More proof that MMT’s JG is a bad idea

Twitter: @rodgermitchell; Search #monetarysovereignty
Facebook: Rodger Malcolm Mitchell

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MMT (Modern Monetary Theory) is a close cousin to this blog, MS (Monetary Sovereignty). Both schools recognize the Big Lie, which actually is a composite of several lies, among which are:

  1. Federal taxes fund federal spending. (They don’t.)
  2. You and your children owe the federal debt. (You don’t.)
  3. Federal finances are like state & local government, business, and personal financing. (They aren’t.)
  4. The federal debt and deficit are too high, “unsustainable,” and should be reduced. (The defict should be increased. The debt is immaterial.)
  5. The federal government cannot afford to pay for Social Security, Medicare, Medicaid and other social programs. (It can, easily.)
  6. There can be “debt-free” money. (All money is debt. There never can be “debt-free” money.)

While MMT and MS agree on the fundamentals of economics, they disagree on the actions to be taken.

MS proposes implementation of the Ten Steps to Prosperity (below) to:

  • grow the economy and to
  • narrow the Gap between the rich and the rest.

MMT proposes a JG (Jobs Guarantee) to:

  • create full employment and
  • price stability.

Wikipedia: “The JG is based on the buffer stock principle whereby the public sector offers a fixed wage job to anyone willing and able to work.  

Buffer stock principle: Commodities are bought when there is a surplus in the economy, stored, and are then sold from these stores when there are economic shortages in the economy.

This says, when you are part of JG, you are not an employee. You are not even a person. You are buffer stock.  Being stock, your likes and dislikes don’t matter. What you want to do doesn’t matter.  This is the “beggars can’t be choosers” solution to joblessness.

Previously, we have published reasons why we believe the Jobs Guarantee is naive, unworkable, and not just useless, but harmful:

JG is a non-solution to the wrong problems. It assumes there is a shortage of jobs that the federal government can provide.

MS claims there is no shortage of jobs, but there may be a shortage of the right jobs, and more importantly, for many people there is a shortage of money.

Today, we received the following Email from the website, LinkedIn:

LinkedIn: Explore job openings in Greater Chicago Area
More than 136,000 new jobs are available now.

Top jobs for people like you:
1 President
2 Chief Executive Officer
3 Vice President
4 Director
5 Specialist

Get jobs tailored to you! Update your industry. This is an occasional email to help you get the most out of LinkedIn.

© 2016 LinkedIn Corporation, 2029 Stierlin Court, Mountain View CA 94043. LinkedIn and the LinkedIn logo are registered trademarks of LinkedIn.

That is 136,000 executive-type jobs available in Chicago. Additionally, just one website, Employment Crossing, listed the following non-executive jobs available in Chicago and its closest suburbs:

Chicago, IL (21,887)
Downers Grove, IL (748)
Evanston, IL (706)
Oak Brook, IL (672)
Chicago Heights, IL (607)
Deerfield, IL (600)
Bolingbrook, IL (592)
Des Plaines, IL (530)
Arlington Heights, IL (501)
Glen Ellyn, IL (467)

There are thousands upon thousands of jobs available, but visualize that you are looking for a job, and can’t find one.   Why?

There are only two reasons:

  1. You don’t want the jobs that are available to you, or:
  2. The jobs you want don’t want you.

Which of these problems is a government Jobs Guarantee program likely to solve for you?

Is the federal government going to do better than the websites, local newspapers, and employment agencies at finding the kinds of jobs you want??

Consider jobs the federal government will guarantee. They will be minimum wage jobs, and they will be federal jobs.

If you currently are looking for a job, are you really unable to find a minimum wage job?  Is that the job you want? Does offering you a minimum wage, federal job solve your money problems?

If the government provides minimum wage, government jobs to all the people who want, but can’t find, minimum wage jobs, how many people will this program actually help? Precious few.

The Jobs Guarantee is a program only an economist could love — an economist who thinks of the economy, not as composed of human beings, but as numbers on a balance sheet — as buffer stock.

To MMT economists you non-rich are born lazy. You are “takers” who must be prodded to toil as “buffer stock” rather than to receive what you really need: (money, education, healthcare, good food, good housing, a working infrastructure, etc.)

“Free stuff” is only for the rich.

Rodger Malcolm Mitchell
Monetary Sovereignty

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The single most important problems in economics involve the excessive income/wealth/power Gaps between the rich and the rest.

