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The Job Guarantee and the MMT Core: Part Thirteen, John Carney Is Full of Talking Points and That's Polite

letsgetitdone's picture

In a piece called “More Questions About the Job Guarantee,” John Carney provides some links to the continuing debate on the Job Guarantee (JG). All the links are to posts critical of the JG idea except a link to one of my four posts critical of Carney's earlier work and supportive of the JG. The four posts are all at Daily Kos, but also at MyFDL,, and The links are here, here, here, and here.

Here's Carney's casual take on my critical efforts:

4.Over at Daily Kos, I get taken to task for "bias towards private sector employment." Well, yes. I certainly do have a bias toward that.

But, as Randall Wray's comments to Roger Mitchell make clear, so do the MMT economists. So does everyone who knows anything about economics and politics. Except, it seems, this guy at Daily Kos.

Well, thanks John, for noticing I'm out here. I'm glad you've deigned to notice. Too bad you're too busy to pay attention to a pretty comprehensive critique of your entire position, though.

But wait, I forgot that the best way for a guy like you to handle a guy like me is to throw a little ridicule my way and never, never discuss the real issues I've raised.

Your coverage here ignores all the issues I've raised in the four posts, except my charge that you're biased towards private sector employment, and it's easy for any reader who checks out the link to see that your answer to that charge is completely inadequate, considering the context of my criticism and its full detail.

I'll quote that charge with its full context of quotes from you and my replies, so everyone can plainly see how ridiculous, superficial, and inadequate your little drive-by reference is.

Does the JG Really Solve the Mismatch Problem?

”The Job Guarantee gets around one of these problems: it guarantees that anyone who comes to the government employment office ready, willing, and able to work will be able to get work for pay and benefits. The problem of mismatch is seemingly solved since the government will just supply the demand for something the unemployed can do. Direct hiring works better, in this sense, than trying to jigger the knobs of monetary policy.

But is the problem of mismatch really solved? I do not think it is.

The jobs created under the Job Guarantee are specifically not supposed to compete with the private sector, which means that they supply goods and services for which there is not a market demand. The total output of the economy might increase, but much of this output is non-productive—that is, it doesn’t actually improve our lives."

Comment: This statement really reflects John Carney's bias towards private sector employment, and is simply ridiculous and outrageous on its face! We all know that Government work produces valuable goods and/or services that improve our lot in life, everyday. We also know that a lot of Government work is valueless or produces negative real value. But we can equally well say the same things about private sector work. Much of it has zero or negative real value from the viewpoint of those of us who aren't getting paid for doing it, and I won't trouble to even provide the very obvious examples of this. There's also much private sector work that adds real value to our lives and is well worth doing.

My point is that whether JG work produces real value has nothing to do with markets or whether businesses in markets believe they can make a profit from certain kinds of activity. But it has everything to do with whether Americans are likely to and, in the event, will value the goods and services produced by JG work. Whether the output of the JG program is “productive” will be judged by the people that will or will not benefit from it, and not by the private sector market that it will not be competing with.

"Now some people will say that this is fetishizing the market. Aren’t there things that improve our lives other than what the market will pay for? I don’t want to argue that there are not. I do not think, for instance, that these days we could pay for the Sistine Chapel but our lives are greatly improved by its existence. The problem is that there is no reason at all to think that people laboring in Job Guarantee positions will supply meaningful improvements rather than holes in the ground."

Comment: I'm sorry, but the quote just before the disclaimer does “fetishize the market.” It clearly does make the a priori assumption that what the market values is much more valuable than what the political system or society or people value. And this is a generalization that John Carney cannot establish with any scientific tests or data. It is an ideological view coming out of Austrian economics and Randian ideology. It is not an assertion that should be taken at face value.

Actually, also, contrary to John's view, there is plenty of reason to think that people laboring in JG positions will add value to the economy. We know that many non-profits add value to American life. We know that New Deal project outcomes added lasting value to American life and continue to do so. We also know that many government activities add value today. But, most importantly, we have plenty of reason to believe that the people who run the JG program will be able to design it so that JG workers will be very likely to produce value. We have the years of research on the JG by MMT researchers to show that many good ideas already exist for JG projects that have value. All we have to do to assure ourselves that this is true is to read that literature.

