Could Make-Work Work?

Aside from hiring 400,000 workers to carry out the federal census, which is a happy coincidence of timing more than make-work, the Obama administration has not initiated any national employment programs like Franklin Roosevelt’s administration did in the New Deal. No Conservation Corps to plant trees, maintain the national parks, or, gulp, help the Coast Guard cleanup oil spills.
 
Economists have said that federal assistance to states and local governments is the best way to stimulate nationwide job creation. Incentives for small businesses, which create the most new jobs, are also effective. The idea is to stimulate the economy so that real growth, not make-work, can pull us out of the recession.
 
I do not dispute that approach. However, many states with sky-high budget deficits have used the federal money to maintain jobs and services rather than to create new ones. That policy has led to disparities. For instance, workers who lost their jobs and applied for unemployment months ago have received protracted federal extensions on their benefits, well beyond the norm. But young workers, yet to find employment, have been left to fend for themselves.
 
What if the federal government could stimulate particular kinds of job creation, tailored both to the nation’s current needs and its long-term goals? That might help to fix a gaping hole in our capitalist system. It is that capitalism financially rewards new ideas, many of which are of questionable merit (a faster drip coffee filter or another talk show), while huge national problems go unresolved: a national shortage of nurses or legal agricultural workers, to name two. The law of supply and demand is supposed to solve such problems, but it hasn’t. That’s where good government ought to step in, especially in hard times.
 
Consider four goals where government incentives could help:

• Improved health care: Given the national shortage of nurses, physicians in general practice and gerontologists, the government should offer incentives to entice students to take up these professions--like lower interest rates on their student loans or debt forgiveness in exchange for specified service upon graduation. Incentives could also encourage practicing nurses to study gerontology as a specialty or apply to medical school. Other important jobs in health care could be professionalized with the help of incentives: standardized training for home health aids, midwives, administrators of small clinics and rest homes. Larger grants could be made in regions where the need is greatest. The government would not hire these workers, but would ensure that there are enough of them to promote a healthy, aging population.

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Higher proficiency in English: Too many Americans lack the English-language skills they need to get a good job, participate in the national community, and execute the requirements of good citizenship. The government could provide incentives to solve this problem. Unemployed college graduates, experienced teachers and others with the skills—like those in Americorps and Teach for America—could tutor children, teens and adults in English. I’m envisioning a national campaign the goal of which is to increase significantly the English fluency of all Americans, regardless of age, national origin or income. Low-cost or free lessons could also be offered in churches, shopping malls, prisons and other venues.

Energy-Efficient offices and homes: Upgrading has been talked about for months and may yet become part of an energy bill, if one makes its way onto the Congressional agenda soon. Why not offer incentives to those who train workers in making these upgrades and to all who hire them? Incentives could go to states, local governments, small businesses (including non-profits) and others. Special incentives could go to programs that focus on training and employing youths in inner cities and in rural areas where jobs are scarce. Small performance bonuses for individuals who complete the training program and work for one or two years could also be part of the incentive package. Why reserve bonuses to Wall Street?

Sound infrastructure: Stimulus monies have already been granted to states for major projects like highways, bridges, high-speed trains and the like. But these massive projects take time to roll out. Eventually they will create jobs. I mention this only to remind readers that the federal government has done some long-term thinking in this respect and deserves credit for it. The jobs will come.

Karen Sue Smith

 

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Tom Maher
7 years 6 months ago
Oh please. Economic history of the past eighty years since the New Deal shows that govenement directed make-work programs do not work. The extensive WPA in the 1930s failed to improve the econopmy after many years of trying.

The key problem with WPA make-work type programs are they are not directed toward real economic need. These programs exists solely to create jobs in the mistaken belief that unproductive jobs are as good as productive jobs.

India development plans during the 1960s and 1970s followed closely the Soviet socialist model as did many other countries. They would greatly overstaff government projects. Wasted time and money were of no concern. The result was no economic progress. Thing were not getting done and it cost a fortune to do very little. The make-work process is hughly wasteful of scarce tax resources. When they dtopped this they made great economic strides and had something to show for the effort.

