I received this article from the group that describes itself as MMT UK yesterday. It was written by Patricia Pino, a recognised expert on modern monetary theory, in response to my suggestions on the job guarantee.
It has been suggested by those in MMT UK that we are going to need to agree to disagree on this issue, but that nonetheless it is appropriate for both sides' arguments to be aired, and because this blog has such an impact on MMT debate, they did wonder whether I might share the post here, which they have already published on their own website. I have agreed to do that, in the spirit of what they note.
I will be writing a separate response to what Patricia had to say, but this is the article that she has written:
PATRICIA PINO
MMTUK.ORG 31 MARCH 2026
THE JOB GUARANTEE: A RESPONSE TO RICHARD MURPHY
Richard Murphy recently published four connected blog posts (one, two, three, four) critiquing the Job Guarantee. His engagement with these questions is welcome, given his prominence in bringing MMT ideas to a wider audience in the UK, and a conversation we had recently in Edinburgh suggested a genuine willingness to work through the disagreements. This is my attempt to continue that conversation. The concerns he raises span administrative feasibility, inflation, stigma, the proper role of fiscal policy, and the psychology of meaning. Taken together, they reveal a deeper disagreement about the nature of unemployment itself.
One question must be addressed first. Richard treats the Job Guarantee as a separable policy proposal: one favoured by some MMT proponents, but not intrinsic to MMT as such. This view is understandable, and many would prefer it to be correct. But it is difficult to sustain once MMT's monetary framework is followed through to its logical conclusion.
MMT holds that the requirement to meet tax obligations in the state's currency creates the structural conditions under which paid employment becomes necessary, not as individual choice, but as a system-wide condition. The state establishes, by design, demand for its currency, and therefore for the work required to earn it, regardless of whether any particular person is liable. In that context, a government that understands its own monetary capacity and then leaves people involuntarily unemployed is not simply failing on welfare grounds; it is withdrawing the means of meeting an obligation it has itself imposed.
The Job Guarantee completes that circuit and, crucially, anchors macroeconomic stabilisation in the labour market rather than the money market. Without the Job Guarantee, MMT is left endorsing the very mechanism it explicitly rejects: price stabilisation secured through money-market management with unemployment operating as the buffer stock, or assuming a level of fiscal fine-tuning that no government has ever demonstrated in practice: spending the right amount, of the right kind, at the right time, to perpetually maintain full employment.
This does not mean that MMT's insights about money creation and fiscal space depend on accepting the Job Guarantee. They do not. But for as long as the state imposes its currency through taxation, the Job Guarantee follows from that logic, regardless of the preferences of its advocates.
With that established, Richard's specific objections deserve direct engagement.
Richard's administrative objection is straightforward: the continuous identification, design, and supervision of meaningful, non-displacing work in ever-evolving conditions represents a challenge of considerable scale. This is true, but it is not a decisive objection. The NHS is complex. The education system is complex. Complexity has never been a sufficient reason to reject an institution whose function is considered essential. The relevant question is whether guaranteeing access to work is deemed sufficiently important to justify organisation at that scale.
Nor is the Job Guarantee conceived as a centrally micromanaged system. The model proposed in the UK, and reflected in international experience, is deliberately decentralised: national funding combined with local delivery.
Communities, local authorities, and civil society organisations design roles around unmet needs. Rather than technocratic job creation from above, it is a framework that enables community established socially useful activity, much of it already taking place informally and without recognition, to be formalised and supported. The Argentine Jefes y jefas experience demonstrates that such programmes can operate at scale, and that participation naturally expands and contracts with broader economic conditions. The Job Guarantee does not need to place every worker in the perfect role; it needs a standing institutional mechanism that can generate and adapt work to local needs.
On inflation, Richard's concern is that a “uniform labour buffer” cannot stabilise prices given the diversity of the workforce, and that inflation is often driven by factors unrelated to wages. It is true that the workforce is diverse and that inflation is not limited to wage pressures, but neither addresses what the Job Guarantee actually claims.
