It's Wednesday and we have discussion on a few topics today. The first relates to…
Tracing the roots of progressive views on the duty to work – Part 7
This is Part 7 of my on-going examination of the concept of ‘duty to work’ and how it was associated with the related idea of a ‘right to work’. Today, I go back in history (again) to discuss a literature that influenced the evolution of my own early advocacy of a Job Guarantee. We see how I considered developments in the early C19th which established very clearly the responsibility of the government to act as an ’employer of last resort’ could be integrated with the buffer stock literature (which analysed the use of commodity buffer systems) in C20th to provide a coherent buffer stock full employment capacity in our modern economies. In Part, this establishes where the Job Guarantee idea, that is now central to Modern Monetary Theory (MMT) came from – at least, in terms of my early contribution to that body of work.
The earlier parts in this series are:
1. Tracing the roots of progressive views on the duty to work – Part 1 (August 4, 2020).
2. Tracing the roots of progressive views on the duty to work – Part 2 (August 11, 2020).
3. Tracing the roots of progressive views on the duty to work – Part 3 (August 20, 2020).
4. Tracing the roots of progressive views on the duty to work – Part 4 (September 1, 2020).
5. Tracing the roots of progressive views on the duty to work – Part 5 (September 8, 2020).
6. Tracing the roots of progressive views on the duty to work – Part 6 (September 29, 2020).
The theme today is to report on early concepts of the right to work, which in Modern Monetary Theory (MMT) are expressed, in part, by a commitment to a Job Guarantee.
But, we should not think of the Job Guarantee as the only expression of a government’s responsibility to ensure a right to work.
I often see commentary in the social media from those who are apparently sympathetic to the idea of a Job Guarantee that would lead one to conclude that MMT economists think the buffer stock capacity will solve all unemployment issues.
The way we conceived of the Job Guarantee from day 1 was to be a relatively small, steady-state pool of jobs which would expand in the relatively rare times that inflation became a problem and/or private spending collapsed.
Typically the Job Guarantee pool would be very small and provide work for the most disadvantaged workers in the society.
When confronted with say a major downturn in private spending, while the Job Guarantee pool will expand, the most valuable intervention a government can make is to create career-based, high skilled jobs in the economy rather than passively sit back and allow the Job Guarantee pool to expand.
Warren Mosler constructs the Job Guarantee as a transition job – transiting the work back in the private sector.
I do not give it that emphasis for my own reasons and am happy to see the a worker permanently occupy a Job Guarantee job if that is the best outcome for them.
But the difference in that construction does not alter the fact that we both conceive of the pool of jobs as being very small when economies are operating at higher pressure levels.
The Job Guarantee is not a panacea for all ills.
As an aside, I keep getting E-mails with statements about the Job Guarantee and links to articles about it, which continue to repeat the assertion that the Job Guarantee is derived from the work of Hyman Minsky.
One recent Op Ed even claimed the idea was “first put forward” by Minsky. The author followed that statement claiming that this idea was “now promoted by” yours truly (and Noel Pearson) insinuating that I was promoting the work of Minsky.
The initial statement is factually wrong and demonstrates an ignorance of history or a willingness to revise history to fulfill some agenda.
The second statement – insinuating I am promoting Minsky’s work – is equally in contradiction with reality and the historical record.
I dealt with these matters in these blog posts:
1. The provenance of the Job Guarantee concept in MMT (April 20, 2020).
2. The historical beginning of the MMT team – from the archives (November 27, 2019).
3. Flattening the curve – the Phillips curve that is (April 7, 2020).
The point is this.
At the outset when the MMT work began, the concept of a Job Guarantee was the outcome of input from myself and Warren Mosler to an early E-mail discussion list (PKT) in mid-1990s.
I document those discussions in the blog posts cited above.
The historical record is clear.
Neither of us were influenced in any way by the work of Hyman Minsky. Warren and I came to the same point from quite different angles and those insights were then developed within the body of work we now know as MMT.
