full employment

Getting Back to Full Employment: A Better Bargain for Working People
by Dean Baker and Jared Bernstein
Published 14 Nov 2013

ISBN: 978-0-615-91836-5 Contents Acknowledgements Chapter 1: Introduction Chapter 2: Evidence of the Benefits of Full Employment Data Appendix Chapter 3: Structural Unemployment: What It Is, Why It Matters, and Why It’s Not Our Biggest Problem Chapter 4: Full Employment and the Budget Chapter 5: Policies for Full Employment I: Improving the Trade Balance Chapter 6: Policies for Full Employment II: Public Investment, Public Jobs, and Work Sharing Chapter 7: Full Employment Now References Acknowledgements This book might not exist were it not for the help we got from many others.

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As we revisit this critical issue, the jobless rate has ranged from 7 percent to 10 percent for over four years, and it’s not expected to come down much anytime soon. A strong labor market with full employment need not be a rare economic anomaly that returns roughly twice for every one appearance of Halley’s Comet. Full employment can be a regular feature of the policy landscape, with tremendous benefits for rising living standards, poverty reduction, the federal budget, and equitable economic growth. In this book we present the benefits and importance of full employment in ways that are particularly germane to the economy today, and we offer policies to begin moving to full employment now. Full employment can be defined as the level of employment at which additional demand in the economy will not create more employment.

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Figure 2-4 shows the results of a statistical exercise to test the correlation between full employment and trends in real income for different groups of families. Specifically, the exercise examines the relationship between changes in real income by income group and the “deviation from full employment” – movements of the unemployment rate above or below the full-employment benchmark (see data appendix for more details).[4] The pattern of the bars shows that the lower your family income, the more you lose in slack labor markets. For families in the 20th percentile, for each percentage point that the unemployment rate was closer to full employment, incomes grew 2.2 percent.

The-General-Theory-of-Employment-Interest-and-Money
by John Maynard Keynes
Published 13 Jul 2018

It follows from this definition that the equality of the real wage to the marginal disutility of employment presupposed by the second postulate, realistically interpreted, corresponds to the absence of ‘involuntary’ unemployment. This state of affairs we shall describe as ‘full’ employment, both ‘frictional’ and ‘voluntary’ unemployment being consistent with ‘full’ employment thus defined. This fits in, we shall find, with other characteristics of the classical theory, which is best regarded as a theory of distribution in conditions of full employment. So long as the classical postulates hold good, unemployment, which is in the above sense involuntary, cannot occur. Apparent unemployment must, therefore, be the result either of temporary loss of work of the ‘between jobs’ type or of intermittent demand for highly specialised resources or of the effect of a trade union ‘closed shop’ on the employment of free labour.

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Evidently this amounts to the same thing as full employment. In the previous chapter we have given a definition of full employment in terms of the behaviour of labour. An alternative, though equivalent, criterion is that at which we have now arrived, namely a situation in which aggregate employment is inelastic in response to an increase in the effective demand for its output. Thus Say’s law, that the aggregate demand price of output as a whole is equal to its aggregate supply price for all volumes of output, is equivalent to the proposition that there is no obstacle to full employment. If, however, this is not the true law relating the aggregate demand and supply functions, there is a vitally important chapter of economic theory which remains to be written and without which all discussions concerning the volume of aggregate employment are futile.

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Thus, given the propensity to consume and the rate of new investment, there will be only one level of employment consistent with equilibrium; since any other level will lead to inequality between the aggregate supply price of output as a whole and its aggregate demand price. This level cannot be greater than full employment, i.e. the real wage cannot be less than the marginal disutility of labour. But there is no reason in general for expecting it to be equal to full employment. The effective demand associated with full employment is a special case, only realised when the propensity to consume and the inducement to invest stand in a particular relationship to one another. This particular relationship, which corresponds to the assumptions of the classical theory, is in a sense an optimum relationship.

Utopia or Bust: A Guide to the Present Crisis
by Benjamin Kunkel
Published 11 Mar 2014

But when the wage share of GDP has steadily fallen across the rich countries while their overall growth rates continue to slide, the opposite possibility looks more likely: only a rising total wage bill during the ’70s and after could have ensured consumer demand consistent with the maintenance of full employment—and a sustainably high rate of return. No less an authority than Kalecki,* in his classic essay on “The Political Aspects of Full Employment” (1943), insisted that “profits would be higher under a regime of full employment than under laissez-faire.” He and others produced models to bear the contention out; the models are unsurprising if you consider that full employment by definition entails expanded economic activity. There are also historical reasons for supposing that the central flaw of postwar capitalism lay in not-full-enough employment.

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Suppose that we are witnessing the end of the global imbalances that mounted so teeteringly high over the last decade, a collective folly in which one group of countries, led by the US, purchased the surplus goods of another group, led by China and Japan, with money the first group did not possess and had to borrow from the second. Neither group, at least not their corporations or governments, truly wanted anything like full employment. For the net-exporting countries, full employment would have raised wage costs and threatened competitiveness. For the net-importing countries, full employment would have triggered inflation and so undermined purchasing power and asset prices. True, the lack of full employment spelled inadequate aggregate demand across the system. But an increasingly baroque financial shell game conjured just enough demand to keep things afloat—until it didn’t.

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There are plenty of reasons to suspect this is only a daydream, not least the veto that international finance continues to wield over the policies of any country needing to borrow money to stimulate domestic development.* But if the US is to recommit itself to full employment, the first battle will have to be over the very definition of the term. Since Milton Friedman’s 1967 paper on the “natural rate of unemployment,” economic orthodoxy has defined full employment along Friedmanite lines as the Non-Accelerating Inflation Rate of Unemployment, or NAIRU. This is full employment not as common sense would gloss it—a job for all those willing and able to work—but as just enough unemployment for wage demands not to drive up inflation. Today full employment is defined by the Bureau of Labor Statistics as 4.9 percent unemployment.

Money and Government: The Past and Future of Economics
by Robert Skidelsky
Published 13 Nov 2018

By use of the formula, policymakers could calculate how much 125 T h e R i s e , T r i u m p h a n d Fa l l of K e y n e s extra spending needed to be injected into, or withdrawn from, the circular flow of spending to maintain full employment. The multiplier theory is the fiscal equivalent of the Quantity Theory of Money, and, at full employment, is identical to it. (For technical discussion of the multiplier, see Appendix 5.2, p. 133.) In advocating loan-financed public spending to maintain full employment, Keynes jettisoned the orthodox policy of cutting public spending to balance the budget in a slump. He wrote: it is a complete mistake to believe that there is a dilemma between schemes for increasing employment and schemes for balancing the budget – that we must go slowly and cautiously with the former for fear of injuring the latter.

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But by the same token, his economics threw little light on what would happen to class income shares when his own policies achieved full employment, in conditions of trade-union control of the supply of labour. In such a situation, would capitalism need to recreate Marx’s ‘reserve army of the unemployed’ to restrain wage demands, or would the government be forced to inflate the economy to keep profits racing ahead of wages? The latter is what the economist Jacob Viner assumed would happen when society got accustomed to full employment.74 Keynes himself admitted that he had ‘no solution . . . to the wages problem in a full employment economy’.75 Marxists, too, believed that attempts to overcome the class struggle by inflation would bring only temporary relief.

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Most British Keynesians rejected the analytical 146 t h e k e y n e si a n a s c e n da n c y relevance of ‘Phillips Curve’ Keynesianism, pointing out that Phillips’s data mostly preceded the existence of a full employment guarantee by the state: Victorian domestic servants, agricultural workers and casual labourers did not strike for higher wages. In the new situation, trade unions could push for higher wages without the risk of their members becoming unemployed. A modest check to demand would not stop inflation, since there was no trade-off between inflation and unemployment to be had short of abandoning the full employment commitment. The only policy that would simultaneously maintain full employment and keep prices stable was control over costs.21 The solution which seemed most congruent with the Keynesian philosophy of social compromise was a compact between government, capital and labour.

Brave New World of Work
by Ulrich Beck
Published 15 Jan 2000

To bring a certain clarity into this bustling international debate, it makes sense to draw a fundamental distinction between the framework of scenario-building and the challenges of the second modernity. Most of the scenarios revolve around the question of Yes or No, end or recovery of full employment, hopes and worries. And all the time, the leitmotifs of the second modernity – science-based information technology, globalization, individualization and ecological crisis – need to be analysed in their consequences for the future of work. Let us first distinguish the following scenarios within the framework of the full-employment society. If the framework of a full-employment society is replaced with that of a multi-activity society, the collapse scenarios become the occasion for a redefinition of work and of the necessary reforms.

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The ‘reformers’, for their part, base their political opposition upon conflicting accounts of the present state of the work society – for even when the adversaries belong to the same society, they live in different worlds. Here the main dividing line is between those who think that full employment will be possible in the future – provided a few levers and screws are properly adjusted – and those who rule this out. To avoid misunderstandings, the point is not that the work society will run out of work. It is not the end of paid work but the end of full employment which is at issue. Two per cent unemployment, social security in work, normal work relations as the usual case – is all this history? So the basic dispute is over whether the full-employment society has ended for ever or will one day come back. Scenario 1: from the work society to the knowledge society Many authors chase away, as if it were a troublesome fly, the human concern that the revolutionary rationalization based on information technology is designed, if not to eliminate, then to thin out paid employment.

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For example, the number of people out of work rose dramatically in the crisis years of 1967 and 1975, only to fall again subsequently below 300,000. Apart from these exceptional periods, full employment remained the rule. But then the oil crisis destroyed this shining world of the full employment society. Slight conjunctural fluctuations aside, the number of unemployed rose tenfold between 1970 and 1996.22 Thus, ever since the 1970s unemployment has been constantly rising and the amount of work per capita has been constantly falling. This conclusion, which is used to counter the optimistic view that information technology will bring full employment, suggests that although the knowledge society is opening up new fields of work, it is gradually easing itself away from the normal work society.

The Deficit Myth: Modern Monetary Theory and the Birth of the People's Economy
by Stephanie Kelton
Published 8 Jun 2020

Why not just strive for a better mix of fiscal and monetary policy to keep the economy operating at its full employment potential? Couldn’t we achieve true full employment by asking the Fed to improve the way it runs monetary policy? Or maybe Congress could help fine-tune the economy with better real-time adjustments in government spending and taxation? Recall that the Fed chooses its own definition of full employment. For them, maximum employment is defined as the level of unemployment it believes is necessary to hit its inflation target. In other words, although it’s legally responsible for full employment and price stability, one goal takes clear priority over the other.

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But that’s because America has almost never achieved anything like true full employment. It’s something we’ve rarely experienced, outside of wartime. One of the most important features of a job guarantee program is that it maintains a form of full employment by immediately rehiring the unemployed into public service work, providing them with income and the retraining required when they are displaced by trade shocks. In this way, the job guarantee can serve as the core of a response to both “free trade” and the “trade war.” With a job guarantee, free trade is no longer a threat to full employment, and trade wars are no longer necessary to prevent unemployment.

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When that happens, the credit cycle reverses, and businesses experience a decline in sales. 28. See, for example, Michael J. Murray and Mathew Forstater, eds., Full Employment and Social Justice (New York: Palgrave Macmillan, 2018); Michael J. Murray and Mathew Forstater, eds., The Job Guarantee (New York: Palgrave Macmillan, 2013); Pavlina R. Tcherneva, The Case for a Job Guarantee (Cambridge, UK: Polity Press, 2020); and William S. Vickrey, Full Employment and Price Stability (Cheltenham, UK: Edward Elgar, 2004). 29. Wray et al., Public Service Employment: A Path to Full Employment. 30. For a more thorough discussion of how this would work, see Pavlina R. Tcherneva, “The Job Guarantee: Design, Jobs, and Implementation,” Working Paper No. 902, Levy Economics Institute of Bard College, April 2018, www.levyinstitute.org/pubs/wp_902.pdf. 31.

The Euro: How a Common Currency Threatens the Future of Europe
by Joseph E. Stiglitz and Alex Hyde-White
Published 24 Oct 2016

Highly indebted households and firms can go bankrupt, because they cannot meet their debt obligations. The countries within Europe differed in these and other ways, implying that it was virtually impossible for them all to attain full employment and external balance simultaneously, in the absence of other institutional arrangements of the kind found in the United States. The eurozone failed to put into place these institutional arrangements. MAINTAINING FULL EMPLOYMENT An economy facing an economic slump has three primary mechanisms to restore full employment: lower interest rates, to stimulate consumption and investment; lower exchange rates, to stimulate exports; or use fiscal policy—increasing spending or decreasing taxes.

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REFORMING THE STRUCTURE OF THE EUROZONE Reforms of the structure of the eurozone itself should aim at an economic system that can simultaneously achieve full employment and robust growth in each of the member countries with sustainable current account deficits in the absence of flexible exchange rates and independent monetary policies. There needs to be a fundamental commitment of the eurozone to maintain the economies at full employment. Markets do not on their own maintain full employment, and markets on their own are not in general stable. In the absence of government intervention, there can be persistent unemployment and high instability.

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But without appropriate reforms in the structure of the eurozone—the institutions, rules, and regulations that govern it—restoring the countries to full employment will lead to unmanageable current account deficits. We saw how the eurozone’s current structure leads to divergence and actually creates current account deficits and crises. The eurozone needs to be reformed so that all countries within the eurozone can attain and maintain full employment. The current eurozone structure does not allow this. As we saw in the previous chapter, while the programs that have been imposed on the crisis countries are intended to eventually lead the country back to full employment, the path is extraordinarily costly with uncertain success.

Hubris: Why Economists Failed to Predict the Crisis and How to Avoid the Next One
by Meghnad Desai
Published 15 Feb 2015

Keynes told the world that a capitalist economy could have two alternative states of equilibrium – one at full employment and the other at less than full employment. The economy might get stuck at the underemployment equilibrium for prolonged periods of time unless deliberately moved. The postwar data showed that the economy was cruising along at full employment. There were short lapses from full employment, but these were quickly corrected thanks to the “built-in” stabilizers – unemployment compensation, social security, old age pensions – which kept demand up even when unemployment was rising. The result of the continuous full employment was that any interest in business cycles disappeared from academia just 20 years after Schumpeter had written his two-volume classic, Business Cycles.

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The intersection of the two curves – aggregate demand and aggregate supply – determined total employment. Keynes’s argument was that this level of employment might fall short of full employment; there might be workers willing to work who would not find employment. They were involuntarily unemployed. Aggregate demand was inadequate to ensure full employment. But if aggregate demand fell short of the full employment level, how could demand be raised to the level at which full employment would result? Consumption was determined by income and largely workers’ income. Income could only rise if there was an increase in employment but employment itself would only rise if incomes rose.

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As orthodox economists, they championed not only laissez-faire but also the quantity theory of money, which could explain inflation. Keynes had rejected the quantity theory as irrelevant for economies with mass unemployment. At full employment, he did acknowledge that the quantity theory would come into its own. Describing how the economy would behave if it got close to full employment, he wrote “We have reached … a situation (i.e. full employment) in which the crude quantity theory of money (interpreting ‘velocity’ to mean ‘income-velocity’) is fully satisfied; for output does not alter and prices rise in exact proportion to MV.”12 But his followers would have none of it.

Keynes Hayek: The Clash That Defined Modern Economics
by Nicholas Wapshott
Published 10 Oct 2011

“Suddenly everyone was looking to restrain inflation, cut deficit spending, reduce regulation, and encourage investment.”91 But the old thinking was hard to jettison. The ever-smiling Georgia peanut farmer and former submariner Jimmy Carter reached the White House on the Keynesian pledge of returning America to full employment. In 1978, he approved the Humphrey-Hawkins Full Employment Act,92 a reprise of the Full Employment Bill of 1945, mandating the president and the Federal Reserve to keep aggregate demand high enough to maintain full employment. In apparent contradiction, the act also directed the president and Congress to balance both the budget and the balance of trade. Like Canute93 commanding the tides, legislators were proving their impotence.

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Kahn exposed the fallacy thus: “If entrepreneurs responded to the abnormal profits by increasing the output of consumption goods, the price level of consumption goods would progressively fall, and abnormal profits would fall, until either entrepreneurs earned no more than normal remuneration or some barrier was encountered—full capacity utilisation or full employment of labour.”13 In his defense, in an anguished letter to Joan Robinson, Keynes pointed out that in parts of A Treatise, “I have long discussions [on] the effects of changes in output; it is only at a particular point in the preliminary theoretical argument that I have assumed constant output.”14 But the objection of Circus members to both fallacies suggested to Keynes what was to become a pivotal element of The General Theory, that overall output was not fixed and could be raised through increased investment to a point where everyone in an economy was employed.15 It was this first slender thread of thought that led to Keynes’s wholesale contradiction of the claim of classical economists like Hayek that an economy, left to its own devices, in the long run inevitably came to rest at a state of equilibrium where there was full employment. Keynes was to argue in The General Theory that in the short and medium terms an economy could reach equilibrium with considerable unemployment and that the full employment equilibrium predicted by classical economists too often proved to be elusive. Keynes believed that the chronic unemployment endured in Britain and America in the 1920s and 1930s was evidence that the full employment equilibrium was a fallacy. During the writing of The General Theory, Kahn proved to be far more than Keynes’s favorite and most devoted pupil; he acquired something of the status of a missing son.

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More distressing to Hayek, perhaps, was that Beveridge’s amanuensis both for the Beveridge Report, presaging nationalized social security and the National Health Service, and for full employment as national policy was Hayek’s star pupil, Nicholas Kaldor. Hayek conceded, with irritation, that “Kaldor, through the Beveridge Report, has done more to spread Keynesian thinking than almost anybody else.”8 The notion of full employment as a government’s prime responsibility was not restricted to Britain. The Australian Labor premier John Curtin in 1945 introduced “Full Employment in Australia,” mandating the government to find a job for everyone capable of working. The same year, drafters of the Charter of the United Nations included a pledge that all governments should strive for “higher standards of living, full employment, and conditions of economic and social progress.”9 The UN took a further step in 1948 when it declared, “Everyone has the right to work, to free choice of employment, to just and favourable conditions of work and to protection against unemployment.”10 War-torn Europe became a laboratory for Keynesianism.

No More Work: Why Full Employment Is a Bad Idea
by James Livingston
Published 15 Feb 2016

These days everybody from Left to Right—from Dean Baker to Arthur C. Brooks—addresses this breakdown of the labor market by advocating full employment, as if having a job is self-evidently a good thing, no matter how dangerous, demanding, or demeaning it is. But “full employment” is not the way to restore our faith in hard work, or playing by the rules, or whatever (note that the official unemployment rate is already below 6 percent, which is pretty close to what economists used to call full employment). Shitty jobs for everyone won’t solve any social problem we now face. Don’t take my word for it, look at the numbers.

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And by “we” I mean pretty much all of us, Left to Right, because everybody wants to put Americans back to work, one way or another—full employment is the goal of right-wing politicians no less than left-wing economists. The differences between them are over means, not ends, and those ends include intangibles like the acquisition of character. Which is to say that everybody has doubled down on the benefits of work just as it reaches a vanishing point. “Full employment” has become a bipartisan goal at the very moment it has become both impossible and unnecessary. V Why? Because work means everything to us—regardless of whether it still produces solid character and allocates incomes rationally, and quite apart from the need to make a living.

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Even George McGovern’s counterproposal, the famous manifesto of May 4, 1972 (published in the New York Review of Books), which would have given all Americans a minimum income grant, made the “loss of grant benefits [as family income rose] sufficiently gradual as not to discourage those on welfare from seeking a job.” So the full-employment agenda was already the default setting of the Democratic Party and the larger Left produced by the New Deal coalition. When he proposed an increase in the corporate income tax rate, for example, McGovern emphasized that his program also included a $10 billion fiscal stimulus that would enhance consumer spending and corporate profits: “Nothing spurs profits like a strong full employment economy, which has the highest priority in my economic program.”5 Third, and this is most important for my purposes, everyone assumed that wages for work would soon be insufficient to sustain family life.

Not Working: Where Have All the Good Jobs Gone?
by David G. Blanchflower
Published 12 Apr 2021

In the United States and the UK in particular, the unemployment rate fell below 5 percent in 2018. In the past this would have indicated an uptick in wage growth, signaling what I explain in the book as the concept of full employment. That didn’t happen. In the book, you’ll see how both countries were nowhere near full employment. Underemployment, in which workers cannot get enough hours, keeps pay in check, was high. Sadly, the U.S. Federal Reserve’s estimates of full employment were wrong. Between 2015 and 2018, anticipating inflation from raising wages, it raised interest rates. In August 2020, at the Fed’s Jackson Hole conference, Chairman Jay Powell had to backtrack and shift the Fed’s inflation goal to keep rates lower for longer.

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Because of the high levels of labor market slack around the world, wages are the dog that hasn’t barked. If there were no labor market slack, meaning economies were at what’s considered “full employment,” wages would be rising, as employers would have to attract workers from competitors, given there are so few people without jobs looking for work. To do that they would have to raise wages. The fact that they haven’t suggests full employment is a faraway dream. Despite this reality the Federal Reserve Board, known as “the Fed,” believes the United States is at full employment and wage growth is set to rise, and hence they are raising interest rates. This looks like a mistake. Pain, Immigration, and Politics Recessions, slow recoveries, and policy mistakes have consequences.

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Share of Excess Hours (%) As an economy moves toward full employment opportunities should increasingly present themselves for underemployed workers who want more hours and overemployed workers who want fewer hours to overcome their hours constraints. Full employment opens up possibilities as more jobs become available. One possibility for those who want more hours is to obtain a second job. A further possibility would be for employees to switch to self-employment, where they could choose their own hours. Self-employment could be a secondary or primary job. This should be especially apparent as the economy moves closer to full employment. There is no evidence in the data so far to support such a claim in the United States or the UK on either front in the recent period when the unemployment rate dropped below 5 percent to 4 percent and lower.

