Banner Archive

Marvel Comics Timeline
Godzilla Timeline



« Unqualified | Main | More JG »

Job Guarantee vs. UBI

This Sanders Institute video about a National Jobs Guarantee is worth watching, but i have some serious grumbles. I support a Job Guarantee but i hate the way it's being pitched as an alternative to Universal Basic Income. JG ensures that everyone who wants to get ahead by working can do so. UBI helps correct the major problem we have with financial (income and wealth) inequality. The two programs could be complementary. UBI creates a new floor; JG ensures that people who are willing and able to work can rise beyond that floor. But if the two must compete, UBI is a far superior solution.

What's extra frustrating is that the people who argue for JG - like Stephanie Kelton, who i otherwise admire - suddenly start using all the arguments against UBI that you'd expect to hear from a center-left liberal (or worse).

The first thing to understand about JG is that it is an almost ACA-level Rube Goldberg contraption of moving parts. It requires jobs to be invented. Jobs that match all possible skill sets. Jobs for physical laborers, jobs for displaced IT professionals, jobs for people with disabilities, etc., etc.. Additionally, the jobs have to be the sort that aren't important enough to be permanent, because the whole idea is that most people go into these jobs during recessions and come out of them when the economy gets good again. That suggests WPA style jobs like park beautification, the creation of art, the recording of oral histories (which was a WPA job; the modern equivalent might be updating Wikipedia pages or something), etc.. Things that i'm not at all against, but which you might describe as make-work. However, Kelton's proposal includes things like child & elderly care and moving to a green economy. Those are not temporary jobs! You don't want to funnel a bunch of semi-qualified people into those positions and then have them leave when the economy gets good again. So there's a massive amount of administration that needs to happen to coordinate and balance all of that. It also requires a massive bureaucracy to evaluate people and place them into the appropriate jobs. Per Kelton's proposal, this bureaucracy will be administered at the local level, which comes with all sorts of problems that i'll discuss below.

Additionally, the JG in Kelton's proposal acts as a stealth raise to the minimum wage and a stealth universal healthcare, because the idea is that these jobs will pay a minimum of $15 an hour (which Kelton calls a "living wage" but it is not) and will provide people with health insurance. So if you have some other job not providing those things, you can quit and get a job from the JG, and that puts pressure on employers. Which is a good thing in the abstract, but it also suggests that the JG is being put forth as competition not just to UBI but to Medicare For All and the Fight For Fifteen (and/or a true living wage).

So with all of that in mind, let's talk about the objections to UBI. The first thing you'll hear is the very conservative idea about the "dignity of work" and how people will just sit at home and grow mold if they're just handed (a very modest amount of) money. This nonsense was already intrinsically rebutted during the debate about the ACA. How many times did we hear about how once people weren't tied to a shitty job because of their insurance needs that they would become entrepreneurs, start their own business, take on some risky career that they've always wanted to, stay home to give some much needed care to their kids/parents, spend more time doing charity work, etc.? The same argument can be made here. Freed from the burden of having to scrounge for a basic living, people will do what they want to do and will be inherently more productive and give much more back to society. Anyone who's been on the internet knows that people do this naturally: they code free software, they do research and update Wikipedia, they make free music, they make free web comics, they make free Youtube videos, they spend massive amounts of time working on comic book fan sites. The idea that we're all going to sit home and drool is counter to everything we know about people.

All of the other arguments about UBI can also be made about JG. Kelton says that the UBI amount would be subject to Congress where budget "hawks" would always be trying to lower it. But the same is true of the minimum wage for JG, and the generosity of the health insurance, AND the amount of funding for the bureaucracy and available jobs.

Another argument is that some people arguing for UBI (mostly the Zuckerberg types) are proposing it as a replacement for existing social programs, which would of course be awful. But no progressive is arguing for this kind of UBI (and i feel like Kelton was downright disingenuous in the video for not acknowledging that). And people make the same argument about JG - it could easily replace TANF, for example. And even the stealth ways that it addresses minimum wage and universal health care raise problems along these lines.

Kelton also says that a problem with UBI is that rich people will get the check as well as poor people. This is literally Hillary Clinton's "Why should we pay for Donald Trump's kids to go to public college?" argument. The answer, obvious to anyone, is that you get the money back by raising the top marginal tax rate. Kelton knows this and it's very disappointing to see her using that line.

The concerns about inflation are the same for both as well, and so is the response (there's so much slack in the economy that we're not even meeting the Fed's current inflation target let alone in danger of real inflation, and in any event the Fed can control inflation with interest rates).

Kelton says that the money people would be getting from JG would result in a massive economic stimulus, which i agree with but the same would be true of UBI. And the question of how to "pay" for it - which would be weird coming from the country's premiere MMT economist - applies equally to JG and UBI.

Then we get to the bureaucracy. Progressives/leftists love universal programs (1,2) because they require very little administration and are inherently fair. But JG puts a lot of arbitrary power into the hands of local administrators. And the first thing that makes me think of is how the New Deal failed black people by allowing the programs to be administered at the local level, thus allowing racist bureaucrats to exclude them (c.f. When Affirmative Action Was White). In a time when every Republican-controlled state with a large black population opted out of the ACA, this remains a legitimate concern. Beyond that, you know that conservatives (including rightwing Dems) are going to demand that the job seekers pass drug tests and that there's a very easy way to fire people, making the "guarantee" not so much of a guarantee. And the grifting opportunity is huge - how do you prevent the local bureaucrats from creating jobs that benefit campaign donors? With a higher level of bureaucracy, maybe? Turtles all the way up? With UBI, everybody just gets a check.

Another kind of grift comes from the fact that in order to determine what types of jobs should be in the JG, the bureaucracies are going to need to hire "experts" from think tanks. In fact, i'd argue that center-left think tanks like CAP are pushing for JG precisely because of these grifting opportunities. Again, with UBI, everybody just gets a check.

It's good that we're talking about stuff like this. It's good whenever the left is pushing new ideas and isn't just trying to figure out how to undo the damage Trump is doing. But if these programs are in competition with each other, the Jobs Guarantee should get a much lower priority.

By fnord12 | March 21, 2018, 5:34 PM | Liberal Outrage