Wide Gaps negatively affect poverty, health and longevity, education, housing, law and crime, war, leadership, ownership, bigotry, supply and demand, taxation, GDP, international relations, scientific advancement, the environment, human motivation and well-being, and virtually every other issue in economics.

Implementation of The Ten Steps To Prosperity can narrow the Gaps:

Ten Steps To Prosperity:
1. ELIMINATE FICA (Ten Reasons to Eliminate FICA )
Although the article lists 10 reasons to eliminate FICA, there are two fundamental reasons:
*FICA is the most regressive tax in American history, widening the Gap by punishing the low and middle-income groups, while leaving the rich untouched, and
*The federal government, being Monetarily Sovereign, neither needs nor uses FICA to support Social Security and Medicare.
2. FEDERALLY FUNDED MEDICARE — PARTS A, B & D, PLUS LONG TERM CARE — FOR EVERYONE (H.R. 676, Medicare for All )
This article addresses the questions:
*Does the economy benefit when the rich can afford better health care than can the rest of Americans?
*Aside from improved health care, what are the other economic effects of “Medicare for everyone?”
*How much would it cost taxpayers?
*Who opposes it?”
3. PROVIDE AN ANNUAL ECONOMIC BONUS TO EVERY MAN, WOMAN AND CHILD IN AMERICA, AND/OR EVERY STATE, A PER CAPITA ECONOMIC BONUS (The JG (Jobs Guarantee) vs the GI (Guaranteed Income) vs the EB) Or institute a reverse income tax.
This article is the fifth in a series about direct financial assistance to Americans:

Why Modern Monetary Theory’s Employer of Last Resort is a bad idea. Sunday, Jan 1 2012
MMT’s Job Guarantee (JG) — “Another crazy, rightwing, Austrian nutjob?” Thursday, Jan 12 2012
Why Modern Monetary Theory’s Jobs Guarantee is like the EU’s euro: A beloved solution to the wrong problem. Tuesday, May 29 2012
“You can’t fire me. I’m on JG” Saturday, Jun 2 2012

Economic growth should include the “bottom” 99.9%, not just the .1%, the only question being, how best to accomplish that. Modern Monetary Theory (MMT) favors giving everyone a job. Monetary Sovereignty (MS) favors giving everyone money. The five articles describe the pros and cons of each approach.
4. FREE EDUCATION (INCLUDING POST-GRAD) FOR EVERYONEFive reasons why we should eliminate school loans
Monetarily non-sovereign State and local governments, despite their limited finances, support grades K-12. That level of education may have been sufficient for a largely agrarian economy, but not for our currently more technical economy that demands greater numbers of highly educated workers.
Because state and local funding is so limited, grades K-12 receive short shrift, especially those schools whose populations come from the lowest economic groups. And college is too costly for most families.
An educated populace benefits a nation, and benefiting the nation is the purpose of the federal government, which has the unlimited ability to pay for K-16 and beyond.
5. SALARY FOR ATTENDING SCHOOL
Even were schooling to be completely free, many young people cannot attend, because they and their families cannot afford to support non-workers. In a foundering boat, everyone needs to bail, and no one can take time off for study.
If a young person’s “job” is to learn and be productive, he/she should be paid to do that job, especially since that job is one of America’s most important.
6. ELIMINATE CORPORATE TAXES
Corporations themselves exist only as legalities. They don’t pay taxes or pay for anything else. They are dollar-transferring machines. They transfer dollars from customers to employees, suppliers, shareholders and the government (the later having no use for those dollars).
Any tax on corporations reduces the amount going to employees, suppliers and shareholders, which diminishes the economy. Ultimately, all corporate taxes come around and reappear as deductions from your personal income.
7. INCREASE THE STANDARD INCOME TAX DEDUCTION, ANNUALLY. (Refer to this.) Federal taxes punish taxpayers and harm the economy. The federal government has no need for those punishing and harmful tax dollars. There are several ways to reduce taxes, and we should evaluate and choose the most progressive approaches.
Cutting FICA and corporate taxes would be a good early step, as both dramatically affect the 99%. Annual increases in the standard income tax deduction, and a reverse income tax also would provide benefits from the bottom up. Both would narrow the Gap.
8. TAX THE VERY RICH (THE “.1%) MORE, WITH HIGHER PROGRESSIVE TAX RATES ON ALL FORMS OF INCOME. (TROPHIC CASCADE)
There was a time when I argued against increasing anyone’s federal taxes. After all, the federal government has no need for tax dollars, and all taxes reduce Gross Domestic Product, thereby negatively affecting the entire economy, including the 99.9%.
But I have come to realize that narrowing the Gap requires trimming the top. It simply would not be possible to provide the 99.9% with enough benefits to narrow the Gap in any meaningful way. Bill Gates reportedly owns $70 billion. To get to that level, he must have been earning $10 billion a year. Pick any acceptable Gap (1000 to 1?), and the lowest paid American would have to receive $10 million a year. Unreasonable.
9. FEDERAL OWNERSHIP OF ALL BANKS (Click The end of private banking and How should America decide “who-gets-money”?)
Banks have created all the dollars that exist. Even dollars created at the direction of the federal government, actually come into being when banks increase the numbers in checking accounts. This gives the banks enormous financial power, and as we all know, power corrupts — especially when multiplied by a profit motive.
Although the federal government also is powerful and corrupted, it does not suffer from a profit motive, the world’s most corrupting influence.
10. INCREASE FEDERAL SPENDING ON THE MYRIAD INITIATIVES THAT BENEFIT AMERICA’S 99.9% (Federal agencies)Browse the agencies. See how many agencies benefit the lower- and middle-income/wealth/ power groups, by adding dollars to the economy and/or by actions more beneficial to the 99.9% than to the .1%.
Save this reference as your primer to current economics. Sadly, much of the material is not being taught in American schools, which is all the more reason for you to use it.