It is true that Randy Wray, who was a participant in the discussions on that E-mail discussion list was very influenced by Hyman Minsky (having had him as a doctoral supervisor) and saw similiarities in what Warren and I were inputting to the List with early work that Minsky had published.
And subsequently, it is true, that Randy and those that were influenced by his work built further connections with Minsky and the unfolding body of MMT work.
But that doesn’t allow one to conclude that the concept of the Job Guarantee as it became a central part of MMT was derived from Minsky. It categorically was not!
And an interesting question one might ask in this context is whether one could have extrapolated the body of work we now call MMT from Minsky’s earlier work.
My answer is that there is no possible way that sort of evolution would have occurred.
I considered those sort of issues in this blog post – Hyman Minsky was not a guiding light for MMT
(November 9, 2016).
Just before I came into contact with Warren Mosler on the PKT list, Hyman Minsky was expressing deep concern about deficits and inflation, which I document in that cited blog post.
In 1991, he was advocating what we call ‘sound finance’ the anathema to the ‘functional finance’, which underpins aspects of Modern Monetary Theory (MMT).
He says things such as:
1. “the government must validate our debt with taxes”.
2. In the context of rising government deficits in the 1980s, he claimed that “the quality of the government’s debt in international markets is deteriorating”.
3. “we lack the will to tax ourselves so that the government liabilities are fully validated by receipts”.
His public comments amounted to a rejection of basic MMT propositions.
While early in his career he was supportive of Abba Lerner’s functional finance ideas, by the time his 1986 book came out – Stabilizing an Unstable Economy – (Yale University Press), he was articulating the ‘sound finance’ principles.
This was the first book or article of Minsky’s that I had read in detail and it marked a change in his position after the election of Ronald Reagan.
At this point, he increasingly argued that government debt was at risk of becoming non-credible in the face of non-government bond investors.
His main message became that the fiscal outcome should be in balance or in surplus at full employment, which of course is not the MMT position at all.
His later work build on these non-MMT propositions, which I discuss in detail in the blog post cited.
The point is that by this time, a natural evolution of his ideas would never have yielded the insights that have become integrated in MMT.
Buffer stocks and the Job Guarantee
Further, I included that brief clarification because it actually bears on what I was going to write in this Part 7 of the series.
It is simply untrue to say that the idea of employment guarantees was first proposed by Hyman Minsky. A short research effort would disabuse anyone of that idea.
My evolution that led me to outline a Job Guarantee scheme, first, in 1978 and then later during the early discussions on the PKT List, was influenced by my research into the commodities literature on buffer stock schemes, which were common in pre-Second World War Australia and later.
It was well-understood that these schemes could provide a framework for macroeconomic stability (redress market movements that would lead to price and income instability).
And I was influenced by the work of Benjamin Graham (particularly his 1937 book ‘Storage and Stability: A Modern Ever-normal Granary’) which laid out a price stability plan based on the use of commodity buffer stocks (storage in the ‘Ever-normal Granary’), which he morphed into a derivative scheme he proposed to create a commodity reserve currency, that would reflect some weighted composite from 21 raw material stocks in the Granary.
I am skating through detail here because this is not the primary emphasis today and I could write a lot about Graham (as I did in my PhD thesis).
I had also read John Maynard Keynes’ 1938 paper – The Policy of Government Storage of Foodstuffs and Raw Materials – (published in the Economic Journal, Vol. 48, No. 191, September, pp.449-460) – link is to JSTOR which requires library access.
Keynes was impressed by Graham’s work and saw it as a way of stabilising prices amidst market fluctuations in commodity supply.
He refers to his 1937 book and Graham’s contention that government storage would be relatively low cost (see discussion in J.M. Keynes, ‘Activities 1931-1939: World Crises and Policies in Britain and America’, published in the Volume 21 The Collected Writings of John Maynard Keynes.
In his 1938 Economic Journal article, Keynes observed (p. 450):
… the fluctuations in the prices of the principal raw materials which are produced and marketed in conditions of unrestricted competition, are quite staggering …
An orderly programme of output, either of the raw materials themselves or of their manufactured products, is scarcely possible in such conditions.
