evaluates the program’s overwhelming popularity and symbiotic relationship with the Green New Deal. It clarifies the different uses of “guaranteeing jobs” that can be found in the climate discourse and situates the Job Guarantee proposal within the green agenda. It also explains why the Job Guarantee would still be needed in a zero-emissions world where temperatures have stabilized, and concludes with some thoughts about its role and place in the international policy architecture.
Notes
1 1. Robinson Meyer, “The Democratic Party Wants to Make Climate Policy Exciting,” The Atlantic, December 5, 2018.
2 2. William S. Vickrey, Full Employment and Price Stability: The Macroeconomic Vision of William S. Vickrey, edited by Mathew Forstater and Pavlina R. Tcherneva, Edward Elgar, 2004.
1 A Public Option for Good Jobs
It took eleven long years after the Great Financial Crisis to bring the US unemployment rate to a postwar low of 3.5 percent. Still there were millions of people who could not find paid work. The official figure in February 2020 was 5.8 million, but with a proper count that number would be more than doubled.1 Job loss is not an affliction that touches everyone equally. It disproportionately affects the young, the poor, individuals with disabilities, people of color, veterans, and former inmates.
Growth, we are told, will raise all boats, but drawn-out jobless recoveries have been the norm for half a century now, and jobs have increasingly failed to deliver good pay. When we consider the question “When the economy grows, who gains?” we find a disturbing answer. In the immediate postwar era, as economies expanded after each recession, the vast majority of the gains went to the bottom 90 percent of families. The exact opposite has been true of the last four expansions (Figure 1).2 Since the 1980s, a growing economy primarily grew the incomes of the wealthiest 10 percent of families. Worse, during the recovery from the Great Recession, average real incomes for the bottom 90 percent of families fell in the first three years of the expansion.
