I posted this question on twitter yesterday:
Simple question on which your opinion is sought. The government will have a choice this winter between two macroeconomic policies it can pursue. It can’t do both. Which would you prefer? Should it go for:
— Richard Murphy (@RichardJMurphy) August 8, 2020
So far full employment is Resoundingly in the lead.
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That’s it then, turn the printing presses full on..
Why would you nit wish to support people to work?
Ben any reading of history will show that monetary or predominantly money based economies are subject to regular recessions usually because of panics over future investment.
It’s possible with today’s coronavirus causing a huge rise in employment to think of these recessions as pandemics or “panicdemics!”
Clearly Corvid-19 has brought forth central and local state interventions shutdowns as expedient measures to get economies back to normal.
Government injections of money either directly, through borrowing, or tax reductions, are interventions like shutdowns to get economies back to normal.
There could of course be automatic interventions like penalising individuals and corporate entities who continue to have strong incomes or large savings for not spending.
But note these are all government initiated interventions because the private sector has difficulty intervening being too fragmented from a response point of view.
I note that you have offered no information in regard to alternative intervention/s and presumably therefore will be of a “let recessions rip” mentality just so long as it doesn’t affect you or your loved ones. If I’m being unfair in making this comment then I’d love to hear what your intervention strategy would be for dealing with economic crises.
Option 3.
A UBI?
No
For reasons noted many times
A good social safety net, yes
But the policy has to be full employment
Full part-time employment and a UBI. (20hours a week)
I’ll meet you half way?!
What does that achieve?
We may well have reached the peak, and now be on a downward trend, in terms of the need for human labour in the economy. Full employment-or anything like it-may not be achievable.
Why? There is so much that could be done
I’m not against the idea of full employment.
Like Ross says, I’m just sceptical that there enough meaningful things that need doing out there to give everyone a full time job? Part-time perhaps. Happy to be proven otherwise though.
Bullshit jobs that use up precious resources don’t count though and need to no longer exist. We can’t all be dog walkers.
Impending AI revolution is also going to put pressure on existing jobs.
Richard,
Sorry, but I think you are as wrong on Universal Basic Income as a classical economist is on Modern Monetary Theory.
I have been trying and failing to find something Stephen Hawking said not long before he died. To the effect that we have the technology to give everyone a comfortable life, but he feared that it would be used to transfer wealth and power to a smaller and smaller group of people, leaving the rest worse off.
Secondly, the pandemic has re-emphasised the complete disconnect between the price and value of work. Not just the essential workers paid a pittance, but the massive amount of unpaid work necessary for society to function at all.
Just as with MMT and the Green New Deal, I suggest we have to completely rethink our ideas on the meaning of jobs and work. The idea of fulfillment as endless hours stacking shelves is on a par with some of the more eccentric insights of classical economics.
PS I hope you follow Blair Fix (e.g. https://economicsfromthetopdown.com/2020/06/18/can-the-world-get-along-without-natural-resources/) who, like you, makes me rethink.
PPS I know I am biased. I have been retired for 10 years, and before that, for over 40 years I was paid to do a job I loved.
PPPS I bought Stephanie Kelton’s book this afternoon
I know Guy Standing well
And I have seriously looked at this issue
I cannot make it work
There are better ways to address the issue than UBI
Michael G: I think this is the Hawking quotation you were looking for, from a Reddit “ask me anything”: https://www.independent.co.uk/life-style/gadgets-and-tech/stephen-hawking-says-robots-could-make-us-all-rich-and-free-but-were-more-likely-to-end-up-poor-and-a6688431.html
“One Reddit user asked Hawking if the rise of intelligent robots could lead to “technological unemployment”, where intelligent machines or programmes render expensive and unreliable human labour obsolete.