Angrynomics
by Eric Lonergan and Mark Blyth
Published 15 Jun 2020

AfD (Alternative für Deutschland) 114 Afghanistan 6 aging population 10, 13, 14, 95, 106–11 and consumption 109–10 and government bonds 138–9, 152 and inequality 56–7, 58, 107–10 and inter-generational transfer 106–107 and poverty 57, 107 as stressor 57, 91, 106, 110, 111, 116, 118 and technological change 90, 106, 122 AIG 85, 124 Amazon 96, 98, 104, 142, 143–4 Anderson, Elizabeth 176 anger 2–3, 7–9, 10, 11–12, 159, 161 misplaced 13 as opportunity 16 and play 153 private see private anger public see public anger reducing see calming strategies anxiety/stress 9, 13–14, 50, 53, 55–6, 88, 118, 161 and cognitive effort 89–90, 91 and job insecurity 95–6 three causes of 91 and uncertainty see uncertainty Apple 96, 142, 143 Aristotle 59, 153 artificial intelligence (AI) 14, 102–106, 142 Asian financial crisis (1998) 77, 140 asset ownership 130–31, 133, 136, 140–41 Atkinson, Tony 80, 173 austerity policies 2–3, 6, 15, 34–5, 41, 48, 84 and euro crisis 44–5 and low interest rates 135 Australia 125 Austria 3 baby boomers 107–108, 110, 111, 175 Bank of England 84, 103, 120, 145, 148 TFS scheme 149–50, 166 banks 1, 6, 15, 33–5, 42, 44, 48, 145–50 and capital/liquidity ratios 126 and direct support for consumption 145–8 and dual interest rates 149–50 and economic models 3, 4 failure of 119–21, 122 and helicopter money 131, 146 independence of 78, 79 and leverage see financial leverage and problem of low interest rates 120–21, 122, 131, 135 regulations on 125–6, 127, 129, 132 restrictions on 72, 77 see also financial crisis (2008) Beck, Aaron 171–2 Bernanke, Ben 6, 148 Biden, Joe 106 billionaires 4 Bitcoin 102, 103 Blackrock 165 blockchain technology 14, 103 Blyth, Mark 172, 175 bonuses 81, 85, 124 Brazil 11, 127 Brexit 4, 7, 11, 22, 24, 37, 38, 55, 117, 154 and austerity policies 41, 45 and immigration 111, 112, 114, 116 and job insecurity 100–101 Brill, Stephen 175 Britain (UK) 3, 38, 119, 155, 162, 164 aging population in 107, 110 austerity policies in 41 dual interest rates in 149–50 and EU see Brexit fear of immigration in 27 gig economy in 100 and government bonds 135, 140 government spending in 71 immigration in 111, 112, 114, 115–16 inequality in 6 interest rates in 145 nationalism in 23 Thatcherism in 75, 76 Brittan, Samuel 151 Brynjolfsson, Erik 173 budget deficits 71, 75 Buffett, Warren 130 calming strategies 12, 15, 118, 122, 123–57 and data dividend see data dividend and direct support for consumption 145–8 and dual interest rates 149–50 and economic diversity 153–6 and inequality see inequality, strategies to reduce and national wealth fund see NWF and regulations on banks 125–6, 127, 129, 132 and sustainable investment see sustainable investment Canada 125 cancer 53, 87, 88, 106 capital 4 cost of 137, 139, 153 and dispersion 97–98 as “fictitious” commodity 65 formation, rate of 108 global 40, 42, 43, 49, 50, 58 and labour 50, 60, 69, 72 and neoliberalism 75, 76, 77, 79 protection of, following financial crisis 85 versus capital 97, 98 Capital in the Twenty-First Century (Piketty) 49, 108–10 capital/liquidity ratios 126 capitalism 64–5 and commodities 65–6 capitalism as computer 11, 61–72 fixing 124–25 hardware of 62–3, 117 software of 63–4, 68–71 and unemployment/inequality 66–7 version 1.0 68–9 version 1.0 crash 64, 66, 67, 71, 73, 83, 118 version 2.0 69–73, 74, 75, 76, 116 version 2.0 crash 70–71, 73, 83–4, 118 version 3.0 74–80, 98–9, 117, 125, 140–41 version 3.0 crash 116 car industry 100–101 caring industry 104 Case, Anne 54, 176 centrism, political 38, 48, 118–19, 121, 160–61, 162 CEOs (chief executive officers) 4 Chamberlain, Joseph 66 Chile 3 China 42, 63, 64, 78, 93, 137, 151, 156 Citibank 81, 82 cities 55, 56 climate change 104, 111, 121, 129, 131, 153, 159–60 and investment see sustainable investment Clinton, Hillary 160 Coggan, Philip 172 cognitive effort 89–90, 91 Cold War 28, 48 ending/legacy of 5, 23, 26, 29, 30, 37, 116 communism 68, 71 competition/competitiveness 47, 65, 94, 95, 111, 116, 125 and technology 105 see also product market competition computer analogy see capitalism as computer constrained volatility 85 consumption, direct support for 145–8, 150–51, 160 consumption, distribution of 52–3, 58 Corbyn, Jeremy 119 corporations 6, 20, 57 and competition 95, 96 and data dividend see data dividend corruption 8, 29, 61, 130 Covid-19 163 culture 160 Czech Republic 146, 147, 155 data dividend 141–4, 160, 162 and monopolies 142, 143, 144 and privacy 141–2 and property rights 142–3 de-unionization 50, 95, 99 Deaton, Angus 54, 176 debt 75, 84, 120, 132, 145, 150 and demography 109, 111, 131 government 136–7, 151, 152 net 136 deflation 65, 69, 120, 128, 144, 148 demand management 44–5, 47, 126–7 democracy 16, 25, 29, 39, 40, 104, 117, 130 and markets 68 demography see aging population Denmark 64, 164 depression see recession deregulation 28, 40, 48, 50, 58, 75 and inflation 127 as micro-stressor 94, 96, 99, 101, 118 DGSE (dynamic stochastic general equilibrium) models 3–4 Doughnut Economics (Raworth) 131–2, 165 dual interest rates 131–2, 149–50, 174 Dublin (Ireland) 17–18 economic change 9–10, 29, 43, 153 see also fiscal reform; recession economic growth 2, 6, 41, 69, 71, 86 and demography 108–10 and immigration 116 and inequality 76, 79–80 and quality of jobs/wages 46, 47, 85 economic ideology 28 economics 12, 54–5 shortcomings of models 3–5, 6, 7 education 24, 53, 58, 135, 141 tuition fees/student loans 107, 111 electoral politics 5–6, 104 and demographics 107, 110 and tribalism 13, 22, 24–7, 29, 30, 31 electric vehicles 153 elites 2–3, 5, 6, 7, 9, 37 in cities 55, 56 and corruption 8, 29 and ethical norms 20 and financial crisis 43–4 manipulation of tribal identity by 22, 24, 61, 116, 161 policy failures of 48–9 Engbom, Niklas 175–6 environmental degradation 29, 161 see also climate change environmental and social governance 168 ethical norms 20 euro crisis 7, 37, 44, 77, 144 Europe 34, 42, 137, 140 inequality in 41, 53, 56, 58 migrant crisis in 7 tribalism in 30 European Central Bank (ECB) 34, 84, 146, 155, 164–5 TLTRO programme 147–8, 166 European Union (EU) 22, 33, 34–5, 37, 43, 119 austerity policies in 2, 36, 48 and financial crisis (2008) 82 micro-stressors in 47–8 and nationalism 154–6 and neoliberalism 76, 77 unemployment in 44–5 see also Brexit eurozone 45, 65, 83, 148, 151, 155 exchange rates 72, 134 Extinction Rebellion 8, 131–2 Facebook 27, 96, 98, 142, 143 fake news 26 Farage, Nigel 17, 161 Farmer, Roger 174 fascism 45–6, 66, 67–8, 71 fear 16, 17, 94, 113, 117, 150, 161 and media 26, 27 and politics 7, 45 financial crisis (2008) 1–2, 6, 26, 29, 30, 39, 48, 127, 163 and automation 102–103 and bail-out of banks 84 fragility of recovery from 46, 85, 89, 121 further reading on 172–3 and globalized financial system 84 and growth of populism 85 and inequality 79–80 and low interest rates 135 and regulation of banks 129 financial leverage 72, 81–3, 85, 99, 126, 157 and credit crunch 83 and interest rates 81–2 financial market deregulation 77 fiscal councils 150–51 fiscal reform 15, 150–53, 162 Fischer, Stan 148, 165 Florence (Italy) 87–8 foodbanks 6, 53 football fans 8, 19, 56 France 2, 3, 20, 55, 56, 71, 101, 154, 156 and NWF 135 Franklin, Benjamin 87 free markets 30, 69, 118 Friedman, Milton 118 full employment 40, 47, 60, 66, 71–2, 79, 85, 175 and inflation 73–4, 76 without inflation 121, 125, 126 future 101–102, 111 Garcia family, parable of 33–5, 43 Gates, Bill 130 GDP (gross domestic product) 5, 44, 76, 79, 100–101, 106, 151, 152 and NWF 135, 141 Germany 3, 11, 34, 38, 42, 62–3, 66, 151, 154, 156, 167 and migrant crisis 111, 113–14 and NWF 135 Gibley, Bruce Cannon 175 gig economy 94, 98, 99–100 global economy 12, 39–40, 50, 53, 58, 133 and nationalism 154 and neoliberalism 77 globalization 5, 39, 41, 42–3, 48, 77, 117 hyper- 40 and inequality 80 and inflation 127 and insecurity 101 and labour market 42, 43 and nationalism 154 Gold Standard 65, 67 Google 96, 98, 104, 142 government bonds 72, 131, 133, 135, 137, 138–9, 152 as insurance policies 139, 140 government borrowing 134–5, 137, 152–3 and cost of capital 137, 139, 153 and low inflation 128, 138–40, 150 and NWF 136–137, 138–40 Great Depression 40, 44, 66, 69, 120 Great Moderation 6, 120 Greece 35, 38, 44, 45, 106–07, 110, 144 green revolution see sustainable investment gross domestic product see GDP Guilluy, Christophe 55 Gulf States 133, 134 Hayek, Friedrich 118 healthcare 47, 53–4, 58, 123–4, 135, 139 and access to data 141–2 and NWF 141 and uncertainty/probability 92 hedge fund managers 4 helicopter money 131, 146, 166 Hildebrand, Philipp 165 Hong Kong 2–3, 140, 164 Hopkin, Jonathan 172 Hopkins, Ellen 123 housing 71, 113, 114, 135 Hungary 11, 23, 30 Iceland 1–2, 8, 20 immigration 5, 7, 26, 27, 111–17, 164 economic effects of 115–16 and housing/training 113, 114 and income distribution 112, 113, 114–15 and manipulation by media/politicians 111, 115 as stressor 113, 115 and technological change 106 and tribalism 95, 111, 112, 113 income see wages income distribution 43, 50, 51 and Keynesian economics 71 and neoliberalism 80, 81 independent fiscal councils 150–51 India 23, 127 individualism 29, 154 Indonesia 3 inequality 3, 4, 6, 15, 29, 30, 40–41, 43, 49–57, 58, 61, 79, 118 difficulties in measuring 50–53 and distribution of income/consumption 53–4 and financial crisis (2008) 79–80, 83, 85 further reading on 173, 176 intergenerational 56–7, 107–10 and populism 54–5 and uncertainty 49–50 inequality, strategies to reduce 121–2, 129–31, 132, 162 asset ownership 130–31, 133, 136, 140–41 and data dividend 141–4 National Wealth Fund see NWF optimal/effective 132–3 and universal basic income (UBI) 141, 144 wealth tax 130, 132 inflation 5, 40, 51–2, 53, 69 death of 126, 128 and full employment 73–4, 76, 121, 122, 125 and global financial markets 78 and interest rates 75, 81–2, 120 low see low inflation and oil prices 96–7 and printing money 78, 128, 145 and raising taxes 129 and recession 144–5 and regulation of banks 125–6, 127, 132 and stagflation 40, 74, 120, 128 inheritance 132, 133, 160 national 136 innovation see technological change insurance industry 93 interest rates 15, 33–4, 75, 81–2, 165–6 dual, and sustainable investment 131–2, 149–50 low, problem of 120–21, 122, 131, 132, 135, 146–8, 152 negative, problem of 15, 148, 149, 150 and spending 147 internet 25 investment spending 40, 60, 69 and future expectations 103 and global capital flows 77–8 and inflation 74 public sector 67, 70–71 sustainable see sustainable investment IRA (Irish Republican Army) 17 Iraq 6 Ireland 17–18, 23, 24 Islam 27 Italy 35, 37, 38, 39, 44, 66, 71, 87–8, 144, 156, 167 aging population in 110 poverty in 47 tribalism in 45–6 Japan 26, 84, 110, 137, 140, 148 job security/insecurity 34, 50, 56, 61, 94, 95–6, 100–101 and technology 102 Kalecki, Michał 60–61, 73–5, 120, 121, 127 Keynes, John Maynard/Keynesian economics 60, 66–7, 68–70, 92, 103, 118, 127, 151 General Theory of Employment, Interest and Money 66, 175 and inflation 67, 69, 128 labour market 35, 40–41, 42, 43, 44 and automation 102–106 deregulation 50, 95, 99, 122, 127 dispersion in 98–9 and full employment see full employment and immigration 115–16 in Keynesian system 71–2 and labour as commodity 59, 60, 65–6, 73, 85 and protectionism 59–61, 66 and secular stability 125, 126 and training 62–3 see also wages Lagarde, Christine 167 Lerner, Abba 118 libertarianism 63 Lonergan, Eric 174 Los Indignatios 85 low inflation 79, 134, 157 and full employment/secular stability 126 and government spending/borrowing 128, 138–40, 150, 152 and recession 144–5, 150, 162 Luce, Edward 164 Ludd, Ned/Luddites 102 machine learning (MI) 102–104 see also artificial intelligence macroeconomics 9, 13, 47, 89 failure of 119–20 and uncertainty 94 Macron, Emmanuel 162 Mair, Peter 172 markets 30, 59–61, 62, 66–7 and democracy 68 and quantity theory of money 68–9 see also labour market Mauss, Marcel 21–2 Mazzucato, Mariana 156 media 11, 43, 47 and technological change 98, 102–103, 105 and tribalism 24–5, 26–7, 29, 31, 61, 116, 161 Merkel, Angela 114 Mexico 63 micro-stressors 47–8, 53, 84, 91 and aging populations see aging populations and change 94 and fourth industrial revolution 94 and immigration see immigration microeconomics 9, 13–14, 160 migrant crisis 7, 111 Milanovic, Branko 52, 80 minimal group paradigm 21 Minsky, Hyman 128 mobile phones 53, 96, 97, 142 modern monetary theory (MMT) 118, 128–9 money, printing 78, 128, 145 monopolies 142, 143, 144 moral outrage 8, 13, 15, 35–6, 57–8, 117, 130, 161 and inequality see inequality as rational 36 and tribalism, compared 19, 20, 22, 29, 30–31, 36 triggers for 36 mortgages 34, 35, 38, 82, 111, 137, 145 nation state 39–40, 48, 50, 117, 119 national wealth fund see NWF nationalism 5, 11, 23, 29, 31, 39, 41, 116, 119 as positive 153–6 neoliberalism 4, 28–9, 37, 75–8, 122 and global capital flows 77–8 and inequality 51, 52, 53 NHS (National Health Service) 107 Nissan 100–101 Nixon, Richard 26 Northern Ireland 17–18, 23, 24 Norway 133, 134 Nussbaum, Martha 16, 35, 36 NWF (national wealth fund) 15, 132, 133–41, 143, 152, 168 and aging population 138–9 and asset ownership 133, 136, 140–41 and government borrowing/debt 136–7, 138–40 and growth of global stock market 137–8 and individual trust funds 135 and negative interest rates 134–5, 136 and risk 136, 137–8 sovereign 133–4 and trade surplus 134 Obama, Barack 29, 46 oil prices 96–7 Orban, Viktor 23, 30, 161 “Panama Papers” 2, 20 pensions 57, 63, 106–107, 138 perpetual loans 147–8 Philadelphia Eagles 20 Pickett, Kate 168 Piketty, Thomas 49, 52, 80, 108–10 play 153 Poland 11, 30 Polanyi, Karl 59–61, 64–5, 67, 175 political centrism 38, 48, 118–19, 121, 160–61, 162 political disengagement 29 political economy 12, 13 political identity 22–3, 29–30, 37, 48, 116, 117 further reading on 172 political parties 5–6, 7, 28 politics, new 15–16, 58, 160 populism 11, 27, 39 and financial crisis 86 three genres of 54–5 Portugal 35, 38, 44, 144 poverty 47, 67, 72, 80, 115 and demographics 57, 107 power 4, 48 powerlessness 9, 41 price stability 76, 79, 128, 147 private anger 7, 8, 9, 10, 13–14, 36, 117 and cognitive effort 89–90, 91 see also anxiety/stress private sector debt 131, 145 and government borrowing 134–5, 137, 138–40 investment 67, 70, 149–50, 151 liability in financial crisis 85, 127 privatization 28, 40, 96, 107 probability 91–3 product market competition 94, 95–8, 116, 125 and deregulation/privatization 96–7 and dispersion 97, 98–9 intensification of 96, 101 and technological change 96, 97–8, 99 productivity 40 and technological innovation 9, 10, 15, 102, 104–105 and wages 71, 72, 74, 76 profit margins 98, 101, 105, 143 property prices 34, 38 property rights 142, 143, 154 protectionism 59–60, 61, 66 public anger 7, 8–9, 10, 89, 98, 117–18 economic causes of 13 see also moral outrage; tribalism/tribal anger public housing 71, 113, 114 public sector investment 67, 70–71 public services 24, 115, 116 quantitative easing (QE) 146–7, 167 quantity theory of money 68–9, 78 racism 26, 54, 55, 115 Raworth, Kate 131–2, 173 Reagan, Ronald 26, 75, 118 recession 15, 29, 30, 34–5, 44, 49, 55, 58, 84, 152, 153 and dual interest rates 150 and interest rates 75, 120–21 and investment spending 60, 70, 71 and low inflation 144–5, 150, 162 and MMT 128–9 and stock markets 139, 140 see also euro crisis referenda 37 regeneration, economic 132 regional development 15, 115, 116, 149, 153, 156 Renzi, Matteo 37 risk 91–2, 127, 136, 137, 153 Roberts, Carys 174 robotics see artificial intelligence Rodrik, Dani 4, 39, 40 Russia 11, 41 Sahm, Claudia 150–51 Salvo, Francesca 87–8 Sandbu, Martin 174 Sanders, Bernie 128, 164 savings 93 scale economies 98, 99, 142 Scottish nationalism 7, 119 secular stability 125, 126, 127 service-based economy 52 Singapore 133, 134, 162 SMEs (small- and medium-sized enterprises) 164–5, 166 social democracy 63–4 social media 26, 27, 90, 98 Solow growth model 109 sovereign wealth funds 133–4 sovereignty 39 Spain 33–5, 38, 44, 45, 144 protests against austerity in 85 spending increasing 145, 147, 151 investment 40, 60 power 145 public sector 67, 70–71, 128, 151 restrictions on 41, 44, 149 sports fans 8, 19–20, 21, 25 sports industry 99 stagflation 40, 74, 120, 128 status-injury 36, 54 stock markets 63, 137–8, 139–40 stress see anxiety/stress strikes 73, 74 student loans 111 supply–demand 60, 96, 104 sustainable investment 131–2, 149–50, 152, 153 Sweden 63–4, 72–3 Syria 111, 113 Tavris, Carol 36, 171 taxes 40, 50, 57, 108, 116, 124 cuts in 34, 44, 111, 151 dodging 2, 6, 20, 132–3, 143 political opposition to 129, 130, 132, 133 raising 152 on wealth 129, 130, 132, 140 Tea Party movement 85 technocracy 37, 42–3, 48, 160–61 technological change 29, 58, 96, 109 and aging population 90, 106, 122 and competition 96, 97–8 and dispersion of returns 97 and fourth industrial revolution 94 further reading on 173–4 and inequality 50, 53 and labour market 102–104 and media 24–5, 27 as micro-stressor 88, 91, 94, 96, 97–8, 99, 101–102, 105, 116, 118 and productivity 9, 10, 15, 105, 122 and rate of diffusion 14 and uncertainty 101–102 telecommunications 96, 97, 142 terrorism 17, 18, 27 Thatcher, Margaret 75, 76, 118, 131 Thunberg, Greta 150 TLTRO programme (European Central Bank) 147–8 trade 21–2, 26, 42, 78, 154 and neoliberalism 78 trade surplus 134 trade unions 28, 42, 63, 66, 72, 73, 76, 79 trade wars 21–2, 26 training 62–3, 93, 113, 114, 141 tribalism/tribal anger 8–9, 11, 18–31, 41, 45–6, 117 and central/eastern Europe 23, 30 destructiveness of 24 and ethical norms 20 and fascism 68 and financial crisis 86, 89 and global politics 21–2, 26, 28–9 and immigration 95, 111, 112, 113 manipulation by politicians/media of 13, 22, 24–7, 29, 30, 31, 35, 61, 95, 116, 161 and minimal group paradigm 21 and moral outrage, compared 19, 20, 22, 29, 30–31, 36 and political identity 22–23, 29–30 social function of 20–21 and sport fans 19–20, 25 see also nationalism trickling down/up 79–80 trilemma, political 39 trucking industry 103 Trump, Donald 11, 22, 23, 25–6, 27, 33, 38, 119, 126, 161 and deregulation 129 election of 41–2, 54 tax cuts of 11 Turkey 11 universal basic income (UBI) 141, 144 Ukraine 11 uncertainty 9–10, 43, 49–50, 65, 91–4, 99, 118, 161 and aging populations see aging populations and emerging technologies 102–103, 106 and healthcare 92 and immigration see immigration reducing 93–4 and risk/probability 91–3 and skills development 93 unemployment 2, 30, 34, 44–5, 48, 58, 66, 72, 84, 167 and inflation/interest rates 74, 75, 125 unfairness 25, 36, 105 United States (US) 3, 38, 93, 118, 129, 164 aging population in 107–108, 110, 111 automation in 103, 104–105 financial crisis in (2008) 82–3, 84, 85 gig economy in 100 healthcare in 47–8, 53–4, 58, 106, 123–4 independent fiscal councils in 150–51 inequality in 50, 51, 53–4, 58, 80–81 Keynesian system in 71, 72–3 labour market in 42, 44, 46, 62 micro-stressors in 47–8 neoliberalism in 76 and NWF 135 stock market in 63 tribalism in 23, 25, 29 wealth tax in 130 US Federal Reserve 6, 46, 84, 108, 110, 120, 148, 151 voice, loss of 37–9, 43, 48, 58 Volcker, Paul 75, 81–2 voting 37–8 see also electoral politics wages 2, 60 and automation 105 and competition 96–7, 98 and consumption 53–4, 58, 72 distribution of see income distribution growth in, without inflation 125 and immigration 115–16 and inequality 4, 50–53, 58 and neoliberalism 76, 77 and oil prices 96–7 and productivity 72, 76 stagnation in 34, 47, 58, 80–81, 83, 84, 85 and supply/demand 65–6 Wall Street Crash 67 Warren, Elizabeth 130, 132 Watson’s Analytics 19 wealth, distribution of 4, 15, 29, 30 welfare state 71 WhatsApp 2 Wilkinson, Richard 176 wind power, investment in 150 Wolf, Martin 80, 173 World Trade Organization (WTO) 42 Wren-Lewis, Simon 151 Yates, Tony 151 “Yellow Jackets” protests 2, 20, 55, 56

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ERIC: It’s important to stress how different the new system was. Regardless of national hardware variations and local software modifications, one policy target – full employment – was the common goal of all nations. This had never happened before. But since the 1920s and 1930s had shown that unemployment and poverty made people angry to the point that the system will collapse, the new system reset was designed to make sure that didn’t happen again. But to sustain full employment and high real wages, the hardware of v.2.0 had to be fundamentally rebuilt too. First, finance had to be put in a box and locked away. Finance that built factories and invested in technology was fine.

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This produced a virtuous circle where high productivity created high wages, which meant high consumption and high tax revenues, all of which enabled the production of high quality public goods (healthcare, education, housing) that lowered labour’s dependence on the market still further and took the anger out of the system.19 And all of this was buttressed by a set of international monetary institutions and agreements that kept exchange rates stable and capital local.20 This was a radical and deep-seated hardware reconfiguration and software reboot that enabled countries as different as the United States and Sweden to sustain full employment as the policy target for three decades, until the wheels, rather unexpectedly, fell off the wagon. Because just as there was a bug in the software of v.1.0 – treating labour as a commodity while denying the possibility of involuntary unemployment – so there was a bug in this system too. Which brings us to Michał, the third economist in our opening parable. You know all about this guy, Mark, so over to you. MARK: In 1943, in the midst of the war, and with the revolution in economic ideas about full employment in full swing, the Polish economist Michał Kalecki wrote seven pages of text for the journal Political Quarterly that not only identified the bug in the software of v.2.0, but predicted what v.3.0 – the world we grew up in – would look like.

Rewriting the Rules of the European Economy: An Agenda for Growth and Shared Prosperity
by Joseph E. Stiglitz
Published 28 Jan 2020

However, if demand does not move in tandem with supply, structural policies have no effect on output since there is already excess supply. In such a case, policies can simply exacerbate the gap between demand and supply. Over the long run, such policies may have a positive effect on standards of living, for if and when aggregate demand increases enough to restore the economy to full employment, output at full employment will be higher. But an economy has to get to full employment first. For that reason, we are focusing on the short-run impact here. In the short run, structural reforms increase output if they increase aggregate demand and decrease output if they decrease aggregate demand. A review of the structural reforms imposed by the Troika in the euro crisis makes clear that most of them worsened the downturn.

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At the very least, the EU needs to carve out an exception to the pact when the ECB cannot lower interest rates further. As we have noted, one of the reasons for the seeming lack of concern about the macroeconomic implications of the deficit rules was that monetary policy could be used to restore Europe to full employment. But the ECB cannot ride to the rescue when growth stalls with interest rates near zero. Especially in these circumstances, policy has to allow sufficient fiscal stimulus to restore full employment. Recognize that Burden-Sharing Is the Essence of Greater European Integration The authorities imposing austerity and the other extreme policies that resulted in such suffering often said there were no alternatives.

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But even if it did so, there remains the question: What happens in a currency union like the euro to a country that is facing recession? It cannot lower its own interest rate; it cannot devalue its currency. This chapter has outlined a broad set of approaches for how Europe can achieve full employment, or at least steer toward that goal in all countries simultaneously. Solving Europe’s macroeconomic problem, namely ensuring that aggregate demand is sufficiently strong so that there is full employment across Europe, is a condition for achieving shared prosperity. Higher incomes and low unemployment would open up greater possibilities for public investment, directly reduce inequality, promote growth, and create the fiscal space adequate to test new ideas to achieve the inclusive, equitable, and sustainable growth that Europe seeks.

Universal Basic Income and the Reshaping of Democracy: Towards a Citizens’ Stipend in a New Political Order
by Burkhard Wehner
Published 10 Jan 2019

Such a decision could therefore be morally well-founded even if political constraints allowed only a modest initial level of a citizens’ stipend. 3.4 Basic Income, Minimum Wage and Full Employment Guarantee If under a basic income scheme the citizens’ stipend alone is not sufficient for an adequate livelihood, then all members of the work force—at least all those who cannot live on savings—will want to earn a work income. For all these individuals there must then be work opportunities on acceptable terms, so that the sum of work income and citizens’ stipend ensures the minimum standard of living as stipulated. In this sense, full employment conditions must be fulfilled. In the recent past, such full employment conditions have proved no longer attainable in most countries.

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A citizens’ stipend is, however, not only a system of material redistribution, but affects social justice in a much broader moral sense. It does so particularly in its capacity as a full employment scheme. A distributional justice associated with full employment is morally superior to a purely arithmetic distributional justice, particularly because the unemployed can in part be assumed 16 3 A Long-Term Vision to belong to the least advantaged of a society. Full employment therefore not only improves the overall perception of social conditions, but also benefits those who are the materially and immaterially most needy. A citizens’ stipend system would, however, be superior to a conventional system even if it neither raised the minimum income nor ensured full employment.

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A citizens’ stipend would create conditions in the labor market that would make full employment objectives easier to achieve. Notably, no workers would any longer be under pressure to cover their livelihood solely from labor income. As basic income recipients, they could manage with lower work incomes than under the conventional social system. With these lower work incomes, the required minimum work performance would also be lower. Workers incapable of higher performance would not on that ground be excluded from the labor market. In this way, a citizens’ stipend could generate full employment conditions. Market processes alone, however, would not provide a guarantee that a sufficient minimum wage at this reduced level is actually paid.

Big Three in Economics: Adam Smith, Karl Marx, and John Maynard Keynes
by Mark Skousen
Published 22 Dec 2006

Keynes and the Classics," British economist John Hicks developed a graphic framework (known as the IS-LM diagram) to demonstrate Keynes's version of full-employment equilibrium (the special classical theory) versus unemployment equilibrium (the general theory) (Hicks 1937). Today's textbooks use a similar diagram to demonstrate aggregate supply (AS) and aggregate demand (AD). In Figure 5.1 we see how the economy is depressed at less than full employment. According to Keynes's model, the classical model only applies when the economy reaches full employment (Qj), while the Keynesian general theory applies at any point along the AS curve where it intersects with the AD curve.

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So the investment schedule is set at any level, unrelated to income. Equilibrium (M) is set at the point where S = I, which you will note falls short of full-employment income (F). Thus, the Keynesian cross reflects underemployment equilibrium. This static equilibrium model represents Samuelson's (and Keynes's) view that capitalism is inherently unstable and can be stuck indefinitely at less than full employment (M). No "automatic mechanism" guarantees full employment in the capitalist economy (Samuelson andNordhaus 1985,139). Samuelson compared capitalism to a car without a steering wheel; it frequently runs off the road and crashes: "The private economy is not unlike a machine without an effective steering wheel or governor," he wrote.

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In his revolutionary 1936 book, The General Theory of Employment, Interest and Money, Keynes preached that capitalism is inherently unstable and has no natural tendency toward full employment. Yet, at the same time, he rejected the need to na-tionalize the economy, impose price-wage controls, and interfere with the microfoundations of supply and demand. All that was needed was for government to take control of a wayward capitalist steering wheel and get the car back on the road to prosperity. How? Not by slashing prices and wages—the classical approach—but by deliberately running federal deficits and spending money on public works that would expand "aggregate demand" and restore confidence. Once the economy got back on track and reached full employment, the government would no longer need to run deficits, and the classical model would function properly.

The People: The Rise and Fall of the Working Class, 1910-2010
by Selina Todd
Published 9 Apr 2014

Basil Dean could not have dreamed that, by the time he felt able to speak of that evening in Bridport, Dunkirk would have been immortalized as a victory for the British; and its army as representatives of ‘the people’ – the workers who, victorious in war, deserved to win the peace. He could not have envisioned Labour’s landslide election victory in 1945, on a pledge to maintain full employment and a welfare state as thanks to the workers on whom victory had depended. The Second World War was the people’s war. It marked one of two major turning points in the twentieth century, heralding a period of full employment and comprehensive welfare provision that was only brought to an end by the second turning point: the election of Margaret Thatcher to government in 1979. During the war the government struck a contract with the people: work hard in return for a guaranteed job, a living wage and care in times of need.

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Local activists, voting figures and opinion polls revealed that Labour had continued to poll strongly in working-class constituencies, though the party had lost ground in some middle-class areas. The Conservatives concluded that Labour’s attractions were, in order of importance: ‘full employment, the National Health Service and social services, Fair Shares, bigger wage-packets [and] “Tory Misrule”’: voters vividly recalled the hungry thirties. While some middle-class voters were greatly attracted by the Conservatives’ commitment to cut income tax, working-class voters in particular were put off by the ‘vagueness of [Conservative] policy for full employment’, ‘cuts in food subsidies’ – including the promise to end rationing – and by ‘Churchill – seen as a warmonger’.50 Yet just one year later, on 26 October 1951, the Labour Party lost the general election.

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There’s too much class distinction.’59 Post-war welfare and educational reforms, together with near-full employment and Labour’s rhetoric of equality and technological innovation, gave young workers a new confidence in their right to be listened to. They were angry to discover that most employers had no intention of consulting them. Wilson’s attitude to the strikers did nothing to assuage their anger. After the election of 1966, the government stopped talking so much about ending social inequality. Changes in the international economic situation were one cause: in the face of foreign manufacturing competition, Wilson fell silent on the issue of full employment, and instead focused on eradicating the most extreme cases of poverty.

