The notion of a “job guarantee” in America, once appropriately seen as a fringe idea lacking credibility, is growing in popularity among the Democratic Party.
Last week, the Washington Post reported that Democratic socialist Sen. Bernie Sanders of Vermont is crafting a proposal in which the federal government would guarantee a job that pays $15 an hour plus health insurance to any American “who wants or needs one.”
The plan, which Sanders hasn’t figured out how to fund yet, would call for the creation of hundreds of government projects throughout the country in fields ranging from infrastructure to caregiving in order to be able to guarantee a job to all American workers.
Two potential 2020 presidential candidates, Sen. Kirsten Gillibrand, D-New York, and Sen. Cory Booker, D-New Jersey, have lent their support to the idea, with the latter proposing a pilot program in 15 localities to see if the scheme can work.
While we’re sure Sanders, Gillibrand and Booker mean well in backing such an idea, as with other top-down government efforts to resolve complicated problems through government action, including rent control and minimum-wage increases, the job guarantee idea not only perverts the proper role of government, but is likely to yield a litany of unintended consequences.
Fundamentally, there’s nothing in the United States Constitution to indicate the founders believed that the proper role of the federal government was to provide jobs at $15 an hour plus benefits including health insurance to anyone who wanted one.
As inconvenient as the Constitution is to those whose primary desire is the dramatic expansion of federal powers, the document was written to constrain the powers of the federal government, not to facilitate the sort of government expansion desired by Sanders, Gillibrand and Booker.
Even if someone dismisses the value of limited government, Sanders’ plan not only currently lacks a funding plan or even a cost estimate, but it comes at a time when the federal government is already on track to spend $1 trillion or more than it takes in nearly every year over the next decade.
And even for those who ignore basic math, the massive federal deficit and the likely skyrocketing cost of the proposal, Sanders’ plan is likely to create massive distortions in the job market.
According to Census data, more than 70 million Americans earned less than $32,500 in 2016, including over 40 million who worked full-time. Sanders’ plan would guarantee jobs with salaries of $31,200. Practically, this is likely to undermine the private sector’s ability to hire and retain workers, while massively swelling the portion of the labor force on the federal payroll. Inflation would likely follow, as would job losses in the private sector as the private sector grappled with higher labor costs.
Further, as with any large expenditure by government, there are likely to be greater incidents of cronyism and politically motivated allocations of government projects of variable value beyond providing jobs with benefits.
This sort of central planning is inconsistent with what America is and what it should be.
“From each according to his ability, to each according to his need,” might appeal to the economically naive, but it has no place in a free society. As such, it should remain only in the imaginations of aspiring central planners far removed from the corridors of power.
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