Hawking replied: “The outcome will depend on how things are distributed. Everyone can enjoy a life of luxurious leisure if the machine-produced wealth is shared, or most people can end up miserably poor if the machine-owners successfully lobby against wealth redistribution.” “
It is worth recalling Keynes thought work would largely be history by now
Of course robots will change work
But vast numbers of people will still be needed in work
Andrew, Thankyou so much for finding the Hawking quote. My gripe is that “Full Employment” is as big a closed door in thinking as “The Government must balance the books”. Richard has opened the full employment door and not liked what he has seen, but most MMT proponents seem to take “Full Employment” as end of story. Hawking gives a glimpse of what could be the other side of the door, but what I see are a range of fascinating and complex questions which MMT needs to be exploring. How far can we get from subsistence wages drearily moving boxes in Amazon towards Hawking Utopia?
I am totally happy to reimagine work, but I also have a very strong feeling that most people want it, even if they had a UBI
Full employment any time.
Full employment any time I read as
Full employment every time.
That should be a constant election commitment from every party. I mean this from the point of view of the electorate not bothering to vote for any party not giving this commitment.
The public and media might then be debating the definition of full employment but I would see that debate as a small step forward from where we are.
Small positives.
Any time, all the time, every time – what ever – just make it full.
Let’s stop wasting people’s lives so that those who already have a life can benefit from house price/asset rises which everyone pretends isn’t one of the real generators of inflation – which it is.
Why do we have to live in a society that thinks it’s OK for people to win ‘big’ because someone else has to lose? For too long, capitalism has been moving money around unfairly instead of making genuinely new money.
Successful capitalism creates the greatest amount of social welfare for the greatest amount of people. We do not have that.
So therefore, capitalism has failed and guess what – it needs Government to redress the balance.
Sure, AI is going to alter things. But that can be stopped. It can be attenuated for social reasons – we just seem to accept it will happen without chewing over the real consequences. Remember when we were told that the working week could be as little as 2 days – that we’d have more leisure time? Well whose stopping that? The message is, with out work, there’s no use for you!!! So which fucker made that decision? Who is saying that ? Oh – the rich of course!!
And not only that – as I have said before – look around you: there’s load of neglect to put right – there’s loads of work to do on our infrastructures and communities.
Most voters in the UK live their lives in a monetary economy yet have no idea how “interventions” take place to create the money for such an economy and the secondary “interventions” necessary to maintain the value or keep relatively stable the value of the first “interventions.”
It’s as though they still live in the four hundred year period of serfdom in the UK whereby their employer provided the resources for them to work on namely the land and they brought forth sustenance which they shared with their employer who offered to protect them so they could enjoy the sustenance. Here is the way the first “intervention” takes place to produce the bulk of “bank money” from thin air:-
https://www.bankofengland.co.uk/-/media/boe/files/quarterly-bulletin/2014/money-creation-in-the-modern-economy
https://www.researchgate.net/publication/265909749_Can_Banks_Individually_Create_Money_Out_of_Nothing_-_The_Theories_and_the_Empirical_Evidence
With the coronavirus pandemic effect on the economy private sector banks are facing a large hit on their loan books through private sector business default. This in turn induces reluctance to create money from thin air to lend and private sector investment falls resulting in deflation and destabilises the value of money as individuals rush to hoard money looking for anything other than productive investment to produce real goods and services. Such a rush out of bank money, for example, is the one that’s currently pushing up the price of gold. Of course, if you understand money and history you know this plunge into gold can only be temporary.
You might therefore have thought that a monetary literate electorate would immediately understand that if private sector banks could create money from thin air then the UK’s central government bank would be able to do the same and therefore make an “intervention” to stabilise the value of the nation’s money. Yet such is the level of monetary system illiteracy most voters are scared of such “intervention” and would immediately want the government as soon as the first buds of recovery appear to suck that “intervention” money out again so the government can balance its books. Of course, such a reversing “intervention” will prolong economic recovery. Here’s the argument for central bank “intervention”:-
https://www.bis.org/speeches/sp180206.pdf
Faced with an electorate in which the majority persistently find it hard to understand the “interventions” necessary to optimally run a monetary economy it seems better to me to accept this and make more effort to get politicians up to speed on these necessary “interventions” so that they can work with private financial sector and non-financial sector business representatives to agree a commonly accepted blueprint for “interventions.”