Animal Spirits: How Human Psychology Drives the Economy, and Why It Matters for Global Capitalism
by George A. Akerlof and Robert J. Shiller
Published 1 Jan 2009

The first such target— and the only one that would be needed in a normal recession—would be a monetary policy and a fiscal policy that would be jointly sufficient to return the economy to full employment. But because of the severe credit crunch, which has been induced by the low state of confidence, such a stimulus is not enough. Indeed, in the face of the credit crunch, it might take very large increases in government expenditures or tax reductions to reach full employment. So we argue that government macroeconomic policy should have a second, intermediate target. Credit flows should also be targeted at the level that would normally prevail at full employment. In the postscript to Chapter 7 we shall describe how the Federal Reserve has developed clever schemes that could enable it to achieve such a target even in these dire times.

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Most of the time—as now, when the U.S. unemployment rate is still 6.7% (although rising)—it predicts remarkably accurately. Consider yet again the Great Depression. Few people ask why employment was as high as 75% in 1933. Instead the common question is why 25% of the labor force was unemployed. To our mind macroeconomics concerns departures from full employment. Failure to be at such full employment must then result from a departure from the classical model of Adam Smith. We do believe, like most of our colleagues, that Adam Smith was basically right regarding why so many people are employed. We are also willing to believe, with some qualifications, that he was essentially correct about the economic advantages of capitalism.

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Most notably, firms that count on outside finance will go bankrupt if they cannot obtain credit. If the credit crunch continues and many firms go bankrupt, it would take an impossibly large fiscal and monetary policy stimulus to achieve full employment. There is the further problem that, as long as credit markets are frozen, the need for fiscal and monetary stimulation will continue. Using the appropriate fiscal and monetary stimulus, in sufficient amount, could possibly keep us at full employment. But to do so without relieving the credit crunch would be like propping a sick man up in bed so that he looks all right. He will collapse again just as soon as you remove the prop.

Samuelson Friedman: The Battle Over the Free Market
by Nicholas Wapshott
Published 2 Aug 2021

But while, according to one White House insider, “Keynesian management of the economy was fading [and] acceptance of the key role of money was rising,”19 Friedman’s monetarism did not figure in Nixon’s thinking. This became evident early in January 1971 when, in his State of the Union address, Nixon announced “a full employment budget,”20 a budget designed to be in balance if the economy were operating at its peak potential. “By spending as if we were at full employment, we will help to bring about full employment.”21 He went on: With the stimulus and the discipline of a full employment budget, with the commitment of the independent Federal Reserve System to provide fully for the monetary needs of a growing economy, and with a much greater effort on the part of labor and management to make their wage and price decisions in the light of the national interest and their own self-interest—then for the worker, the farmer, the consumer, for Americans everywhere we shall gain the goal of a new prosperity: more jobs, more income, more profits, without inflation and without war.22 Friedman, distressed to find himself shut out of the decision making, was taken by surprise when, in an interview immediately after the State of the Union, Nixon declared, “Now I am a Keynesian.”

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Secretary of Commerce from February 29, 1972 to February 1, 1973. 18.From taped conversation 546-2, July 26, 1971, White House Tapes, Nixon Presidential Materials Staff, National Archives at College Park, Md. http://millercenter.org/presidentialrecordings. 19.Stein, Presidential Economics, p. 138. 20.“A full employment budget” alluded to the amount of federal government stimulus spending needed to ensure full employment. By fixing spending as if full employment had been achieved, Nixon hoped to boost the economy and create jobs. 21.http://www.presidency.ucsb.edu/ws/?pid=3110. Nixon was expressing a commonly held simple Keynesian view that unemployment should be reduced by public spending and a budget deficit until full employment had been reached, when the budget should be made to balance to avoid overheating [inflation].

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In 1960, Samuelson hinted that there were problems with the Phillips Curve jobs/prices trade-off when he described cost-push inflation as “a force that operates year-in and year-out, whenever we are at high employment, to push up prices. … Instead of setting in only after you have reached over-full employment, the suspicion is dawning that it may be a problem that plagues us even when we haven’t arrived at a satisfactory level of employment.”13 Samuelson thought demand-pull inflation was a problem primarily for prosperous economies. As steady economic growth led to full employment, labor became scarce and allowed workers, in particular trade-union members, to win pay increases that restored the value of their wages when prices rose.

Automation and the Future of Work
by Aaron Benanav
Published 3 Nov 2020

For critiques see Geoff Mann and Joel Wainwright, Climate Leviathan: A Political Theory of Our Planetary Future, Verso, 2018, pp. 99–128; Troy Vetesse, “To Freeze the Thames,” New Left Review, no. 111, S2, May–June 2018; Jason Hickel, “Degrowth: A Theory of Radical Abundance,” Real World Economics Review, no. 87, 2019, pp. 54–68; and Nicholas Beuret, “A Green New Deal between Whom and for What?,” Viewpoint, October 24, 2019. 18 See Nixon Apple, “The Rise and Fall of Full Employment Capitalism,” Studies in Political Economy, vol. 4, no. 1, 1980. 19 For the classic account, see Michal Kalecki, “Political Aspects of Full Employment,” Political Quarterly, vol. 14, no. 4, 1943. Kalecki was wrong to think that capitalists would oppose full employment as such. They were fine with it, as long as it was achieved via private investment in the course of rapid, export-driven growth. See also Jonathan Levy, “Capital as Process and the History of Capital,” Business History Review, vol. 91, special issue 3, 2017. 20 See James Crotty, “Post-Keynesian Economic Theory: An Overview and Evaluation,” American Economic Review, vol. 70, no. 2, 1980, p. 25; Adam Przeworski, “Social Democracy as Historical Phenomenon,” New Left Review, no. 122, S1, July– August 1980, pp. 56–8. 21 Oskar Lange and Fred M.

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On this advanced social foundation, he argued, the state could begin to wind down the economy sometime in the late 1960s, increasing “leisure” to reduce weekly hours of work and favoring an “equitable distribution” of income to reduce levels of economic inequality.16 Add to this program a planned transition from fossil fuels to renewable sources of energy, and Beveridge’s proposal would rival the most radical designs for a Green New Deal today.17 Of course, governments never seriously considered implementing Beveridge’s full employment proposal. Examining the reasons for the failure of the radical Keynesian projects of the past shows why similar plans will hardly fare better today. In the aftermath of World War II, proposed public-investment-led full employment programs were forcefully combatted and soundly defeated, at a time when left-wing organizations were much stronger than they are today (of course, most of those left-wing organizations were fighting for more than public investment: many were calling for the socialization of production).18 Large asset-owners understood, correctly, that public investment posed an existential threat to their prerogatives regarding where and how much of society’s resources to invest in the expansion of production—and hence whether economies would expand or slide into recessions.19 It was not so much full employment they feared, but rather full employment achieved via public investment, which would have neutralized the capacity of large asset owners to throw society into chaos through threats of disinvestment.

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In the aftermath of World War II, proposed public-investment-led full employment programs were forcefully combatted and soundly defeated, at a time when left-wing organizations were much stronger than they are today (of course, most of those left-wing organizations were fighting for more than public investment: many were calling for the socialization of production).18 Large asset-owners understood, correctly, that public investment posed an existential threat to their prerogatives regarding where and how much of society’s resources to invest in the expansion of production—and hence whether economies would expand or slide into recessions.19 It was not so much full employment they feared, but rather full employment achieved via public investment, which would have neutralized the capacity of large asset owners to throw society into chaos through threats of disinvestment. Throughout the postwar period and into the present, capitalists have ensured that they retained a tight grip over this heavy artillery of the class conflict: the capital strike.20 By threatening to disinvest, capitalists have ensured that the private investment decisions of large firms are respected, as the condition of maintaining or restoring high levels of employment.

Two Nations, Indivisible: A History of Inequality in America: A History of Inequality in America
by Jamie Bronstein
Published 29 Oct 2016

Twenty-five years after internment, those who had been interned were still experiencing annual incomes 9 to 13 percent lower than those Japanese Americans (in Hawaii and outside the evacuation area) who were not interned.89 RIGHT TO FULL EMPLOYMENT Full employment had become so important that by 1944, Roosevelt proposed a second, “economic Bill of Rights,” in his State of the Union message. He hoped to guarantee Americans full employment at a living wage, medical care, and a social safety net—the same kinds of reforms called for in Britain’s Beveridge Report two years before.90 It is worth quoting Roosevelt at some length: We have come to a clear realization of the fact that true individual freedom cannot exist without economic security and independence.

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In 1946, Congress passed an Employment Act committing the federal government to maximizing employment, production, and purchasing power “in a manner calculated to foster and promote free competitive enterprise and the general welfare.”8 Unlike the act that had failed to pass in 1945, this 1946 act strove for “maximum employment” rather than full employment, thus paving the way for a postwar consensus that varying degrees of unemployment were acceptable.9 The President’s Council of Economic Advisers (CEA), created by the act, advised successive presidents on policy, but none of the CEA chairmen prioritized government-guaranteed full employment.10 The Republican victory over both houses of Congress in 1946, and Truman’s Cold War military buildup further decreased concern with employment.11 As Cold War ideological divisions hardened into anticommunist hysteria, the degree of central planning that Roosevelt’s notions required may have seemed more Soviet than American to many.

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Not only was this proposed spending increase controversial, but Carter administration insiders also warned that the program would be massively concentrated in a few poor southern states that had traditionally done little to address poverty.81 Despite having Democratic majorities in both the House and the Senate, Carter was unable to cultivate good relationships with key legislators, and PBJI was killed in committee.82 The Carter administration also seriously grappled with the notion of government-guaranteed full employment. The Humphrey-Hawkins Full Employment Act of 1978, originally drafted in 1974, would have compelled the federal government to provide jobs for all who wanted to work, whether or not the private sector demanded their needs or talents. Willing workers could sue the government if it failed to find them jobs. The bill called for a government department to conduct both employment and production surveys and then generate necessary jobs, whether in the public or the private sector.83 Like Nixon’s FAP, the Humphrey-Hawkins Bill was attacked from the left and the right.

The End of Loser Liberalism: Making Markets Progressive
by Dean Baker
Published 1 Jan 2011

But at least Disney and Comcast do not get to directly appoint members of the FCC. Chapter 6 Full Employment without the Fed In principle, the Fed should vigorously pursue policies that promote full employment. [49] However, it does not do so now, nor is it likely to do so in the near future. Under its current structure, the Fed is primarily responsive to the financial industry’s concerns about inflation, and full employment comes in a distant second. A progressive agenda should include efforts to educate the public about the Fed’s importance and its structure, for two reasons: to maintain pressure on the Fed to pursue the full-employment portion of its mandate, and to create support for legally restructuring the institution so that it is more accountable to democratically elected officials.

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A progressive agenda should include efforts to educate the public about the Fed’s importance and its structure, for two reasons: to maintain pressure on the Fed to pursue the full-employment portion of its mandate, and to create support for legally restructuring the institution so that it is more accountable to democratically elected officials. But even in a best-case scenario, the Fed will be controlled by financial interests long into the future. This raises the question of whether there are other steps that can be taken to move the economy back toward full employment even when the Fed is at best indifferent – if not outright hostile – to this effort. Work sharing: The quickest route back to full employment In the absence of a growing demand for labor that would increase employment, an alternative route is to divide up the existing work among more workers. While this may be an inferior path – there is enormous waste associated with an economy operating below its potential – it may be the only route available given that the possibility of further fiscal stimulus appears to be blocked by political considerations.

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While this may be an inferior path – there is enormous waste associated with an economy operating below its potential – it may be the only route available given that the possibility of further fiscal stimulus appears to be blocked by political considerations. Yet, in any case, work sharing might be a proper route back to full employment, since there is nothing written in stone about the current length of the work week or work year. Work sharing is not a new idea. The idea of shortening work time to create more jobs has a long history. In the context of an economy that is at full employment, the approach might be misguided, since legislated reductions in work time can lead to increased inflationary pressure and economic distortions. However, in an economy that is operating well below its potential and that is projected to remain below potential output for much of the next decade, as is the case with the U.S. economy, work sharing may be the most viable way of bringing the nation back to full employment.

The Tyranny of Nostalgia: Half a Century of British Economic Decline
by Russell Jones
Published 15 Jan 2023

This surprisingly upbeat outcome reflected a number of overlapping and reinforcing considerations, including rapid global population growth and an associated strong demand for capital; the requirement for industrial reconstruction in Europe and Japan; a period of catch-up with the technological best practice of the United States, which also provided generous financial assistance to its wartime allies and others; weak energy and commodity prices, such that the UK’s terms of trade (the price of UK exports relative to the sterling price of UK imports) improved consistently from the Korean War until the early 1970s, and by more than 35% in total; and the progressive liberalization and rapid expansion of global trade. Britain, meanwhile, became as strongly committed to full employment as any western nation. By February 1951 the second Attlee government had already instructed the United Nations that the maximum level of unemployment it would tolerate was 3% of the workforce, and that action to keep joblessness below that level would be initiated well before the threshold was reached.19 Indeed, full employment became a sacred cow, and the idea of what should constitute full employment became more and more extreme − certainly more radical than anything Keynes himself had imagined to be practicable for any length of time.

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By February 1951 the second Attlee government had already instructed the United Nations that the maximum level of unemployment it would tolerate was 3% of the workforce, and that action to keep joblessness below that level would be initiated well before the threshold was reached.19 Indeed, full employment became a sacred cow, and the idea of what should constitute full employment became more and more extreme − certainly more radical than anything Keynes himself had imagined to be practicable for any length of time. In late 1944, for example, Keynes wrote a letter to Sir William Beveridge about the latter’s book, Full Employment in a Free Society, in which it was mooted that governments should aim to reduce unemployment to 3% of the workforce. He commented: ‘No harm in aiming at 3 per cent unemployment, but I shall be surprised if we succeed.’20 As the expectation of very full employment became increasingly embedded in the nation’s political superstructure, it became harder for governments to row back on previous commitments and those who argued that it might be wise for the economy to be run with a greater degree of spare capacity were dismissed as reactionaries.

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Friedman also made a critical contribution to macroeconomic theory in identifying the role of evolving inflationary expectations in the widespread tendency for post-war inflation to accelerate, not least in the UK.5 As already noted, Keynes had accepted that the QTM was essentially valid at full employment – an increase in aggregate demand in such circumstances would merely tend to raise prices, not output. Friedman concurred with this, but his concept of full employment was different to that of Keynes. Friedman referred not to a widespread absence of spare capacity but to an equilibrium level of unemployment defined as the ‘natural rate’ – or the rate that was manifest under conditions of stable inflation and that reflected the structural characteristics of the labour and commodity markets.

Inventing the Future: Postcapitalism and a World Without Work
by Nick Srnicek and Alex Williams
Published 1 Oct 2015

Still, it might be imagined that, with the right political pressure and policies, a return to full employment could be an option.137 But, given that the height of the social democratic era required the exclusion of women from the waged workforce, we should in fact wonder whether full employment has ever been possible. If full employment remains operative only as an ideological mystification, its normalisation of work still extends to the unemployed. The transformation of welfare and the rise of workfare – forcing people to work in order to receive benefits – represent an increasingly insidious example of this. Mirroring the changing fortunes of full employment, unemployment has long been governed according to different ideas.138 Initial approaches saw unemployment as an individual accident – something to be mitigated by insurance-like solutions.

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Another, much smaller, set of arguments has been interested in the claim that the surplus population has a secular trend to grow in size. 49.Marx, Capital, Volume I, p. 798. 50.Richard Duboff, ‘Full Employment: The History of a Receding Target’, Politics & Society 7: 1 (1977), pp. 7–8. 51.While NAIRU is debatable as a measure of full employment, the postwar period saw unemployment typically below NAIRU, and the neoliberal period has seen unemployment consistently above NAIRU. Jared Bernstein and Dean Baker, ‘Full Employment: The Recovery’s Missing Ingredient’, Washington Post, 3 November 2014, p. 10; José Nun, ‘The End of Work and the “Marginal Mass” Thesis’, Latin American Perspectives 27: 1 (2000), p. 8; Guy Standing, The Precariat: The New Dangerous Class (London: Bloomsbury Academic, 2011), pp. 46–7; Jeffrey Straussman, ‘The “Reserve Army” of Unemployed Revisited’, Society 14: 3 (1977), p. 42. 52.Economic Projections of Federal Reserve Board Members and Federal Reserve Bank Presidents, December 2014, Federal Reserve Board, 2014, pdf available at federal-reserve.gov, p. 1. 53.Claire Cain Miller, ‘As Robots Grow Smarter, American Workers Struggle to Keep Up’, New York Times, 15 December 2014. 54.Bureau of Labor Statistics, ‘Civilian Employment–Population Ratio’, Federal Reserve Bank of St Louis, 2014, at research.stlouisfed.org; Deepankar Basu, The Reserve Army of Labour in the Postwar US Economy: Some Stock and Flow Estimates, Working Paper (Amherst: University of Massachusetts, 2012), p. 7. 55.ILO, Global Employment Trends 2014, p. 17. 56.The job growth rate dropped from 1.7 per cent between 1991 and 2007 to 1.2 per cent between 2007 and 2014.

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One of the principal ways to manage the unruly surplus has been to champion the social democratic ideal of full employment, whereby every physically capable (male) worker has a job. In support of this ideal, economic policies aim to reincorporate the surplus into capitalism as disciplined and waged workers, secured by a hegemonic consensus between the representatives of labour and capital. The apogee of this approach was the postwar period, when working-class struggle and conservative concern with social order positioned full employment as a necessary economic goal.119 In this brief ‘golden age’ of capitalism, unemployment was kept to a minimum, and capital had to seek out pre-capitalist populations around the world in order to expand and accumulate.120 For the most part, job growth was achieved through healthy economic growth that increased the demand for labour.121 Historically, growth of the national economy has often been important in warding off the effects of technological unemployment – either by increasing the output of existing industries or by inventing new industries to employ the displaced workers.

An Extraordinary Time: The End of the Postwar Boom and the Return of the Ordinary Economy
by Marc Levinson
Published 31 Jul 2016

By the final months of World War II, a large majority of Americans, and nearly one-third of business leaders, told pollsters that it was government’s role to maintain full employment. Among Americans with college degrees, a stunning 70 percent concurred that “Full employment is something we should try to get, and it will require government action as well as planning by industry to get it.” When the US Senate, dominated by conservatives, considered the Full Employment Act in September 1945, seventy-one senators agreed that the government should ensure full employment when the private sector fell short, and only ten voted no.18 Although the Full Employment Act was much weakened before Congress finally approved it, support remained strong for the idea that government should, and could, ensure jobs for all.

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No one seemed to notice that the “full-employment budget” created perverse incentives for elected politicians everywhere. Agreeing to more government spending at times of high unemployment was easy enough, but reducing spending during economic upturns was far less attractive. Deficit spending would become the norm. The well-intentioned idea of a full-employment budget, like many well-intentioned ideas, had unforeseen consequences. Economists became arbiters, specifying what unemployment rate would constitute “full employment” and then calculating how much government spending would be required to reach that target. “Conceptual advances and quantitative research in economics are replacing emotion with reason,” Walter Heller, formerly the chief economic adviser to presidents John F.

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See also specific presidents and prime ministers Franco, Francisco, 211–213 Franklin National Bank, 87–89, 91, 95, 96 free enterprise, 224, 225 free-market economics, 30, 31, 254–255; Thatcher and, 172, 260 French Republic, 4 Friedman, Milton, 75, 76, 153, 176, 180–181, 185 full employment, 6, 25–26, 30, 35, 170, 179, 180, 233, 261; tax cuts, easy money, government programs and, 75. See also employment/unemployment; unemployment Full Employment Act, 25–26 full-employment budget, 26 Fullerton, Don, 228 G-77, 43 gas: deregulation of, 99–100, 102, 103–104, 107–108, 109, 113 GATT. See General Agreement on Tariffs and Trade General Agreement on Tariffs and Trade (GATT), 42 German Bundesbank, 28, 51, 55, 86, 181 Germany, 19, 224; banks/banking system in, 28, 91, 94 (see also banks/banking systems); debt crisis in, 246; economic crisis of 1970s in, 164; economic planning in, 28, 29–30; economy at close of World War II in, 16–17; economy policy in, 27–35; formal division into two zones in, 28–29; income inequality in, 135; inflation and buying power in, 55–56; labor/trade unions in, 169; political parties in, 27–28; postwar occupied zones in, 28; postwar productivity in, 23; welfare state in, 17.

People, Power, and Profits: Progressive Capitalism for an Age of Discontent
by Joseph E. Stiglitz
Published 22 Apr 2019

I explain here what government can do to create the economy we should have. Ensuring full employment No policy is more important for equality, growth, and efficiency than maintaining full employment. And the most important ingredient in a middle-class life style is having a decent job. That in turn requires that there be jobs—a macroeconomic framework that ensures full employment. In spite of the fact that many conservative economists believe that markets always work efficiently, it should be obvious: there have been long periods of time in which the market, on its own, has failed to achieve full employment. Massive unemployment is a great waste of resources.

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If monetary policy responds by lowering interest rates, and the lower interest rates increase investment or consumption, full employment might be restored. But sometimes monetary policy doesn’t work, or at least work well enough to achieve full employment. That helps explain why after the admission of China to the WTO in 2001, American unemployment increased and wages fell in those places that produced goods that were competitive with things being imported in growing volume from China.5 Even when monetary and fiscal policy work to return the economy eventually to full employment, globalization often leads to job destruction in the short run, as the loss of jobs from an onslaught of imports occurs faster than job creation from additional exports, especially when banks aren’t lending much to new enterprises seeking to take advantage of the new opportunities offered, say, by a new trade agreement.6 Moreover, trade agreements and tax laws have effectively encouraged firms to move manufacturing abroad, destroying jobs at home.

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With the Federal Reserve keeping interest rates so low for so long, capital costs relative to labor were especially low—and not surprisingly, then, attention got drawn toward reducing labor costs. The demand for labor, already not enough to maintain full employment, was weakened further.13 Lower wages and increased inequality Even getting us to full employment may not be enough. If machines replace labor, then by definition, the demand for labor at any given wage is reduced, so to restore the economy to full employment wages must fall. This is just a straightforward application of the law of supply and demand. But it means that, without government intervention, large parts of the economy will be worse off.14 Of course, in principle, technological advances should be able to make all of us better off, as is also true for globalization.

End This Depression Now!
by Paul Krugman
Published 30 Apr 2012

Of the 13 million U.S. workers who were unemployed in October 2011, only 1.1 million (a mere 8 percent) had previously been employed in construction. More broadly, if the problem is that many workers have the wrong skills, or are in the wrong place, those workers with the right skills in the right place should be doing well. They should be experiencing full employment and rising wages. So where are these people? To be fair, there is full employment, even a labor shortage, on the High Plains: Nebraska and the Dakotas have low unemployment by historical standards, largely thanks to a surge in gas drilling. But those three states have a combined population only slightly larger than that of Brooklyn, and unemployment is high everywhere else.

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Before I get there, however, let’s talk briefly about the views of those who don’t believe any of what I’ve just said. Is It Structural? I believe this present labor supply of ours is peculiarly unadaptable and untrained. It cannot respond to the opportunities which industry may offer. This implies a situation of great inequality—full employment, much over-time, high wages, and great prosperity for certain favored groups, accompanied by low wages, short time, unemployment, and possibly destitution for others. —Ewan Clague The quotation above comes from an article in the Journal of the American Statistical Association. It makes an argument one hears from many quarters these days: that the fundamental problems we have run deeper than a mere lack of demand, that too many of our workers lack the skills the twenty-first-century economy requires, or too many of them are still stuck in the wrong locations or the wrong industry.

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Sometimes it’s framed in terms of a story about how technology is simply making workers unnecessary—which is what President Obama seemed to be saying when he told the Today Show, There are some structural issues with our economy where a lot of businesses have learned to be much more efficient with fewer workers. You see it when you go to a bank and you use an ATM, you don’t go to a bank teller. Or you see it when you go to the airport and you use a kiosk instead of checking at the gate. [my emphasis] And most common of all is the assertion that we can’t expect a return to full employment anytime soon, because we need to transfer workers out of an overblown housing sector and retrain them for other jobs. Here’s Charles Plosser, the president of the Federal Reserve Bank of Richmond, and an important voice arguing against policies to expand demand: You can’t change the carpenter into a nurse easily, and you can’t change the mortgage broker into a computer expert in a manufacturing plant very easily.

Free Money for All: A Basic Income Guarantee Solution for the Twenty-First Century
by Mark Walker
Published 29 Nov 2015

Those fortunate to be still employed, in other words, should find BIG an attractive means to avoid the threat of having their heads put on the ends of pikes by angry mobs upset by perceived unfairness of the robotic revolution. On the other hand, if the economy is able to generate full employment, then the economy will have to grow faster than the redundancy rate to maintain full employment. This means that the economists who predict full employment must also predict a massive growing economy of unprecedented proportions as a logical consequence. That is, optimism about full employment logically requires optimism about a massively expanded economy. In this case, paying for BIG will be comparatively easy as it will be a small percentage of total economic output.

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The point, in other words, is that new industries themselves will likely use advanced robotics and computers, and so economic output will have to increase faster than the percentage of unemployed to keep the economy at full employment. Figure 5.2 shows the relationship necessary for economic growth and full employment. Table 5.1 Increase in economic output Employees per firm Total employees 100 111 125 142 166 200 250 333 500 1,000 10 9 8 7 6 5 4 3 2 1 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 Economy Growth Necessary to maintain full employment Firms Total widgets Percentage of economy in 2014 (%) 1,000 1,110 1,250 1,425 1,660 2,000 2,500 3,333 5,000 10,000 100 111 125 142 166 200 250 333 500 1000 2000 1800 1600 1400 1200 1000 800 600 400 200 0 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Employment Redundancy Figure 5.2 redundancy Exponential rate of economic growth and employment PEACE, ROBOTS, AND TECHNOLOGICAL UNEMPLOYMENT 111 We are now in a position to see why BIG is a smart bet, given the uncertainties in employment creation.

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Indeed, the belief that the economy will always generate enough jobs seems to be well entrenched: every year I hear college freshmen state it with the same unflinching faith, just like economists such as Tabarrok. Notice that the economists have the more extreme position. They are committed to the idea that the economy will generate full employment. Chicken Little wins if there is anything less than full employment due to technology’s advancement. Despite Chicken Little’s horrendous track record of failure in predicting technological unemployment, I think the prediction of technological unemployment is sound. The Nature of the Debate between Chicken Little and the Economists Thus far, I have merely rehearsed the outlines of a familiar debate.

The End of Alchemy: Money, Banking and the Future of the Global Economy
by Mervyn King
Published 3 Mar 2016

Growth today seems possible only if interest rates are much lower than normal – at present the long-term real rate of interest is close to zero. The ‘natural’ real rate is the real rate of interest that generates a level of total spending sufficient to ensure full employment. When asked why demand is weak, economists tend to answer that it is because the natural real rate of interest is negative – in other words, people will spend only when faced with negative real interest rates. And when asked why that is, they reply that it is because demand is insufficient to maintain full employment. The reasoning is circular. Simply restating the phenomenon of secular stagnation in different words and pretending to have offered an explanation does not amount to a theory.