He saw this problem as contributing to instabilities in export trade, which was a major issue for Britain at the time, given its export prominence.
He also saw that (pp. 451-52):
… nothing can be more inefficient than the present system by which the price is always too high or too low and there are frequent meaningless fluctuations in the plant and labour force employed.
While he considered that “measures to stabilise the aggregate of effective demand” (p.451) could be of help here, he considered a ‘storage’ approach could supplement.
He considered the government had a responsibility to facilitate this storage solution (a buffer stock manager) given that the competitive firms had no incentive to hold inventories in this way.
H.M. Treasury would fund the “warehouse costs and interest”, which he considered would be a modest expense.
He wanted to extend the scheme to the British Empire nations which provided raw materials – “sugar from the West Indies, jute from India, wool from Australia, vegetable oil products from West Africa, non-ferrous metals, and all the endless variety of Empire products which must be stored somewhere”.
I refer to the influence that Benjamin Graham had on my thinking as a student in this blog post: Modern monetary theory and inflation – Part 1 (July 7, 2010).
The point was that the principle that buffer stock mechanisms funded and administered by government could provide for market stability (volumes and prices) was well established in the commodities literature.
My departure came from an idea I had 1978 when I was studying agricultural economics at the University of Melbourne as part of my fourth-year studies.
It was a time when unemployment was rising sharply in Australia and inflation was high (as a result of the OPEC oil crises). I was trying to work out a way to advocate for continued full employment but address the issues that economists were raising about inflation.
I was also very interested in the Phillips curve literature which I saw as the major battleground for the emerging dominance of the NAIRU approach (using unemployment buffer stocks to discipline inflation) – that sort of research became my Phd research program.
So it came to be that if the government could buy and sell wool at will to correct shortfalls (or surpluses) of wool production relative to demand, which allowed it to stabilise prices and incomes, then why could it not do the same with labour.
And, for me the Job Guarantee idea was formed. Minsky was nowhere to be seen!
But I had also been reading historical literature that first introduced me to the idea of employment guarantees and the government as ’employer of last resort’.
The buffer stock approach allowed me to tie together full employment and price stability.
But that earlier literature reinforced my thinking about the centrality of government in maintaining a ‘right to work’ through employment guarantees.
So far from Hyman Minsky being the “first to propose” employment guarantees, we now head back to the early C19th. We could have gone back earlier but it is the early C19th literature that I first became acquainted with state-run employment guarantees.
The Saint Simonians
As a young student I read a lot of the literature about and by the – Saint Simonians – who were a “French political, religious and social movement of the first half of the 19th century” who followed the lead of “Claude Henri de Rouvroy, comte de Saint-Simon”.
He advocated the transformation of industrialisation so that “true equality” could be achieved by the “union of men engaged in useful work”.
He was one of the thinkers who tried to build a liberation Socialist philosophy after the French Revolution.
His early work – particularly the publications in l’Industrie (1816-18) – which was a collection of pamphlets where he and others would expound their philosophical positions on how humanity might develop from the primitive to sophisticated.
The Saint Simonians advocated socialism but were not aligned with the emerging Marxists.
Claude Henri de Rouvroy proposed that government would cease being a vehicle for class domination, and, instead use science and technology to introduce and maintain a welfare state to benefit all.
As I was working my way through the Marxist literature I was very interested in these alternative visions of socialism as a vehicle to advancing improved well-being for workers.
Louis Blanc
Louis Blanc – was a historian, a socialist influenced by the Saint Simonians, and for a short period, a French politician.
Karl Marx called him a ‘utopian socialist’
In the leadup to the – 1848 Revolution in France – Louis Blanc was among several writers who saw the 1846 harvest and financial crises as an instigation for progressive reform.
Louis Blanc became prominent in advocating the ‘right to work’ and his writing was interrupted by the February 1848 revolt, upon which he took a position in the provisional government and became Chairman of the Luxemburg Committee.