You are absolutely right….
Spot on
And part of that fear in the electorate Helen is the threat of austerity looming large – that what has been given has to be taken away.
Most politicians know full well, it’s just much more lucrative to pretend otherwise. This faux naif routine so many politicians pull with regards to economic matters, is just rhetorical squid ink.
Full employment. Man is a social animal. Sitting at home forced to watch daytime TV is a cruel and unusual punishment for all except the confirmed masochists. That is of course for those fortunate to have a home.
Beware of reading anything into the results of a self-selecting poll.
I’d vote for Full Employment.
What about universal basic services as a step in the right direction towards full employment
I have more faith in these than UBI
A bit of a “no brainer” on here but in Conservative Central office it would cause serious headaches.
Maybe people lack the imagination to see the sorts of employment that could be offered if the government took seriously the obligation to get things going again, to save people’s lives by creating work. My parents lived through the Great Depression In the States, and my mother was employed in a WPA project writing a book about California, although I don’t remember what was in it. Geography and economics, I guess. The finished book, which looked like a volume of an encyclopaedia, sat on a shelf in a bookcase in our living room when I was a child, perhaps 20 years afterwards. I don’t know what happened to all the other copies that must’ve been printed. Meaningful work? Who knows? She apparently went into an office with other people, worked, laughed, created something together, and collected a regular pay check which she used to support herself and her family. It helped. We didn’t know who Keynes was. That was the New Deal as we experienced it. Too bad for the Americans now that it didn’t go into creating a durable system of free health care, but still.
Why not look at all the sorts of projects somebody thought up then and see where that takes us? There’s certainly useful work that could be created if the government had the will to pump some money into the country by providing employment and paying people to do it.
The road to full employment through the Green New Deal, detailed on here in several blogs. There are many jobs being done which provide no social benefit overall, which it would be good to see then end of, such as building or extending motorways, or vanity projects like HS2 where people could be re-deployed into the GND. I’m not sure how the “masters of the universe” could be re-deployed.
Also, a Job Guarantee to provide an intermediate stage (perhaps for many) between unemployment, under-employment and “bullshit” jobs, and finding permanent well-paid fulfilling work for the longer term.
Stephanie Kelton describes the JG in the Deficit Myth and refers the reader to a fuller description in Wray, L et al: http://www.levyinstitute.org/pubs/rpr_4_18.pdf. On p.39 there are numerous examples of the kinds of jobs that might be done, with the proviso that this is not “workfare” and that people should be fitted to jobs and in their own locality. For example, (amongst an extensive list) environmental jobs tackling “soil erosion; flood control”; Community Care: “building playgrounds, pedestrian areas, and bike lanes”; People Care: “elder care, afterschool programs”.
Just a few examples to give a flavour. Bullshit jobs? They are certainly things that need to be done, aren’t being done or are being badly done, and if well done would considerably improve life for many.
Caring
Teaching
The GND
New social housing
Making roads cycle safe
Bullshit jobs?
I don’t think so
My concern about full employment (and employment generally), is what the work is/will be, what happens if it’s turned down, how much it pays. This policy cannot be divorced from the evidence (such as David Graeber’s Bullshit Jobs), and evidence for people’s dislike of their work. Most people see their job as “bullshit” – socially unnecessary – and getting on for 80% of people hate their work, including a quarter who are also “actively disengaged” (workplace sabotage). There may be rhetoric around the value of work (Rishi Sunak said he “believed in the nobility of work” – as if), but this is irrelevant since what matters is evidence, without which we live in delusion. The evidence suggests that for many, work is destructive, and most know their work is of no social worth.
There is also the politics of wage labour to contend with, since “employment” is not a natural state of human being but a political construct not discontinuous with exploitation, servitude or slavery. It is not universally agreed that employment is an acceptable state of being, indeed many millions try to get/stay out of it via self-employment, the lottery, investing, rentierism, being the boss, and so on.
Also, work and what it produces is costing us all life on earth.
