What should the president do about jobs?
For 30 years, democratic administrations have approached the issue with a focus on the common economy, confident that it will be followed by a vibrant labor market. But among Democrats, as well as major economists, there is a growing sense that the market alone cannot give workers a square footage.
Thus, after the health crisis that destroyed millions of jobs, the summer city protests that drew attention to the plight of black communities, another presidential election that exposed deep economic and social divisions, some policymakers are rethinking the political tool of the Great Depression. Providing jobs by the federal government directly to anyone who wants to.
Outwardly, politics seems to be stuck like never before. Senator Corey Booker, DN.J., introduced bills in 2018 և 2019 to create pilot programs in 15 cities և regions that offer federally funded training and guaranteed employment to all who seek it. Both attempts failed.
And after the Progressive Democrats in Congress proposed a federal job plan in 2019 as part of their new Green Deal, Wyoming’s 3rd House Republican asked Liz Cheney: “Are you ready to give the government, some faceless officials sitting in Washington, the power to make those choices for your life?”
But when it comes to government intervention in the economy, political parameters have changed. The system, which in 2008 After the financial crisis, he avoided exceeding $ 1 trillion in stimulus, had no problem saving $ 2.2 trillion last March, and $ 900 billion more in December. President Biden says the $ 1.9 trillion package will be supplemented.
“As a result of the epidemic, the boundaries of political discourse have grown considerably,” said Michael R.
On the left is a sense of opportunity to make non-Orthodox experiments. “The job guarantee itself may not be necessary or politically feasible,” said Lawrence Katz, a Harvard professor who was chief economist in the Clinton administration. “But I would like to see more experiments.”
And Americans seem ready to consider the idea. In November, Carnegie Corp. commissioned a Gallup poll to address government intervention to provide job opportunities for people who lost their jobs during the COVID-19 epidemic. It found that 93% of respondents think it is a good idea, including 87% of Republicans.
Even when respondents struggled with a hypothetical price of $ 200 billion or more, almost 9 out of 10 respondents said the benefits outweighed the costs. And a majority of Democrats and Republicans also preferred government jobs to higher unemployment benefits.
The question is, is the Biden administration pursuing a policy that has not been pursued since the New Deal?
“We tried to put a ban on federal labor guarantees,” said Darik Hamilton, a professor of economics at the new School of Social Research. He was an adviser to Sen. Bernie Sanders, who worked with Biden representatives before the November election to develop an economic strategy that could unite the Democratic Party. “It was the cornerstone of what we brought.”
In any case, the guarantee of working on paper sharply mitigated the recession, as the government silenced the displaced workers due to the economic downturn. But unlike President Franklin D. Roosevelt’s plans to provide jobs for millions of people displaced by the Great Depression are now intended not only to tackle unemployment but also to improve jobs in good times.
If the federal government offered jobs plus $ 15 an hour in health insurance, it would force private employers who wanted to depend on their workforce to pay at least as much. The federal job guarantee “sets minimum standards for employment,” Hamilton said.
The president does not seem ready to go all the way. “We doubted we were going to get there,” Hamilton said.
The Biden Rehabilitation Program involves efforts by public health departments to train a group of new public health workers to fund և 100,000 full-time employees. Child և His commitment to expand access to care for the elderly is combined with the promise of good, well-paying jobs in foster care. And he promised to promote the creation of 10 million quality clean energy jobs with undeveloped eggs.
“There are a number of proposals for partner planning to get people working to meet the needs of the nation,” said Heather Bush, a member of Biden’s board of economic advisers.
And yet, the idea of a broad job guarantee is still an innovation. It would be expensive for beginners.
Hamilton, who prefers the federal job guarantee, was the co-author of the 2018 study: Mark Paul, William A. Together with Darit Jr. և Haing aw au, who was trying to estimate the costs. Based on employment figures for 2016, assuming an average cost of $ 55,820, including benefits, the study found that it costs between $ 654 billion and $ 2.1 trillion a year, which will be partially offset by higher economic product “savings” tax savings. on other assistance programs, such as food stamps և unemployment insurance.
And the prospect of large-scale government intervention in the labor market raises thorny questions.
First, the work that the government can offer to provide a job guarantee is determined. Health նախագծ infrastructure projects require highly skilled workers, such as high-quality seniors, child care. Jobs, for example, in the field of garden maintenance or as teaching assistants can encroach on what local governments are already doing.
Moreover, the availability of federal jobs will dramatically change the employment equation for low-wage employers such as McDonald’s or Walmart. Stein argues that a universal federal job guarantee that pays $ 15 an hour plus health benefits will “destroy the job market.”
Some rich countries have job guarantees for young adults. Since 2013, the European Union has had a plan to ensure that everyone under the age of 25 receives training or employment. But these programs are based on subsidizing private employment, not offering government jobs.
Many European countries have subsidized private wages during the epidemic, allowing employers to lay off workers instead of laying off workers.
The United States has a limited wage subsidy program, the Employment Opportunity Credit, which was introduced in 1996. It provides up to $ 9,600 in credit to employers who employ certain categories of employees, such as food stamp recipients, veterans, or criminals.
Developing countries have tried job guarantees, which the Economic Cooperation and Development Organization said that “in 2018. They outperform income by providing jobs, helping individuals (re) connect with the labor market, building self-esteem, and developing skills and abilities. ” But in more advanced economies, the report added, “previous experience with public sector programs has shown that they have little effect on participants’ post-program outcomes.”
Labor Market Policy Effectiveness Survey 2017 Overview – Berkeley, University of California, David Card; Jochen Cluv from Humboldt University in Berlin; և Andrea Weber of the University of Vienna concluded that employee skills improvement programs work best, while “public sector employment subsidies tend to have a small or even negative average impact on employees.” For one, private employers do not seem to appreciate the experience of government employees.
Another economist, David Neumark of the University of California, Irvine, is skeptical that new policies are needed to ensure a decent standard of living for workers. Prog programs such as the Income Tax Credit, which complements the earnings of low-wage workers, just need to be made more generous, he said.
“I’m not sure the tools are missing,” he said. “Instead, we were too stingy with the tools we had.”
Neymark notes that the idea of government intervention to help working Americans is gripping even the political right. “Republicans are at least talking more about delivering some goods to low-income people,” he said. “Maybe there is room to agree on some things.”
Despite the wide range of guarantees, the Strain of the American Enterprise Institute sees new room for effort. “If the question is, ‘Do we need more aggressive labor market policies to increase people’s capabilities?’ The answer is yes, “he said. “I consider it more of a moral imperative than an economic one.”