The February Revolution arose on the back of rising unemployment and poverty. Skilled workers were pushed down to material levels commensurate with the ‘proletariat’.
The so-called “Bourgeois Monarch”, Louis Philippe sat on his heels and acted in the interests of capital (particularly the bankers – the “financial aristocracy”) and largely ignored the growing plight of industrial labour.
Louis Philippe ignored the growing protest movement and because the poor did not enjoy political franchise, a revolt was inevitable.
The Revolution established the “droit du travail” (‘right to work’) as an operative principle binding government initiatives.
This article – Employment and the Revolution of 1848 in France – provides useful historical narrative and facts.
On February 25, 1848, Louis Blanc proposed a motion to the French government:
… to guarantee the existence of the workmen by work …
The provisional government rejected the motion saying it was outside its provisional jurisdiction.
Instead, Louis Blanc was appointed on February 28, 1848 to oversee a new body – Commission du Gouvernement pour les travailleurs (Government Labour Commission)- which operated out of the Palace of Luxembourg.
In a way, we are completing a circle here to – Part 1 – of this series, given that it was Louis Blanc who entered the phrase:
De chacun selon ses facultés, à chacun selon ses besoins
That is, “from each according to his ability, to each according to his needs”.
Louis Blanc believed this could be accomplished through strictly enforced labour regulations (safety etc), nationalisation of key industries, and the creation of a cooperative system of “social workshops”, which would be worker controlled in relation to the trade union movement.
His eventual socialist goal was “the eventual wholesale elimination of private capitalism and the market wage system, and its substitution by a “universal association” geared towards the needs of workers.” (Source).
The Commission set about fulfilling their agenda to create the ‘ateliers nationaux’ (national workshops) for all the existing trades, which would provide guarantee work for the unemployed.
There was considerable disputation however over topics such as whether the low-skilled were receiving favours that were not forthcoming for the higher skilled workers.
In terms of documenting the historical record of the evolution of the ‘right to work’ and employment guarantee ideas, no better person to be consulted is Dr Victor Quirk who wrote a masterly PhD thesis under my supervision on the topic.
He goes back to the 1351.
He wrote a guest blog here which is relevant – Advocating full employment (November 24, 2010).
He also provided some excellent analysis on the fortunes of these national workshops.
Given the necessity to organise the jobs quickly, the workshops struggled to come up to scale.
On March 15, 1848, 14,000 workers were employed in Paris. By June 15, 1848, this number had risen to 117,310.
But there were always more workers desiring jobs than the capacity could create which resulted in conflict.
Victor Quirk writes:
The chaotic nature of the scheme was partially the consequence of the tensions within the cabinet on the question of the elimination of unemployment.
Louis Blanc was largely sidelined in the management of the scheme once the fear of on-going revolts subsided.
In effect, the conservative forces did not support this utopian scheme. Ultimately, the National Assembly exploited the chaos within Louis Blanc’s workshop system to withdraw it.
If you want chapter and verse on this scheme then I urge you to consult Victor’s thesis.
Having failed, Louis Blanc migrated to England in August 1848 and was considered a “a leader of petty-bourgeois émigrés in London” (see Karl Marx and Frederick Engels, Selected Correspondence (Progress Publishers, Moscow, 1975)).
The point here is that his proposal was a coherent early example of the ‘right to work’ and for the government to act as an ’employer of last resort’.
When I read this literature as a student in the late 1970s and early 1980s, I was convinced that the government had to act in this way and that the later literature on the buffer stock mechanisms, provided me an understanding of the architecture and machinery in which this sort of capacity could be exercised to maintain price stability.
I saw the melding of these literatures (the ‘right to work’ socialists and the buffer stock approach) to be a way to overcome the Phillips curve dilemma of having to endure high unemployment to maintain price stability.
And Minsky was nowhere to be seen.
It is false to assert he was the first to introduce the notion of employer of last resort.
The US Second Bill of Rights 1944
The – Second Bill of Rights – was proposed by the then US President Roosevelt on January 11, 1944 as part of his – Eleventh State of the Union Address.
