Anti-Poverty Week – best solution is job creation

Today marks the beginning of – Anti-Poverty Week – in Australia and elsewhere. The overwhelming reason people are poor is because they are unemployed (or underemployed). There are related reasons associated with poor housing etc, but the fact remains that if we eliminate mass unemployment by providing enough work for all those who desire it and ensure there are jobs for those with multiple disadvantages then we will reduce poverty overnight. While poverty is persistent, it wasn’t always thus. I have been to many meeting where policy makers, usually very well adorned in the latest clothing, plenty of nice watches and rings, and all the latest gadgets (phones, tablets etc), wax lyrical about how complex the poverty problem is. I usually respond at some point (trying my hardest to disguise disdain) by suggesting the problem is relatively simple. The federal government can always create enough work any time it chooses at a decent wage to ensure that no-one needs to live below the poverty line. Read: always! It can also always pay those who cannot work for whatever reason an adequate pension. Read: always. If we run out of real resources which prevent those nominal payments (wage and pensions) translating into an adequate standard of living, then the government can always redistribute the real resources by increasing taxes on those who have “too many” resources at their disposable. Too many is a relative concept in this context. The so-called complexity of the problem is just code for an unwillingness of the policy makers to use the capacity they have as currency issuers. There is nothing complex about announcing that the government will pay a living wage to anyone who wants to work – just turn up tomorrow and the wage begins. If that announcement was made then we would know who wants to work for a wage and those who do not. For Anti-Poverty Week – the best thing the government can do is announce the unconditional job offer.

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