Two Big Questions About the Job Guarantee: God, Devil, and the Details

Progressives have these questions. Others will too.

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By Steve Roth

Should government guarantee a “good” job for anybody who wants one? It’s one of the biggest ideas among progressive economists who are trying to seize the Overton window of what’s politically feasible, to step outside the regressive economic framework that’s dominated American politics (right and left) at least since the Reagan Revolution.

There’s a whole lot to like about the JG idea. It would absorb and employ the reserve army of the unemployed that perennially undercuts workers’ bargaining power — driving higher wages and widespread prosperity, and (over time) undercutting economy-strangling concentrations of wealth and income. And it would serve as a cyclical thermostat, naturally expanding when private-sector hiring goes south, and contracting when a hot economy causes the private sector to outbid the JG program for workers.

But at least two big questions remain largely unanswered by JG advocates, both of which cut to the crux of the program’s workability. They’re detailed questions about how the institution would actually work in practice: what the rules are, who arbitrates and enforces the rules, and how.

1. Can job-guarantee workers be fired? For instance, if they refuse to work (much)? J.W. Mason, one of the best economists writing today, asks this key question:

Can jobs be guaranteed? In principle I’m very sympathetic to the widespread (at least among my friends on social media) calls for a job guarantee. It makes sense as a direction of travel, implying a commitment to a much lower unemployment rate, expanded public employment, organizing work to fit people’s capabilities rather than vice versa, and increasing the power of workers vis-a-vis employers. But I have a nagging doubt: A job is contingent by its nature – without the threat of unemployment, can there even be employment as we know it?

If JG employees can not work, still receive their wages and benefits, and not be fired, how is the program different from a guaranteed income without a work requirement? It’s possible this wouldn’t be a problem in practice — that normative expectations alone, for instance, would suffice for JG employees to do the work that’s expected of them. And JG advocates envision a system where the onus of providing appropriate and meaningful jobs falls much more heavily on the employers’ side — a crucial shift in the power structure of the labor market.

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But the question remains. An army of JG opponents will put it top, front, and center, loudly, if such programs start to look like they might achieve policy reality. Proponents need a tight, cogent, and compelling answer to hand. (“You obviously haven’t read this Australian case law” very much does not qualify.)

2. Who decides which employers and employees will have their wages paid by government? The idea is that social-service groups, NGOs, and “social entrepreneurs” would provide and administer the work and jobs, with their employees’ wages and benefits being paid by the job-guarantee program. But that begs the question of which organizations’ employees, and which employees within those organizations, would be paid by the program.

Matt Bruenig of the People’s Policy Project may be asking the best questions on this subject, cutting to the crux of which jobs, and which employers, should be part of the JG program. But even he doesn’t get to the next level: Some institutional structure(s) of rules, and humans making decisions based on those rules, will have to be in place for the whole JG project to work. What will those rules and institutions be? Who will make those decisions, and how?

If dedicated progressives who are deeply sympathetic to the goals, tenets, and approaches of JG, who have read and thought at some length on the subject (Matt, Mason, and me), are asking these questions, you can be quite certain that well-financed opponents will be asking them nonstop — and really, quite justifiably.

As always, God, and the Devil, are in the details.

2017 June 23

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