In it, he articulated that a key feature of the Bill would be a ‘right to work’ among other rights that are visibly absent from American life today. The ‘right to work’ meant, in those days, that the government was responsible to ensure that everyone who wanted to work had a job (that is, an employment guarantee).
In this neoliberal era, the term has become used in the context of right-wing “right-to-work laws” that attack trade unions an push power towards employers.
Unfortunately, Roosevelt’s bill never made it to the US Congress and he died before the Second World War was terminated. Subsequent efforts to revive it were always blocked by the conservative political forces.
But, clearly, the tradition of employment guarantees went back long before Hyman Minsky was writing about it (though briefly).
Conclusion
In Part 8 I will deal with the issue of coercion.
That is enough for today!
(c) Copyright 2020 William Mitchell. All Rights Reserved.
I am glad to see this explicit clarification regarding the origins of the right to work and the concept of an employer of last resort, both historically and within the MMT literature.
I hope it will put a few misconceptions to bed.
“When confronted with say a major downturn in private spending, while the Job Guarantee pool will expand, the most valuable intervention a government can make is to create career-based, high skilled jobs in the economy rather than passively sit back and allow the Job Guarantee pool to expand.”
The main issue is “at what wage”.
Those who believe the Job Guarantee gets them public workers on the cheap forget that once the private sector expands again it will start to bid away workers from the Job Guarantee with better and higher wage offers.
That will be a time the labour market is tightening and production is being used up by a buoyant private sector.
So if at that time the public sector has to start chasing wages to keep people in needed public positions, there is a very real risk of an inflationary spiral.
Or those public positions get left unfilled and we’re back to medical wards with 60% of the needed personnel in them.
Job Guarantee work can only really be “Nice to have” output that isn’t as important as full time public service, or full time private sector production.
Regrettably we have a society where celebrity earns millions but quiet public service earns a pittance. If there was ever a case for a hypothecated tax, then this is it.
Just on tonight’s budget, did i understand this correctly?
“Public schools will receive less funding from the federal government than private and independent schools. For the 2020-21 financial year, $9.1 billion will be provided to public state education, while the non-government private school system will receive $12.8 billion.”
Surely not?
>Surely not?
About three quarters of recurrent funding for public schools comes from Australian state governments, while almost all catholic and independent school funding comes from the federal government.
Excellent article at putting the record straight.
Those of us who have been at this for a long time knew this already. I was very disappointed that Bill’s life work was not quoted more in Stephanie’s book.
Bill’s book from over a decade ago – Full employment abandoned: Shifting sands and policy failures is a great book. Was way ahead of the curve at that time.
The assertion of an a priori entitlement to any one of a seemingly ever-widening catalogue of “human rights” – whether on behalf of humanity in general or (as with identity politics) of some particular sub-group – has become a central ingredient in much of our age’s political discourse. In this instance the right being asserted is “the right to work”.
However, grammatically (in English) that phrase can have either of two alternative meanings:- 1) (where “to work” is the infinitive form of the verb), when it transcribes to “the right to (be allowed to) perform work” or, 2) (where “work” is a noun meaning “employment”, or “a job”), when it transcribes to “the right to be provided with, or to have unimpeded access to, paid employment”. Those two meanings are quite distinct and have differing socio-economic implications.
Having regard to the term being inherently ambiguous the prerequisite for any coherent discussion is that participants first agree upon which of the two alternative possible meanings for it they are going to use. But that never happens, which can – and usually does – cause the discussion to be unfocused and/or at cross-purposes. What *seems* to be the term’s intended meaning here is (mainly though not exclusively):- “the right to be provided with, or to have unimpeded access to, paid employment” (since having a right to perform work lacks any real-world applicability, discussing it would seem to be academic in any case).
Assertion of the former as “a (human) right” is a philosophical proposition not one confined to the narrow field of economics. So it boils-down to a clash between differing political philosophies and thus to being no more amenable to permanent resolution than any other such. In practice everything depends upon which political faction or ideology has the upper-hand at any given period in any given society. In my lifetime each of the two opposed factions has been dominant in its turn: perhaps we are now due (or overdue) for the next reversal of political fortune.