I know that John says that he has read the MMT JG literature and that he hasn't any reason to believe that value will be produced, so he wants to be cautious before implementing the JG. But I've read that literature too, and I totally disagree with John and think his view is colored by the bias I called attention to above. He is predisposed to think that the JG cannot add value, so therefore, no examples of projects that might produce value will persuade him.

I can't say for sure whether this view of mine about John is right. To see whether it is, readers of this post should read the MMT literature themselves and decide. Don't take my word for it, and don't take John's. Decide for yourselves! I'm confident that you will decide that John's claim that “The problem is that there is no reason at all to think that people laboring in Job Guarantee positions will supply meaningful improvements rather than holes in the ground,” is just false.

"The Job Guarantee folks seem to think that there are plenty of meaningful jobs that aren’t getting done but that could be done by the unemployed. I don’t think this is correct. In fact, I cannot really think of many at all. Sometimes things like caring for the elderly or constructing bridges and roads are nominated as candidates. But these are not jobs that can be done just by anyone. They require a certain sort of person with a certain set of skills. Most jobs do."

Comment: This is the same claim as the one made above. Read the literature! Decide for yourself! It's easy to think of productive work for people to do. I'll bet you can do it for yourself. Here's one, start a JG project to provide the SEC with 50,000 new investigators to ferret out the control fraud in the private sector that led to the crash of 2008. That one will certainly add value to American life; specifically a value it is lacking now – namely the value of justice and fairness under the law. Of course, the 50,000 new investigators will need some training; but I suspect Bill Black could design a brief educational program teaching the basics of investigation that wouldn't require more than two weeks of intensive training to complete.

There's a lot more critical evaluation in the rest of that Part Five post and also in the other three that Carney chooses to ignore. But as the title of this post says, his effort to criticize the JG is full of talking points and no serious reasoning. It is highly ideological, and is simply an attempt to cut a very important plank out of the MMT policy platform. The JG policy in the context of other MMT proposals like the full payroll tax cut and State revenue sharing is intended to produce Full Employment and Price Stability in the broader context of practicing economics for the public purpose.

Carney's real problem is that he neither believes in public purpose nor in FE with PS. His attack on the JG is just a way of getting at these higher goals and objectives. John Carney wants MMT to merge with Austrian economics to create an alternative to neo-liberalism that he likes. The real problem with MMT is that if its historical values, prescriptions, and policies remain in place, then he won't be able to get that done. MMT, as it now stands is progressive economics whose normative orientation is the same as John Kenneth Galbraith's. Carney needs to change that to get his new synthesis.

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Submitted by lambert on

which is neither.

Presumably there's empirical evidence from Argentina that JG programs there created real value?

Also, I wonder how much of Carney's problem is the old problem that what we don't see we don't know. Carney's from Richistan. He doesn't live in a world of decaying roads, bad schools, no fibre, and on and on and on. We see work that needs to be done, and that "the market" isn't able to supply, all around us.

Submitted by Hugh on

You mention a key point at the end. Skills mismatches are bogus. If there is a skills mismatch, employers whether public or private, can train the workers they need. Actually ongoing education and training should be an integral part of most jobs, not all, but most.

Also as I pointed out in an earlier post in this series, the skills mismatch is bogus for another reason. Millions of American jobs have been shipped to China but what never gets questioned is what skills exactly do Chinese fresh off the farm have that Americans supposedly lack? If we were to believe the skills mismatch argument, they should never have been sent to China in the first place. The reason they ended up there is precisely to weaken American labor further and make it that much easier to facilitate the looting of the country, that is wealth flowing from the middle class to the rich and abroad.

I don't credit Carney with good faith. He is just trying to place MMT with its great money making powers at the service of corporations. This again exposes the fatal flaw in reformism. Carney wants to reform a system dominated by the rich and corporations by putting at their disposal nearly limitless money resources. This would be like leaving a stash of C4 and the keys to the refinery in the hands of a pyromaniac.

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Submitted by letsgetitdone on

You're both right. This is all about getting the rich, richer, and the poor poorer. That stuff about "skills mismatch" is really just BS. Amercians certainly have the all the skills necessary to build IPhones and IPads. The only reason why they weren't built here was that Jobs wouldn't pay American Labor and we had no laws in place to make him do so. We need to change that.