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From the start of monetary union until 2013, prices on this measure rose by 16 per cent in Germany, 25 per cent in France, 33 per cent in Greece, 34 per cent in Italy, 37 per cent in Portugal, and 40 per cent in Spain.19 So although the birth of the euro brought about some initial convergence of expected inflation rates, the consequence of a single interest rate was to generate subsequent divergence of inflation outcomes. The resulting loss of competitiveness among the southern members of the union against Germany is large, even allowing for some overvaluation of the Deutschmark when it was subsumed into the euro. It increased full-employment trade deficits (the excess of imports over exports when a country is operating at full employment) in countries where competitiveness was being lost, and increased trade surpluses in those where it was being gained. Those surpluses and deficits are at the heart of the problem today. Trade deficits have to be financed by borrowing from abroad, and trade surpluses are invested overseas.

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The General Theory, although it contains some beautiful and compelling prose, includes many arguments that are obscure and difficult, even at times almost incomprehensible. Macroeconomics in this era became divided into two schools of thought: Keynesian and neoclassical.4 The former focused on the role of the state in returning an economy from depression to full employment. The latter studied the conditions in which a market economy returns to full employment under its own steam after a temporary deviation from its normal equilibrium. Neoclassical economists often argue that the Keynesian analysis presents a special case in which employment is temporarily below its attainable level, often as a result of misguided government policies.

Limitless: The Federal Reserve Takes on a New Age of Crisis
by Jeanna Smialek
Published 27 Feb 2023

The inaugural Fed Listens event in Chicago in June 2019—before the pandemic, when the labor market was widely assessed to be at or near full employment—had changed his mind. Brainard had moderated a panel with the chancellor of the City Colleges of Chicago, the chief executive of the National Skills Coalition, and the head of the Greater Kansas City AFL-CIO. It was titled “What Does Full Employment Look Like for Your Community or Constituency?” Juan Salgado, the chancellor, had pointed out that in one of the heavily minority communities his college served in Chicago, unemployment was at 35 percent and 47 percent of people were not in the labor force.[28] “When I hear we’re at full employment, that’s not my reality.

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The Month Markets Melted 3. One Nation, Under Banks 4. The Fed’s Second Act 5. The Temple Is Under New Management 6. A Polarized Fed 7. March Madness 8. A Corporate House of Cards 9. The Day the Fed Changed 10. Racing Across Red Lines 11. Culture Wars and Capital 12. Love Songs to Full Employment 13. A Fed Restrained 14. The Creeping Crises 15. A Year of Uncomfortable Questions Epilogue Acknowledgments Bibliography Notes Index _142549205_ INTRODUCTION The interviewer on the April 9, 2020, webcast had a simple question for the chair of the Federal Reserve: How much support could the central bank provide to businesses and households using its emergency powers?

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It lowered rates to encourage lending and spending when the economy was weak or raised them to slow it down when consumption and hiring were running hot. It was a technocratic job, but an important one with big consequences for the American population. The Fed used its policy to achieve the two main goals Congress had assigned it: keeping inflation low and fostering full employment. Prosperity turned on whether it succeeded. The Fed’s role in society didn’t stop there. As of 2019, it also regulated and supervised the nation’s largest bank holding companies, monitored financial stability, managed the nation’s cash supply and core payments system, and performed extensive economic research.

Men Without Work
by Nicholas Eberstadt
Published 4 Sep 2016

(April 2016, International New York Times4) •“June’s Super Jobs Report (July 2016, Atlantic Monthly5) In addition, U.S. economists and policymakers who have served under Republican and Democratic presidents maintain that today’s U.S. economy is either near or at “full employment”: •“It is encouraging to see that the U.S. economy is approaching full employment with low inflation.” (Ben Bernanke, former chairman of the Federal Reserve Board, October 20156) •“The American economy is in good shape . . . we are essentially at full employment . . . tight labor markets are leading to increases in hourly earnings and in the producer prices of services.” (Martin Feldstein, former chair of the President’s Council of Economic Advisers and longtime director of the National Bureau of Economic Research, February 20167) •“We are coming close to [the Federal Reserve’s] assigned congressional goal of full employment.

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This disturbing situation is our “new normal.” No less disturbing is the fact that the general public and political elites have uncritically accepted this American decimation as today’s “new normal.” Today’s received wisdom holds that the United States is now at or near “full employment.” An alternative view would hold that, by not-so-distant historic standards, the nation today is short of full employment by nearly 10 million male workers (to say nothing of the additional current “jobs deficit” for women). Unlike the dead soldiers in Roman antiquity, our decimated men still live and walk among us, though in an existence without productive economic purpose.

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_r=0. 5.Bourree Lam, “June’s Super Jobs Report”, Atlantic Monthly, July 8 2016, http://www.theatlantic.com/business/archive/2016/07/june-jobs-report/490466/. 6.Ben Bernanke, “How the Fed Saved the Economy,” Brookings, October 4, 2015, https://www.brookings.edu/opinions/how-the-fed-saved-the-economy/. 7.Martin Feldstein, “The U.S. Economy Is in Good Shape,” Wall Street Journal, February 21, 2016, http://www.wsj.com/articles/the-u-s-economy-is-in-good-shape-1456097121. 8.Jana Raindow, Christopher Condon, and Matthew Boesler, “Yellen Says U.S. Near Full Employment, Some Slack Remains,” Bloomberg, April 7, 2016, http://www.bloomberg.com/news/articles/2016-04-07/yellen-says-u-s-close-to-full-employment-some-slack-remains. 9.Note that the workforce is officially defined as the sixteen-plus population (more or less is the age you legally can get out of school); historically it was the fourteen-plus population. In this study, I use three measures working age population: twenty-plus, twenty-to-sixty-four, and the “prime working” ages of twenty-five-to-fifty-four. 10.While the U.S.

Capitalism 4.0: The Birth of a New Economy in the Aftermath of Crisis
by Anatole Kaletsky
Published 22 Jun 2010

As a result, labor militancy intensified and pay demands escalated; and in an economic system where the top priority of government policy was maintaining full employment, companies felt confident that enough money would be printed to accommodate whatever pay offers were needed to stave off labor militancy and strikes. Inflation was the inevitable result. The only way to stop this inflationary spiral and restore discipline in the labor market was for governments to abandon full-employment policies and create conditions in which millions of workers would lose their jobs. This is exactly what happened after 1979. The self-destruction of Keynesian full-employment policies was anticipated in 1943, in one of the most prescient economic papers ever published.

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This inflationary crisis would, in turn, force the capitalist system to reinvent itself again—and economic theory would devise retrospective justifications for whatever new policies the survival of capitalism demanded: The assumption that a government will maintain full employment in a capitalist economy if it knows how to do it is fallacious . . . Under a regime of permanent full employment “the sack” would cease to play its role as a disciplinary measure. Continuous full employment would cause social and political changes which would give impetus to the opposition of business leaders . . . The self-assurance and class-consciousness of the working class would grow. Strikes for wage increases and improvements in working conditions would create political tension . . .

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Moreover, the proportion of unionized workers in the private-sector labor force started falling gradually in the 1960s as the United States, Britain, and other advanced economies reduced their reliance on large-scale manufacturing. Toward the end of that decade, however, the accelerating growth of public-sector employment began to offset this decline in union power. More importantly, the twenty-five years of continuous full employment after 1945 transformed the psychology of the postwar generation of workers and union leaders. Full employment began to be taken for granted and unions became increasingly militant in demanding a larger share of corporate and national incomes, as predicted by Michal Kalecki in his 1943 article. 25 Companies and governments were generally willing to concede to these demands for higher wages against the background of rapid global growth—and this labor market pressure started turning easy monetary conditions into inflation.

The Price of Inequality: How Today's Divided Society Endangers Our Future
by Joseph E. Stiglitz
Published 10 Jun 2012

The United States is in a position, for instance, to tax corporations that operate in the United States on the full basis of the profits they derive from their sales in the United States, regardless of where their production occurs.13 Restoring and maintaining full employment A fiscal policy to maintain full employment—with equality. The most important government policy influencing well-being, with the most important consequences for distribution, is maintaining full employment. Unless the United States is careful, it could move into a situation similar to that of some European countries, with permanently higher unemployment—a vast waste of resources, which would simultaneously lead to more inequality and weaken both our economic and our fiscal situation.

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As we noted in earlier chapters, a defense of these subsidies is that they increase employment. But as we noted there, too, the responsibility for maintaining the economy at full employment lies with macroeconomic policy (monetary policy and fiscal policy). If macroeconomic policy is managed well, we can have an economy at full employment, without these subsidies. If macroeconomic policy is not managed well, we won’t have full employment, even with the subsidies. 23. The balanced-budget multiplier is normally assumed to be around unity. But if taxes are increased on the rich, who otherwise would have saved a lot, and expenditure increases are focused on “high multiplier” activities, like investments in education, then the balanced-budget multiplier can be much larger. 24.

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Getting more money into the pockets of those in the middle and at the bottom would do that. That’s why deficit reduction proposals that would, in effect, impose much of the burden of tax increases on the middle would simply make things worse.29 It is the responsibility of macropolicy—monetary and fiscal policy—to maintain the economy at full employment. When things are going well, and the economy is operating near full employment, excessive military spending and lavish corporate welfare don’t create jobs. They just distort the economy by moving labor from more-productive uses to less-productive uses. It is true that if we correct these distortions, some workers with sector-specific skills will suffer, as their skills will no longer be in demand.

Slouching Towards Utopia: An Economic History of the Twentieth Century
by J. Bradford Delong
Published 6 Apr 2020

China in 2007 and after knew not so much that the market was made for man, but that the market was made for the purpose of serving the goals of the Chinese Communist Party. One of those goals was maintaining full employment. And so full employment was maintained. Were “ghost cities” built and lots of people put to work building infrastructure that would decay and degrade before anybody could use it? Yes. Were unstable financial structures constructed that would not be fully accepted by banks without government arm-twisting? Yes. But those costs were trivial relative to the damage avoided by maintaining full employment and growth through what was, elsewhere, the Great Recession. During the Great Recession, China gained from five to ten extra years in its race to catch up to the global north.

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The Gilded Age oligarchy of the robber barons had failed, and had in fact brought on the Great Depression—how was not quite clear, but, as Franklin Roosevelt put it, there was near consensus that the oligarchs and the plutocratic financiers needed to be cast down “from their high seats in the temple of our civilization.”8 Competition needed to rule. The Great Depression had also convinced the private sector that it needed the help of an active government to manage the economy in order to attain at least an approximation of full employment. Perhaps, more importantly, the Depression convinced the middle class that it had powerful interests in common with the working class—and from then on, both would demand social insurance and full employment from politicians. Adding to all of this, the totalitarian threat from Stalin’s Soviet Union played a large role in convincing the nascent North Atlantic alliance to follow America’s lead in both security policy and political-economic restructuring.

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The decade starting in 1966, of having, almost every year, surprise upward shocks to the rate of growth of money prices on average, convinced businesses, unions, workers, and consumers that (a) inflation needed to be paid attention to, and (b) it was likely to be the same as or a bit more than it had been last year—so you needed (c) to build into your planning the expectation that, over the next year, your wages and other people’s wages, and your prices and other people’s prices, would rise by at least as much as, and probably more than, they had last year. This then produced stagflation. If inflation were to stay constant, then employment would have to fall below full employment to put pressure on workers to accept wage increases lower than they had expected. If the economy were to be at full employment, then the rate of inflation would have to creep upward. The Organization of the Petroleum Exporting Countries imposed an oil embargo against the United States and the Netherlands in the aftermath of the 1973 Yom Kippur War, and this deranged the oil market.

Stolen: How to Save the World From Financialisation
by Grace Blakeley
Published 9 Sep 2019

Michał Kalecki — a Polish economist who theorised demand management at the same time, and some have said before, Keynes himself — had foreseen such problems decades earlier.21 After reaching his conclusions about the capacity of the state to control demand in the economy, he argued that such policies couldn’t work for long because there were “political aspects” of full employment policy that rendered it inherently unstable. The state’s commitment to promote full employment undermined the thing that made capitalism work: the threat of the sack. A policy of full employment would remove the “reserve army” that capitalists relied on to ensure a steady stream of cheap labour. Without desperate workers to exploit, profits would dry up. The powerful state that had emerged from the Second World War had committed a second sin: it was no longer afraid of the capitalists’ threats to withdraw investment.

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In the 1960s, economists drew on the work of William Phillips to posit an inverse relationship between inflation and unemployment. According to the models they built, when unemployment was high, inflation was low, and vice versa, implying that states should tolerate moderate levels of inflation in order to promote full employment.20 Governments were supposed to boost spending and reduce interest rates until full employment was reached, at which point they should start to reduce spending and raise interest rates in order to bring down inflation. Effecting this balancing act between inflation and unemployment was seen as the main aim of economic policy throughout the post-war period.

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In this uncharted territory nobody knew what to do. By the time unemployment reached 4% in the early 1970s, it was clear that the state was trying to resolve the issue by tacitly withdrawing its promise to protect full employment in an effort to bring down inflation. But such a strategy posed an existential threat to the UK’s trade unions: the withdrawal of the state’s commitment to full employment would mean losing a powerful ally in their fight against the bosses. They could not afford to go down without a fight — not to mention, their members required jobs and pay increases in line with inflation to be able to survive.

Buying Time: The Delayed Crisis of Democratic Capitalism
by Wolfgang Streeck
Published 1 Jan 2013

Whereas recipients of residual income seek the highest possible yield on their capital investment, earners of fixed income try to keep as low as possible the input required of them.41 Distribution conflicts arise from the fact that, other things being equal, higher residual income for the profit-dependent entails lower wages for the wage-dependent, and vice versa.42 For a theory of political economy in which capital is an actor and not just machinery, the seemingly technical ‘functioning’ of the ‘economy’ – above all, growth and full employment – is in reality a political matter. Here lies the difference from a technocratic concept of crisis, such as we find in the years after the Second World War and also in Pollock’s work and Frankfurt social theory. Both growth and full employment depend on the willingness of capital owners to invest, and that in turn depends on their aspirations for an ‘adequate’ rate of return, as well as on their general assessment of the security and stability of the capitalist economic order.

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His answer was that permanent full employment brought the danger that workers would become over-demanding once they had forgotten the insecurity and deprivation associated with unemployment. At that point discipline might break down at the workplace as well as in the political arena. This was why, in Kalecki’s view, capital should have an interest in lasting structural unemployment, serving to warn employees of what they might face if their demands became excessive. This, of course, assumed that governments could be persuaded to renounce Keynesian measures to guarantee full employment. To employers and governments under democratic capitalism, the global wave of wildcat strikes in 1968 and 1969 appeared to be the result of a long period of crisis-free growth and secure full employment that had fuelled excessive expectations on the part of a labour force spoiled by affluence and the welfare state.47 Workers, on the other hand, thought they had simply been insisting on their democratic right to continuous improvements in living standards and economic security.

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If this fails, and the insecurity and unsatisfied demands of capital make themselves felt as disturbances to ‘the economy’, a further, derivative legitimation crisis may ensue, this time among the wage-dependants for whom the technical functioning of the system, especially its provision of growth and full employment, is the necessary condition for them to be at peace with it. New demands are not required for this, only non-fulfilment of the old ones. In other words, capitalism presupposes a social contract in which the legitimate mutual expectations of capital and labour, of profit-dependants and wage-dependants, are more or less explicitly enshrined as a formal or informal economic constitution.

Economic Dignity
by Gene Sperling
Published 14 Sep 2020

The stimulus enacted early in the Obama administration saved or created about nine million jobs from 2009 to 2012 and helped prevent a second Great Depression.120 The decreasing evidence over the last two decades that deficits lead to inflation has bolstered the already strong case for the use of government investment on an ongoing basis to expand economic demand and reap the economic dignity benefits of full employment. From a perspective of ensuring that work leads to economic dignity for all workers, the case for tighter labor markets and full-employment monetary and fiscal policy is very strong. As economists Dean Baker and Jared Bernstein summarized in their book Getting Back to Full Employment, “Unemployment is not just a problem that affects those unable to find jobs; it hurts the entire labor force. Unemployment reduces the bargaining power of all job holders.”121 Recent empirical work by Bernstein and Keith Bentele has further reinforced that the largest beneficiaries of such full-employment policies are low-income workers, particularly those non-white or single moms.122 Simply put: beyond wage growth, tight labor markets give higher capacity to make demands or exit to the very same workers who normally have the least power to say no to mandatory arbitration, no to noncompete clauses, no to erratic work schedules, and no to abuse at work.

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Benjamin Wallace-Wells, “Sherrod Brown Wants to Bring a Working-Class Ethos Back to the Democratic Party,” New Yorker, December 13, 2018, https://www.newyorker.com/news/the-political-scene/sherrod-brown-wants-to-bring-a-working-class-ethos-back-to-the-democratic-party; and “The Dignity of Work,” accessed November 5, 2019, https://dignityofwork.com/. 15. Mark Paul, William Darity Jr., and Darrick Hamilton, “The Federal Job Guarantee—A Policy to Achieve Permanent Full Employment,” Center on Budget and Policy Priorities, March 9, 2018, https://www.cbpp.org/research/full-employment/the-federal-job-guarantee-a-policy-to-achieve-permanent-full-employment. 16. Alexander Hamilton, “Federalist No. 1,” October 27, 1787, https://teachingamericanhistory.org/library/document/federalist-no-1/. 17. Gunnar Myrdal, An American Dilemma: The Negro Problem and Modern Democracy (New York: Harper & Brothers Publishers, 1944). 18.

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A percentage point decline in unemployment raises annual hours by 2.7 percent for African American households. Josh Bivens and Ben Zipperer, “The Importance of Locking in Full Employment for the Long Haul,” Economic Policy Institute, August 21, 2018, https://www.epi.org/publication/the-importance-of-locking-in-full-employment-for-the-long-haul. 122. Jared Bernstein and Keith Bentele, “The Increasing Benefits and Diminished Costs of Running a High-Pressure Labor Market,” Center on Budget and Policy Priorities, May 15, 2019, https://www.cbpp.org/research/full-employment/the-increasing-benefits-and-diminished-costs-of-running-a-high-pressure. Real wages of workers in the bottom quintile grow 2.3 percent in tight labor markets but fall 3.9 percent in slack labor markets—a difference of 6.1 percentage points—with the biggest effects at the bottom of the income distribution.

The Making of Global Capitalism
by Leo Panitch and Sam Gindin
Published 8 Oct 2012

More broadly their concerns related to their ambition to replace London as the world’s international financial center.48 But above all Wall Street’s opposition reflected the concern that New Deal–type economists and technicians ensconced in permanent international institutions might have even greater autonomy from them than those in the Federal Reserve and the Treasury (especially since the Treasury clearly wanted the Fund to displace the Bank of International Settlements, which had been created by the bankers themselves).49 Moreover, given the Keynesian provenance of the Fund and the Bank, it was hardly surprising that bankers would be anxious lest full employment rather than price stability might become the priority for governments. Their anxiety about the inflationary implications of full employment was by no means an idle concern, and would indeed prove to be—as Michal Kalecki and Joan Robinson also predicted at the time—the central contradiction of Keynesianism in the postwar era. If there was ever a case where the advantages of relative autonomy were manifest, allowing a capitalist state to act on behalf of capital but not at its behest, it was in the extensive public campaign the US Treasury undertook to get the Bretton Woods agreement endorsed by Congress over the bankers’ opposition.

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And a further, much more profound contradiction had arisen—one that overlapped with and to a considerable extent really underlay the others. The realization of Keynesian “full employment” objectives by the 1960s clearly brought to the fore the old question of how capital and the state were to cope with the demands made by working classes no longer restrained by the fear of involuntarily conscription into the reserve army of labor. The achievement of near full employment within all the advanced capitalist states spurred the growing militancy of a new generation of workers who drove up wages, challenged managerial prerogatives, and forced a steady increase in social expenditures—all of which not only made it very difficult for capitalist states to resolve international economic imbalances through domestic austerity policies, but generated growing worries about price stability, productivity and profits.

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The most significant indicator of the changing political balance of class forces lay in the fate of the labor-backed Humphrey-Hawkins Equal Opportunity and Full Employment Bill, to which the administration—in order to win over Democratic “moderates” in the Senate and assuage business critics—attached provisions specifying that it should not encourage inflation or “employee migration from the private to the public sector.”16 Those endorsing the bill faced the seemingly insurmountable task of overcoming the “fears of expansive government, increased taxes, and, especially, the acceleration of inflation.” Unsurprisingly, the Humphrey-Hawkins Bill’s ambitious proposal for “nationally coordinated economic planning to bring about full employment” was countered by those “entrenched interests that opposed planning—interests that were aggressively re-organized in the 1970s.”17 By the time the bill was passed, in October 1978, as the Full Employment and Balanced Growth Act, the promise of access to work for all was gone, and it was stipulated that for fiscal deficit reasons no new job-creation programs could be started before the end of 1980.

Modernising Money: Why Our Monetary System Is Broken and How It Can Be Fixed
by Andrew Jackson (economist) and Ben Dyson (economist)
Published 15 Nov 2012

(Minsky, 1986, pp. 173-174) In today’s economy increases in lending for investment may also be non-inflationary at full employment so long as it attracts labour and capital that was previously not used to produce goods and services – that is, it must lead to an increase in the amount of goods produced in an economy. In an economy operating below full capacity It is unlikely that many people would argue that today’s economy is at ‘full employment’, even allowing for ‘natural’ or ‘frictional’ unemployment. In a situation where the economy is operating below potential output (less than full employment, however defined) many resources are lying idle. Credit creation for productive investment purposes should therefore increase output.

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(Turner, 2010, pp. 37-38) That asset price inflation and credit creation by banks interact with each other in potentially destabilising ways will be looked at in more detail in section 4.2. The next section will discuss the possibility that asset price inflation may feed into consumer price inflation. Box 4.B - ‘Full employment’ In neoclassical economics the term ‘full employment’i has a very specific meaning. It is not the level of employment where there is no unemployment, as one might expect, or even the level of employment which allows for a small amount of temporary unemployment as people shift between jobs. Instead the term full employment refers to the level of employment at which any increase in employment leads to an acceleration in the rate of inflation. In economics this is known as the Non Accelerating Inflation Rate of Unemployment (NAIRU).

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Most of these have long been known – indeed, a central theme of Keynes’ ‘General Theory’ (1936) is that markets, left to their own devices, will not necessarily deliver full employment. Nevertheless, despite these problems it will be useful to consider the effects of bank lending in a scenario where the economy is at its ‘full capacity’. The rationale for doing so is to examine whether bank lending – i.e. increasing demand through the creation of new purchasing power – can actually be non-inflationary, despite the economy being at full capacity.iii i. Full employment is a controversial term amongst economists. Some (such as Tobin) argue the term should be taken literally, that is full employment refers to a 0% unemployment rate.

The Shifts and the Shocks: What We've Learned--And Have Still to Learn--From the Financial Crisis
by Martin Wolf
Published 24 Nov 2015

This is a situation in which Keynesian fiscal policy becomes relevant. This is no more than to say that the economy was in a ‘liquidity trap’: at the lowest interest rate the central bank could create, the private and foreign sectors would have had a large excess of income over desired spending at full employment (the spending that would have occurred had the economy been at full employment, which, of course, it was not). This could be dealt with in only one of two ways: either by a collapse in income greater than the associated collapse in spending – that is, an outright depression – or by a large fiscal deficit. If the government had refused to run the deficits, by slashing its own spending as the private sector was also doing, the result would have been a depression, possibly one as bad as the Great Depression.

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As domestic demand for both non-tradeables and tradeables expanded, a huge excess demand for tradeables emerged. The expansion of production abroad, notably in China, satisfied this excess demand, so generating huge trade and current-account deficits. Meanwhile demand and supply for non-tradeables returned to balance, producing the full employment the Federal Reserve was seeking. In this way, internal balance – full employment – was achieved, albeit temporarily, at the price of a huge external imbalance – excess demand for tradeables and so trade and current-account deficits. The global market for the US dollar is rigged. It is one in which governments are prepared to buy massively, to prevent prices from reaching natural market clearing levels.

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In Lerner’s words, ‘Government should adjust its rates of expenditure and taxation such that total spending is neither more nor less than that which is sufficient to purchase the full employment level of output at current prices. If this means there is a deficit, greater borrowing, “printing money”, etc., then these things in themselves are neither good nor bad, they are simply the means to the desired ends of full employment and price stability.’53 So long as these policies do not generate excess demand, there is no reason to fear their inflationary effects. This does not mean no constraint on monetary policy exists, but those constraints come from inflation and the associated risks of sharp declines in the value of the currency against other currencies.

The Rise and Decline of Nations: Economic Growth, Stagflation, and Social Rigidities
by Mancur Olson

The effect of combinations on the part of a group of workers is to protect their relative real wage.3 The central role of "sticky" (slow to change) wages in Keynes's theory, and one of the institutions that can cause this stickiness, are also emphasized in Keynes's chapter on "Changes in Money Wages": Since there is, as a rule, no means of securing a simultaneous and equal reduction of money-wages in all industries, it is in the interest of all workers to resist a reduction in their own particular case.... If, indeed, labour were always in a position to take action (and were to do so), whenever there was less than full employment, to reduce its money demands by concerted action to whatever point was required to make money so abundant relatively to the wage-unit that the rate of interest would fall to a level compatible with full employment, we should, in effect, have monetary management by the Trade Unions, aimed at full employment, instead of by the banking system.4 To be sure, Keynes's explanation of underemployment equilibrium did not consist merely of the assumption of sticky wages; pre-Keynesian theory already ascribed unemployment to unrealistically high wage levels, and Keynes was anxious to differentiate his theory from the theory that preceded it.

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Unwillingness to invest in a second profession may be due to a deplorable conservatism in many individuals of middle age or older, but it surely often exists, and when it does, a full employment equilibrium literally could arrive only after most of those in the category at issue have retired. As Keynes wisely said, in the long run we are all dead. Even if we take a timeless view of macroeconomic fluctuations and we unrealistically ignore the costs of the resource reallocation to the flexprice or equilibrium sector whenever aggregate demand is substantially less than expected, the fact that there are always some flexible prices need not ever insure full employment. A second problem with the hurried economist's general-equilibrium argument is that it overlooks what can best be described as the "selling apples on street corners" syndrome.

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If, indeed, labour were always in a position to take action (and were to do so), whenever there was less than full employment, to reduce its money demands by concerted action to whatever point was required to make money so abundant relatively to the wage-unit that the rate of interest would fall to a level compatible with full employment, we should, in effect, have monetary management by the Trade Unions, aimed at full employment, instead of by the banking system.4 To be sure, Keynes's explanation of underemployment equilibrium did not consist merely of the assumption of sticky wages; pre-Keynesian theory already ascribed unemployment to unrealistically high wage levels, and Keynes was anxious to differentiate his theory from the theory that preceded it. Indeed, Keynes argued that reductions of money wages need not bring full employment, and that if they did it involved, in essence, "monetary management by the Trade Unions." As we know, Keynes also had new ideas about the demand for money as an asset and other matters that played significant roles in his theory. Still, the fact remains that although Keynes's theory argued for changing aggregate effective demand, especially through budget deficits and surpluses, and claimed to explain depression and inflation solely from the demand side, it nonetheless began and in substantial part rested upon the assumption that there were forces that influenced wages and that, within limits and at least for a time, did so in ways that could not be explained in terms of increases or decreases in the demand for labor or individual decisions to trade off more or less labor for leisure.