If only a JG scheme were actually able to be introduced in some country and be seen (after the inevitable bugs had been ironed-out) to be successful in meeting the aims for such a scheme first independently prescribed by Bill and Warren that might be a big step towards bringing about such a reversal. I certainly would like to think so but I suspect that the the political reversal must (alas!) precede – not follow – a JG scheme’s introduction, in *any* country. I hope I’m wrong.
Derek, where did you find a mention of Bill or his work in Kelton’s book? He isn’t in the index or the bibliography and I didn’t notice any mention of him in the text itself. Of course, I could hvae missed it. In the acknowledgements, no mention of Bill either, although suprelatives were applied to her US colleagues. I wasn’t disappointed because I didn’t expect to see any such mention; rather, I was more irritated.
Derek, apologies. I misremembered. There is one mention of Bill in the notes/bibliography. And it isn’t one of his central contributions. If there are others, I should be glad to be apprised of it.
First, I love these blogposts.
Second, I’ve always had a problem with the Job Guarantee as ‘transitional’, as here in the UK I see an endless unsatisfied demand for the sort of services which only local government should provide.
Third, the reference to the ‘Second Bill of Rights’ prompted me to send this to Sarah O’Connor, an FT columnist, who wrote a recent op ed “Be bold like FDR and create jobs directly”. I sent her a copy of my letter to FT, which they didn’t publish, and she replied: “many thanks for this! I agree as you know.” (I didn’t know.)
@Carol Willcox
“… I’ve always had a problem with the Job Guarantee as ‘transitional’, as here in the UK I see an endless unsatisfied demand for the sort of services which only local government should provide”.
I wonder if you aren’t conflating what are in fact two separate ideas?
Warren Mosler is always insistent that, in his view of the functioning of a JG, its prime purpose is to facilitate the *transitioning* of people who have been thrown out of their private-sector (or long-term public-sector) employment back again into self-sustaining stable employment, in either sector. Thus that their time spent doing JG jobs would by design and intention tend to be of relatively short duration (whilst they at the same time make a valued contribution to the community by undertaking work which otherwise would not be performed at all).
I must say that that seems to me to be eminently sensible but perhaps you disagree?
Anyway, that’s entirely different from envisaging the JG scheme itself as “transitional”, which Warren himself has never implied AFAIK – and personally I’ve never encountered that suggestion anywhere else. That makes me to wonder if it’s what you really meant.
Secondly, apropos this:-
“I see an endless unsatisfied demand for the sort of services which only local government should provide”,
It sounds as if the services you speak-of are stable in nature and needed permanently and continually. If so then presumably they ought to be performed by LG staff permanently employed at a commensurate wage and conditions package, not by JG-scheme employees. The latter are for “nice-to-have” (but not enduring) jobs.
As Carol Wilcox indicates, “I’ve always had a problem with the Job Guarantee as ‘transitional’, as here in the UK I see an endless unsatisfied demand for the sort of services which only local government should provide.” I share her concern from over here in the U.S. I doubt whether a modest buffer stock JG, as Bill describes it, even begins to address the increasing scarcity of decent jobs serving decent purposes that the private sector has brought into being and forced down our collective throats in recent decades. Frankly, if the JG is primarily an on-and-off-again counterbalancing measure to supplement at the margins the dehumanizing and ecocidal forms of employment offered to the masses by neoliberalism, then there’s small wonder that the JG concept hasn’t caught on in much of the left. But if, on the other hand, MMT does indeed allow for and accordingly inspire the far grander idea of robust public sector employment programs designed to address crucial human and environmental needs (as alluded to, for example, in “Reclaiming the State”), then why doesn’t MMT put that bold, beautiful, and critically necessary concept front and center in its advocacy, with the JG, given its much more modest and limited purpose, serving as a footnote, a toe in the water? Are we selling MMT most effectively by leading with the JG and claiming to be only a lens? A lens by itself, for the vast majority of people, is not a very exciting or motivational or inspirational thing–it’s rather what can be seen through the lens that has the power to grip and move men and women.