The other famous trick with government programs is they become boondoggles - they are self-perpetuating, existing for their own sake. They take decades longer than needed and run five or six times over budget.

A classic example of a federal govenment sponsored booddoggle le is the Big Dig in Boston it took an extra ten years to "complete". Yhe Big Dig cost tens of billions more than was originally estimaded. The politicians, unions and business groups never wanted it to end. It had to end finally after the Bib Dig exhasued all federal resources (something very hard to do since Highway Trust Fund is a very generous funding source) and the state then had to raise every type of tax, fee and toll to pay for the state indebtedness to this project The taxpayer will be paying for the Big Dig for years to come. This is waste of resources that could be used elsewhere. This wasted money will not be available for real jobs and economic need elsewhere in the economy. Politicians and government bureacrats are poor judges of real economic need and value.

Beth Cioffoletti
7 years 6 months ago
I think that making work may work, Karen.
 
When I was in Prague, there were many workers taking care of the walkways, which were a mosaic of rock-pieces.  Evidently this arrangement required a lot of upkeep because there were workers on most every street repairing the walks.  I remarked about this to a German friend and he said, mostly in jest, "they have to keep the peasants busy and happy so that they don't rise up in rebellsion!".
 
Workers not only are able to care for themselves and their families with dignity, they also need to shop and pay taxes, which contributes to the health of the economy and communal funds.
 
The wealth of our country has been skewing itself into the hands of the very wealthy for the 20 or 30 years.  Making jobs would strengthen the middle class and could begin the process of spreading the wealth a little more evenly.
Tom Maher
7 years 6 months ago
Have you heard the news of the last few week about Hungary (You mentioned Budapest which is th ecapital of Hungary)?

Hungary is now one of the eight (and counting) European nations having trouble finacing its national debt. The percentage indebtedness relative to their total economy is very large such that Hungary may not be able to to pay for its contiued debt servicing. Accordingly Hungary will have to cut back all government programs or default on their debt payments.

This is not the 1930s anymore Social welfare program are financed in the west in large part by govenment indebtedness not just taxes. The level of indebtedness is so high that it is approaching or already exceeded the ability to repay the debt. So Hungary is enlightened alright but it is also unfortunarely too close to being broke.

Greece of course is the worse case where it owes creditors more than the entire Greece economy can produce in a year. Greece is drastically and painfully cutting salries, pensions, jobs and programs.

Folks in the 1930s did not have to worry about national debt becasue governemnt debt was low or nonexistant. Today these eight European nations have too much debt and therefore must cut back. If they fail to cut back (they really hate to cut backs and they should) they will go into default and not be able to get any financing for anything for years.

California is experience the same problem. By itself it is the eight largest economy the world but it has binged om social spending by debt financing. (Note here that California does not have a milittary budget to blame xcessive indebtedness on.) Its political establishmenr knosw it will not be bailed out. So on its own it must cut spending.

The United States needs to stop growing the national debt also. U.S. debt is 13 trillion dollar and this is projected to go to 20 trillion in five years. This is a small compared to its total economic activity but in absolute terms 13 trillion is hugh. All the countires in the world may not have a spare 20 trillion to lend us yet that is where we are haeding.

So the problem for the United States and all countries is the national debt is dangerously high. No such problem existed in the 1930s.

This is not the 1930s anymore. The rules of the game have changed becasue the world has changed. We sure don't need a WPA in 2010.
Vince Killoran
7 years 6 months ago
We are working off of the myth that a large national debt is inherently bad.
Beth Cioffoletti
7 years 6 months ago
No, I mentioned Prague - the Czech Republic.
Whenever anyone mentions the debt, I always suggest dismantling our war machine, but no one seems interested.  They would rather cut jobs, social programs, anything but bombs and military expenditures.
Jim McCrea
7 years 6 months ago
The debt could also be decreased by raising taxes:  income, social security and elimination of capital gains reduced taxes.
 
