Working for the People (Job Insurance, Part 4)

In Economic Planning, Economics, Full Employment, History and Politics, Living Wage, New Deal, Politics of Policy, Public Policy, Public Works, Social Democracy, Social Policy, Unions, Welfare State, WPA on August 26, 2009 at 9:59 am

Introduction:

In part 1 of this series, I described how a job insurance program could work nationally; in part 2 I discussed how it could work set up on the state level. In part 3, I talked about how job insurance would transform the American state, economy, and society. And yet, to date, while I’ve wrote a lot about what the prom would look like and how it would effect the world around it, I haven’t yet discussed what it would be like to participate in the program, to go to work on a Job Insurance-funded public employment project.

And this part is crucial. If you get it wrong, political support for the program will collapse, implementation will be a failure, and Job Insurance will join CETA in the historical dust bin of noble failures.

But if you get it right, Job Insurance could be an amazing success of social and economic policy that validates the efforts of  generations of reformers – a permanent addition to the American safety net.

Background:

In trying to understand what job insurance (or related concepts like the right to a job or full employment) means,  one of the difficulties you have to deal with is the complex variations in policy that could all be described as “providing work.” The Victorian workhouse, the WPA, and the Swedish beredkeparbete could all be understood as different ways to provide jobs to the unemployed, but they are not the same. They differ both in terms of the material means by which they operated (wages, hours, working conditions, and the like) and by the ideological ends they served.

The Victorian Workhouse, first established nationally in the U.K by the Poor Law Reform of 1834, was explicitly designed to be punitive and terrifying. Under the principle of “less eligibility,” working conditions in the workhouse had to be made ” worse than the worst job possible outside the workhouse,” in order to deter the able-bodied indigent from too readily accepting public assistance and becoming a burden on the rate-payers of the parish. In order to make even the poorest worker think twice before walking through the doors of the parish workhouse, the institution was made into a symbol of terror: policies were established that deliberately divided families and removed children from their parents, workers were required to wear uniforms as in a prison, work lasted 10 hours a day, the work to be done was physically and mentally draining like breaking stones or textile production, and the only wages were subsistence from the workhouse kitchens. So here, the material means are kept deliberately terrible to achieve the ideological end of deterrence.

The WPA, established under the Emergency Relief Appropriations Act of 1935, by contrast was designed to combat the mass unemployment of the Great Depression. The policy advocates who designed the WPA, mostly young men who had been in the orbit of progressive social work at the outset of the Great Depression and who had worked in local relief agencies and volunteered to help run the Federal Emergency Relief Administration (FERA), saw the program as an enlightened effort to eliminate the dehumanizing and archaic system of Poor Relief that had existed in America – the WPA would move unemployed workers off of relief and into work, WPA workers would earn a cash wage that they would be free to spend as they saw fit, and the work would be as similar to normal employment as possible. And yet those elements of the WPA that were the most radical were the hardest to maintain against conservative challenge – the WPA paid a prevailing wage based on union scales starting in 1936 but a Dixiecrat/Republican alliance reduced this to a fixed monthly “security wage” in 1939; for a while, WPA workers organized themselves into unions through the UAW’s WPA Welfare Department, but the Hatch Act and other laws were designed to prevent WPA workers from exercising their political power (at one point, it was proposed that WPA workers be barred from voting). And the most radical step of all – opening the WPA to anyone who lacked a job, as opposed to those who had gone on relief – which had been done only briefly in the six months of the Civil Works Administration’s life, never happened. That was left to a Full Employment Bill.

The system of beredskaparbete (direct job creation) that became part of the Swedish labor market policy regime from 1932 through the mid-1990s and continues in some form today went much further than even the WPA. Rather than a temporary emergency program that always sought to find a permanent status, beredskaparbete was part of a social compact forged between the Swedish people and the Social Democratic Party that the government would ensure full employment and the right to a job to all its citizens. Rather than a security payment, wages and benefits were set through collective bargaining with Sweden’s hegemonic Lands Organisationen (L.O), the trade union confederation that represents about 80% of the workforce in Sweden. Rather than being targeted to the poor or to people on relief, beredskaparbete was open to anyone who was unemployed.

So as you can see, not all jobs programs are created equal.

A Public Job as Work With Dignity:

One of the potential pitfalls of a Job Insurance system is that the temptation will always be there to morally and otherwise control publicly employed workers (to give a mild example, John Edward’s plan for creating one million transitional jobs for the unemployed would have required drugs testing), and there will always be fiscal and ideological pressures to keep labor costs down and prevent “substitution” (i.e, workers preferring public sector employment to private sector employment), even under progressive administrations.  On the right, there will be efforts made to denigrate and investigate workers and their work in order to shore up the belief that the private sector is always superior to the public sector, that state efforts to alleviate suffering only cause dependency, and so forth.