The Job Guarantee function is narrower than Richard suggests: to stabilise demand and provide a nominal anchor through a publicly defined wage floor, replacing unemployment with employment at a fixed rate. Labour markets are diverse, but diversity does not undermine the anchor; the Job Guarantee is the benchmark against which all other wages are set, because employers must offer above it to attract workers out of the public programme. Inflation generated by supply shocks, geopolitical disruptions, industry bottlenecks, or market concentration requires other instruments. The Job Guarantee addresses a specific problem, not every problem.
Richard's claim that Job Guarantee participants would be trapped in a lower-status parallel labour market is difficult to reconcile with how the programme functions. Participation rises during downturns and falls as private-sector employment recovers. Employers tend to prefer hiring from those already in work, which means that Job Guarantee participants are better placed than the unemployed when private sector opportunities do arise. The relevant comparison is not between the Job Guarantee and some idealised labour market, but between the Job Guarantee and the current system, where the floor is unemployment itself, a condition defined by income loss, exclusion, stigma and deskilling. For those individuals who remain in the programme in the long term, guaranteed employment still provides income, participation, and purpose. That is a better outcome than a system that accepts permanent unemployment as normal.
Richard's preferred alternative, centred on investment, industrial strategy, and broad fiscal expansion, is not wrong. It is genuinely important. But it is not a substitute for the Job Guarantee. Public investment operates at the project and sector levels. It cannot guarantee that every individual will be matched to employment. Differences in skills, geography, timing, and personal circumstance ensure that some people remain outside even the best-designed investment programmes. Broader fiscal policy can reduce this mismatch. It has never eliminated it.
This brings us to the central disagreement.
Richard's framework is fundamentally project-led. It begins with programmes and asks how labour can be matched to them. The Job Guarantee, by contrast, is person-led. It begins with people and asks how the economy can be organised to include them. This is not a disagreement about the purpose of public policy, but about how access to work is organised.
In a project-led system, every programme faces a dual constraint: it must deliver its intended social purpose while also matching the workers available to it. These objectives do not always point in the same direction, and when they conflict, some mismatch is structurally inevitable. Richard's position is that broader fiscal policy can, in practice, reduce this mismatch to negligible levels. But the complexity does not disappear, it is simply left unaddressed. People are not static. Their circumstances, health, capabilities, and needs evolve continuously, and no programme designed around fixed project requirements can fully respond to such variation. The same ever-evolving conditions Richard cites as a reason to doubt the Job Guarantee apply equally to his own preferred approach.
The difference is that the Job Guarantee is explicitly designed to catch those who fall through the gaps. It does not assume mismatch can be engineered away. It ensures that where alignment between projects and people fails, access to work does not.
There is a striking asymmetry in this debate. The evidence for the Job Guarantee is incomplete, but it exists. Programmes in Argentina, India, Austria and elsewhere demonstrate that employment guarantees can function in practice, expand and contract with economic conditions, and deliver measurable improvements in wellbeing and participation. By contrast, the claim that a sufficiently broad set of other fiscal tools can eliminate unemployment altogether remains largely theoretical. Richard calls for “a better approach” but does not specify how the residual unemployment would be handled. The implication is that it can be reduced to a tolerable level. But tolerable to whom?
Richard's final and most philosophically ambitious objection draws on Viktor Frankl: namely, that work created outside existing structures risks being experienced as meaningless because it may lack the forms of social validation that those structures normally provide. This is a serious point, but the premise needs to be examined.
Richard's own approach rightly seeks to realise socially necessary work through improved public programmes and investment. But the boundary of what gets included is shaped by institutional design and practical constraints. Some of the most necessary forms of work do not map neatly onto planned projects. The Job Guarantee does not create meaning from nothing. It confers institutional legitimacy to contributions that already matter to communities, but which existing institutions have not been able to reach. Social recognition matters, but it is not fixed. It is shaped by institutions and institutional capacity. The Job Guarantee extends that capacity.
The empirical evidence also cuts against Richard's concern. Participation in public employment programmes is consistently associated with improved wellbeing and a stronger sense of purpose. A recent Job Guarantee trial in Austria (one of the most rigorously evaluated experiments of its kind) found participants reporting meaningful work and measurable improvements in mental health. The psychological harm in unemployment lies in exclusion, inactivity, and loss of contribution. The Job Guarantee addresses all three.