The Ten Steps will grow the economy, and narrow the income/wealth/power Gap between the rich and you.

MONETARY SOVEREIGNTY

38 thoughts on “More proof that MMT’s JG is a bad idea

  1. Free stuff is only for the rich because they do not use their assets like the majority does. Millions of people spending in the real economy are inflationary and force interest rates upwards.

    Rich individuals investing in the stock market is not inflationary.

    The goal is to let individuals trickle down money and credit to other individuals. Not to the masses because that would raise rates.

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    1. Ah yes, the perennial bogeyman of “inflation.”
      Statistically speaking, most of mankind lives in poverty.
      But at least they don’t have “inflation.”
      So let’s envy them.

      Here’s a hint…

      Inflation only happens when the money supply and consumer demand far outstrip the availability of goods and services.

      If the availability of goods and services rises to meet the money supply and consumer demand, then there is no inflation. Instead, there is an economic powerhouse.

      But go ahead and stay in your dream-world if it makes you happy in your misery.

      This is one of the problems with mankind. Most people prefer smugness to prosperity. They prefer to imagine themselves “brilliant” rather than to sincerely think, and sincerely ask questions.

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      1. I was just bantering on the issue. .

        I live in Sweden right now and that is how things work here because the whole economy is in record-debt and since last year we have had negative interest rates to stave off deflation. Our central bank will not, according to a report, raise the rates before year 2019 so we are in a deep mess.

        They have not said it clearly but in my world long-term negative rates imply a goal to have no inflation at all and that means austerity. But credit-expansion are taking place and that is to invest in real estate and the stock market. So the already rich get things for free.

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        1. My comment was garbled for some reason. Here it is again…

          “I live in Sweden right now and that is how things work here because the whole economy is in record-debt and since last year…”

          By“debt,” do you mean private debt or public debt? Private debt means things like car loans, school loans, house loans (mortgages) and so on. Public debt is Swedish government debt.

          If Swedish PRIVATE debt is very high, then you have a problem. Too much private debt can kill an economy.

          However if you mean that Swedish PUBLIC debt, then you have no problem whatsoever, since the Swedish government can create infinite Swedish kronas out of thin air, just as the U.S. government can create infinite dollars out of thin air.

          But wait…doesn’t Sweden need foreign currencies in order to buy imports? Yes, but Sweden’s trade surplus averages 52 billion Swedish kronas per quarter. That’s an average of 1.8 billion euros (USD $2 billion) flowing in from abroad every single month. Therefore anyone who says the Swedish government has financial difficulties is a liar or a fool.

          So when you say the Swedish economy is in record-debt, this is meaningless to me without further clarification.

          By the way, austerity means deficit reduction, not negative inflation. If the Swedish government is imposing austerity on you, then it is entirely gratuitous, and is designed to widen the gap between the rich and the rest.