@RobertH, Newton has interpreted what I wrote correctly.
Neil Wilson
‘Nice to have’ output feels very subjective. A decision has to be made about what qualifies as nice to have. At the far end it could be argued that if it’s nice to have we should always have it, why deny ourselves. On the other end we have ministers who view the NHS as a ‘nice to have’ that can be sacrificed in a downturn. Who’s to judge? For me the answer should clearly be us.
However, how can we know where the line is between ‘nice to have’ and essential in advance of that work existing? How can we engage in collectively answering this question if we have no experience of what effect the work has on our lives and society? This highlights a contradiction in the job guarantee to me, but also points towards its necessity beyond just its macroeconomic function.
I’m fully behind Bill’s idea that a job guarantee employee should be allowed to remain in that work. Further to this, I think that job guarantee jobs themselves should be allowed to transition to the wider public sector; at which point, I agree, the question becomes ‘at what wage?’. This would allow us to answer the question of what work is essential by engaging in that work. Job guarantee employment that originates from participatory democracy at the local level then faces the question of whether it is essential, ‘nice to have’ or completely useless in its proper context. I feel that our notion of what is ‘nice to have’ should be allowed to evolve iteratively through the job guarantee itself.
This would reconcile us with the contradiction and allow it to create a movement in our notion of valuable work that engages us in answering the question of what is ‘nice to have’ we couldn’t answer in isolation before. Basically I suspect we need the job guarantee to discover what is appropriate work for the job guarantee and what is not.
I appreciate there are likely macroeconomic implications to allowing JG work itself to transition. I can’t say I’ve considered much further then the above.
@Mark H thanks for the explanation. Makes sense now.
“A lens by itself, for the vast majority of people, is not a very exciting or motivational or inspirational thing-it’s rather what can be seen through the lens that has the power to grip and move men and women”.
A very interesting point by Newton Finn.
But the issue here on is, like most of us know, what policies we prefer can vastly depend on where we stand – left, right or situational. I most prefer what you prefer ” design policies that address crucial human and environmental needs”, our survival. But others might prefer using fiscal capacity on more the real estate development, electric mobility, more high-tech industrial developments and the similar, to boost the economy.
So what would be the vision that we want to move people is very much on our share meanings which come from our socio-economic background, values and the likes.
It is not so easy where to move people to…
# Everyone,
In the US the JGP would be fully funded by the Federal Gov.
OTOH, most public service jobs would have to be funded by the state or local gov.
Many local govs. would therefore leave the job as a JGP job as long as this is possible.
Nixon created a grant program for the states, but that was eliminated by Reagan [I think].
I suppose we could reinstate a grant program.
But, unless it is frozen in with a Constitutional amendment it can be ended by the Repuds any time they gain power.
But, then I have proposed that we get amendments to require the US Gov. to do several things. Things like Soc. Sec., national health care, and the JGP.
.
“Who’s to judge? ”
The tax paying public judge by voting for politicians that keep taxes low and therefore give the private sector space to bid people away from public service.
If you want a higher public wage you have to get a set of people to pay the taxes, reduce their spending and free up the capacity to handle the higher wage. Simple as that.
In UK terms the approach would be to inject funding automatically via the Job Guarantee and likely Council Tax Benefit, then leave it up to local elections to determine the level of council tax that people are prepared to pay to create permanent public sector employment. Then jobs can transition out of the Job Guarantee into the public sector proper.
Local taxation is too restricted at present, and insufficient.
It’s not politicians that don’t value public service. It’s the people that elect them. Politicians are followers, not leaders.
“Local taxation is too restricted at present, and insufficient”. (Neil Wilson)
I agree. And I think it’s that current reality which is distorting this discussion (at any rate among UK participants). If local govt in the UK were once again to be invested with something equivalent to the powers that were devolved (especially to the big provincial cities) in the Victorian age it would then become once again the votes of the local population which would become crucial (or much more crucial than now anyway) to the outcome locally. The current trend towards creating new mayorships (?) for urban centres may be heading back in that direction.
