The Long, Tortured History of the Job Guarantee

... Over the last month, progressives have been celebrating the legislation recently introduced by Senator Cory Booker, calling for a pilot job guaranteein 15 cities and regions, co-sponsored by Senators Elizabeth Warren and Kirsten Gillibrand. But this bill preempts universal job guarantee legislation being drawn up by Bernie Sanders and rejects even the limited job guarantee advocated by the Center for American Progress, suggesting that Democratic leaders still do not understand the severity of the problem. Those excited by the idea ought to remember, too, that it was liberals, not conservatives, who have killed job guarantee bills in the past.

Direct job-creation seems foreign now, but it was the very heart of the New Deal. Virtually every penny spent in those years went to an alphabet soup of programs like FERA, CWA, PWA, CCC, and the WPA. These were responsible for thousands of schools, hospitals, parks, airfields, roads, sewers, trails, and other valuable infrastructure, helping lay the groundwork for the famous post-war economic boom. Every county in the nation but three had a major public works initiative. And for a solid decade, the U.S. government remained the largest employer in the nation. 

Joblessness also fell dramatically, if we count public labor—to 9 percent in FDR’s first term, and to 6 percent in 1941 (and this was beforethe war). No later Congress was more successful. The growth rates in that period were impressive, too, averaging between 8 and 10 percent, far better than most recovering economies. Kiran Klaus Patel, in his 2016 book The New Deal: A Global History, notes that direct job-creation was the most distinctly American feature of the New Deal, although many local governments have used the program in economic downturns through history. Philip Harvey, Steven Attewell, Edwin Amenta, and others have argued that FDR’s Committee on Economic Security saw the better-known insurance and welfare program as fallbacks, actually, to a primary, “forgotten leg” in the welfare state: public employment. 

Recent pieces on the job guarantee sometimes note that FDR gave the right to work the top spot in his famous second Bill of Rights. And with fear of depression returning after the war, farmers, unions, and liberals mobilized behind a Full Employment bill that ostensibly would have created a permanent WPA. But while a pair of racist southern Democrats and one northern Republican are often blamedfor defeating this social democratic legislation, the best new researchfinds that it was already “one of the most conservative” proposals floating around Congress, before the House ever voted—watered down by the New Deal Keynesian economists who drafted and reworked what became the 1946 Employment Act (which provided full employment in rhetoric only). 

Happily, depression did not return. But in the fabled 1950s economy, unemployment steadily increased after three recessions, and then “automation” entered the lexicon. By the late 1950s, Walter Reuther, the left-labor leader, was calling for a March on Washington and a “Marshall Plan for the cities,” soon joined by civil rights leaders. John F. Kennedy responded with the first national job training program, but it did little. Lyndon Johnson followed with the Keynesians’ solution: a tax cut, expected to “unleash” the market and (what else?) “create jobs.” Unemployment fell, helped by the Vietnam War, but high rates of joblessness remained, particularly for the “unskilled” and discriminated groups. Very soon after LBJ’s War on Poverty began, various government departments began pushing for direct job-creation and calling for the government to become “employer of last resort,” ideas JFK and LBJ had many times rejected. But domestic welfare was subsumed by the war.

Hubert Humphrey carried the banner in 1968, promoting federal planning for jobs, housing, and community development. But when he lost to Nixon, reformers in the party rejected this approach. ...