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          1. @ Steve: If that is true, then the Swedish government is practicing gratuitous austerity in order to widen the gap between the rich and the rest. The government starves people of money in order to force them to seek high interest loans, and thereby become debt slaves. This is a global phenomenon that continues because the masses refuse to see it clearly.

            It’s like having a painful blood-sucking parasite on your back. You weep and wail, blaming everyone around you for your pain, while you refuse to look at the cause, which is the parasite in your back. The parasite is the Big Lie and all who purvey it.

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          2. Hi again! The problem is that Sweden must borrow its deficits on the market. That is because of the EU-constitution that prohibits the central banks to perform such actions.

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  2. “JG assumes there is a shortage of jobs that the federal government can provide.” ~ RMM

    The problem is not a shortage of jobs, but a shortage in aggregate demand in the real economy (as opposed to the financial economy, which has TOO MUCH demand).

    For the USA, aggregate demand can be stimulated by greater deficit spending, as long as the money is not all stolen by the rich.

    Suppose the U.S. government stimulates the economy so much that collective activity creates all kinds of consumer demands that are not met. We would see businesses (and jobs) sprout like weeds as people seize the opportunities. Everything from taco stands to massive construction companies. The possibilities are limitless.

    The JG concept is not practical, not feasible, and not necessary.

    +++++++++++++++++++++++++++++++++++++++++++++++++++++++

    “’Free stuff’ is only for the rich.” ~ RMM

    Actually “free stuff” is for me and for everyone above me on the ladder of wealth and power. Whatever government benefit I receive is what I deserve, and what I have “earned.”

    Meanwhile whatever government benefit is received by people below me on the ladder of wealth and power is “free stuff.”

    Therefore, when I condemn people for wanting “free stuff,” I refer to people who I imagine are inferior me.

    I am a “maker.” Everyone below me is a “taker” who wants “free stuff” (like I get).

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  3. It’s only proof if you know what the JG actually is and how it works.

    May I suggest you read this economic paper produced at the latest post Kensyian international conference.

    “What is Full Employment — And Why the Definition Matters” presented by Philip Harvey at the 2016 Post Keynesian Conference.

    Then come back and do a critique.

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    1. Bob, rather than sending me to a 20-page document devoted to the definition of “full employment,” and how it has evolved over the past 80 years, why not simply tell me what sentences in the above post with which you disagree and why.

      Thankfully, you didn’t send me to a textbook, but even 20 pages of academese are too much, especially since the post wasn’t quibbling about the title definition, or even whether full employment is beneficial, but rather whether JG was a feasible solution to anything.

      Please have mercy, and don’t ask an old man to read a document where just the first note reads (all in one paragraph):

      1 See, e.g., Bernstein and Baker (2013) (describing “ 4 percent — the average unemployment rate for 2000, the last time we were at full employment ” as “ a reasonable target, one worth shooting for ”); Bivens (2014) (describing the U.S. economy’s performance in 2000 as an “approximation of genuinely full employment); Boushey, Mishel and Bernstein (2002) (noting that “The full -employment economy of the late 1990s made a large and positive difference in the growth of real income for low- and middle- income families”); Krugman (2013) (commenting that that “[t] he US economy in 2000 had really, really full employment — it was an era when labor was so scarce that McDonald’s was actively trying to recruit senior citizens, when the joke was that you could get a job as long as your breath would fog a mirror, that is, as long as you were actually alive ”); Kuttner (2012) (noting that “In the late 1990s, when we had full employment, in one three- year period Social Security’s Year of Reckoning was set back by eight years, from 2029 to 2037); Madrick (1999) (noting that “little has been better for the country than a dose of full employment”); Mishel (2015) (stating that “ we should strive to reach genuine full empl oyment” described as “roughly 4 percent unemployment” ); Palley (2007) (describing the distinguishing features of full employment as “wages systematically rising with productivity” as in the “late 1970s, the late 1980s, and the late 1990s, when wages started rising with productivity at the tail end of booms”); Pollin (2012) (GET QUOTE); Stiglitz (2002) (commenting when asked to describe the benefits of trade that “ in the United States and in advanced industrial countries, we often say that trade is good, but imports are bad. We like to export, but we don’t like to import. Why? Because we recognize that sometimes imports lead to job destruction. We recognize that it is the responsibility, though, of those involved in macromanagement, the Central Bank — the Fed in the United States — to ensure the economy remains close to full employment. But even when we had unemployment of 3.9 percent, 4 percent, we worried. We worried about the unemployment that a flood of imports could create, even though these people could get jobs eventually elsewhere in the economy. ”).