Richard is right that the meaning of work matters. He is right that social recognition matters too. But recognition is not the preserve of markets or conventional public investment alone. The Job Guarantee extends it to those from whom it is otherwise withheld, and the evidence suggests that participants are fully capable of recognising the difference.
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[…] detailed response to my recent posts on modern monetary theory (MMT) and the Job Guarantee (JG), which I shared this morning. I welcome that. These are issues that deserve serious engagement, not sloganising. And if there is […]
I am retired. I am not working. My pension is taxed.
First, it is good to see a civilised debate. Thank you, both…..and I think my position has shifted (partly) as a result.
I still do not see the requirement for MMT to include a Job Guarantee. The argument that you must have a job to meet your tax obligations is not the case (as Cliff B notes). Generally, tax is only levied on those that have/earn money.
However, I no longer dismiss the Job Guarantee as a bad policy. There is no argument about Full Employment being an important policy objective but, for me, the Job Guarantee smacked of “workfare” where crappy jobs are imposed on unwilling victims so that they qualify for measly benefit payments. However, Ms. Pino persuades me that it does not have to be that way… although it is still a huge challenge.
An interesting read.
‘paid employment becomes necessary, not as individual choice, but as a system-wide condition’ sounds draconian, it might benefit me, needing a job in my sixties, or someone whose disability does not prevent them working, but it does not help someone who is cannot work, it still excludes them. The state taxes me if I am in receipt of state help, or a pension. The poorest pay the highest proportion of their income in taxes, some without paying income tax. How do we include and properly support those who cannot work, if they are outside the system?
Local job creation to suit local needs sounds more practical than central control, but it could be a postcode lottery – I could be helping on a community project in one area, or litter picking for a reform authority, and litter picking done for an hour or two as a volunteer is different from doing it for whole shifts, in all weathers. We have been soused in the acid of neoliberal ‘benefit-scorn’ for too long to for many to not view this as an opportunity for ‘welfare to work’ measures.
I am still skeptical.
Me too
This all sounds too neoliberal to me: the idea that we must work feels economically incorrect now. We have long hidfden tht fact that many do not to make the labour stats feel right.
I think Patricia’s understanding of MMT is very different from mine. I think MMT is a description, a theory, a way of understanding, how our monetary system functions. To me it is the basis for logical, rational, policy upon which policies are implemented.
But Patricia seems to see it differently. She says, “MMT is left endorsing the very mechanism it explicitly rejects …..”. So, to her, MMT supports some mechanisms and rejects others. That is not a neutral theory. It is a political agenda albeit with valid insights about the operation of the economy. Given that she is calling her political agenda “MMT” then I can quite see why she feels a job guarantee is an integral part.
It is clear that economies can function without a job guarantee, most do. But, sovereign, fiat currency, economies all conform to what I think of as MMT. So a job guarantee must be a policy in this way of thinking.
The problem is, to me, that she has an explicit political agenda (I make no comment on whether that agenda is good or bad). But by calling it “MMT” she confuses it with a neutral explanation of how the economy works. That, in turn, confuses the public about what MMT is and how the economy works. By adding confusion she enables false arguments by those who opposed her political agenda. The consequence is that she is undermining the very agenda that she seeks to support.
I wish she would stop.
“It is clear that economies can function without a job guarantee, most do. But, sovereign, fiat currency, economies all conform to what I think of as MMT.”
Agreed
It seems to me that Patricia makes a moral case but not a logically necessary case. Iow, it is possible to derive a job guarantee from the tax obligation but it is not a sole implication.
There’s a lack of numbers on both sides of the argument. How many people now unemployed, later working for minimum wage as part of job guarantee, are we talking about? Will any of them pay income tax? Will they be better off financially if they take up a guaranteed job? Would they still get housing benefit, for example?
