Should the government guarantee jobs for people?

Adam Ozimek has a very good post on that question, here is one part of it:

(By the way, can you be fired from a guaranteed job? If you’re guaranteeing everyone can be hired, and nobody can be fired or even it’s very difficult to fire them, then that’s creating quite the management headache for whoever participates in this program.)

Crowd out is also a problem on the supply side of the labor market as well, and failing to accurately consider this means the estimated program costs are way too low. The goal of the program is to create 4.4 million jobs that will cost $36,000 a year each. CAP says this will only cost $158 billion. But this assumes there is no crowd out from people who already have jobs. If these are going to be “good jobs with good wages”, then why wouldn’t people who currently have jobs that aren’t as good or have lower wages from trying to get them? About a third of all workers earn less than $15 an hour, and EPI estimates that a $15 an hour minimum wage by 2024 would directly affect 22.5 million workers. So it’s easy to imagine that there would be 20 million people or more who want one of these guaranteed “good” jobs today. How do we decide who gets these jobs, and do we set a cap?

So it seems clear the $158 billion estimated cost is way, way too low. I don’t know if advocates know that this plan would result in a large scale nationalization of the economy and don’t care, perhaps even seeing this as a benefit, or if they are just making a mistake.

Do read the whole thing, Adam makes many good points.


Comments for this post are closed