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      1. What’s the point to refuse to learn the subject with the excuse that you haven’t got time to read 20 pages.

        Yet, you go to Wikipedia, cherry pick certain words and then use broad strokes like a paint brush to try and make a case against the JG.

        Here’s very few words that critique what you’ve posted.

        View at Medium.com

        View at Medium.com

        View at Medium.com

        Will take you less time to read all 3 than it did to read Wikipedia.

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        1. Actually, by asking for your words.

          When you can point to where the post was in error, and in your own words, why, I’ll discuss that with you.

          I receive way too many notes from people merely sending me a link to prove I am wrong, and expecting me to do their homework for them.

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          1. There’s no point because of your hang up with Federal jobs. It is clear you think they are nothing compared with private sector jobs.

            Even though the whole ethos of the private sector is to become more effecient and thus in the end destroy jobs.

            You can’t seem to grasp that there a millions of people out there who would happily take either, rather than live on a meagre welfare check.

            You go on and on about “is it the type of job you want.” When quite cleary 90% of the worlds population are in jobs they don’t want. As many people still don’t know what they want to do even when they reach retirement age.

            Given the choice, how many people would rather help OAP and war veterans get dressed in the morning and help feed them than work on wall street?

            Your critique does not even come close to answering that question.

            By offering a living wage job with all the benefits of holiday pay and a pension etc.etc this automatically challenges the private sector to up its game and improve or die. As real competition enters the market.

            Where people who had no chance of finding a job will get the skills needed to how did you put it ?

            Get the jobs ” that don’t want you.” only to be out of work again as the private sector embraces technology becomes more effecient and throws them on the scrap heap again.

            For 40 years now there has been 2 choices…

            a) Keep a large group of people unemployed ready for the private sector

            b) Keep everyone who can work employed ready for the private sector.

            We’ve picked option a) which has been a complete disaster that has driven down wages and productivity.

            There’s millions of people out there that would love £375 a week rather than £75 a week. Yet, you seem to think they won’t take it because they might have to clean up some beach somewhere rather than work at Macdonalds.

            Macdonalds would replace them in a second as you now order your food via a terminal. The private sector destroys jobs in the end and always has as it becomes more effecient.

            The reason you can’t see the JG for what it is, jobs that people will take rather than be on £75 a week and jobs not in the private sector because they get all the entitlements that human beings should get. That min wage jobs in the private sector won’t give them.

            Is very clear. You think private sector jobs good, federal jobs bad. Even though in the future federal jobs is all anyone will be able to get.

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    1. Please do not send me to a 3,200-word article and think you have made a point. I neither have the time nor the energy to read that much more than I already read.

      If you would like to summarize the reason(s) you “prefer his argument,” or why I am “missing the point,” feel free to do so.

      And when you say, “the private sector is not hiring,” you have missed the entire point of the post.

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      1. I am travelling now for several days, so I’ll have to reply later. Anyway since the JG is so anathema to you it’s well worth you taking the time to read it. Otherwise it sounds like a cop out.

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        1. I see. You’re travelling, but no cop out.

          There literally are thousands of articles about JG, and I’ll wager I have read more of them than you have.

          One of my many criticisms of JG is that every writer seems to have a different version:
          -Minimum wage
          -Below minimum wage
          -Above minimum wage
          -Federal jobs
          -Private sector jobs
          -A big bureaucracy needed
          -Only one person needed

          The list goes on and on, and people expect me to go to some paper or book, read it and then argue with it?

          And JG is only one of dozens, maybe hundreds, of subjects I’ve written about. There are a thousand posts on this blog.

          Links are fine if they support facts or an opinion, but not as a substitute for thought.

          I’ve done my reading and my thinking and I’ve written the articles. I didn’t merely post a link and say, “Argue with this.”.

          The cop outs are the ones who send me all these damn links and expect me to read them, to summarize them, to critique them and to provide an explanation, so they don’t have to do their own homework.

          If you have something to say, put up or shut up — but only when you’re finished traveling, of course.

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  4. Hey Rodger. I think you miss the point that the MMT JG is to mop up the residual unemployment, which mostly affects unskilled workers, after automatic stabilization. It is key piece of MMT policy formulation but it plays a minor part over since it addresses a residual. A good policy would ensure that this residual is generally limited and the other matters that Roger mentions are addressed effectively and efficiently.