Marxian Economic Theory
by Meghnad Desai
Published 20 May 2013

Their analysis of the behaviour of corporations follows very closely John Kenneth Galbraith's theories of the New Industrial State. Their statistical investigations of the surplus have been anticipated in traditional macro-economics by the measure known as the full employment surplus or the Okun gap.5 This is the gap between the potential level of GNP at full employment level and the actual level at any time. It is used for operational purposes of macroeconomic stabilisation. The label Baran and Sweezy attach to this concept is critical but its function can be easily operational. Baran and Sweezy's analysis is then a combination of Neoclassical microeconomics, without the assumption of perfect competition, and orthodox macroeconomics.

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While Mane did not foresee many of these events, Mattick says. they are perfectly consistent with his theory. Indeed the rise of Keynesianism is a socio-economic development predicted by Mane's theory, according to Mattick. (p.130). What is more, state intervention to achieve full employment is not even a new socio-economic development which need be p~edicted by Mane. It is a part of Mane's theory anyway. "Mane's theory does not deny t~e fact that full-employment can and may be created either by government-induced investments or by an increase in the propensity to consume." (p. 131). For Mattick thus the Keynesian challenge is no challenge; it is all in Man and not a word of it needs revising, adapting or correcting.

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Having thus shorn Marxian theory of its historical and social content, having stripped it of its qualitative dynamics, an emasculated version of his model is retained to be criticised or worshipped, but not to be used as a tool for advancing our understanding of the real world. It is only in such emasculated systems that rising real wages and standards of living, shortening hours of work, continuous full employment etc. are seen ~s embarrassing to the Marxian model, to be regarded by the critics as refutations and to be denounced by the champions as illusory. All this is not said in a diehard defence of Marx's model. Whether we accept his theory or reject it, we need to specify correctly and completely all the aspects of his model.

Snakes and Ladders: The Great British Social Mobility Myth
by Selina Todd
Published 11 Feb 2021

This was most clear in education, where Labour promised reforms that would ‘give every boy and girl a chance to develop the best that is in them.’75 Labour’s version of social democracy was, therefore, an evolving and ambiguous one, which could appeal to egalitarian visions and meritocratic ambitions. It was also entirely new to Britain. The innovations of wartime – increased welfare, the expansion of scientific and technical jobs and training, full employment and higher wages – had been pioneered by the public sector, or assisted by state regulation of private enterprise. Now Labour argued that only social welfare provided by the state, public ownership of key industries and full employment could give ‘the people … the means of living full, happy, healthy lives’.76 On 26 July 1945 Clement Attlee’s Labour Party swept to power with a landslide victory.78 The new government’s jubilant supporters included many of those who had benefited from the meritocratic reforms of the war.

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Highest now was ‘the power of vested interests’, by which people meant ‘big business, conservative leaders … and the “old gang”’.68 Before the war, wealth had been hailed as a sign of personal success, and upward mobility a widely shared ambition. In wartime ‘fair shares’ Britain, the wealthy were increasingly viewed as self-interested rather than successful. By 1942 it was clear that state intervention in the form of rationing, co-ordination of welfare services and full employment had not stymied people’s liberty, but led to greater social equality, and more chances for some to climb the ladder. Increasingly, people defined equality of opportunity as central to ‘democracy’ – what Britain was fighting for. When Mass Observation asked people what they wanted from post-war education ‘greater equality’ was their single greatest aspiration.

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Free secondary education (introduced in 1947), the National Health Service and the new social services (launched in 1948) required millions of new professional, technical and white-collar workers. And winning the peace depended on skilled and professional workers to devise and enact ambitious town-planning schemes, to manage industry, and to deliver Labour’s promise of full employment. The breakthrough generation were well prepared to take advantage of the new post-war chances. Some of them had experienced upward mobility during the early 1940s, but even more did so after the war ended. By the time the breakthrough generation were in their forties, 17 per cent of manual-workers’ sons and 33 per cent of the sons of white-collar workers were professionals or managers.

The Upside of Inequality
by Edward Conard
Published 1 Sep 2016

If these deposits sit idle, U.S. growth, employment, and wages will be lower than they would be if the economy used all its available resources—chiefly, labor idled by trade deficits. Of course, the economy can always reach full employment by cutting wages, in effect, by spreading a given amount of labor income over a greater number of workers. To reach full employment at the highest possible wages, the economy must fully utilize all its resources. To put risk-averse savings to work, someone must bear the risk of using those savings. With a limited capacity and willingness to bear risk, a portion of this capacity must be used to regain employment lost to trade deficits rather than using it to grow employment and wages further.

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He feared households would continue to save for retirement, down payments for homes, and college for their children, but without faster growth, there would be more savings than investment. To achieve full employment at the highest possible wage, the economy must deploy all its resources. It must either consume or invest its output. If consumers reduce consumption and increase savings, investors must borrow and invest the additional savings to maintain full utilization of the economy’s resources. Otherwise, growth will slow if savings sit unused. When growth slows, unemployment rises and wages fall relative to the economy deploying all its resources. Wages and unemployment are two sides of the same coin. Theoretically, the economy can always reach full employment by lowering wages.

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But the U.S. economy ran enormous trade deficits with China, Germany, and Japan—economies with large surpluses of risk-averse savings. These economies used risk-averse savings to fund large trade surpluses that indirectly necessitated large increases in U.S. borrowing and lending—chiefly subprime mortgages—to maintain full employment. This expansion of credit destabilized U.S. banks. When real estate prices fell 30 percent, it sparked a panicked run on an inherently unstable banking system. Rather than diagnosing the problems properly, demagogues on the left and right claimed that ill-advised monetary policy, misguided regulation, and debt-fueled growth—fraudulently devised by reckless bankers—had created unsustainable prosperity.

Pivotal Decade: How the United States Traded Factories for Finance in the Seventies
by Judith Stein
Published 30 Apr 2010

All of these decisions reinforced class voting and made region, ethnicity, race, and religion secondary. Not surprisingly, the Democrats also went back to their traditional issues. Determined to avoid the mistake McGovern made in 1972, the Democratic platform clearly embraced the federal government’s responsibility to create a full-employment economy. The Humphrey-Hawkins full-employment bill was written into the platform despite Jimmy Carter’s lack of enthusiasm for it. Democrats embraced wage and price control to address inflation. But the candidate continued the morality and leadership themes that had won him the nomination, avoiding specifics as much as the press allowed.

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Their only success was the Humphrey-Hawkins full employment law, and even this victory was more a tribute to Hubert Humphrey, who had died of cancer in January 1978, than a blueprint for action. In fact, it underscored the poverty of liberal economics. Humphrey-Hawkins was a lightweight version of the Humphrey-Javits bill, which was a full-blown planning bill. Humphrey-Javits had been introduced in the midst of the recession of 1975, when it seemed that the economy needed a major overhaul. It included new forms of sectoral, or “micro,” planning to ensure full employment. When the economy picked up in 1976, its sponsors dropped it.

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Before the Great Depression, economists believed that unemployment could never plague nations because fluid wages and prices would adjust and sop up the unemployed. But Britain between the wars and the U.S. during the 1930s did not reveal automatic rectification. The British economist John Maynard Keynes showed that economies lacked mechanisms to attain the full employment of their resources. Even if wages fell, the expectation of classical economists, profit prospects were not certain. If there was little prospect of demand, a businessman would not expand his factory, even if wages and interest rates were low. Keynes found answers by studying and compiling aggregate, nationwide statistics.

Liberalism at Large: The World According to the Economist
by Alex Zevin
Published 12 Nov 2019

‘The comments I make below are in the nature of footnotes rather than dissent.’34 Yet these footnotes did make clear three important concerns Crowther harboured about a post-war world of welfare and full employment, which carried over from the pre-war decade, and set strict limits to it. First, any major change in social structure must be ruled out. Crowther poured scorn on economist E. F. Schumacher, who had remarked in the draft that full employment might be hard to achieve without tackling the issue of ownership of the means of production. ‘No doubt it would be easier to achieve full employment if Control of Employment and the Essential Works Order remained in force in peacetime. No doubt it would also be easier if the whole of industry – or at least the large capital-using industries – were nationalised.’

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Yet it was simply a tax plan to secure ‘minimum levels of income’ with a Keynesian aim of ‘subsidising consumption’ and ‘preventing sharp falls in production and employment’.31 The success of the entire project, which was ‘not revolutionary’, depended on a return to liberalism at home and abroad: never so loose as to ‘lessen incentives to work and advancement’, promoting ‘full employment and the freest possible trade’, and ensuring low and steady inflation, which Beveridge’s plan secured by creating ‘a greater class of rentiers than ever before’ with a ‘vested interest in the stability of the currency’.32 Crowther did a variety of war work while editor, from analyses of manpower deployment for the Cabinet, to US goodwill tours.33 No job was more revealing, however, than his role in drafting the follow-up report from Beveridge in 1944, Full Employment in a Free Society. ‘I am fully in agreement with the line you take, which is closely similar to that taken in the series of articles in The Economist a year ago’, Crowther remarked in a detailed memorandum to Beveridge, followed up by in-person meetings, on the draft that emerged from the conference on international aspects of post-war employment policy at Nuffield College in September 1943.

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The third point is the most striking, for unlike the first two, it seems to have been the common assumption of all participants including Beveridge.37 The main ‘international implications of full employment’ for Britain in the post-war world were that the country must work to prevent any repetition of the rising tariffs, currency devaluations and other moves to autarky of the inter-war period. Full employment in one country was impossible. For if others allowed their trade cycles to continue, leading to a crash and mass unemployment, they would again try to export their way out of trouble at the expense of trading partners, precipitating a global race to the bottom.

How Will Capitalism End?
by Wolfgang Streeck
Published 8 Nov 2016

It included an expanding welfare state, the right of workers to free collective bargaining and a political guarantee of full employment, underwritten by governments making extensive use of the Keynesian economic toolkit. When growth began to falter in the late 1960s, however, this combination became difficult to maintain. While free collective bargaining enabled workers through their unions to act on what had become firmly ingrained expectations of regular yearly wage increases, governments’ commitment to full employment, together with a growing welfare state, protected unions from potential employment losses caused by wage settlements in excess of productivity growth.

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In subsequent years governments all over the Western world faced the question of how to make trade unions moderate their members’ wage demands without having to rescind the Keynesian promise of full employment. In countries where the institutional structure of the collective-bargaining system was not conducive to the negotiation of tripartite ‘social pacts’, most governments remained convinced throughout the 1970s that allowing unemployment to rise in order to contain real wage increases was too risky for their own survival, if not for the stability of capitalist democracy as such. Their only way out was an accommodating monetary policy which, while allowing free collective bargaining and full employment to continue to coexist, did so at the expense of raising the rate of inflation to levels that accelerated over time.

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While Keynes and, to some extent, Kalecki and Polanyi carried the day, Hayek withdrew into temporary exile. Since then, however, mainstream economics has become obsessed with the ‘irresponsibility’ of opportunistic politicians who cater to an economically uneducated electorate by interfering with otherwise efficient markets, in pursuit of objectives – such as full employment and social justice – that truly free markets would in the long run deliver anyway, but must fail to deliver when distorted by politics. Economic crises, according to standard theories of ‘public choice’, essentially stem from market-distorting political interventions for social objectives.3 In this view, the right kind of intervention sets markets free from political interference; the wrong, market-distorting kind derives from an excess of democracy; more precisely, from democracy being carried over by irresponsible politicians into the economy, where it has no business.

The Production of Money: How to Break the Power of Banks
by Ann Pettifor
Published 27 Mar 2017

The commitment in the wartime White Paper to employment policy to maintain a high and stable level of employment had been achieved to an extent greater than anyone expected – and was reiterated both in the 1956 White Paper on the economic implications of full employment and in the Radcliffe Report in 1959. We had lived within the Bretton Woods arrangements – a little precariously at times but successfully.14 But the achievement of full employment was disregarded by economists and policymakers then, much as it is disregarded today: as a non-event. They promoted instead an agenda based on ‘growth’ and financial liberalisation. From the early 1960s with full unemployment at 2 percent, British policymakers echoed the OECD in setting an explicit target for real annual ‘growth’ of 4 percent.

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The assumption that it is the supply of money that is important is repeated when Fisher and his modern-day supporters echo another misunderstanding at the heart of monetarist and Austrian economics (the orthodox economics of the Austrian School based on the rejection of macroeconomics). This is the assumption that aggregate economic activity tends to be stable, or moving towards an equilibrium in which supply matches demand and full employment follows. In this view, very little can be done by the authorities to change or improve levels of activity. Instead matters are left to the ‘invisible hand’ to move the economy to full employment. According to this view, if the supply of money aimed at a given level of activity is too high, the result will be higher prices or inflation. The solution, monetarists argued, is to reduce the supply of money.

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Like the wolf in the fairy tale: ‘All the better to fleece you with.’ Satyajit Das, Traders, Guns and Money (2010) Finance must be the servant, and the intelligent servant, of the community and productive industry; not their stupid master. National Executive Committee of the British Labour Party (June 1944), Full Employment and Financial Policy The global finance sector today exercises extraordinary power over society and in particular over governments, industry and labour. Players in financial markets dominate economic policy-making, undermine democratic decisionmaking, and have helped financialise almost all sectors of the economy (except perhaps faith organisations).

Globalists: The End of Empire and the Birth of Neoliberalism
by Quinn Slobodian
Published 16 Mar 2018

In 1952 the American Enterprise Association (­later the American Enterprise Institute) published Röpke’s critique of the UN “Report on National and International Mea­sures for Full Employment” (1949), which had been written primarily by British and French Keynesians.75 Röpke wrote that ­there was “no other economic issue which appears so attractive and yet may be so dangerous as the one based on this misleading and bitterly discussed concept” of full employment and warned that the report marked the dangerous shift from “national planning” to “international planning.”76 With the launch of Kennedy’s New Frontier program in 1961, Röpke found another “New” entity to place in the crosshairs of critique.

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Wiggins, 139–150 (Washington, DC: Public Affairs Press, 1958); Henry Hazlitt, Illusions of Point Four (Irvington-­on-­Hudson, NY: Foundation for Economic Education, 1950); Gaston Leduc, “Le Sous-­devéloppment et ses problèmes,” Revue d’économie politique 62, no. 2 (May 1952): 133–189; Wilhelm Röpke, The Economics of Full Employment: An Analy­sis of the UN Report on National and International Mea­sures for Full Employment (New York: American Enterprise Association, 1952); Wilhelm Röpke, “Unentwickelte Länder,” Ordo 5 (1953): 63–113. For an overview of MPS discussions of development, see Dieter Plehwe, “The Origins of the Neoliberal Economic Development Discourse,” in The Road from Mont Pèlerin: The Making of the Neoliberal Thought Collective, ed.

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The quote was repeated in a 1957 study sponsored by seventeen congressmen and published in the national magazine of the Chamber of Commerce: “Adverse Effects of Expanding Government,” Nation’s Business 45, no. 9 (September 1957): 39–94, at 89. 74. Quoted in Wegmann, Früher Neoliberalismus, 317. 75. Röpke, The Economics of Full Employment; J. F. J. Toye and Richard Toye, The UN and Global Po­liti­cal Economy: Trade, Finance, and Development (Bloomington: Indiana University Press, 2004), 93. 76. Röpke, The Economics of Full Employment, 5, 31. 77. Wilhelm Röpke, “Washington’s Economics: A German Scholar Sees Nation Moving into Fiscal Socialism,” Wall Street Journal, April 1, 1963. 78. Röpke, “Die unentwickelten Länder,” 15, 59.

Aftershock: The Next Economy and America's Future
by Robert B. Reich
Published 21 Sep 2010

But he recognized in it two major faults—“its failure to provide for full employment and its arbitrary and inequitable distribution of wealth and incomes.” Until these were corrected, Keynes argued, capitalism would continue to be highly unstable, vulnerable to economic booms that would often be followed by catastrophic collapses. Yet if government worked to correct these faults, he felt confident that future generations could inherit a stable and prosperous world. Classical economists had viewed markets as self-correcting. They had supposed that full employment would always prevail in the end. Any spate of unemployment would cause wages to drop until employers found it profitable to hire workers again.

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Keynes’s big idea was to use macroeconomic policy to maintain full employment. Policymakers should expand the money supply to permanently lower interest rates, so that consumers and businesses could get lower-cost loans, and government should increase its own spending to make up for the shortfall in consumer demand, so that more jobs would be created. Part of Keynes’s answer was also to spread the benefits of economic growth. Keynes recognized that growth depends on the incentives of the rich to save and invest. But he noted that until an economy reaches full employment, additional savings don’t help; in fact, they cause harm by reducing the demand for goods and services.

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To be sure, the U.S. government refrained from doing what many of Europe’s social democratic countries did—directly redistribute income from the rich to the poor and middle class, and nationalize industries. Nonetheless, it actively created the conditions for the middle class to fully share in the nation’s prosperity. It did so by pushing the economy toward full employment, creating a more progressive income tax, enhancing the bargaining power of average workers, building up Social Security, providing workers with a strong safety net when they couldn’t work, and improving their productivity. Franklin D. Roosevelt never fully understood Keynesian economics, despite the efforts of Marriner Eccles and others to educate him, but FDR proved the success of Keynesianism.

Servant Economy: Where America's Elite Is Sending the Middle Class
by Jeff Faux
Published 16 May 2012

The models conclude what is obvious to virtually anyone over the age of twelve: consumers will benefit from cheaper goods made by cheaper labor. What the typical American trying to understand the debate is not told is that these models invariably assume full employment. So it’s no surprise that they do not find that trade deficits cost jobs. Obviously, in the real world, economies are not constantly, or even typically, at full employment. So, unless compensated by an increase in consumer, business, or government spending, a trade deficit always means a slowdown in the growth of the GDP, which means a slowdown in job growth. Here the U.S. economics profession has disgraced itself over the trade issue.

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Therefore, for musician’s wages to increase along with the wages of industrial workers, the price of a symphony ticket has to rise much faster than prices in the industrial sector.11 Similarly, the public sector, which is also labor intensive, will naturally require higher prices (in the form of taxes) to maintain the quality of its services. In a full-employment economy with a healthy industrial sector, workers whose wages are rising can afford to pay high prices for services and pay rising taxes. But with the offshoring of the high-productivity sectors, the source of rising wages shrinks. Add the ideological resistance to tax increases and the undercutting of the bargaining position of labor, and you have a formula for wage stagnation. Add in economic policies that favor price stability over full employment and you have a formula for wage decline. Still, Pollyanna will not be suppressed.

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All have their part to play as workers and consumers, and therefore all have a claim on the benefits of growth. Economic security—pooling risks through social insurance, subsidizing higher education, and collective bargaining—is as important as the freedom to buy low and sell high. By providing a cushion for ordinary workers, the innovations of full employment, rising wages, unions, and government-sponsored safety nets also provided a protective cushion for the American capitalist class. After all, the implication of Keynes’s proposition was that what is good for General Motors is good for America—even though the businessmen had to also accept its corollary that what is good for the United Auto Workers is good for General Motors.

Arguing With Zombies: Economics, Politics, and the Fight for a Better Future
by Paul Krugman
Published 28 Jan 2020

Lerner says that the interest rate should be set at the level that produces “the most desirable level of investment,” and that fiscal policy should then be chosen to achieve full employment given that interest rate. What is the optimal interest rate? He doesn’t say—maybe because through the thirties the zero lower bound made that point moot. Anyway, what actually happens at least much of the time—although, crucially, not when we’re at the zero lower bound—is more or less the opposite: political trade-offs determine taxes and spending, and monetary policy adjusts the interest rate to achieve full employment without inflation. Under those conditions budget deficits do crowd out private spending, because tax cuts or spending increases will lead to higher interest rates.

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Once the crash happened, however, economists who had studied these things found themselves in familiar territory. We know a lot about financial crises, from both theory and history. We also know a lot about how economies work in the aftermath of crises: that 1998 paper was about what happens when even a zero interest rate isn’t enough to restore full employment, a condition that went from being a uniquely Japanese problem to the norm across the Western world. For me, then, the five or so years following the 2008 crisis were both the best and the worst of times. They were the best of times in the sense that my role as newspaper columnist and my academic research converged almost perfectly, so that I was in a position to say a lot about what policymakers should be doing.

…

Budget deficits haven’t led to soaring interest rates (and the Fed’s “money-printing” hasn’t led to inflation); austerity policies have greatly deepened economic slumps almost everywhere they have been tried. Yes, the government must pay its bills in the long run. But spending cuts and/or tax increases should wait until the economy is no longer depressed, and the private sector is willing to spend enough to produce full employment. Is this impossibly complicated? I don’t think so. Now, I suppose that someone like Langone will just respond that it’s all gibberish he can’t understand. But unless he really is stupid, which as I said I doubt, that’s only because he doesn’t want to understand. NOBODY UNDERSTANDS DEBT February 9, 2015 Many economists, including Janet Yellen, view global economic troubles since 2008 largely as a story about “deleveraging”—a simultaneous attempt by debtors almost everywhere to reduce their liabilities.

How Much Is Enough?: Money and the Good Life
by Robert Skidelsky and Edward Skidelsky
Published 18 Jun 2012

A second wave of New Liberalism associated with Keynes, Beveridge and Roosevelt took root in the troubled 1930s and 1940s and came of age in the 1950s and 1960s. Keynes aimed to fill the most important “gap” in the classical market economy, its failure to provide for continuous full employment. In his General Theory of Employment, Interest, and Money (1936), he argued that it was the state’s duty to maintain enough aggregate demand to ensure the continuous use of all potential resources. Continuous full employment was not only an essential condition of security, but, as we have seen, part of Keynes’s ethical project for getting over the hump of “economic necessity” as quickly as possible in order to open up the possibility of a good life for all.

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“His worst, because some of his social and political theory would not stand too close a scrutiny; because society is not likely to run out of new wants as long as consumption is conspicuous and competitive … His best because of the roving, inquiring, intuitive, provocative mind of the man.”4 But for all its futurism, “Economic Possibilities” links up directly with Keynes’s main preoccupation: the problem of persistent mass unemployment. It provides the “ideal” motivation for the revolution in economic policy for which he is chiefly known: continuous full employment, uninterrupted by slumps, was the quickest route to the utopia towards which the essay beckoned. Keynes wanted to ensure that the capitalist system worked at full blast so as to hasten the day when it would come to an end. More than eighty years have passed since he wrote his essay; we are his “grandchildren,” even his great-grandchildren.

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Obesity has risen threefold across Europe since the 1980s, even in countries with traditionally low rates.38 UK prescriptions for depression have also increased, though that may not reflect any rise in depression itself.39 And work-related stress has got worse since 1992, especially for women.40 By historical standards, we remain extremely healthy, but the old assurance that this state of affairs would continue in perpetuity is fading. The maladies of affluence may yet come to outweigh those of poverty. Chart 9. Alcohol-related Deaths in the UK Source: WHO Global Information System on Alcohol and Health Security. Full employment as a goal of macroeconomic policy was abandoned during the Reagan/Thatcher era and has not been reinstated. UK unemployment exceeded the 5 percent mark in 1980 and has largely stayed there since, soaring during recessions to 10 percent or higher. A similar pattern prevails across the OECD, as Chart 11 shows.

The Great Demographic Reversal: Ageing Societies, Waning Inequality, and an Inflation Revival
by Charles Goodhart and Manoj Pradhan
Published 8 Aug 2020

Inflation then seemed to be primarily a consequence of wars and other major political disturbances. The over-riding concern, when Keynes was writing the General Theory, was to restore and to maintain reasonably full employment, not to control inflation. It is in some ways a measure of the success of Keynesian economics that since World War II, at least until the twenty-first century, the main problem that faced us was to combine reasonably full employment with price stability. Of course, the initial recovery to full employment at the end of the 1930s and early 1940s owed more to rearmament and World War II than to Keynesian economics. But after World War II and into the early 1950s, the initial major concern/expectation was that the advanced economies might fall back into a further bout of stagnation/deflation.

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In contrast, u* has varied between about 5 and 2%. After the unhappy experience of the 1930s, economists such as Beveridge and Keynes initially thought that achieving a level of 4–5% would be a good outcome. But the success of full employment policies bringing UE down to around 1.5% after World War II, initially with relatively little inflation, led to the aim of holding UE below 2%.4 Demand management, and full employment policies, greatly strengthened the bargaining power of workers and trade unions. The alternative to not agreeing to the employer’s wage offer would be another job elsewhere, rather than unemployment. Also, as noted in Chapters 3 and 5, demography led to an improving dependency ratio.

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The wider question, however, is whether, and how far, the patent effect on individual categories of work spills over into explaining the relative stagnation of real wages, and of labour’s share of income, as a whole? Superficially one might think that, if labour-saving technology was largely responsible, productivity should have grown faster than has been the case in the last two decades. But what if public policy to maintain aggregate demand and full employment has its main practical domestic effect on low productivity service industries, and the ‘gig economy’? A plausible hypothesis. Let us put the question another way; why would such technological developments change the slope and/or position of the Phillips curve? With the same level of overall unemployment, why would the associated aggregate wage/price outcome be less?

The Accidental Theorist: And Other Dispatches From the Dismal Science
by Paul Krugman
Published 18 Feb 2010

Keynes was willing to concede that in some sufficiently long run, these theories might indeed be valid; but, as he memorably pointed out, “In the long run we are all dead.” In the short run, he asserted, interest rates were determined not by the balance between savings and investment at full employment but by “liquidity preference”—the public’s desire to hold cash unless offered a sufficient incentive to invest in less safe and convenient assets. Savings and investment were still necessarily equal; but if desired savings at full employment turned out to exceed desired investment, what would fall would be not interest rates but the level of employment and output. In particular, if investment demand should fall for whatever reason—such as, say, a stock-market crash—the result would be an economy-wide slump.

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It so happens that I am about to use my hot-dog-and-bun example to talk about technology, jobs, and the future of capitalism. And I plan to make some serious points about those subjects—the kind of points that can only be made if you are willing to play around with a thought experiment or two. So let’s continue. Suppose that our economy initially employs 120 million workers, which corresponds more or less to full employment. It takes two person-days to produce either a hot dog or a bun. (Hey, realism is not the point here.) Assuming that the economy produces what consumers want, it must be producing 30 million hot dogs and 30 million buns each day; 60 million workers will be employed in each sector. Now, suppose that improved technology allows a worker to produce a hot dog in one day rather than two.

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But macroeconomics—the study of economy-wide events like inflation and deflation, booms and slumps—was in a state of arrested development that left it utterly incapable of making sense of the Great Depression. So-called “classical” macroeconomics asserted that the economy had a long-run tendency to return to full employment, and focused only on that long run. Its two main tenets were the quantity theory of money—the assertion that the overall level of prices was proportional to the quantity of money in circulation—and the “loanable funds” theory of interest, which asserted that interest rates would rise or fall to equate total savings with total investment.

