Buried in discouraging unemployment numbers recently released was proof that a straightforward way to end unemployment (and not just reduce it) actually exists.
The private sector of the economy created 83,000 additional jobs in June, but total employment fell because 225,000 temporary census workers were let go.
The census workers had real jobs and these were additional jobs that reduced unemployment. They demonstrate that there are two possible ways to reduce unemployment, not just one.
The government has been trying to reduce unemployment by “stimulating” the economy so that private employers would become willing and able to put more people to work. But it is unclear how well this strategy has worked.
The alternative is for government itself to hire the unemployed and put them to doing useful things. This is what the Census Bureau did, and back during the Great Depression this is what the WPA and other government programs did. In
President Franklin D. Roosevelt felt that it was better to pay people to do something than to pay them to do nothing. They could be doing something constructive, and there was more dignity in working than in just receiving a dole.
There is plenty of work that needs doing. It would seem, therefore, that we shouldn’t be repeatedly extending eligibility for unemployment compensation payments. Instead, the government should offer to hire everyone who is willing and able to work but cannot find another job and pay them the federal minimum wage of $7.25 per hour for 40 hours a week.
People could receive unemployment compensation while their eligibility remains, and then take one of the new jobs, or they could forgo unemployment compensation and go directly into a job.
As soon as they can find private sector jobs that pay better, of course these people will do so. But in the meantime even minimum wage employment will be a lot better than nothing.
If all 14.6 million currently unemployed took such government jobs, and if on top of minimum wages the government paid $400 per month towards medical insurance for each employee, it would cost about $24 billion per month, or $289 billion per year, not including administrative costs.
We have certainly been paying at least this much for the current “stimulus” programs
whose results are debatable and which at best have only slightly reduced unemployment rather than eliminating it.
If we have a pool we want to fill with water, does it make more sense to turn on a faucet and fill it up, or to hire pilots to seed the clouds and try to make it rain? Cloud-seeding, like our current approach to dealing with unemployment, would be discredited “trickle down” theory with a vengeance!
Why not go with a straightforward approach whose costs and results are measurable, which has worked in the past, and which could put a total end to unemployment rather than just reducing it?
This article appeared on CommonDreams on July 6, 2010.