Strange bedfellows: the contradictory ideology of the Australian job guarantee movement
John Quiggin recently wrote a piece about how MMT is not really a theory. This post is about how the Job Guarantee is not really a coherent political programme but rather is movement. The definition of the Job Guarantee can be stretched to appeal to pretty much anyone. Indeed, this seems to be the point of the Job Guarantee Movement — uniting different groups of supporters behind a proposal that is so vague any disagreements can be avoided.
Two prominent JG advocates in Australia are Bill Mitchell and Warwick Smith. Their concepts of the job guarantee are very different but this is hard to recognise due to Bill Mitchells presentation of his views being quite misleading.
Warwick Smith is essentially a utopian environmentalist who believes in localism and direct democracy. He wants the job guarantee to be administered on a local level empowering community’s with economic resources. His idea for local currencies directly contradicts MMT. MMT is focused on the privileges of the currency issuer and MMT academics are rightly dismissive of the utility of third-party currencies. The local currency idea shows how the JG is more of a loose movement than a coherent platform and also underlines Warwick’s perspective of greenie localism.
It’s easy to see how the effects of Warwick’s ideas would not be positive for the unemployed especially if you have experience living in a conservative community. The community I grew up in (the South East of SA), had one of the highest no votes for gay marriage. It is full of conservative Christians who would be very keen to volunteer substantial time and effort administering a local job guarantee program if they got the chance. They also view unemployment as a result of poor moral fibre and have very little real empathy for the unemployed. Negative stereotyping of ‘dole bludgers’ is the consensus view in communities like this.
Local communities across Australia are incredibly different. Some have low unemployment and a lot of educated people who have free time to volunteer. Others have high unemployment and much lower social or educational capital. Public services that are run and resourced at a local level tend to more unequal while centralisation leads to more uniform standards for everyone. The implications of Warwick’s localism are not progressive at all.
While Bill Mitchel presents the job guarantee as his key proposal if you look at the detail of how his program is meant to work in fact his is really a big government agenda of a much-expanded public service with much more economic planning capacity. In a way this is a compliment to Bill, it shows that unlike Warwick he understands how government and the economy work.
Mitchel says explicitly that the JG he envisages would be a niche program for a small number of workers. Sensibly he points out that government has been hollowed out and needs to regain its administrative capacity to provide public goods. An expanded public sector not the job guarantee program would provide economic stimulus and employment (in Bill’s conception). It really does raise the question of why advocate for the JG at all in the context of a discussion about macroeconomics? Bill Mitchel writes movingly about how some people need individualised support to work using those who suffer from seizures as an example. But most on the left would happily support this simply as a wellbeing initiative. In reality Mitchells macroeconomics is not substantively different to Keynesianism. If you think I simply don’t understand MMT than consider this is basically John Quiggin’s view also.
Proposing a Job Guarantee elevates Bill to policy entrepreneur with a unique niche. It also allows him to reach across the aisle to the conservative workfare crowd. Progressive MMT advocates tend to interpret MMT’s support within the conservatives and the business community as evidence of the success of their political programme. In reality Mitchel is unconcerned how the Job Guarantee can be used to create support for work for the dole two point zero and even shares many parts of the workfare belief system.
JG advocates views may contradict each other but coherence is hardly the point of the Job Guarantee movement. The whole thing is a bandwagon that progresses by presenting a united front and at the same time trying to appeal to everyone. Progressives are attracted because they see a unique educational tool that can overcome the household budgeting myth. This feature has probably also motivated media figures like Emma Alberici and Alan Kohler to advocate for MMT. And a sharper presentation of ‘Deficits are good’ is beneficial, but Alfred Learner achieved this with his functional finance system that was not considered at odds with Keynes.
The success of the movement is due to the bandwagon effect of disparate groups joining the MMT bandwagon without interrogating key political questions about worker power. Minsky, Wray Mossler and Mitchel have all said that the Job Guarantee will supress inflation by keeping wages down. Anyone in the left or Union movement needs to address this before promoting MMT further. MMT is also still an elite discourse popular with trendy progressives and people with an interest in finance. Many aspects of the Job Guarantee don’t pass the pub or common-sense test. Like organising essential services on a countercyclical basis or using untrained labour to do complicated work like childcare or environmental maintenance. But if you ask members of the public if the government should provide jobs for everyone of course they will say yes.
In order to have a real full employment policy the key ideological debate the left needs to win is that contrary to current orthodoxy, the public sector can in fact provide goods and services effectively. In areas such as human services it is more efficient in terms of average wellbeing than the private sector. This is a point that Mitchell wants to downplay and Warwick doesn’t fully understand. But centre left thinkers like John Quiggin or Richard Dennis have been hammering away at for decades. At the very least the job guarantee movement needs to work through its own inconsistencies.