    The key point is that there is always some unemployment in a capitalist economy and it is addressed either through a buffer stock of unemployed (ten dogs and only nine bones) or a buffer stock of employed (ten dogs and ten bones).

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    1. You have just hit on one of my many complaints about JG. Critiquing JG is like trying to pick up Jello. It keeps changing shape and slipping through my fingers.

      So now JG has become this little thing, this “mop up of residual” unemployment. It’s a “key piece,” but it plays a “minor part.”

      As I said earlier, everyone has a different JG, so when I critique one part, I am sent a memo or a link that defines JG in yet a different way.

      Meanwhile, it’s such a minor part, the center of MMT is at UMKC, where Randy Wray runs the Center for Full Employment and Price Stability, and there you will find JG is considered (by Randy) so important that when I criticized it, he once wrote that I am another crazy rightwing nutjob . . . (the rest of his rant is not for public consumption.)

      Is JG a key piece or a minor part? Minumum wage? Or more? Or less? Private employment or public employment?

      Does the government plan to compete with private employment agencies? Will JG people merely steal jobs from other people?

      What are the geographic issues that will be solved? I live in a northern suburb of Chicago. How far am I required to travel to have a minimum wage job?

      No, wait. I live in a small farm town in South Dakota. Where and what will my job be? Who will find it for me?

      Is it a real job or just make-work? Who will be my supervisor on this job? Can I be fired? By whom? If I am fired, what happens, next?

      The list goes on and on and on — and all for a “mop up” action.

      And, in truth, the answers to those questions are irrelevant to the fact that JG addresses a fiction: That there are not enough jobs.

      The reality: There are not enough good jobs, i.e. jobs people want and/or jobs that want people.

      That is the whole point of the article.

      Tell me. If you were unemployed would you accept a minimum wage job? If your honest answer is “Yes,” there are plenty out there. You don’t need JG to find you a minimum wage job. Just look in the newspaper or online.

      Finally, rather than spending time and effort to create a bureaucratic system to “mop up residuals,” how about instituting the Ten Steps to Prosperity. The very first step is “Eliminate FICA,” which will do far more for meaningful employment than JG — and no bureaucracy required.

      JG just diverts attention from real economic solutions.

      I have owned and run businesses for 60 years and I can tell you this: JG is the classic example of the mountain laboring and creating a mouse.

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    2. The best way to create more jobs is to increase deficit spending, while making sure that rich people don’t steal all the added money.

      Until the JG cultists address this assertion, I am not interested in anything they have to say. Their refusal to address this assertion proves that they are sophists who furiously argue about the color of the emperor’s new clothes.

      Like

      1. What do you think the JG will do.

        Decrease deficit spending ?

        The rich people won’t steal the added money. They’ll earn it buy offering goods and services that those on the JG want to buy. Now they have £375 a week to spend instead of £75.

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        1. Instead of a JG, why not have Universal Social Security, i.e. a Basic Guaranteed Income?

          Or do you believe that everyone in the lower classes must toil, and that only rich people should get paid for not working?

          If you had a Basic Guaranteed Income, you would not be so desperate that you had to take the first awful job you found. Employers would have to create decent jobs in order to entice you to work with them (as opposed to work FOR them).

          The way I see it, JG cultists chase a nebulous phantom with all their might. They remind me of people who are obsessed with “positive money,” a notion which is based on the false belief that all money is created by banks as loans. Nothing can budge them from this delusion, just as nothing can liberate JG enthusiasts from their fixation.

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        2. And by the way, without some changes, the rich WILL steal any added money.

          Because the financial economy has become a deadly parasite on the real economy, all money added to the real economy flows upward at an ever-accelerating rate. Every single dollar sooner or later gravitates to the lenders and landlords and patent holders and the corporate lords. Every dollar is eventually sucked up by the rich owners of capital, who become trillionaires while we remain slaves and serfs (i.e. renters).

          Therefore, even with a JG (and probably even with universal social security) prices would rise to match the enhanced circulation of dollars, so the upward flow could continue.

          Of course, this is all academic. The financial economy is a cancer that has hollowed out the USA (sucked it dry) and will cause the USA to eventually collapse from internal rot.

          It happened to the Roman Empire. It will happen to us.

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          1. Here’s one big hole for a start that you won’t be able to defend no matter how hard you try. That is the problem of idleness.