In order to counter this, a special effort has to be made from the beginning to endow the employment created by Job Insurance not merely with a living wage, but also with dignity and right. Establishing a system of insurance is important – just as FDR saw in 1935 that establishing a contributory system would give pensioners a moral if not an absolute legal right to their pension, Job Insurance workers will be harder to control because they’re not welfare clients subject to the mercy of the government, they’ve earned their job through monthly payments into the system. However, there’s more that can be done to ensure that a Job Insurance job is one with dignity:

  1. Job Insurance Bill of Rights – as part of the enabling legislation, a code should be established clearly laying out the rights of workers to a six month term that can only be terminated due to just cause, a right to re-apply at the end of six months if they are unable to find a job of equal quality on the job market, a guaranteed wage of $10-12.50 an hour, a 32 hour work week and 8 hours a week of training, standard working conditions, and assistance from the program’s administrators in carrying out a job search.
  2. The Right to Organize – in both the case of the WPA and the Swedish system, the right to organize into a labor union is crucial for protecting the rights of public workers, and steadily improving the conditions of work and the performance of the program (surprise, workers tend to work better if you pay them decently). Moreover, given that unions historically were somewhat way of such programs for fear that they would be used to undercut union wage scales or (in the case of the ill-designed and ill-administered CETA) replace public employee unions altogether, this assurance is critical for establishing the kind of political support needed for a permanent program. Finally, in order to make the job training part of Job Insurance work at all, sending teachers from union apprenticeship programs will be a crucial part of the program.
  3. Job Training/Education – while I am often skeptical of most job training programs, it is true that “hard” job training programs (i.e, programs that train you in a specific trade, like electrician or nurse’s assistant, as opposed to “soft” programs that simply teach you how to fill out a resume and dress for an interview without actually giving you any skills) do have a decent track record. Thus, in order to both improve efficiency at existing work sites, and to help Job Insurance workers more easily find a decent job after six months,eight hours a week should be given over to training, where workers should be given access to a variety of programs, from union apprenticeships to a free ride at local vocational, technical, or community colleges.
  4. Job Insurance as Yardstick Employer– classically, we’ve worried that a government jobs program would hurt private employers by creating a “substitution effect,” whereby workers would prefer to keep their public sector jobs rather than go back onto the job market. Personally, I don’t see that as a negative – one of the deep weaknesses of the American economy right now is an increasing tendency towards the casualization of unskilled labor, especially in the service sector. If this economy is going to be one in which your average worker can earn a living wage, you’re going to need a Job Insurance program – just like a public option – to force employers to pay and treat their employees better. Wages aside, a public employer that doesn’t lock its employees in the store overnight or force them to do unpaid overtime or refuses to give them more than 20 hours a week can do enormous good by raising “the moral common denominator of competition.”

Conclusion:

It’s a truism of people who study public policy that “implementation is just as important as design.” Too often, though, this is understood only in abstract terms about oversight, funding levels, personnel, and the like. In truth, the living experience of moving through the program is the best test of implementation and design, and should always be the highest test of policy success.

I’m a unionized public employee, and while my job isn’t perfect, it is one where I have rights that I can use to ensure that I am treated with dignity and fairness. If and when we establish a system of job insurance, why shouldn’t every worker enjoy the same?

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  1. Hi Steve,

    another great post, I wholly agree with “living experience” metric! I have to ask, how do you envision sanctions for those who don’t do their work in maximum employment programs? I am not suggesting that slacking off might be a widespread phenomenon (as the Right sometimes does), but surely we cannot expect that a 100% of those holding a government job would perform it dutifully. So what happens when they don’t? Pay cuts, lay-off, reassignment? What would a lay-off even look like since any able-bodied/minded person should be able to get a job?

    I know that this is not the favorite topic of labor activists to discuss, but that is another reason to be clear on that issue.

    Also, how come the comments are signed while individual posts aren’t (or am I just missing the signature somewhere)?

    • Thanks.

      Well, like any employer, you can have reprimands, performance evaluations, etc. and with a proper system of just cause, dismissal.

      Keep in mind, you have the right to get a job, not to keep it. There’s a responsibility on the other hand to do a “fair day’s work” for a fair day’s wages.

    • Regarding the signature, not sure.

  2. Right, I understand how ones performance might be evaluated. But what happens when somebody is not allowed to keep the job? They get laid off, right? And then what, they are unemployed again and eligible for another job, or are they ineligible for the whole program for some time and go on unemployed relief?

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