Who knows. Howard Reed could model this – but at £15k pa I cannot see hoW JG job can deliver more than just over £400 in tax plus some NI, and it is not a living wage, so I cannot even see how it would be legal. UC would still be needed
The system annoyingly lost my first post at 08:00 this morning so I’m glad that Richard says exactly what I felt then – Ms Pino’s response reeks of Neo-liberalism and negatively biased toward the State. She is reduced to lecturing us on the benefits of the JG at the end, so tenuous is her argument:
1. Why is the State ‘imposing’ things on people? Can’t people impose things on the State? Is not co-imposition (reciprocity) not called real ‘democracy? Someone has to be in charge. Neo-liberals don’t believe in this. A sovereign, legal currency is based on this. Deal with it Ms Pino. The language is a dead give away of her ideology.
2. What is a wrong with a ‘project’ led approach? There is much to do – everyone agrees about pot holes and crap trains, shit water etc. The project approach combined with local co-ordination – what’s the problem?
3. The State is a partner in this – not just the sugar-daddy. It has the right to its pound of flesh – outputs which are both macro and micro. Pino’s belief seems to be in individuals will save the day. Really? It’s both.
4. A properly configured JG will/could reconfigure the State’s relationship with its citizens. Currently the State runs the economy for markets, creating chaos, enabling assets to be hoovered up cheaply by capital (posing as ‘investment’), leaving society with the costs (vulture capitalism). Capital has effectively bought democracy for itself. A JG will change that relationship with an economy ran for everyone.
5. Destroying capitalism by individualising it is unrealistic (and has already been tried and failed); improving the way it works is not. If the latter is not true, then Smith’s ‘Theory of Moral Sentiments’ is bollocks.
If you don’t mind I would share my opinion.
I would fear that this type of job guarantee would turn into political weapon.
I would like to point at Hungary which also have a program like this. But local councils get so much leverage over people in need that it is actively causing fear for the participants that they might loose their job because they won’t be needed if there is a leadership change etc. The program also allows the government to tweak with numbers. So on and so on.
Of course Hungary is a different country but a perfect example to learn from as well.
Thank you
Patricia writes: “the continuous identification, design, and supervision of meaningful, non-displacing work in ever-evolving conditions represents a challenge of considerable scale. [But] The NHS is complex. The education system is complex.” And she goes on: “The Job Guarantee does not need to place every worker in the perfect role; it needs a standing institutional mechanism that can generate and adapt work to local needs.” The analogy with the education system seems to me to highlight the potential problems with this approach. Yes, the education system is complex, but (speaking as a researcher on school education and a lecturer in research-intensive universities over decades), how often does it generate learning fitted to localities or individuals? At the vast majority of times and places, education systems have dealt with complexity by requiring individuals to engage with largely predetermined programmes of study. It is possible to imagine systems that are more fitted to local or individual needs – which would no doubt be better – but the amount of resource that would be needed to sustain them would be high (this doesn’t mean it shouldn’t be done, just that the costs need to be considered). It should also be considered that education systems generally have a compulsory element (for some age-groups), and in the age-groups where they are not compulsory, the proportion not engaging with them is significant.
Thank you and much to agree with
I have to admit that I didn’t bother continuing any further with Ms Pino’s article after reading
“MMT holds that the requirement to meet tax obligations in the state’s currency creates the structural conditions under which paid employment becomes necessary, not as individual choice, but as a system-wide condition.”
Paid employment is not necessary to meet tax obligations. One could just as well argue (and equally wrongly) that a universal basic income is required by MMT.
Upon reading this piece about work guarantee, I recalled sections of EP Thompson’s The Making of the English Working Class. The Methodist Church of the time were full on people working, working hard, existing only to work for their masters and praising the lord.
Waged work is not and has never been the pinnacle of achievement in the human existence. We have been beaten, brain washed, starved, whipped, kidnapped, shackled and murdered to instil a good “work ethic”.
Work, for a dispossessed proletariat (us) should be a social, national, community based activity. Enough to make things happen, enough to pay for needs and should not be to enrich individuals at everyone else’s loss.
I’m afraid, as others have pointed out, work guarantees with the current attitudes to wealth at all costs, is simply an exercise in abuse.
I agree with you about work
This article offers a thoughtful and detailed presentation of the debate around Modern Monetary Theory and the Job Guarantee, clearly outlining how proponents see employment as a stabilising economic policy and why engaging seriously with contrasting views matters for meaningful discussion on full employment.