Rethinking Capitalism: Economics and Policy for Sustainable and Inclusive Growth
by Michael Jacobs and Mariana Mazzucato
Published 31 Jul 2016

She consults with policy-makers, investment banks and portfolio managers across the globe, and is a regular commentator on national radio and broadcast television. L. Randall Wray is Professor of Economics at Bard College and Senior Scholar at the Levy Economics Institute. He is the author of Money and Credit in Capitalist Economies (Edward Elgar, 1990); Understanding Modern Money: The Key to Full Employment and Price Stability (Edward Elgar, 1998); and Modern Money Theory: A Primer on Macroeconomics for Sovereign Monetary Systems (Palgrave Macmillan, 2012, 2nd rev ed, 2015). He is also co-editor of, and a contributor to, Money, Financial Instability, and Stabilization Policy (Edward Elgar, 2006), and Keynes for the 21st Century: The Continuing Relevance of The General Theory (Palgrave Macmillan, 2008).

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Since the financial crisis it has fallen further in most developed countries, including the US, Japan, France and the UK.16 At the same time there appears to be some evidence that rates of productivity-enhancing innovation have also slowed down.17 All this has led some economists to ask whether Western capitalism has entered a period of ‘secular stagnation’, in which a structural weakness of investment and demand leaves positive interest rates no longer able to support full employment. While such a prospect should not be regarded as somehow inevitable, it reflects a widespread concern that developed economies may face a long period of low growth and financial instability.18 Stagnant living standards and rising inequality But weak and unstable growth is only part of modern capitalism’s problem.

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Keynes, The General Theory of Employment, Interest and Money, London, Macmillan, 2007 [1936]. 52 Shiller, Irrational Exuberance. 53 ‘I expect to see the State … taking an ever greater responsibility for directly organising investment … I conceive, therefore, that a somewhat comprehensive socialisation of investment will prove the only means of securing an approximation to full employment.’ J. M. Keynes, The Collected Writings of John Maynard Keynes, vol. 7, Cambridge, Cambridge University Press, 1973, pp. 164, 378. 54 H.-J. Chang, Globalization, Economic Development and the Role of the State, London, Zed Books, 2002. 55 T. Piketty, Capital in the 21st Century, Cambridge, MA, Harvard University Press, 2014. 56 A.

Free to Choose: A Personal Statement
by Milton Friedman and Rose D. Friedman
Published 2 Jan 1980

Under these circumstances, what average number of persons employed corresponds to full employment? As with spending and taxes, there is here, too, an asymmetry. Measures that can be represented as adding to employment are politically attractive. Measures that can be represented as adding to unemployment are politically unattractive. The result is to impart a bias to government policy in the direction of adopting unduly ambitious targets of full employment. The relation to inflation is twofold. First, government spending can be represented as adding to employment, government taxes as adding to unemployment by reducing private spending. Hence, the full employment policy reinforces the tendency for government to increase spending and lower taxes, and to finance any resulting deficit by increasing the quantity of money rather than by taxes or borrowing from the public.

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It enables them to increase government spending, providing goodies for their constituents, without having to vote for taxes to pay for them, and without having to borrow from the public. A second source of higher monetary growth in the United States in recent years has been the attempt to produce full employment. The objective, as for so many government programs, is admirable, but the results have not been. "Full employment" is a much more complex and ambiguous concept than it appears to be on the surface. In a dynamic world, in which new products emerge and old ones disappear, demand shifts from one product to another, innovation alters methods of production, and so on without end, it is desirable to have a good deal of labor mobility.

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It can do so by buying outstanding government bonds, paying for them with newly created high-powered money. That enables the banks to make a larger volume of private loans, which can also be represented as adding to employment. Under pressure to promote full employment, the Fed's monetary policy has had the same inflationary bias as the government's fiscal policy. These policies have not succeeded in producing full employment but they have produced inflation. As Prime Minister James Callaghan put it in a courageous talk to a British Labour party conference in September 1976: "We used to think that you could just spend your way out of a recession and increase employment by cutting taxes and boosting government spending.

Basic Income: A Radical Proposal for a Free Society and a Sane Economy
by Philippe van Parijs and Yannick Vanderborght
Published 20 Mar 2017

It does not impose a maximum limit on everyÂ�one’s working time but it makes it easier for Â�people to reduce their working time, both Â�because it reduces what they lose if they do and because Â� it gives them a firm income on which they can rely. It thereby attacks the root cause of trouÂ�bles for both Â�those who get sick by working too much and Â�those who get sick Â�because they cannot find jobs.58 It does not amount to giving up the objective of full employment sensibly interpreted. For full employment can mean two Â�things: full-Â�time paid work for the entire able-Â�bodied part of the population of working age, or the real possibility of getting meaningful paid work for all Â�those who want it. As an objective, the basic income strategy rejects the former but embraces the latter.59 And it pursues it both by subsidizing low-Â� paid work with low immediate productivity and by making it easier for Â�people to choose to work less at any given point in their lives.

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As documented by Juliet Schor (1993), some Americans are overworked Â�because they earn too much (say, one hour less a week would mean giving up a new swimming pool) and Â�others Â�because they earn too Â�little (say, one hour less a week would mean junk food for the kids). 59. A basic income is often defended as an alternative to full employment, though not always by distinguishing clearly between Â�these two interpretations. See, for example, Robert Theobald 1967, Claus Offe 1992, 1996a, Fritz Scharpf 1993, James Â�Meade 1995, Jean-Â�Marc Ferry 1995, André Gorz 1997, Yoland Bresson 1999. On the relationship between basic income, wage subsidies, and working time reduction, see chapter 2. ReÂ�sisÂ�tance to technological change and the banning of volunteering are two other (worse) ways of pursuing full employment (Â�whether in the bad or the good sense) for which basic income provides an alternative. 60.

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Thus, economist Xavier Greffe, while recognizing that the proposal “rests on justified criticisms of current social policy” and “would increase the effectiveness of social policy,” nonetheless found it badly defective: “Located at the heart of liberal discourse, the negative income tax implicitly admits that the market constitutes the privileged mechanism of social integration and that it therefore suffices to help individuals artificially when they access it in order to overcome inÂ�equality and the lack of integration.”108 Similarly, in one of his legendary lectures at the Collège de France, Michel Foucault (1926–1984) first presented the negative income tax in a way that sounded sympathetic: “Â�After all, it does not and should not concern us to know why someone falls below the level of the social game; Â�whether he is a drug addict or voluntarily unemployed is not imporÂ�tant.â•‹.â•‹.â•‹.╋╉The only Â�thing 95 BASIC INCOME that Â�matters is that the individual has fallen below a given level and, at that point, without looking further, and so without having to make all Â�those bureaucratic, police, or inquisitorial investigations, the problem becomes one of granting him a subsidy.â•‹.â•‹.â•‹.”109 Ultimately, however, the negative income tax is for Foucault essentially a tool in the serÂ�vice of “neoliberal” policies. Now that the peasant population no longer provides an “endless fund of manpower,” that function is to be served by the population assisted by the negative income tax scheme—Â� admittedly “in a very liberal and much less bureaucratic and disciplinary way than it is by a system focused on full employment”: “Ultimately, it is up to Â�people to work if they want or not work if they Â�don’t. Above all Â�there is the possibility of not forcing them to work if Â�there is no interest in Â�doing so. They are merely guaranteed the possibility of minimal existence at a given level, and in this way the neoliberal policy can be got to work.”110 For Foucault as for many of Â�those in EuÂ�rope who cared about the fate of the poor and the unemployed, this association with the functional needs of capitalism and neoliberal thought sufficed to discredit the idea, or at least to discourage active interest in it.

Making Globalization Work
by Joseph E. Stiglitz
Published 16 Sep 2006

The Bolivians and Ecuadorians argued—rightly, I thought—that the return on investing in the recession was far higher than it would be when global conditions returned to normal levels and their economy was nearer to full employment. In addition to the direct return, there would be a multiplier effect, as the spending would stimulate the entire economy, which was marked by huge underutilization of productive capacity, and help it move toward full employment. Spending money, with natural resources to back the loans, made good economic sense. But the IMF, always worried about government overspending, pressured Ecuador and Bolivia to follow a quite different course.

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What we had fought for while I was in the Clinton administration was relevant, not just to Americans but to the rest of the world as well. As I moved from the Clinton administration to the World Bank, I continued to push for the right balance between the private and public sectors and to advance policies promoting equality and full employment. The issues I raised during my tenure at the World Bank—which received a warm reception by many of the economists there—are the same ones I raised in Globalization and Its Discontents. The passions evoked by the global financial crises and the difficult transitions from communism to a market economy have now faded.

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If one delegates decision making to “conservatives,” almost inevitably one will get economic policies and outcomes that reflect their political interests and cultural values.8 This book obviously reflects my own judgments and values; at least, I hope to be transparent, and present both sides of the ongoing economic debates. SAVING GLOBALIZATION FROM ITS ADVOCATES Some seventy years ago, during the Great Depression, the British economist, John Maynard Keynes, formulated his theory of unemployment, which detailed how government action could help restore the economy to full employment and growth. Keynes was vilified by conservatives, who saw his prescription as increasing the role of government. They seized on the budget deficits that inevitably accompany a downturn as an occasion to cut back on government programs. But Keynes actually did more to save the capitalist system than all the pro-market financiers put together.

Inflated: How Money and Debt Built the American Dream
by R. Christopher Whalen
Published 7 Dec 2010

It would take four more years and the election of Ronald Reagan for the Kemp–Roth tax cut to be adopted by Congress. Humphrey-Hawkins and Full Employment The political reaction by the Democratic majority in Congress to the election of Jimmy Carter and Senator Fritz Mondale (D-MN) was to greatly increase federal spending. Among even mainstream Democrats, the answer to the years of uncertainty and unemployment during the 1970s was to embed in the law the right to full employment. Senator Hubert Humphrey (D-MN) and Congressman Gus Hawkins (D-CA) sponsored legislation in the early 1970s to do just that and in 1978 the Congress passed the Humphrey-Hawkins Full Employment and Balanced Growth Act. The law established a maximum unemployment rate of 4 percent and did not mandate a government-paid job for anyone who sought one.

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Taxes were cut to stimulate the economy after the war concluded, so that the United States did not experience a severe downturn in economic activity, as was the case following WWI. This act marked one of the early instances of Congress mandating full employment as a matter of government policy and giving responsibility for this goal to Washington. Like the promises made by Washington of financial regulation or consumer protection, the promise of full employment is worth no more than Washington’s paper money, but none-the-less helps define the American dream. As with much of the government effort and expenditure in the 1930s, the ostensible goal of Washington was to use a postwar surge in economic prosperity as an antidote to the return of national socialism or anything like it.

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Louis Federal Reserve Bank maintenance Free Banking era cessation Free Banking Model, collapse Freedoms (FDR) Free silver coinage, agitation Free trade American devotion global commitment, shift Keynes criticism policy, Federal Reserve System (impact) proposal Frick, Henry campaign contributions Friedman, Milton Depression arguments FDR analysis Fed analysis Monetary History of the United States New Deal documentation U.S. money supply analysis Full employment priorities Full employment, government mandate Fundamental disequilibrium Future earnings, trend (assessment) G-7 countries, loan guarantees Galbraith, John Kenneth deficit support Great Crash Gallatin, Albert Gardner, Richard (Sterling-Dollar Diplomacy in Current Perspective) Gary, Elbert H. Geithner, Timothy General Agreement on Tariffs and Trade (GATT) General Motors (GM) bailout bankruptcy organization collapse debt, impact du Pont investment Durant support General Motors Acceptance Corporation (GMAC) bailout credit supply founding Germany Barron attack (Wall Street Journal) central powers, attack (Barron support) WWI debt imposition, impact GI Bill of Rights Gilbert, Clinton (Mirrors of Wall Street) Gilbert, Parker Gilded Age cessation comparison impact trusts, near-bank status Glass, Carter American principle devotion Banking Act sponsorship populist facade proposal Secretary of the Treasury status Glass-Steagall Act Glass-Steagall laws Global currency backing system, problem Global imbalances Global inflation Global marketplace, U.S. advantage Global markets, dollar flow Global payments system, U.S. response Global system, equilibrium Gold Bretton Woods, impact coinage, hard money Jacksonian notion (continuation) coins (specie) confiscation hoarding confiscation conspiracy, relief convertibility Nixon cessation restoration (1879) American resistance return dollar peg, cessation (1971) dollar price, increase exchange FDR, impact greenbacks convertibility, restoration exchange market dynamic movement Fed policy independence impact paper dollars, relationship payment (WWI), promise post-market crisis, Gould operation price fluctuation peak (1869) production purchase, greenbacks (Gould usage) refinement, cyanide process (adoption) reserves bank drain drain seizure Board of Governors complicity stocks, U.S. government holding supply, expansion Goldenweiser, E.A.

The New Economics: A Bigger Picture
by David Boyle and Andrew Simms
Published 14 Jun 2009

There are costs – social and economic – of everyone being at work.20 It would mean, for example, that with no one at home except the frail and elderly, there is a gap left among those who socialize our children, look after older people, prevent crime and provide the human face of our neighbourhoods and communities. Some of those gaps include informal childcare. The problem is, under a successful policy of full employment, when all available carers of working age would be at work in the daytime and, in the period after school, the time they have previously spent looking after children will have to be replaced. The same is true for the people who look after sick or elderly relatives at home. If the full employment policy were successful, these people might no longer be available. WHY DO BRITONS WORK HARDER THAN MEDIEVAL PEASANTS? 87 The care they provide includes help with shopping, cleaning, finances, washing, bathing and administering medicine, tube feeding, even occupational therapy.

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About 890,000 people in the UK over 16 are providing this informally for 50 or more hours a week, at an equivalent cost of £57.4 billion per year, two thirds of what it costs to run the National Health Service.21 Full employment would also considerably reduce the amount of time and effort that goes into volunteering. There is also increasing evidence that it is sheer neighbourhood activity, at all times of the day – not just outside working hours – that is the main determinant of crime rates. The major study of Chicago by the Harvard School of Public Health showed that it was the willingness of neighbours to intervene in small ways that was by far the most important factor in reducing crime.22 Full employment, in other words, is likely to be corrosive of social capital, if it leaves nobody available in communities.

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Often this is the kind of ‘work’ that is far better done by neighbours than by professionals. But the attitude of conventional economics to this unmarketable, unwaged work is corrosive. Once it drops out of the conventional economic system, it becomes invisible to policy makers, unless it can be sold and commodified. It also leads to a situation where the government believes that ‘full employment’ – or 80 per cent of the working age population in work – is a valuable objective, when their voluntary work or their work as parents might actually be more valuable to the neighbourhood. There are costs – social and economic – of everyone being at work.20 It would mean, for example, that with no one at home except the frail and elderly, there is a gap left among those who socialize our children, look after older people, prevent crime and provide the human face of our neighbourhoods and communities.

Money Mischief: Episodes in Monetary History
by Milton Friedman
Published 1 Jan 1992

They can increase government spending, and provide "goodies" for their supporters and constituents, without having to propose or vote for new taxes to pay for spending and without having to borrow from the public. A second source of higher monetary growth in the United States was the attempt to produce full employment. The objective, as for so many government programs, is admirable, but the results have not been. Full employment is a much more complex and ambiguous concept than it appears to be on the surface. Moreover, there is an asymmetry that imparts a bias to government policy in the direction of adopting unduly ambitious targets of full employment. Any measure that can be represented as adding to employment is politically attractive. Any measure that can be represented as adding to unemployment is politically unattractive.

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One way it can do so is by buying outstanding government bonds and paying for them with newly created high-powered money. That enables the banks to make a larger volume of private loans, which can also be represented as adding to employment. The pressure to promote full employment has given the Fed's monetary policy the same inflationary bias as it has given the government's fiscal policy. These policies have not succeeded in producing full employment, but they have produced inflation. As Prime Minister James Callaghan put it in a courageous talk to a British Labour party conference in September 1976: "We used to think that you could just spend your way out of a recession and increase employment by cutting taxes and boosting government spending.

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Whatever may have been true for money linked to silver or gold, with today's paper money it is governments and governments alone that can produce excessive monetary growth, and hence inflation. In the United States, the accelerated monetary growth from the mid-1960s to the end of the 1970s—the most recent period of accelerating inflation—occurred for three related reasons: first, the rapid growth in government spending; second, the government's full-employment policy; third, a mistaken policy pursued by the Federal Reserve System. Higher government spending will not lead to more rapid monetary growth and inflation if the additional spending is financed either by taxes or by borrowing from the public. In both cases, the government has more to spend, the public less.

Jihad vs. McWorld: Terrorism's Challenge to Democracy
by Benjamin Barber
Published 20 Apr 2010

Not long after World War II, Victor Lebow recognized that “Our enormously productive economy … demands that we make consumption our way of life, that we convert the buying and selling of goods into rituals, that we seek our spiritual satisfaction, our ego satisfaction, in consumption.”8 Today, as Alan Durning remarks, “the words ‘consumer’ and ‘person’ have become virtual synonyms. The world economy,” Durning concludes, “is currently organized to furnish I. I billion people with a consumer life-style long on things but short on time High consumption is a precondition to neither full employment nor the end of poverty.”9 It is this world that the consumers of Ireland and Palestine and South Africa are now free to join. But full employment and social justice, or a lifestyle that leaves time to enjoy the goods wealth and education produce, are the concerns of citizens, not consumers, and the release from Jihad will not automatically make them citizens. Until McWorld finds a way to nurture citizens as successfully as it nurtures buyers and sellers, such aims will be systematically neglected, whatever innovative transnational institutions are introduced.

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“Communist” Vietnam is not far behind, and was opened to American trade recently, presumably on the strength of the belief that markets ultimately defeat ideology.24 Capitalism requires consumers with access to markets and a stable political climate in order to succeed: such conditions may or may not be fostered by democracy, which can be disorderly and even anarchic, especially in its early stages, and which often pursues public goods costly to or at odds with private-market imperatives—environmentalism or full employment for example. On the level of the individual, capitalism seeks consumers susceptible to the shaping of their needs and the manipulation of their wants while democracy needs citizens autonomous in their thoughts and independent in their deliberative judgments. Aleksandr Solzhenitsyn wishes to “tame savage capitalism,” but capitalism wishes to tame anarchic democracy and appears to have little problem tolerating tyranny as long as it secures stability.25 Certainly the hurried pursuit of free markets regardless of social consequences has put democratic development in jeopardy in many nations recently liberated from communism.26 Social insecurity and rampant unemployment for peoples accustomed to the cradle-to-the-grave ministrations of paternalistic socialist bureacracies are unlikely to convert them to a system of democracy for which they have otherwise had no preparation.

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Many modern nation-states have generated national industrial policies aimed at strategic coordination of economic policy and domination of international markets by their business corporations on the theory that the nation’s citizens will somehow be benefited by supporting corporations even if corporations decline to return the favor. Yet although full employment is a public good, it is not a corporate good. Business efficiency dictates downsizing, which means capital-intensive production, and capital-intensive production means labor-minimizing job policies. Translated into English this means firing as many permanent workers as possible and eliminating their costly benefit and pension packages.

Creating Unequal Futures?: Rethinking Poverty, Inequality and Disadvantage
by Ruth Fincher and Peter Saunders
Published 1 Jul 2001

Loader, Routledge, London, pp. 38–48 Horsburgh, S. 1998 ‘Living on the edge’ Time 28 September, pp. 49–51 Horton, W. 1999 Libraries: Explore and Discover—Australian Library Week Oration, Parliament House, Canberra, May Hout, M. 1997 ‘Inequality at the margins: the effects of welfare, the minimum wage, and tax credits on low-wage labor’ Politics and Society vol. 25, no. 4, December Hout, M., Arum, R. and Voss, K. 1996 ‘The political economy of inequality in the ‘‘age of extremes’’’ Demography vol. 33, no. 4, pp. 421–5 Howarth, C., Kenway, P. , Palmer, G. and Street, C. 1999 Monitoring Poverty and Social Exclusion: Labour’s Inheritance, Joseph Rowntree Foundation, York Hughes, H. 1994, Achieving Full Employment Discussion Paper No. 1, Full Employment Project, Institute of Public Affairs and Melbourne University, Melbourne Hunter. B. 1997a ‘An indigenous worker’s guide to the Workplace Relations and Other Legislation Amendment Act’ Journal of Industrial Relations vol. 39, no. 4, pp. 439–56 ——1997b ‘The determinants of indigenous employment outcomes: the importance of education and training’ Australian Bulletin of Labour vol. 23, no. 3, pp. 177–92 ——1999 Three Nations, Not One: Indigenous and Other Australian Poverty CAEPR Working Paper No. 1, Centre for Aboriginal Economic and Policy Research, The Australian National University, Canberra Hunter, B.H. and Gray, M.C. 1999 Income Fluctuations over the Lifecycle— A Cohort Analysis of Indigenous and Non-indigenous Australians, 1986–96 CAEPR Discussion Paper No. 183, Centre for Aboriginal 237 PDF OUTPUT c: ALLEN & UNWIN r: DP2\BP4401W\MAIN p: (02) 6232 5991 f: (02) 6232 4995 36 DAGLISH STREET CURTIN ACT 2605 237 CREATING UNEQUAL FUTURES?

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Model: Jobs and Wages in a Deregulated Economy, Economic Policy Institute, Washington Mitchell, D. 1991 Income Transfers in Ten Welfare States, Aldershot, Avebury Mitchell, D. and Harding, A. 1993 Changes in Poverty Among Families During the 1990s: Poverty Gap Versus Poverty Head-count Approaches Discussion Paper No. 2, National Centre for Social and Economic Modelling, University of Canberra Mitchell, W.F. 1999 ‘Full employment abandoned—the macroeconomic story’, Out of the Rut: Making Labor a Genuine Alternative eds M. Carman and I. Rogers, Allen & Unwin, St Leonards Mitchell, W.F and Watts, M.J. 1997 ‘The path to full employment’ Australian Economic Review vol. 30, no. 4, pp. 436–44 Moore, D. 1998 Why Regulation of the Labour Market is Inequitable, Outdated and Inefficient, Occasional Address to Annual Meeting of the HR Nicholls Society, 30 November Morehead, A., Steele, M., Alexander, M., Stephen, K. and Duffin, L. 1997 Change at Work: The 1995 Australian Workplace Industrial Relations Survey (AWIRS 95), Longman, South Melbourne Morris, P. 1996 ‘Newspapers and the new information media’ Media International Australia no. 17, pp. 10–21 Mullins, P. 1991 ‘Tourism urbanisation’ International Journal of Urban and Regional Research vol. 15, no. 3, pp. 326–42 Murie, A. and Musterd, S. 1996 ‘Social segregation, housing tenure and social change in Dutch cities in the late 1980s’ Urban Studies vol. 33, no. 3, pp. 495–516 Murphy, P. and Watson, S. 1994 ‘Social polarisation and Australian cities’ International Journal of Urban and Regional Research vol. 8, no. 4, pp. 573–90 Murray, C. 1984 Losing Ground New York, Basic Books 240 PDF OUTPUT c: ALLEN & UNWIN r: DP2\BP4401W\MAIN p: (02) 6232 5991 f: (02) 6232 4995 36 DAGLISH STREET CURTIN ACT 2605 240 REFERENCES National Board of Employment, Education and Training: Higher Education Council 1996 Equality, Diversity and Excellence: Advancing the National Higher Education Equity Framework, AGPS, Canberra National Commission of Audit 1996 Report to the Commonwealth Government, AGPS, Canberra National Health Strategy 1992 Enough to Make you Sick: How Income and Environment Affect Health, Research Paper No. 1, National Health Strategy, Melbourne National Inquiry into the Separation of Aboriginal and Torres Strait Islanders from their Families 1997 Bringing Them Home: National Inquiry into the Separation of Aboriginal and Torres Strait Islander Children from their Families, Human Rights and Equal Opportunity Commission, Sydney Neumark, D. and Wascher, W. 1997 Do Minimum Wages Fight Poverty?

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Evidence from the Luxembourg Income Study Project, Discussion Paper No. 81, Social Policy Research Centre, University of New South Wales, Sydney Saunders, P. and Whiteford, P. 1989 Measuring Poverty: A Review of the Issues Discussion Paper 88/11, Economic Planning Advisory Council, Canberra Sawyer, M. 1976 Income Distribution OECD Occasional Studies, OECD, Paris Schlesinger, P. 1972 The Sociology of Knowledge paper presented to the 1972 Meeting of the British Sociological Association Schmid, G. 1995 ‘Is full employment still possible? Transitional labour markets as a new strategy of labour market policy’ Economic and Industrial Democracy vol. 16, no. 3 Schmid, G. and Auer, P. 1998 ‘Transitional labour markets: concepts and examples in Europe’ New Institutional Arrangements in the Labour Market: Transitional Labour Markets as a New Full Employment Concept, European Academy of the Urban Environment, Berlin Schmid, G. et al. 1996 International Handbook of Labour Market Policy and Evaluation, Edward Edgar, Cheltenham, UK Sen, A. 1982 Poverty and Famines, Clarendon Press, Oxford ——1983 ‘Poor, relatively speaking’ Oxford Economic Papers, vol. 35, pp. 153–69 ——1985 Commodities and Capabilities, North Holland, Amsterdam ——1992 Inequality Re-examined, Oxford University Press, Oxford ——1997 ‘Inequality, unemployment and contemporary Europe’ International Labour Review vol. 136, no. 2, pp. 155–72 Shaver, S. 1990 Gender, Social Policy Regimes and the Welfare State, Discussion Paper No. 26, Social Policy Research Centre, University of New South Wales, Sydney Shaver, S. and Bradshaw, J. 1993 The Recognition of Wifely Labour by Welfare States, Discussion Paper No. 44, Social Policy Research Centre, University of New South Wales, Sydney Smeeding, T.M. 1997 Financial Poverty in Developed Countries: The Evidence from LIS Final Report to the United Nations Development Programme, LIS Working Paper No. 155, CEPS/INSTEAD, Luxembourg Smeeding, T., O’Higgins, M. and Rainwater, L. eds 1990 Poverty, Inequality and Income Distribution in Comparative Perspective, Harvester Wheatsheaf, Hemel Hempstead Smeeding, T. et al. 1992 Noncash Income, Living Standards and Inequality: 244 PDF OUTPUT c: ALLEN & UNWIN r: DP2\BP4401W\MAIN p: (02) 6232 5991 f: (02) 6232 4995 36 DAGLISH STREET CURTIN ACT 2605 244 REFERENCES Evidence from the Luxembourg Income Study, LIS Working Paper No. 79, CEPS/INSTEAD, Luxembourg Smeeding, T. and Coder, J. 1993 Income Inequality in Rich Countries During the 1980s LIS Working Paper No. 88, CEPS/INSTEAD, Luxembourg Society of St Vincent de Paul 1999 The ‘Hidden Faces’ of Poverty.

Austerity Britain: 1945-51
by David Kynaston
Published 12 May 2008

Overall, most historians are agreed with Correlli Barnett that a more modest appraisal of Britain’s place in the world, accompanied by lower levels of taxation, would have been beneficial to the productive economy – especially in terms of investment at a time when so much plant and machinery was rundown or even destroyed. Where his case becomes much more controversial is in his often polemical attack on what he sees as the unnecessary twin burdens of full employment and the welfare state. ‘The Pervasive Harm of “Full Employment”’ is one of the chapter titles in The Lost Victory – a doctrine embodied in the strongly Keynesian White Paper of 1944 and typically castigated by Barnett as ‘not so much a Schwerpunkt as a shackle’. He argues vigorously that it was a doctrine that owed everything to faulty perceptions of the inter-war years, when in fact, ‘except during the hurricane of the world’s slump in 1930–3’, unemployment had ‘never constituted a general problem . . . but a local and structural one’.

