Opinion: Provide Jobs for All and End Poverty
Over the past 40 years, corporate America has off-shored half our manufacturing base, almost all of our textile industry, and in recent decades even our high tech computing jobs have been moving overseas. Our own tech people are being asked to train their replacements abroad. Now we are being told that half the jobs remaining will be swallowed up by AI and tech apps. Is the race to the bottom inevitable? Is ever-growing income inequality just a new fact of life in the global economy?
Proposals for a Guaranteed Basic Income (GBI) are being floated as industries are disrupted. This can be very helpful. Coal miners are a stock example. Our bloated health care bureaucracy could shrink dramatically if we move to a single payer system. And retail… Wal-Mart has disrupted almost every downtown business district, and now Amazon is taking down the Big Box stores. We’ve suffered with self checkout lanes for years, and now we will just flash our credit cards as we pick up our online orders.
GBI is also being considered as a strategy to boost incomes of the “working poor.” The middle class has been shrinking for years as the service economy has replaced those good-paying union jobs. Young people carrying college loan debt are struggling in the gig economy. In Columbus, two-thirds of those seeking affordable housing are on wait lists. Poverty and the lack of living wage jobs are so bad, Rev. Martin Luther King Jr.’s 1968 Poor People’s Campaign is back. Really. Big nationwide rallies are being planned for this spring.
The number of children and the working poor living at or near the poverty level has remained unconscionably high. The patchwork of safety net programs designed to alleviate poverty and its symptoms are inadequate. Food insecurity, lack of health care, domestic violence, and high crime rates in unsafe neighborhoods affect a third of our fellow citizens.
The Newark (Ohio) Think Tank on Poverty reports that 28 percent of the population is “unbanked” or “under-banked.” That’s 93 million Americans who are dependent upon check cashing and payday loan sharks when any financial emergency occurs requiring extra money for food, medicine, rent, utilities, etc.
A guaranteed income floor can enhance the safety net, but it also reinforces the status quo of low paying jobs and adds one more layer to the bureaucracy of services for vulnerable populations. GBI, like raising the minimum wage, can be a useful strategy, but the deeper systemic problem of low paid service jobs and underemployed workers remains.
Is this the future we want? It sure seems like the future we are getting: continued efforts, however well meaning, to reform a system that is not serving us well. It’s unjust and must no longer be acceptable in the richest country in the world.
Fortunately, there is an alternative approach, and it may be just what we need at a time when public investment is going to be essential, if we are to mount the “Marshall Plan” commitment we need to reverse global warming.
The answer to this complex jobs conundrum can be found in our history books. During the Great Depression, FDR went beyond the safety net of social security and granted workers the right to organize unions. He put people to work by creating jobs to build infrastructure, established the Civilian Conservation Corps, the Works Progress Administration, and many other programs. He did not offer training programs in the hope that the private sector would be able to profit from reforestation, or invest in building post offices, libraries, etc. The government acted in the interest of ordinary people, because our democracy gives our representatives the power to do so.
Let’s go back to the future and create livable wage jobs again for every man or woman who needs one. There is a new economics (Modern Monetary Theory aka MMT) that has designed Job Guarantee (JG) proposals that are carefully crafted to complement the need for real, full employment when the private and public sectors fail to meet the needs of our workforce.
MMT economists understand that our capitalist economy must be organized for the benefit of everyone (i.e., Main Street communities, not just Wall Street investors). Without good jobs, our communities will continue to face all the costly and humiliating symptoms of poverty: food insecurity, unaffordable housing, drug abuse, domestic violence, the school-to-prison pipeline, etc.
A Job Guarantee program is both practical and affordable. MMT economists would tap the nonprofit sector to fund jobs that are needed now to meet the needs of our communities. The upfront costs would be high (some estimates are around three quarters of a trillion dollars), but it would save money in the long run by reducing the “safety net” costs and increasing local tax revenues. The Federal Reserve spent far more dollars bailing out the big banks after the Great Recession of 2007-08.
These would not be make-work jobs: skilled and unskilled labor is needed right now to insulate homes, plant trees, expand after school programs, offer rides to senior citizens, clean up our neighborhoods, etc. Ask any nonprofit agency if they are ready to hire. When true full employment returns, the private sector will again attract workers from the JG programs, many with new skills and work experience. JG programs will shrink as the private sector expands. More tax returns will strengthen local government services.
MMT economists have operated in the shadows of the dominant Chicago school of economics and the neoliberal policies of government austerity and income inequality driven by economic globalization, which benefits multinational corporations at the expense of Main Street local economies. We are fortunate in central Ohio to have a major think tank for MMT economists at Denison University in Granville. Anyone interested in JG programs and macroeconomic policies may visit the Binzagr Institute for Sustainable Prosperity .