I am awaiting the screams even as I hit "post comment."
Tom Maher
7 years 6 months ago
As I said about Califronia it is an extermely wealty state and ot does not have a military but it is in debt up to its eyebrows. The problem with waealthy states like California is they elvelrage every tax dollar to do even more good. - have a dollar: spend two. So they wind up being more in debt than much less wealthy states.

New York City was famous for this in the 1960s and 1970s until it went bankrupt in 1976. A very wealthy city which even has a personal income tax as of 1968. Yhe more money they barrowed the less they lived within their means. When bankrupcy came and a federal bailout in 1976 they had to drastic layoffs in every department and cutbacks ineverything for at least five years. Yje road in a few years looked like the lunar landscape with potholes that could swallow a car. New York Citiy's bankrupcy set back all social programs several fold permanemently.

Europe is always the model for enlighten government spending. Well sadly eight European countries are on their way to going broke from social spending. Greece, Portugal, Spain, Ireland, Italy Hungary among them are having difficulty financding their national debt. Bnks and investors will not lend want to lend them anymore out of fear they can no longer pay for their debt service. In 2010 nations are maxed out on their ability to barrow. And this unwillingness to lend to nations is spreading across Europe and may eventually include U.S. national debt. World credit conditons are headed south.

Bye the way how many "rich people" does Greece Ireland etc have to tax? Certinly at 100% taxation it would not make any difference these countries are so in debt.

Tom Maher
7 years 6 months ago
Spending money you don't have is what does not add up anymoe. The 1930s deficit spending schemes presented in this article are being shown to be no longer possible. In the last eight weeks banks and investors have refused to lend ot counrties like Greece. A country loaded down with debt like Greece, Ireland, Italy , Spain, Potugal and Hungary are not being allowed to continue to deficit spend. Banks and investors will no longer leand them the money as in the past without drastic reductions in their government expenditures. These countries have so much debt that investors fear theese coutries are near to or have already reach critical point wher they can no logner service the debt they have. On their own these countires are at or near bankruptcy. They no longer have the ability to creat 1930s barrowing. The oppsoite is the case like bankrupt New York City they are being forced as a coditon cut back all programs of every type drastically in order to be bailed out by other countries in the European Union.

The point is credit is no longer freely available to any counry including the United States that has high levels of national debt. The world credit market no longer trust these countries ability to pay off their large deficits. So fresh credit is being denied without drastic cutback. Greece has had rioting for weeks due to the drastic across the board cutback in wages, pensions, services and goevernment employement. This is the future not the 1930s deficit spending schemes such as the WPA.
Vince Killoran
7 years 6 months ago
Tom-the problem in a lot of cases lies with the IMF, not these countries or their social spending.  It's good to read that the Bank of the South (BANSUR) is going operational and  may give the old financial dictators a run for their money (!).
Brian Gallagher
7 years 6 months ago
Make-work isn't the answer.  Real jobs, millions of them, must be created in those sectors of greatest need: medicine, education, urbanization (i.e. mass transit - oil's not getting any cheaper)
 
Taxes must be raised on the wealthy and slashed for the poor.  Income inequality must be resolved.
 
The war on the worker's movement and smashing of trade unionism (which includes turning unions into bureaucracies complicit with corporations) has revealed the contradiction at the heart of all 'austerity' 'belt-tightening' measures:  the workers are also, at the same time, the consumers.  To impoverish them by cutting or simply not hiring is to make war on your own customers' purchasing power. 
 