            There are those that believe the world owes them a living, and that they have a right to resources others have provided and created without giving anything in return.

            Do you believe the surfers, individuals doing precisely what they want without regard for anybody else, should be paid? Either you believe they have the right to extract output from others without providing any useful output in return, or you believe they should produce useful output first and exchange it (via the medium of money) for output from others.

            The Surfers are those who don’t have a job and just want to surf. They want to be ‘free -man’. So they don’t have a living income, and they don’t want to do anything other than what they want.

            The original argument is that they should receive a living income, regardless of what they do. But that means somebody has to produce something real and give it to them for nothing real in return. Which simply isn’t fair.

            This would be destroyed at the polls just like in Switzerland. As most of the population, don’t see why we should provide output to people who are giving us nothing real in return – particularly when they clearly could produce output for others if they were less selfish and more community focussed.

            Basic income proposals are just tax credits that trigger taxation loss aversion in the entire population rather than just a small subset. All while crippling the spend side auto stabilisers.

            So you have an individual there who has received food and shelter created by somebody else, but failed to provide anything into the social pool in return. They have produced something and self-consumed – getting a double bite of the real output pie. And that simply isn’t fair to others.

            This is the key point. Whether you as an individual are doing enough to fulfil your obligation to the social pool is a matter *judged by others*. Those others who use up their time to produce your food and shelter.

            And that’s the bit that basic income supporters can’t stand. The idea that what they do is judged by a jury of their peers and the jury decides if it is sufficient to deserve food and shelter or not.

            Look at child benefits for example which are no longer universal and have never been at anything more than 3% of median earnings. It is a pittance. If you can’t get a ‘basic income’ in place for children – who are prevented from working in most nations – then you have absolutely no chance with fit adults.

            So what do you want?

            Millions of people earning £75 a week putting nothing back into the resource pool while they take the resources themselves. ?

            Or

            Millions of people on £375 a week helping all of us by building up the resource pool and taking their fair share.?

            I know what voters would vote for.

            The JG fills that huge gap.

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  5. Bob,

    You said, “There are those that believe the world owes them a living, and that they have a right to resources others have provided and created without giving anything in return.”

    Are you talking about the idle rich, those members of the “Lucky Sperm Club,” who inherited millions from daddy, like for instance, our next President, whose main contribution to the economy was to stiff thousands of working people out of their wages and hundreds of investors out of their investments?

    Is that who you mean?

    (I alway wonder why people are so reluctant to see poor people idle while receiving a couple thousand dollars in government benefits, but have no qualms about rich people being idle while receiving hundreds of millions in government benefits. Why do you suppose that is?)

    Anyway, if you have been reading the posts, you would see that JG may be well-intentioned as a general concept, but when you get to the details, you find that the program is unworkable.

    Or you can answer these questions:

    Is JG minimum wage? Or more? Or less?

    Private employment or public employment?

    Does the government plan to compete with private industry?

    Does the government plan to compete with private employment agencies?

    Will JG people merely steal jobs from other people or will additional jobs be created? If so, how?

    Describe the JG national bureaucracy.

    What are the geographic issues that will be solved? I live in a northern suburb of Chicago. How far am I required to travel to intgerview for, and be hired for, a minimum wage job?

    No, wait. I live in a small farm town in South Dakota. Where and what will my job be? Who will find this job for me?

    Is it a real job or just make-work? Who will be my supervisor on this job? Can I be fired? By whom?

    If I am fired, what happens, next?

    My proposal is the Ten Steps to Prosperity. What’s yours?

    Finally, your comments indicate you believe taxpayers pay for federal spending. In a Monetarily Sovereign government, taxpayers pay for nothing.

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  6. Hello, JG adherents. Here’s yet another story you can ignore:

    We’re hiring: U.S. job openings top 6 million for fourth month in a row Published: Nov 7, 2017 11:22 a.m. ET

    The numbers: The number of job openings in the U.S. rose slightly in September to 6.09 million, keeping them near a record high. Job openings have topped 6 million for four months in a row for the first time ever.

    Yet even with all the hiring over the past several years, wages still aren’t growing all that fast. Hourly pay rose 2.4% in the 12 months ended in October.

    Companies are scraping the bottom of the barrel in search of qualified workers and they are reluctant to offer significantly higher pay, especially since productivity is so low.

    Now please tell me how minimum-wage JG will help grow our economy or improve the lot of the working people.

