Hey, there, displaced factory worker! Looking for work? Bernie Sanders has a Job for you. How would you like to make $15 an hour cleaning up park trails for your municipal government? What, you say that sounds like something an employee of the city's parks department already does, or is supposed to do? What about repainting school playgrounds? Oh, the unionized school district employees gave you a stern look? Um. Hang on, he'll get back to you.
Sanders has announced a new plan to make sure everybody who is unemployed gets a job. His plan is just to invent a bunch of new government jobs and pay $15 an hour with benefits! Ta-Da! Problem solved.
No, really. That's kind of the plan. According to The Washington Post, which reported the proposal yesterday, Sanders' office doesn't have a cost estimate or any idea how it will be funded yet. Post policy writer Jeff Stein turned to a study by a pack of "left-leaning economists" for the Levy Economics Institute of Bard College, who seem to think only good things will happen with the creation of millions of government-funded jobs, and hardly any bad things. Klein notes:
Job guarantee advocates say their plan would drive up wages by significantly increasing competition for workers, ensuring that corporations have to offer more generous salaries and benefits if they want to keep their employees from working for the government.
Of course, they might have to lay off some employees in order to pay for these increased wages and benefits. Or they could increase the speed by which they're automating to get rid of jobs to save money. But that's okay! There's going to be all these government jobs to replace them! Paid for with tax revenue from…from…wait. If everybody goes to work for the government, where will the revenue come from? I'm sure they'll figure out something.
So what sort of government work is there that would provide $15 an hour plus benefits to millions of unemployed Americans? The Levy Economics Institute study provides several examples of how these guaranteed jobs might play out at the local level. Here's one:
A local artist collective employs painters, actors, musicians, and stage hands to run year-round productions for the community. They organize school outreach programs, run summer camps, and offer free art, music, and literacy classes for disadvantaged/special needs youths. They collaborate with local schools in offering art enrichment programs.
You might think to yourself, "These seem like the kinds of jobs that certain people with certain types of interests have been begging for the government to fund for years." Indeed, much of the examples in the Levy study seem like descriptions of programs that certain types of local government-connected people with very particular ideas would like to see the government doing. Their plan leans heavily on the assumption that all these unemployed or underemployed people would happily do the grunt work that aligns with left-leaning environmental and public policy project goals. The report openly uses the Works Progress Administration of the New Deal as a model to support it.
Perhaps you're wondering, "Is there even any widespread demand for these kinds of jobs that aren't already being filled?" That may sound like some sort of reference to marketplace capitalism! But that's not the point! The point is jobs. The study declares:
It separates the offer of employment from the profitability of employment. Projects are created to serve community needs, rather than prioritizing whether the projects are deemed profitable in the narrow sense.
But how does one determine what a community needs while ignoring market responses? Why should taxpayers fund community plays if they have no interest in actually sitting through them? This report makes it very clear that the task falls to local public institutions and job centers, not market demands. That necessarily means it will be driven, much like this report is, by the interests of the people who are in charge of the programs or have the most influence over the programs. That these programs could end up as a corrupt breeding ground for government cronyism and nepotism in who gets assigned for which jobs is utterly absent from the study.
For that matter, can people be fired from these "guaranteed" jobs? I mean, given how hard it is to fire bad teachers or dangerous cops, it's worth wondering whether people who get these jobs will continue to get paid if they fail to show up for their job trimming the hedges of their community skate park or surveying people about their food insecurities. (According to the Post, Sanders' plan calls for something sinisterly called the Division of Progress Investigation to handle discipline.) The study treats these jobs as though they can be created and eliminated as the economy demands, but trends in government worker employment scream "More! More! More!" There will be tremendous pressure and inertia to keep these jobs going once they're filled.
The study estimates that this program could attract as many as 15 million participants. According to the U.S. Bureau of Labor statistics, 2017 ended with 22.3 million people employed in government sector jobs—that's federal, state, and local all combined. This program would result in about a 50 percent increase in people who work for the government.
Right now cities and states are flirting with (and sometimes embracing) bankruptcy as government employee wage and benefit commitments destroy their budgets. Harvey, a suburb of Chicago, just laid off 18 firefighters and 13 police officers as a result of the state withholding money from the city to pay for its police pension fund. The suburb is $7 million delinquent in payments.
If governments are unable to absorb the financial costs of paying its current employees, how on earth is it going to pay for such a dramatic increase in new government employees? It would have to dramatically increase taxes on the private sector, which would cause them to shed jobs, which would cause those laid off employees to demand one of these "guaranteed" jobs. And so there will be pressure for this program to expand even further, even as governments see a decline in tax revenue.
It's not a surprise to see Sanders embrace such an incomprehensible, economically illiterate employment program and declining to consider the consequences. When he ran for president, he repeatedly called for free college educations based on programs from other countries, without seeming to have any grasp of how those education systems work. He has so many bad economic ideas that Reason Editor at Large Matt Welch put together a top-10 list of them back in May 2016. Check them out here.
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