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In it he set out proposals for a comprehensive post-war system of social security, in effect laying the foundations for the ‘classic’ welfare state – an attack upon what he memorably depicted as ‘the five giant evils’ of want, disease, ignorance, squalor and idleness – and in so doing caused such a stir that an extraordinary 630,000 copies of the report (mainly the abridged, popular edition) were sold. Then, in 1944, as the war began to draw to a close, there were two major ‘reconstruction’ moments: in May the publication of a White Paper that committed the British government to the pursuit of full employment as the highest economic objective; and in August the arrival on the statute book of R. A. (‘Rab’) Butler’s Education Act, which, among other things, created free, non-fee-paying grammar schools. To all appearances the reforming, forward-looking tide was running fast. Who Else Is Rank was the symptomatic title of an unpublished novel co-written the following winter by a 22-year-old Kingsley Amis and a fellow Signals officer.

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‘We must see to it after we’re demobilised,’ the Amis figure (a sensitive young lieutenant) says at one point, ‘that these common men, from whom we’re separated only by a traditional barrier – we’re no more than common men ourselves – benefit from the work that has been done, and if the system won’t let that happen, well, we shall just have to change the system.’3. In April 1945, as Hitler made his last stand in Berlin, the Labour Party issued its manifesto for the election that was bound to follow the end of the war. Called Let Us Face the Future, it demanded decisive action by the state to ensure full employment, the nationalisation of several key industries, an urgent housing programme, the creation of a new national health service and (in a nod to Beveridge) ‘social provision against rainy days’. The tone was admirably lacking in bombast but distinctly high-minded. ‘The problems and pressures of the post-war world,’ the fairly brief document declared, ‘threaten our security and progress as surely as – though less dramatically than – the Germans threatened them in 1940.

A Brief History of Neoliberalism
by David Harvey
Published 2 Jan 1995

The US itself turned towards a liberal democratic state form, and Japan, under the close supervision of the US, built a nominally democratic but in practice highly bureaucratic state apparatus empowered to oversee the reconstruction of that country. What all of these various state forms had in common was an acceptance that the state should focus on full employment, economic growth, and the welfare of its citizens, and that state power should be freely deployed, alongside of or, if necessary, intervening in or even substituting for market processes to achieve these ends. Fiscal and monetary policies usually dubbed ‘Keynesian’ were widely deployed to dampen business cycles and to ensure reasonably full employment. A ‘class compromise’ between capital and labour was generally advocated as the key guarantor of domestic peace and tranquillity.

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In October 1979 Paul Volcker, chairman of the US Federal Reserve Bank under President Carter, engineered a draconian shift in US monetary policy.18 The long-standing commitment in the US liberal democratic state to the principles of the New Deal, which meant broadly Keynesian fiscal and monetary policies with full employment as the key objective, was abandoned in favour of a policy designed to quell inflation no matter what the consequences might be for employment. The real rate of interest, which had often been negative during the double-digit inflationary surge of the 1970s, was rendered positive by fiat of the Federal Reserve (Figure 1.5).

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Since degree of neoliberalization was increasingly taken by the IMF and the World Bank as a measure of a good business climate, the pressure on all states to adopt neoliberal reforms ratcheted upwards.2 Thirdly, the Wall Street–IMF–Treasury complex that came to dominate economic policy in the Clinton years was able to persuade, cajole, and (thanks to structural adjustment programmes administered by the IMF) coerce many developing countries to take the neoliberal road.3 The US also used the carrot of preferential access to its huge consumer market to persuade many countries to reform their economies along neoliberal lines (in some instances through bilateral trade agreements). These policies helped produce a boom in the US in the 1990s. The US, riding a wave of technological innovation that underpinned the rise of a so-called ‘new economy’, looked as if it had the answer and that its policies were worthy of emulation, even though the relatively full employment achieved was at low rates of pay under conditions of diminishing social protections (the number of people without health insurance grew). Flexibility in labour markets and reductions in welfare provision (Clinton’s draconian overhaul of ‘the welfare system as we know it’) began to pay off for the US and put competitive pressures on the more rigid labour markets that prevailed in most of Europe (with the exception of Britain) and Japan.

A Pelican Introduction: Basic Income
by Guy Standing
Published 3 May 2017

A Basic Income Would Distract from Progressive Policies, Such as ‘Full Employment’ There are several ways of rebutting this version of Hirschmann’s ‘jeopardy’ point. First, in the second decade of the twenty-first century, where is the pressure to achieve other progressive policies? The growth and level of inequality are almost unprecedented; economic insecurity is pervasive; full employment has been redefined to be about 5 per cent unemployment with much ‘underemployment’, concealed by labour statistics that are unfit for purpose; and, above all, the growing precariat has been neglected by mainstream politics. Second, why should ‘full employment’ be regarded as a progressive policy?

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If the basic income was funded by switching public expenditure rather than by additional spending, the inflationary effect would be minimal. As Geoff Crocker has shown, only if aggregate spending power were higher than economic production (GDP) could there be an inflationary impact.12 The inflation claim would only be valid in relation to an economy that was at or close to ‘full employment’. No modern economy is close to ‘full employment’. And labour markets are much more open than they used to be, so any increase in the demand for labour could be expected to lead either to more labour force entrants or, more likely, to a relative shift of jobs abroad, dampening the impact on wages. It is worth pointing out that, in recent years, central banks and governments around the world have been desperately trying to overcome price deflation (falling prices) and to increase inflation.

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After the Second World War, the ‘right’ was formalized in Article 23 of the Universal Declaration of Human Rights of 1948, as follows: ‘Everyone has the right to work, to free choice of employment, to just and favourable conditions of work and to protection against unemployment.’ This commitment coincided with a sudden faith in the ability, and thus duty, of governments to create ‘full employment’ (which really meant ‘full employment’ of men). The International Labour Organization went a step further in its Employment Policy Convention No.122 of 1964. Although the Convention did not include an obligation on governments to commit to a ‘right to work’ in those words, it was subsequently interpreted that way.

What Would the Great Economists Do?: How Twelve Brilliant Minds Would Solve Today's Biggest Problems
by Linda Yueh
Published 4 Jun 2018

He argued that, even in normal times, the incentive to invest is too weak and the propensity to hoard cash is too strong. Without the necessary investment, the economy tends to operate at less than full employment, where all labour is deployed productively. If there were also a ‘shock’ to investment demand, such as a stock market crash, output and employment would decline, resulting in economic slumps. So, Keynes proposed that governments should incur debt to move the economy back to full employment. He stressed that government borrowing to spend need not be inflationary if the economy was operating below its potential, and advocated deficit spending, where the government borrowed to spend during downturns and repaid debt during the good times: ‘The boom not the slump is the right time for austerity.’18 A practical economist, he proposed a board of public investment to plan to have a stock of projects ready for when other types of investments started to decline.

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So, the role of government in promoting employment and reviving growth is front and centre in public policy. It is well known that Keynes did not believe in the market’s ability to self-correct, which was the dominant economic thinking at the time. Instead, he argued for government spending, and incurring a budget deficit if necessary, to bring the economy back to full employment. His views were shaped by the persistently high unemployment rates that followed the Great Depression, and Keynes’s ideas made him an influential figure, even posthumously during the post-war period which saw the birth of large government programmes such as the welfare state. In another parallel to today, the dominant economic debate since the Great Recession of 2009 has been over austerity – cutting government spending and raising taxes to reduce the budget deficit.

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In another parallel to today, the dominant economic debate since the Great Recession of 2009 has been over austerity – cutting government spending and raising taxes to reduce the budget deficit. One of the results of austerity measures is a huge drop in government/public/state investment, which hampers economic growth. Looking ahead, what would Keynes advise today’s governments to do about public investment, an important driver of growth and full employment in the economy? Another big economic debate is over how to make economies more productive. Recovery since the financial crisis has been slow by historical standards. Raising productivity, which has stagnated in many developed economies, is crucial if the economy is to grow; but it requires innovation.

The Great Economists: How Their Ideas Can Help Us Today
by Linda Yueh
Published 15 Mar 2018

He argued that, even in normal times, the incentive to invest is too weak and the propensity to hoard cash is too strong. Without the necessary investment, the economy tends to operate at less than full employment, where all labour is deployed productively. If there were also a ‘shock’ to investment demand, such as a stock market crash, output and employment would decline, resulting in economic slumps. So, Keynes proposed that governments should incur debt to move the economy back to full employment. He stressed that government borrowing to spend need not be inflationary if the economy was operating below its potential, and advocated deficit spending, where the government borrowed to spend during downturns and repaid debt during the good times: ‘The boom not the slump is the right time for austerity.’18 A practical economist, he proposed a board of public investment to plan to have a stock of projects ready for when other types of investments started to decline.

…

So, the role of government in promoting employment and reviving growth is front and centre in public policy. It is well known that Keynes did not believe in the market’s ability to self-correct, which was the dominant economic thinking at the time. Instead, he argued for government spending, and incurring a budget deficit if necessary, to bring the economy back to full employment. His views were shaped by the persistently high unemployment rates that followed the Great Depression, and Keynes’s ideas made him an influential figure, even posthumously during the post-war period which saw the birth of large government programmes such as the welfare state. In another parallel to today, the dominant economic debate since the Great Recession of 2009 has been over austerity – cutting government spending and raising taxes to reduce the budget deficit.

…

In another parallel to today, the dominant economic debate since the Great Recession of 2009 has been over austerity – cutting government spending and raising taxes to reduce the budget deficit. One of the results of austerity measures is a huge drop in government/public/state investment, which hampers economic growth. Looking ahead, what would Keynes advise today’s governments to do about public investment, an important driver of growth and full employment in the economy? Another big economic debate is over how to make economies more productive. Recovery since the financial crisis has been slow by historical standards. Raising productivity, which has stagnated in many developed economies, is crucial if the economy is to grow; but it requires innovation.

Success and Luck: Good Fortune and the Myth of Meritocracy
by Robert H. Frank
Published 31 Mar 2016

The basic problem plaguing an economy operating at less than full employment is that low levels of total spending enable producers to serve their customers without having to hire everyone who wants to work. So, by making the after-tax price of consumer goods higher, taxing consumption would indeed inhibit spending, exacerbating an already sluggish economy. Since the economies of most nations have not yet recovered fully from the global financial crisis of 2008, adoption of a progressive consumption tax should be postponed until full employment has again been restored. Once that happens, the progressive consumption tax should be phased in slowly, allowing it to gradually replace the income tax.

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At the same, the availability of additional savings would cause interest rates to fall, which would give firms an incentive to increase their investment spending. For each dollar by which consumption went down, then, investment would go up by a dollar, leaving total spending the same as before. An economy’s ability to achieve full employment depends on its total spending, not on how that total is apportioned between consumption and investment. So a progressive consumption tax would not cause the economy to slow down, provided it was already operating at full employment. On the contrary, the progressive consumption tax would actually stimulate long-term economic growth in a fully employed economy. With higher investment and lower consumption, more workers would be employed to produce investment goods and fewer to produce consumer goods.

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The mere announcement that a progressive consumption tax was coming would stimulate hundreds of billions of dollars of additional private spending. Building larger mansions may not make the wealthy any happier, but it does create jobs for unemployed architects and carpenters. Phased in gradually when the economy is back at full employment, a progressive consumption tax would induce a gradual shift in the composition of national spending. The proportion devoted to luxury consumption would slowly decline, while the proportion devoted to investment would slowly rise. A progressive consumption tax implemented in that way would not reduce the number of jobs; it would merely alter the mix of tasks that get done.

The State and the Stork: The Population Debate and Policy Making in US History
by Derek S. Hoff
Published 30 May 2012

In Population Growth and Levels of Consumption (1956), Belshaw argued that the former generally hindered the latter. Perhaps demographic expansion offers poorly performing economies a meager boost, but any benefits while at full employment are the “exception rather than the rule.”87 “The case for population growth in terms of . . . [higher] consumption,” he concluded, “rests on the failure to sustain full employment by other means.”88 Minimization of the importance of population growth also emanated, ironically, from some theorists who, despite the obvious inaccuracy of 1930s secular-stagnation theory’s predictions of the end of economic growth, continued to believe that modern capitalism had run its course.

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Right now, we are not making it.”46 The idea of a demographically induced gap between current and necessary economic growth received the administration’s stamp of approval in the 1962 Economic Report of the President, which CEA member James Tobin called one of the agency’s two “economic manifestos” (the other came under Ronald Reagan).47 The impression that the demographic bubble forced the economy to work harder just to stand still was thus an important weapon in the push for an aggressive full-employment policy, which culminated in major Keynesian-inspired tax cuts in 1964. managing the great society’s population growth 143 The aggregate-demand camp’s emphasis on the sluggish macroeconomy did not run counter to SPK.48 The community of economists surrounding the Kennedy and Johnson administrations maintained that, given the state’s ability to spur prosperity and full employment, population growth was a neutral economic variable—and hence the regulation of population growth proposed from various quarters could proceed.

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He had long been impressed by historical connections between demographic and economic expansion, although he believed that the causal link between them was tenuous.118 In the 1960s, Kuznets would move into the pro–population growth camp, but in the 1950s he was still sympathetic to the Coale-Hoover paradigm that rapid population growth—what he called “population swarming”—stunts capital formation and income growth.119 At the 1954 Columbia University Conference on Economic Welfare, Kuznets doubted whether continual population growth is necessary to preserve full employment, noting the “elusive . . . indirect association between population growth patterns and economic growth.”120 At the Population Council meeting, Kuznets declared that neither Harberger nor Spengler had sufficient evidence to prove the forecast that continued population growth would stunt per capita income, and he retained his view that the relationship between population and economic growth was unresolved.121 Overall, the meeting’s participants seem to have debated to a draw, and Osborn captured the unresolved nature of the economic debate when he wrote in his summary: “Economists seem generally to agree that per capita production and per capita consumption are now handicapped rather than benefitted by further increase in numbers of people, though technical advances, new capital and other factors will for a long time to come more than offset this handicap.”122 Though population anxiety remained widespread, several theoretical contradictions and barriers squeezed the economic case against population growth.

World Economy Since the Wars: A Personal View
by John Kenneth Galbraith
Published 14 May 1994

Let him assume that a President, or other candidate for reelection to major public office, has the opportunity of defending a large increase in man-hour productivity which has been divided equally between greatly increased total output and greatly increased unemployment. And let it be assumed that as an alternative he might choose unchanged productivity which has left everyone employed. That full employment is more desirable than increased production combined with unemployment would be clear alike to the most sophisticated and the most primitive politician. The foregoing provides the basic rule of procedure for the remainder of this essay. It shows that, in the absence of a genuine grading up of lower incomes, we need not be much concerned with the supply of goods for their own sake.

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Were the economy given to occasional bouts of stimulation with excessive investment and rising prices—the business cycle of the central economic tradition—then countercyclical repression of demand might involve no serious problem. Some who have seen no conflict between fiscal policy and growth have, without doubt, viewed it in such a context. But if full employment and full use of capacity is taken as the norm of economic policy, as in modern times it is, then the rate of investment associated with full use of capacity is also normal. A policy which holds production below capacity in the interest of price stability inescapably sacrifices economic growth.

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IV So long as the use of fiscal policy is in unresolved conflict with other and prior economic goals, it will not be used with effective vigor, at least in peacetime. This conflict and the resulting inutility of fiscal measures are not yet widely conceded by economists. The textbooks still elucidate the use of fiscal measures as a device for ensuring price stability. They concede that we must settle for something less than completely full employment and that this will offer difficulties. But they assume that, given inflation, taxes can be increased. The only difficulty is that the policy never looks practical at any particular moment. While the conflict with other goals persists, it never will. One last possibility remains. That is to combine fiscal policy with control over prices and wages.

Austerity: The History of a Dangerous Idea
by Mark Blyth
Published 24 Apr 2013

These same ideas were offered as explanations and implemented as policies in many countries in the 1920s and 1930s, and as we shall see in chapter 6, they didn’t work then either. As Keynes demonstrated, there is no reason for an economy to “naturally” return to a full-employment equilibrium after a shock. It can settle into a state far from full employment for a very long time.53 The Austrian explanation of sustained unemployment after a bust—the inability of the economy to self-heal as it should—is that trade unions are holding up the market-clearing wage. But in the United States, for example, where unions cover less than one in eight workers, such an explanation is simply not credible.54 Moreover, Germany and Sweden, countries with much higher unemployment rates through the business cycle, also have far higher unionization rates.

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In his assessment of George’s proposals, Keynes “first adumbrated the … relation of saving to investment.”88 That is, he argued that saving doesn’t drive investment if “investment is free to fluctuate under the influence of expectations” such that income and employment adjust to the ex post level of saving.89 As a consequence, government should “fill the gap/prime the pump” by spending money that business is sitting on because of uncertainty about the future. This view was extremely threatening to the Treasury since it implied that supply-side factors were insufficient to drive the economy to full employment. It required a response, which the Treasury duly provided in both the “Memoranda on Certain Proposals” and most publicly in Winston Churchill’s 1929 budget speech in which he argued that “when the Government borrow[s] in the money market it becomes a new competitor with industry and engrosses to itself resources which would otherwise have been employed by private enterprise, and in the process raises the rent of money to all who have need of it.”90 This is as pure a statement of the notion that the government crowds out investment as one can find.

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This, in turn, causes consumption to shrink, which in the aggregate pulls the economy down further and makes the debt to be paid back all the greater. Fourth, just as it does not follow that governments should always intervene to stave off market adjustments, as the “Greenspan put” and Ireland’s bank rescue showed only too well, to argue that there should never be intervention presumes knowledge of the system—it will return to full employment if left alone—that Austrians themselves say is impossible to attain. The Austrian counterfactual, that in the absence of interventions market allocation will be optimal, can never be satisfied. After all, if entrepreneurs are duped by short-term interest-rate cuts, there is no reason to assume that their choices would necessarily be any better than those of the state doing the duping when it comes to choosing how to allocate capital in the first instance.56 Fifth, one doesn’t have to accept a John Galt anti-inflationary capital strike thesis to explain why companies are currently sitting on tons of cash.

A Pelican Introduction Economics: A User's Guide
by Ha-Joon Chang
Published 26 May 2014

If excess savings are reduced in this way, there will be no downward pressure on interest rates and thus no extra stimulus for investment. Keynes thought that investment will be high enough for full employment only when animal spirits – ‘a spontaneous urge to action rather than inaction’, as he defines it – of the potential investors are stimulated by new technologies, financial euphoria and other unusual events. The normal state of affairs, in his view, would be that investment is equated to savings at a level of effective demand (the demand that is actually backed up by purchasing power) that is insufficient to support full employment. In order to achieve full employment, Keynes argued, the government therefore has to use its spending actively to prop up the level of demand.18 Money gets a real job in economics: the Keynesian theory of finance The prevalence of uncertainty in Keynesian economics means that money is not simply an accounting unit or merely a convenient medium of exchange, as the Classical (and the Neoclassical) school thought.

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: the Keynesian explanation Keynes started from the obvious observation that an economy doesn’t consume all that it produces. The difference – that is, savings – needs to be invested, if everything that has been produced is to be sold and if all productive inputs, including the labour service of workers, are to be employed (this is known as full employment). Unfortunately, there is no guarantee that savings will equal investment, especially when those who invest and those who save are not one and the same, unlike in the early days of capitalism, when capitalists mostly invested out of their own savings and workers could not save, given their low wages.

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There are things we know that we know. There are known unknowns. That is to say, there are things that we now know we don’t know. But there are also unknown unknowns. There are things we do not know we don’t know.’ The idea of ‘unknown unknowns’ nicely sums up Keynes’ concept of uncertainty. Active fiscal policy for full employment: the Keynesian solution In an uncertain world, investors may suddenly become pessimistic about the future and reduce their investments. In such a situation, there will be more savings than are needed – there will be, in technical terms, a ‘savings glut’. The Classical economists thought this glut would be sooner or later eliminated, as the lower demand for savings would drive the interest rate (that is, the price of borrowing, if you like) down, making investments more attractive.

Shadows of Empire: The Anglosphere in British Politics
by Michael Kenny and Nick Pearce
Published 5 Jun 2018

The managed international monetary system in which both the USA and the UK had a stake, as sovereigns of the world's two major currencies, was gradually replaced by a liberalised economic order under renewed American leadership. The class compromises of the post-war era, cemented on the foundations of full employment, real wage growth and the construction of the national welfare state, broke down, at first due to conflicts over coordinated wage restraint and the management of inflation, and later because of bitter struggles over the power of trade unions. At the same time, the Keynesian coordinates of macro-economic demand management and the maintenance of full employment were dismantled in favour of inflation control and public spending cuts. As the 1970s ended, Britain and the USA began the process of constructing a new neo-liberal political economy, with the financial sector at its heart.

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A full-blown sterling crisis ensued and dollar convertibility had to be suspended within weeks, followed by further rationing of food and petrol. The alternative option – of severe deflation to restore Britain's balance of payments – could not be countenanced, since it would mean sacrificing full employment and the building of the New Jerusalem on which the Attlee government was embarked. But the suspension of convertibility had to be acceptable to the USA, since it was being asked to continue to allow the sterling area to remain protected, with imperial tariff preferences, import controls on dollar goods, and a currency that could not be freely exchanged – ‘precisely those things that American leaders had been so determined to crush eighteen months earlier.’2 American forbearance when Britain defaulted on its loan terms was based on a new strategic assessment of the USA's economic and military interests.

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Support for the British Empire was the lodestar of his foreign policy, and he staunchly maintained it, even as he negotiated Australia's place within the USA's Pacific security umbrella (in 1951, to the UK's intense irritation, Australia and New Zealand took their place in the US constellation of Cold War alliances by signing the ANZUS Pact). Although, in the post-war era of full employment, Australia's labour supply needs could no longer be met by British migrants, it nonetheless maintained a ‘white’ immigration policy that lasted into the 1970s (the post-war Labour immigration minister, Arthur Calwell, notoriously declared when he deported Chinese refugees in 1947 that ‘Two Wongs don't make a White’).

Why Wages Rise
by F. A. Harper
Published 1 Jan 1957

Let us take these Douglas-Pigou figures, leaning a bit on the conservative side of their conclusions. Let us say that the figure is 3 per cent. What would this mean when applied to real life? The accompanying chart of the wage level and unemployment shows how unemployment and the wage level are related on this three-to-one basis. At the free market wage of 100 (base scale) there is full employment — no unemployment. Everyone who really wants to work has a job. Now assume that wages are to be forced above the free market level (moving leftward from 100, on the base scale). Employment declines — unemployment increases — at a rapid rate, according to the factor of three. Starting from whatever level one wants to consider, a one per cent rise in wages will reduce employment by 3 per cent.

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Or one might ask people who are not working whether they have turned down jobs at the price offered, or whether they are out of work because they couldn’t find any jobs at any price. Moving in the opposite direction of wages below the free market price (rightward from 100, on the base scale) results in the opposite tendency. More and more people are wanted for work. But since there is full employment at the free market wage, reductions in wages from that point can cause “negative unemployment” only under special conditions. New persons not normally in the working force may be pulled into jobs at a wage below the free market point if they can be induced to do so under the urgency of war, or something like that.

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This is because wage earners are voters, and they do not form unions to keep wages below the free market point. The other reason why “negative unemployment” does not last long is that the labor statisticians soon conclude that their count of the working force must have been wrong before. So they revise their figures in such a way that full employment is not exceeded, according to the newly revised statistics. Such is the problem of pricing work in the market for labor. Such is the function of freedom in wages. ____________ 1Douglas, Paul H. The Theory of Wages. New York: The Macmillan Company, 1934. p. 501. Pigou, A. C. Theory of Unemployment.

Rethinking Money: How New Currencies Turn Scarcity Into Prosperity
by Bernard Lietaer and Jacqui Dunne
Published 4 Feb 2013

The devastation of the Great Depression and the dramatic economic ramifications of the 1930s forced economists and nations to reexamine their assumptions regarding the economy, particularly the thendominant view that a free market, unfettered by government interference, would naturally bring about full employment equilibrium. This debate still rages, almost a century later. Without needing to parse the theories, ideas from three iconic schools of thought shape current economic and political debates: John Maynard Keynes, Friedrich Hayek, and Milton Friedman and their respective Keynesian, Austrian, and Chicago schools of economics.

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MIT economist David Autor predicts that automation will eliminate middle-class jobs, and shows that the trend of demand for mainly high- and low-wage extremes will continue for the foreseeable future. 119 120 PROSPERITY These views are supported by the official statistics, which show that employers tend to be hiring more temporary part-time workers or volunteer workers such as interns, with most job creation trending to lower-paying work. A staggering 21 million jobs need to be created by 2020 to return America to full employment.3 Santa Fe Institute economist Brian Arthur cogently describes the ongoing transition from industrial to information age: “With the coming of the Industrial Revolution—roughly from the 1760s, when Watt’s steam engine appeared, through around 1850 and beyond—the economy developed a muscular system in the form of machine power.

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The bridge was so different from how it had been described in various books and articles. It seemed in real life more diminutive, plainer, and definitely shorter, yet its impact was unexpectedly overwhelming. Back in the dreary days of the 1930s Great Depression, this nondescript yet iconic overpass symbolized the dreams of full employment and a decent standard of living for all. Scholars, government officials, and thousands of others traveled to this Austrian community to personally witness and learn from the miracle of Wörgl. Today, the town has little significance, noted mostly for its railway junction connecting the line from Innsbruck to Munich with the inner-Austrian line to Salzburg.

The Joy of Tax
by Richard Murphy
Published 30 Sep 2015

Money is, of course, an issue of some importance in any economy. In fact, given that inflation was the sole issue of apparent concern in the mandate for the Bank of England from 1997 until recently, you might have gained the idea that money has been the most important issue to be addressed in the UK economy of late. I would strongly disagree: full employment, the sustainability of the economy and its ability to meet the real needs of those who live within it are all in my view of more importance than money; and yet if money is ignored none of those other objectives can be achieved. The amount of money in an economy has a dramatic impact on the scale of economic activity that takes place within it, and just two factors – the relationship between the amount of tax the government collects and its total spending; and the amount of money that is created by the banks when making loans – determine how much money (or credit, because all money is a promise to pay) there is in that economy to facilitate the trades people want to undertake.

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In itself this chart shows the difficulty of delivering vertical equity in a tax system: when taxes on consumption are high (as they are in the UK when the combination of VAT, excise duty and other charges is taken into account) and those on low incomes spend all they have (and sometimes more besides because of untaxed income sources or borrowing), then what appears to be a partially regressive tax system results. In fact, the 10 per cent of people with the highest incomes in the UK appear to pay less in total taxation than many on lower incomes. Figure 8: UK tax paid by income decile, 2010–11 Source: Richard Murphy and Howard Reed, ‘Financing the Social State: Towards a full employment economy’, April 2013, Class Think Tank9 Equality may be the name of the game in tax, but we aren’t delivering it – and that is taking into account only the obvious issues relating to tax and equality that most people tend to think of. As I said at the start of this section, there is rather more to tax and equality than these obvious considerations.