    Let me repeat, if I haven’t made myself clear: JOBS ARE NOT THE PROBLEM. THE PROBLEM IS THE GAP BETWEEN THE RICH AND THE REST.

    JG won’t solve anything. The Ten Steps will.

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    1. I believe you are on a hiding to nothing, Rodger over the choice. We need IMO, both. As long as jobs can be found governments can provide. After all governments are totally responsible for unemployment. So it’s up to them to get the full employment role working. Then, because no scheme is watertight a BI can fill in the gaps. There will always be people who cannot work and those need an income. Those who can work will be employed, even if the jobs are not all suitable for everyone in the location wherever it is. No solution will be perfect.

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      1. A doctor told a cancer patient to eat chicken soup. The patient said, “Chicken soup. That won’t help me.” The doctor replied, “Maybe, maybe not. But it couldn’t hurt.”

        You have just relegated JG to the “chicken soup” category. Anyway, governments are not “totally responsible for unemployment” any more than they are totally responsible for employment. In Russia, maybe. Not in the U.S.

        There is a “law of unintended consequences” that JG would bring into play. Think about the potential consequences of the government employing everyone who wants a job.

        .

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        1. There’s a lot of talk, maybe even evidence, that we are geared to work for a living. The “protestant ethic” syndrome. People get satisfaction from having a job and that leads to happier people and all that. However jobs HAVE to pay living wages and a JG has to pay a living wage, so the public sector will have also to pay a living wage.
          Roosevelt said if you can’t pay a living wage you don’t deserve to be in business. Here in Aus governments pay well and the private sector has to keep up, which can be a problem, so it is nuanced. Is that an unintended consequence? I would hope not.

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          1. I’m retired (from any paying job), and I couldn’t be happier about it. I know I’m happier than the people working in the minimum pay or dangerous or hard physical effort jobs, or jobs where the boss is mean, or no-hope-for-advancement jobs, or lonely or dealing-with-bad-people jobs or long commute jobs or . . . oops, have I just mentioned virtually all the JG jobs — those jobs that are supposed to provide “satisfaction”?

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          2. Life can be a bummer. You take your chances and hope for a decent boss.
            But if they know the workers are guaranteed their wages by the government the pressure relief might make them into “good” bosses. What is a good job is not ours to prove. Each can choose or not what to do. No one is forcing you to be employed but no one is forcing you to be unemployed which happens today.
            When I said the government is responsible for unemployment, that is a part of the monetary system set up. Hunter gathers cannot be “unemployed” but with a monetary system comes unemployment. Basic.

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          3. Bottom line:

            JG is based on the Puritan belief that people should labor, and the government should give them that labor.

            The Ten Steps are based on the belief that people should enjoy good lives, and purpose of government is to help them enjoy good lives.

            They two beliefs are mutually exclusive. (Yes, they are.) Take your pick.

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          4. it begs the question that work is required to make available the resources needed to live a good life. Someone has to serve us our meals, our coffees. Someone has to grow the crops, someone has to build the infrastructure.
            Your idea only works with slavery. people we regard as lesser, work slaves, to do the work needed to keep us fed and the lights on. Your solution doesn’t make sense.

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          5. Work is required, but that work might be done by 1,000 people, or by 10 people and 10 machines or by zero people and a roomba-type of automatic sowing and reaping machine. MMT is stuck in the past, has not come to the present, and is completely clueless about the future.

            MMT seems to think we need pony-express riders to deliver the mail, or letter carriers to carry the mail. But now we have Email and texts.

            The goal of economics is not to make people work; the goal is to help people not have to work. Kindly explain that to MMT.

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          6. Sorry you are dreaming of some future nirvana. It’s OK to dream but since our economy peaked before 1970 and now we rely on credit for growth its a route to ruin. The economy is not a monetary system it is a surplus energy system. The ECoE -energy cost of energy -is rising rapidly. So the leverage we used to have to multiply our output exponentially is failing now. This explains the asset inflation rush to keep growth going. The future will be work, not leisure. And that is only if we can manage the nation to cope, not a sure bet.

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  7. Not a bad essay … :). You wrote ” income/wealth/power Gaps between the rich and the rest ” and then you remained focused on INCOME, tax income.
    If wealth and power important for you, then you should tax it, and give it away as well… for the new born.. Only this way the next generations can grow into a political system that is their own, and not controlled by the past, the path dependency of the parents….

    Like

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