The biggest reduction in their powers occurred (I believe) on Margaret Thatcher’s watch and in accordance with her ideology – even while she was trumpeting the virtues of “small government” she was busily concentrating power in Westminster. Local councils were demonised as spendthrift and hopelessly inefficient (especially where they had been captured by the so-called “loony Left”).
(Some of those armchair revolutionaries didn’t exactly do themselves any favours either, or endear themselves to the British electorate – like Liverpool Council for instance, or the county-council (was it Derbyshire? I forget) which voted to declare itself a “nuclear-free zone”, as if an incoming ICBM with nuclear warhead would know about that and direct itself accordingly, and the radioactivity it generated when it detonated somewhere else would magically stop at the county border. Lunacy indeed!).
With regard to local taxation in UK, 10 years ago half of funding came from central government, with the majority of the rest from Council Tax and Business Rates (property taxes). Since then the government contribution has almost vanished, with the result that the owner of a mansion in Westminster pays almost the same Council Tax as the tenant of a bedsit in Weymouth.
Ideas of local income and sales taxes have never been considered practical here. Aren’t spending decisions enough democratic responsibility?
@Neil WIlson
“The main issues is “at what wage” …
…So if at that time the public sector has to start chasing wages to keep people in needed public positions, there is a very real risk of an inflationary spiral.”
The answer is not simple, but obviously lies in taxation of the private sector. As Bill is constantly pointing out, government can tax the private sector in order to free up the resources it needs. A hypothecated tax might be an option (e.g. tax private medicine to ensure the public option is at full capacity), but really the precise tax would need to be designed by experts on tax and inflation (and I mean genuine experts who have read and understood the MMT textbook chapters on inflation etc.) and be designed based on precisely what is going on in the private sector.
Re the wage, for certain kinds of expertise such as medicine, it may also be necessary to bid against other countries to avoid loss of expertise to those countries, e.g. if we are talking about a developing nation. And of course inflation is a factor there. There’s not a one-size-fits-all answer.
I’m sure if I had time I could go deeper than this, but the trouble is inflation really is very complicated and hard to cover in individual blog posts let alone comment sections. So my question to you is, have you read the MMT textbook, or some of Bill’s posts on inflation elsewhere, and tried to figure out the answer to this issue?
‘Are we selling MMT most effectively by leading with the JG and claiming to be only a lens? A lens by itself, for the vast majority of people, is not a very exciting or motivational or inspirational thing’
I would be very excited and see it as a major step if BBC reporters, instead of repeating govt nonsense on the terrible size of debt and the need for future repayment, ridiculed this guff just as they might be somewhat sceptical of a flat earth society spokesperson. With regard to the JG, I see it as part of the package in explaining not just what is practically required for a government to continually fulfill a right to work obligation, but also to strike a nail into the nairu.
“was it Derbyshire? I forget”
It was. Under a certain David Bookbinder
Except they forgot that Rolls Royce, a major employer in Derby, made engines for nuclear submarines.
And therefore it was changed to “working towards a nuclear free zone”.
That’s what you get when the council offices are at the other end of the county in Matlock – and why Derby ended up with its own City council in 1997nty in Matlock – and why Derby ended up with its own City council in 1997
Why not just use the traditional progressive formulation to title this series of blogs?
Why not “tracing the roots of progressive roots on the right to work”?
Why not “tracing the roots of progressive views on the right to work” of course
The Revolution established the “droit du travail” (‘right to work’) as an operative principle binding government initiatives.
Just a small “lost in translation” moment here which might lead to a misinterpretation.
“Droit du Travail” is “Right of the workers”, not “right to work”.
Dear froggy (at 2020/10/13 at 3:33 pm)
Thanks very much. I understood the term ‘droit du travail’ to mean ‘labour law’, which in the context of the historical time I was referring to, was focused on right to work.
best wishes
bill