The result of declining or stagnant real wages since the ’80s has been global industrial overcapacity: too much plant turning out too much stuff for not enough buyers. THe largest fleet in history is TODAY right off Singapore - thousands of empty, unused cargo ships (unbelievable photos):  http://www.dailymail.co.uk/home/moslive/article-1212013/Revealed-The-ghost-fleet-recession-anchored-just-east-Singapore.html
“the ultimate reason for all real crises always remains the poverty and restricted consumption of the masses.” - Karl Marx
Mary Kennedy
7 years 6 months ago
Maintaining the infrastructure, Brian, is a real job.  One that's been neglected far too long.  But yes to you and Jim, who note that undertaxing never solved anything.
Stanley Kopacz
7 years 6 months ago
I always love it when conservatives talk about the New Deal not working.  It DID work.  The country didn't go communist.  If it weren't for FDR, the word "capitalist" would have been a name for something turning slowly on a spit over a fire. They called FDR a "class traitor".  He was only the smartest of his class and why that class persists, for better or worse.
Nowadays, it would seem to be a good idea to get young high school graduates off the street, especially the ones with a lot of testosterone to burn up.  It's about maintaining peace and order.  If you have to lock these guys up, you end up paying room and board and where's the profit in that?
 
Tom Maher
7 years 5 months ago
It is amazing that people here talk about the controversial results of the 1930s while ignoring owverwhelming established more current facts of th late 1980s and early 1990s that are in effect today.

Can you imagine that in 2010 Catholic commentators are still actually quoting Marx and advocating for Marxist socialism ideas? How flat-footed are Catholics in absorbing new economic information? The world is profoundly changed long ago. Why is the church so backward and far behind this well-known, public information?

Give Catholics another 100 years to absorb the news that the Soviet Union and all its satellites collapsed as of 1989. The Soviet Union and all its satillites more than 20 years ago in 1989 rejected and got rid of Marxist socialism. - yu know the one that was supposed to provide a "workers paradise" by th etotal control by the govenment of all aspects of the economy for the "common good" as Catholics would say. Well the new is that it did not work out that way at all and socialism was rejected by a sizeable part of humanity that actually lived and worked under communism.

This is an overwhelming empirical result. Absolute state control of an economy has been unanimously rejected by people living under this socialist system. One does not have to go back to the 1930s for clues of how governemnt programs do not work.

But Catholic ignorance of economic and what is going on in the world economically is breathtaking. Catholic illiteracy of economics has got to be the hiohest in the world.

This is Galileo all over again. Empiracl facts are ignored in favor of unverified Catholic preconceptions of how the world works. So Catholics teach Marxist socialism and "distributive justivce" while eveyone who lived under Marxist socialism reject it. Catholic sovial theory is once again overwhwmingly disproven by empiracl evidence: worldwide socilism does not work and has been rejected in favor of capitalism, Marxism's nemisis. How many more decades will it take for Catholics to learn what everyone else has known for decades? Catholic use way to much theology and no science to explain and justify things.
Gabriel Marcella
7 years 5 months ago
Karen,
There are areas where the government can make a crucial difference and should, beyond such essentials as national defense, protection of the environemnt, and the rule of law. For example, government has taken the lead and promoted scientific research (e.g.: internet), medicine, and the study of foreign areas and critical languages. Moreover, its taxing authority is used to incentivize energy efficient homes, the working place, and transportation. Such incentives can be easily expanded to achieve some of your goals. In my small town in Pennsylvania low income housing is getting insulation, a superb contribution to energy efficiency. Poor people can least afford insulation, and their dwellings are often the most energy inefficient. Those that advocate minimalist government (a legitmate position within our political process)also recognize that there are areas where the law of supply and demand and the private sector are simply inadequate to perform some essential tasks. The difference between miminalists and activists in our politics may be large, but that's no reason to dismiss the important and legitimate functions of government.
Vince Killoran
7 years 6 months ago
Tom:  You're presenting a mishmash of things here and they don't add up.
 
A couple of quick points and maybe others can jump in and address the "world credit conditions" aspect:
 
1.  NYC's problems resulted from a worold wide financial crisis, a deep national recession, and financial mismanagement, not its social democracy-like programs.  The key work on this is Josh Freeman's  Working-Class New York: Life and Labor Since World War II. New York: The New Press, 2000.
 
2. The European examples should not lead anyone to conclude that strong public investments are bad. In fact, that was part of Ireland's problem, i.e., the economy boomed but they never spent on infrastructure.

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