For me to support full employment a number of conditions would have to be met:
It would all need to be organised by genuine, equal co-operatives.
Any work could be refused at no detriment to the person refusing it.
It must meet the person’s individual needs.
All training and support is provided and on full pay.
Robust, fully-funded powers of legal redress are provided to everyone against any business or organisation for bullying, harassment, discrimination and so on (plenty of workplaces are toxic).
Anyone can leave any role at any time without penalty.
If someone is looking for a specific role and that is not currently provided, no force can be applied to make the person fulfill another role. The role is either created or the person is paid in full as though they’re working as part of the scheme – otherwise it’s slavery.
The power needs to be with the individual worker.
The work must not be harmful to life on earth.
The work must enhance human wellbeing (vape factories, cigarette manufacturers, online gambling sites, etc. must not be counted in any scheme for full employment).
Everyone must, as of right, be allowed to walk away from bullshit jobs, or work that harms them or the world and be offered meaningful, healthy, interesting work as of right.
Pay and conditions must be decided collectively.
The scheme must be non-hierarchical – no boards of directors dictating to everyone else whilst scooping up all the money.
“Full-time” should over time be reduced, initially to 25 hours, but then further as technology allows.
Fully-funded pensions are obligatory, with equal payments for all.
Whether it’s funded or not must not at the whim of any centralised govt, but by collective decision-making.
It must be fully democratic, not the thin gruel that gets called democracy in the UK.
I think we are a very long way from that vision David
And I am not nearly so sure that work is viewed as harshly by all as you think. But, I may have been fortunate in meeting too many who seem to enjoy their work or resent not having the chance to achieve what they want through work. The last group may overlap with the bullshit jobs problem – which is very real – but has never implied to me that people do not want to work – they just do not want to do what they can get, which is something very different.
A key reason I read your blog, is the knowledge and perspective you and other commenters bring to economics and politics. I may have a different frame of reference than you about work, and my experience of work in part explains my view – I’ve seen how awful work can be on numerous occasions. Beyond that, I defer to the evidence as I, like you, realise my experience will always be limited. David Graeber’s work cannot be dismissed, but neither can the experiences of the millions of people working in retail, cafes and restaurants, garment workers, seasonal workers, people working in call centres and so on. The figures for the numbers of people disengaged from their work or sabotaging came from an interview with a PhD on Thinking Aloud on radio 4. There are over 3 million people on minimum wage, and (as you say) a million on zero hours contracts, and many millions whose work involves endless repetition of tasks with no autonomy or power. As others have commented, people are sociable, and wish to be active and do useful things, but that is no justification for exploitation and neither is it justification for assuming that, just because people get on and do awful work, that they must be getting something more from it than money to live. I’m fortunate that the work I do pays me well enough to work fewer hours and I find it greatly satisfying as well as challenging and difficult. I’ve also worked in factories, shops, building sites, warehouses and experienced how soul-destroying these experiences can be, how ugly, vindictive and needlessly cruel. The evidence is clear that those who relish their work are in a small minority. I think George Orwell estimated it to be about 17% whose lives weren’t being ground down by the drudge of work and poverty.
I wholly accept what you say as true
All I am saying is that it is not a universal truth
We can do better
David Willetts.
I am 100% with you on this one.
I would also add that in order to tackle climate change we need to reduce the amount of stuff we consume which also means that we need to reduce the amount of stuff we do.
We need to get away from an economy based on exponential growth to have any chance of surviving climate change. This means doing less than we currently are.
I like the idea of full employment and a job guarantee, but I’m not convinced that there would be enough things to do that are actually beneficial and can give everyone a full time job. (40hours a week). Part time possibly?
Don’t forget, that all those Bullshit Jobs that David Greaber highlights also need to disappear and be replaced by meaningful work.
Plus AI is going to put pay to a whole traunch of jobs in the existing workforce, very soon.
(By the way, Bullshit Jobs is a great read if anyone is looking for a read over the summer. Very funny in places. Highlights humanities collective insanity very well!)
I have no statistical evidence to back up my claim! Happy to be proven wrong.