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It is then important to note that this issue extends beyond mere cash payments to and from the individual. Ensuring availability of resources such as appropriate housing is an essential part of this process of achieving equality of sufficient well-being to participate in society, as too is a policy of full employment. It is pointless having a tax system that says it promotes equality of sufficiency but does not also promote the means to deliver it. One can, of course, extend this notion to education and healthcare as well as many aspects of the social welfare system on which so many depend at some point in their lives.

Unfinished Business
by Tamim Bayoumi

In this system, described in more detail in the next chapter, countries kept their exchange rates fixed against the US dollar, which itself was fixed against gold and (at least in theory) any changes in parity against the dollar needed to be discussed with the international community via the International Monetary Fund. The system was supported by an intellectual framework in which countries could use a combination of fiscal and monetary policy to achieve full employment and a desirable trade balance. The key insight was that, in response to excess economic slack, either a looser monetary policy or a larger government deficit could be used to achieve full employment (“internal balance”), but that the two policies had contrasting effects on the trade balance. Cutting short-term interest rates to stimulate activity via monetary policy would tend to lower the exchange rate, increase exports, and create a larger trade surplus.

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The two macroeconomic policies (monetary and fiscal) could combine to achieve the two objectives (full employment and a desirable trade balance). Support for this integrated policy framework started to fray soon after the break-up of the Bretton Woods system in the early 1970s as belief in the active use of fiscal policy waned. This came in large part from a backlash against the increased size of government and rapid rise in government debt in the 1960s and 1970s. The focus of fiscal policymakers switched from fine-tuning the government deficit so as to achieve full employment to longer-term objectives such as reducing the size of government and the associated tax bill.

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Equally importantly, assigning macroeconomic stability solely to the central bank is not intuitive. Indeed, before the 1980s the macroeconomic orthodoxy embraced an integrated approach in which monetary and fiscal policies were used simultaneously achieve full employment (“internal balance”) and a desirable trade position (“external balance”). In this macroeconomic scheme there were two objectives (full employment/stable inflation and a sustainable external position) and two instruments (monetary and fiscal policy). Currently, there are four objections—stable inflation/low slack, high underlying growth, low government debt, and financial stability—as well as four instruments—monetary, fiscal, structural, and financial policies.

Milton Friedman: A Biography
by Lanny Ebenstein
Published 23 Jan 2007

Keynes believed that the major cause of national economic activity at less than full employment in advanced economies was attempted excess saving for which investment opportunities did not exist. Essential to his view was that as an economy matures, desired savings exceed desired investment. As Keynes defined them, savings always equal investment after the fact. He argued that in developed economies, a failure to find investment opportunities would stymie the attempt to save. The result would be unemployment because money saved would not be spent on consumption. Economic equilibrium could occur at less than full employment and maximum output. Keynes’s General Theory is filled with references to the existence of and problems caused by excess saving as economics mature: The fundamental psychological law, upon which we are entitled to depend with great confidence . . . is that men are disposed . . . to increase their consumption as their income increases, but not by as much as the increase in their income.2 [W]e take it as a fundamental... rule of any modern community that, when its real income is increased, it will not increase its consumption by an equal absolute amount.3 In the United States... by 1929 the rapid capital expansion of the previous five years had led cumulatively to the setting up of sinking funds and depreciation allowances... on so huge a scale that an enormous volume of entirely new investment was required merely to absorb these financial provisions; and it became almost hopeless to find still more new investment on a sufficient scale to provide for such new saving as a wealthy community . . . would be disposed to set aside.

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The only way to maintain the temporarily beneficial effects of inflation is for inflation to rise at increasing, unanticipated rates, which is unsustainable. According to Friedman: “Keynes’s key theoretical proposition . . . [is] that even in a world of flexible prices, a position of equilibrium at full employment might not exist.”19 Friedman’s view, on the other hand, is that in a world of flexible prices, equilibrium at full employment will exist. Friedman’s view in the middle 1960s was that a regime of generally stable prices is the best public policy. To accomplish this goal, he recommends a fixed annual increase in the money supply, variously estimated (in part based on the money aggregates used) at 2 to 5 percent, about equal to long-term growth in the economy.

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Therefore, to the extent that Friedman’s theory dampened economists’ enthusiasm for an active fiscal policy, it thus helped to dampen the rate of growth of government.12 Friedman emphasizes the importance of the findings of A Theory of the Consumption Function in its final chapter. One of the major theoretical outcomes of Keynesian analysis is “the denial that the long-run equilibrium position of a free enterprise economy is...at full employment.”13 In Keynes’s view, free private property capitalism is inherently unstable or nonmaximally productive because of excess saving as capitalist economies mature. In challenging this hypothesis, Friedman helped to pave the way academically for the intellectual rehabilitation of free private property capitalism from the 1960s to the present.

The Making of an Atlantic Ruling Class
by Kees Van der Pijl
Published 2 Jun 2014

In particular, it was feared that the logic of the socialization of the productive forces might spill over to the relations of production if, after the recommended ‘euthanasia of the rentier’, only the managerial element was left to maintain the rate of exploitation. As Kalecki argued in a well-known article of 1943, a democratic full-employment policy would always entail unacceptable consequences for the capitalist class. Keynes, too, was aware that the full realization of his programme risked endangering the capitalist form it intended to save and could only be attempted under emergency or wartime conditions. In a 1940 article, he conceded that ‘it seems politically impossible for a capitalist democracy to organize expenditure on the scale necessary to make the grand experiment which would prove my case — except in war conditions’.32 By this time, the class struggles underlying the ascendancy of the productive-capital concept over the previous liberalism had produced highly divergent outcomes in the United States and Europe.

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In October, the AFL leader, Samuel Gompers, was appointed to the Advisory Commission of the Council of National Defense, and in 1917, Wilson addressed the national convention of the AFL, inviting its leaders to serve on the National Labor Conference and later on the National War Labor Board. The war, with it stimulus to full employment,34 reinforced the hold of imperialist ideology not just over the trade-union bureacracy, but also over much of the native skilled working class.35 Their contribution to the war effort notwithstanding, however, workers’ standards of living declined; only after Armistice did wages begin to catch up with prices that by 1919 had doubled over their 1915 level.

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At a meeting of the AFL Executive Council in 1917, Gompers reprimanded a Negro delegation for ‘somehow conveying the idea that they are to be petted or coddled and given special consideration and special privilege. Of course that can’t be done’.39 Confronted by an upsurge of class struggle and reaction at home, the AFL’s new-found internationalism collapsed with even greater speed than Wilson’s attempt to create a new world order. Yet the Wilson offensive, absorbing social pressures generated by near-full employment and redirecting them (partly through an appeal to Anglo-Saxon chauvinism and partly through reform) towards support for expansion into the European sphere-of-influence, served as the paradigmatic precedent for the later Roosevelt, Marshall and Kennedy offensives. Atlantic unity, whether positive (for democracy) or negative (against socialism) in its explicit programme, derived its basic structural characteristics from this episode. 2.

Seven Crashes: The Economic Crises That Shaped Globalization
by Harold James
Published 15 Jan 2023

But the labor for the new activities was not instantly available, and a substantial transfer of people from one area to another was incompatible with the policy emphasis on full employment. The problem was most acutely diagnosed, not in the case of western market economies, but in the world of Soviet planning, where János Kornai analyzed how there could be no real economic system from which both excess demand and excess supply had been eliminated: “‘Optimization,’” he wrote, “is not possible: we want full employment, but we do not want labor shortage. They are joint products, which, it seems, necessarily appear together.”7 Growth and Productivity Though the source of the inflation problem was domestic, the arguments and responses that it provoked lay in external policy, in the shaping of how a national economy related to the rest of the world.

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The core of the analysis was the hypothesis that “the short-term real interest rate that was consistent with full employment had fallen to −2% or −3% sometime in the middle of the last decade.” That thought experiment appeared to generate quite precisely the postrecession environment: “Then, what would happen? Then, even with artificial stimulus to demand coming from all this financial imprudence, you wouldn’t see any excess demand. And even with a relative resumption of normal credit conditions, you’d have a lot of difficulty getting back to full employment.”108 The analysis provided a powerful explanation of the weakness of the Obama recovery.

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Instead, the core of the problem lay in a modern open and globalized economy that was too adaptive, and hence not producing enough demand to generate growth and full employment: “The more flexible wages and prices are, the more they will be expected to fall during an output slowdown, leading to an increase in real interest rates. Indeed, there is the possibility of destabilising deflation, with falling prices leading to higher real interest rates leading to greater output shortfalls leading to more rapidly falling prices, and onwards in a vicious cycle.”112 The key insight was that the Full Employment Real Interest Rate (FERIR) levels “may have declined.” The key to the analysis given by Summers depended on a historical analysis of trends of long-term interest rate movements.

The Globalization Paradox: Democracy and the Future of the World Economy
by Dani Rodrik
Published 23 Dec 2010

Countries on gold faced rapid capital outflows at the slightest hint of trouble, which required high interest rates and endangered their governments’ ability to maintain fixed parities. Stability on the foreign exchanges clashed with the goal of full employment. These financial market pressures ultimately condemned Britain’s return to the gold standard to failure. Once markets’ dynamics became intertwined with domestic politics, there was no hope that a world of smoothly functioning, self-equilibrating finance would lie within reach. Keynes identified another, more fundamental problem. Unfettered capital flows undermined not only financial stability but also macroeconomic equilibrium—full employment and price stability. The idea that the macroeconomy would self-adjust, without help from domestic fiscal and monetary policies, had been buried by the experience of the Great Depression and the chaos of the 1930s.

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They did so because that was the belief system that governed central bank behavior at the time. The maintenance of the gold standard had absolute priority in the conduct of monetary policy both because the system came to be viewed as the foundation of monetary stability and because there were no competing objectives—such as full employment or economic growth—in the conduct of monetary policy. Ideas mattered, here as elsewhere. The notion that active monetary and fiscal policies could systematically smooth business cycles or that currency devaluation could help reduce trade imbalances—these were yet to come, or heretical at best.

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There must be no microeconomic market imperfections other than the trade restrictions in question, or if there are some, the second-best interactions that are entailed must not be too adverse. The home economy must be “small” in world markets, or else the liberalization must not put the economy on the wrong side of the “optimum tariff.” The economy must be in reasonably full employment, or if not, the monetary and fiscal authorities must have effective tools of demand management at their disposal. The income redistributive effects of the liberalization should not be judged undesirable by society at large, or if they are, there must be compensatory tax-transfer schemes with low enough excess burden.

Keeping at It: The Quest for Sound Money and Good Government
by Paul Volcker and Christine Harper
Published 30 Oct 2018

The growing sense of frustration and political concerns about the lack of full employment were reflected in new legislation. In 1977 the Federal Reserve Act was amended to require that the central bank “maintain long run growth of the monetary and credit aggregates commensurate with the economy’s long run potential to increase production, so as to promote the goals of maximum employment, stable prices, and moderate long-term interest rates.” Reasonable enough as an aspiration, but here we have the origin of what has since been interpreted as the “dual mandate.” The following year, Congress passed the Full Employment and Balanced Growth Act, known more widely as the “Humphrey-Hawkins Act” for the senator and congressman who sponsored the legislation.

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Then, with victory in sight, the authorities relax and accept a “little inflation” in the hope of stimulating further growth, only to see the process resume all over again. The sad history of economic policy over much of Latin America offers too many examples. The United States is not Latin America, with its history of recurrent inflation. But it does face an ongoing challenge for monetary and fiscal policy. The now long expansion and full employment with signs of growing pressures on labor markets have, so far, not upset price stability. But it is a crucial period for monetary policy. The late Bill Martin, as I recalled earlier, is famous for his remark that the job of the central bank is to take away the punch bowl just when the party gets going.

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Yet, as I write, with economic growth rising and the unemployment rate near historic lows, concerns are being voiced that consumer prices are growing too slowly—just because they’re a quarter percent or so below the 2 percent target! Could that be a signal to “ease” monetary policy, or at least to delay restraint, even with the economy at full employment? Certainly, that would be nonsense. How did central bankers fall into the trap of assigning such weight to tiny changes in a single statistic, with all of its inherent weakness? I think I know the origin. It’s not a matter of theory or of deep empirical studies. Just a very practical decision in a far-away place.

Meltdown: How Greed and Corruption Shattered Our Financial System and How We Can Recover
by Katrina Vanden Heuvel and William Greider
Published 9 Jan 2009

The self-taught Eccles (he never went to college) personally intuited what John Maynard Keynes developed as a formal theory: The national government, including the Fed, must become the intervening balance wheel in a modern industrial economy—the stabilizing force that, when necessary, stimulates the economy to encourage faster growth and full employment, while at other times it puts the brakes on economic activity to avoid inflation. Eccles essentially invented the modern Federal Reserve, liberating the central bank from the 1920s hard-money orthodoxy of banking and finance, an inflexible doctrine that gravely worsened the Depression. Greenspan, one might say, devoted his tenure to eliminating vestiges of Eccles and FDR.

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A public official who fails to alert investors to such risks “is no better than a doctor who, having diagnosed high blood pressure in a patient, says nothing because he thinks the patient might be lucky and show no ill effects,” Shiller wrote. The Price of “Sound Money” The lopsided focus of Greenspan’s Fed—exalting financial markets over the real economy—is perhaps his greatest ideology-driven error, and it caused the deepest damage to society. Congress by law instructs the Federal Reserve to pursue twin goals—stable money and full employment—and there is always a natural tension between those two objectives. Maintaining low price inflation gets much more difficult when the economy expands more vigorously, so the central bank traditionally tried to sustain a rough balance. Greenspan resolved the tension easily (as most conservatives probably would) by tipping the scales in favor of sound money.

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In fact, it is the most dangerous terrain in capitalism. Preventing deflationary calamities was one of the main reasons the Federal Reserve was created. After years of doing the opposite, the chairman belatedly took his foot off the brake pedal and decided to let the economy grow faster. His shift generated full employment and rising wages—the chairman was celebrated as an economic genius—but booming relief for the real economy came too late to last, given the other imbalances Greenspan had fostered. Faster growth perversely expanded the stock market’s delusions, and the price mania spiraled to new heights. Remember the predictions of Dow 35,000?

The Socialist Manifesto: The Case for Radical Politics in an Era of Extreme Inequality
by Bhaskar Sunkara
Published 1 Feb 2019

Sweden in the 1970s was not simply the most livable society in history; it was also the European country where, after World War II, socialists got the furthest along in undermining capital’s power. While capitalists worried about Nikita Khrushchev’s shoe-banging promises to bury the West, the greatest threat to free market capitalism was not in Russia but in Scandinavia, where the combination of a universal welfare state, full employment, and centralized unions gave labor enormous power. Swedish trade unions even came out with a proposal for wage-earner funds in 1976 that would have slowly socialized private firms. How Sweden’s social democrats got to that point, and why their experiment eventually fell apart, is an unlikely, instructive story.

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And even in a period with emergency wage, price, and consumption controls, planning had a great deal of mystique. Despite Wigforss’s assurances about the continued role of private capital, the 1944 program advocated government takeovers of basic industries and finance and an overarching state responsibility for shaping investment and maintaining full employment. Economist and trade minister Gunnar Myrdal spoke of a “harvest time” for the labor movement, in which the fruits of recent economic development would fall to workers. Yet a push for nationalization found resistance from a capitalist class that could credibly threaten to withhold investment. That climate, combined with the onset of the Cold War, tempered the SAP, which forsook alliance with the Communists in favor of a new coalition with the Agrarians.10 With the march toward socialization blocked, the party eventually adopted a 1951 plan created by LO economists Gösta Rehn and Rudolf Meidner.

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These negotiations were done directly between labor and capital, but the role of the state was crucial: “active labor market policies” helped workers formerly employed in less productive firms get reabsorbed in expanding parts of the economy. Social guarantees—for health care, education, child care, and so on—meant that there was a growing state sector to help ensure full employment. It was a program for “functional socialism,” in that it made certain socialist priorities clear but would seek them by shaping the outcomes of capitalist enterprise rather than through nationalization. Such a model, however, was one that capitalists would agree to only under duress. As Meidner put it, “management prefers decentralized bargaining” and “wage differentials as instruments for managerial control.”12 Even though capitalists benefited from the Rehn-Meidner plan in many respects, it was only implemented because a powerful labor movement and social-democratic party forced its way.

The Great Divide: Unequal Societies and What We Can Do About Them
by Joseph E. Stiglitz
Published 15 Mar 2015

With formidable yet accessible economic insight, he urges us to embrace real solutions: increasing taxes on corporations and the wealthy; offering more help to the children of the poor; investing in education, science, and infrastructure; helping out homeowners instead of banks; and, most importantly, doing more to restore the economy to full employment. Stiglitz also draws lessons from Scandinavia, Singapore, and Japan, and he argues against the tide of unnecessary, destructive austerity that is sweeping across Europe.Ultimately, Stiglitz believes our choice is not between growth and fairness; with the right policies, we can choose both. His complaint is not so much about capitalism as such, but how twenty-first-century capitalism has been perverted.

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If it tightens prematurely—as soon as inflation seems nascent—it is likely that the share of wages will be ratcheted downward, for during the downturn, workers fare badly, and they have to be allowed to make up for what they lost. While the main thrust of the Fed’s policy has been to restore the economy to full employment—a policy that would be an enormous boon to workers—some of what it has done may have contributed to inequality. One of the main effects of quantitative easing, the policy of buying long-term bonds to lower the long-term interest rate, has been to bolster the stock market—of benefit disproportionately to the rich.

…

Meanwhile, its failure to do what it could and should have done to make the financial market work better for ordinary Americans—to ensure competition, to restrict the excessive fees that credit and debit cards charge to merchants that ultimately get paid by consumers, to restore lending to small and medium-size enterprises, to create a mortgage market that serves Americans rather than the interests of the banks—has hurt those in the middle and bottom at the same time that it has enriched the coffers of the banks. Yellen is right, too, to point out (as I have done in this book) the limits to monetary policy. It is hard-pressed to restore the economy to full employment on its own. Indeed, it may be contributing to the jobless recovery that we are experiencing (the percentage of the working-age population that is employed, though it has rebounded slightly since the crisis, is still lower than at any time since 1984). Low interest rates encourage firms, when they invest, to invest in very capital intensive technologies—replacing unskilled workers with machines makes no sense in an era in which so many unskilled workers are striving to find jobs.

Roller-Coaster: Europe, 1950-2017
by Ian Kershaw
Published 29 Aug 2018

THE WELFARE STATE Part of the virtuous circle of economic growth was the increased stream of revenue to governments that enabled states to spend far greater amounts on welfare provision. Tax revenue rose at unprecedented rates with the return to full employment and the big expansion of consumer spending. State budgets in Western Europe were up to twenty times higher in the 1970s than they had been in 1950. Governments were consequently in a position to spend far more on welfare programmes than ever before. Welfare provision and full employment had been the overwhelming needs of a new society – the obvious lesson of the Great Depression, and recognized by all post-war governments. In the post-war decades all political parties agreed on the need to expand welfare provision.

…

Two decades of high growth had produced full employment. The problem now was of rising inflation. Pumping money into the economy was guaranteed merely to add to inflationary pressures. Stimulating demand simply prompted claims for higher wages. Without increased productivity that just fed into further inflation. A large (and still rising) proportion of workers, especially in the expanded public sector, belonged to trade unions – in 1970 around two-thirds in Sweden, half in Britain, a third in West Germany (though little over a fifth in France). Unions were able to exploit virtually full employment and a labour shortage to win sometimes spectacular wage increases – 19 per cent in Italian industry in 1969 – without commensurate increases in productivity.

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The writer Johannes Gaitanides acknowledged in 1959 ‘the weaknesses, mistakes and failings of the Federal Republic’, but claimed it was a mistake to dismiss its notable achievements. ‘How would this critique of the Federal Republic look,’ he asked, ‘if it had not produced an economic miracle, full employment, improvement in the social status of workers, integration of expellees from the east and refugees from central Germany [by which he meant from the regions that had become the German Democratic Republic], further development of social security, shortened working hours, co-determination of workers in heavy industry and restitution to victims of Nazism?’

The Rise and Fall of the Neoliberal Order: America and the World in the Free Market Era
by Gary Gerstle
Published 14 Oct 2022

A large and mobilized labor movement provided many of the Democratic Party’s shock troops, its members working hard to get out the vote, staff polling stations, and generate enthusiasm for FDR and Democratic candidates up and down the ballot. Labor was matched in influence—and even more so in campaign contributions—by sectors of the business class persuaded that their industries would benefit from the full-employment, mass-consumption system of regulated capitalism that the New Deal promised to create. Moreover, the communist success in the Soviet Union scared American businessmen as did the influence of communists in the ranks of American labor, inclining them (the businessmen) to compromise with more moderate sectors of the labor movement.4 The New Deal order gained its power not just from dependable electoral and business constituencies but also from its ability to implant its core ideological principles on the political landscape.

…

These old-style Democrats were Keynesians; the New Deal order, they believed, could be reinvigorated. They fought hard for labor law reform meant to reanimate the labor movement and the capital-labor compromise on which the New Deal for so long had rested. They hoped that the passage of the Humphrey-Hawkins Full Employment and Balanced Growth Act of 1978 would impel the government to use its fiscal and monetary resources to encourage job creation in the private sector and to launch public-sector jobs programs. In 1979 and 1980, New Deal order stalwarts within the Democratic Party also drew Carter into deep discussions about creating tripartite boards of labor leaders, corporate heads, and representatives of the public of the sort that had flourished in the 1930s and 1940s.

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He criticized them for accepting “private enterprise’s primacy as fully as Citibank’s Walter Wriston or Ronald Reagan’s official family.” They “pay small heed,” he disapprovingly observed, “to maldistribution of income and wealth.” The aims of these neoliberals were “not to be confused,” he alleged, with “traditional, highly honorable liberal aspirations for full employment, universal health coverage, tax equity, adequate housing, urban rehabilitation, integration of minorities into the labor force, and the mild redistribution of income, wealth and power.” The neoliberal ideal, Lekachman concluded, “appears to be more intelligent behavior by capitalists under the gentle tutelage of Government, which stimulates corporations with increased rewards.”60 Lekachman’s portrait of Democratic neoliberals aptly described Paul E.

State of Emergency: The Way We Were
by Dominic Sandbrook
Published 29 Sep 2010

It was certainly unfair to hold Heath personally responsible when the roots of the problem lay in the late 1960s, and when he had clearly tried everything, including Keynesian spending measures, to address it. In retrospect, it is obvious that full employment as it was understood in the 1940s and 1950s was destined for the scrapheap. From the Wilson years onwards, successive governments were forced to run the economy at higher levels of unemployment simply to keep inflation in check, and even during the fat years under Tony Blair full employment never returned. Indeed, by the standards of later administrations an unemployment rate of around 4 per cent, for which Heath was mercilessly pilloried, was astonishingly good.

…

For more than a decade, as Britain’s imperial possessions disappeared, its economic lead evaporated and its manufacturers struggled to compete with foreign rivals, politicians of both parties had talked of sweeping modernization and structural reform, from decimalization to European integration. In general, however, they had shrunk from radical economic change, frightened that it would undermine full employment and alienate the voters, content merely to keep muddling through. Perhaps this was not surprising: for twenty years, thanks to its soft Commonwealth markets and the weakness of its rivals, Britain had been protected from the harsh winds of global competition. But by the early 1970s, as Edward Heath was to discover, the kaleidoscope was shifting.

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Now it was a typical section of the south London commuter belt, a world of identical semi-detached houses and brick council estates, inhabited by skilled workers, clerks and technicians. In 1945 it had been a safe Labour seat; now it was classic aspirational upper-working-class and middle-class Conservative. It was a place transformed by light industry, rising wages and full employment, a place where farms had been replaced by shopping centres and labourers had given way to pharmacists. It seemed a long way from the sensationalist high jinks that later dominated popular memories of the post-war years – the Profumo scandal, Swinging London, the Beatles and the Rolling Stones – and yet, better than any of those things, it symbolized the subterranean economic and social trends that had changed the lives of Britain’s 55 million people.

Debunking Economics - Revised, Expanded and Integrated Edition: The Naked Emperor Dethroned?
by Steve Keen
Published 21 Sep 2011

This ‘liquidity trap’ enabled Hicks to provide an explanation for the Great Depression, and simultaneously reconcile Keynes with ‘the Classics.’ Keynes was consigned to one end of the LM curve, where the liquidity trap applied, and ‘the Classics’ to the other, where full employment was the rule (see Figure 3.1). In the ‘classical’ range of the LM curve, conventional economics reigned supreme: there was a maximal, full employment level of income, where any attempts to increase output would simply cause a rising interest rate (or inflation, in extensions of the IS-LM model). In the ‘Keynesian’ region, monetary policy (which moved the LM curve) was ineffective, because the LM curve was effectively horizontal, but fiscal policy (which moved the IS curve) could generate greater output – and hence employment – without increasing interest rates.

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As a result, the media and the public were clamoring for change, supporting the efforts of leading neoclassicals like Milton Friedman to overthrow their Keynesian overlords in the academy. The public policy focus shifted from the Keynesian emphasis upon keeping unemployment low – and tolerating higher inflation as a side effect – to keeping inflation low, in the belief that this would allow the private sector to ‘do its thing’ and achieve full employment. The initial results were mixed – inflation plunged as Fed chairman Volcker pushed the cash rate3 to 20 percent, but unemployment exploded to its post-war peak of almost 11 percent in 1983. But that painful crisis proved to be the worst under neoclassical management of economic policy. The next recession in the early 1990s had a peak unemployment rate of less than 8 percent.

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Educated into ignorance If the real world were accurately described by economic textbooks, there would not now be a financial crisis – and nor would there ever have been one in the past either: the Great Depression would not have happened. The economy would instead be either in equilibrium, or rapidly returning to it, with full employment, low inflation, and sensibly priced assets. Of course, the real world is nothing like that. Instead, it has been permanently in disequilibrium, and in near-turmoil, ever since the financial crisis began in 2007. So the textbooks are wrong. But there is a bizarre irony in this disconnect between reality and economic textbooks.

The Weightless World: Strategies for Managing the Digital Economy
by Diane Coyle
Published 29 Oct 1998

By Maarten Lindeboom and Jan Van Ours, in Jobs, Wages and Poverty, Centre for Economic Performance 1997. Figures from the OECD’s Employment Outlook 1996. In Working for Full Employment, ed.John Philpott. The State We’re In, Will Hutton. Article in New Statesman, London, 21 February 1997. How Fat Cats Rock the Boat by Charles Leadbetter, Independent on Sunday, London, 3 November 1996. See, for example, The Stakeholder Society, by John Plender. Essay in Working for Full Employment, ed.John Philpott. In What Labour Can Do, Warner Books, 1997. Chapter Six. The End of Welfare It always seems to be dark, appropriately enough.

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Just as the great inequalities generated by the Industrial Revolution created the political dynamic that led to the extension of the vote, the creation of social insurance and the redistribution of income through the national economy, the scarcities and inequalities of the late twentieth century will prompt a political reaction. It is one that will bring to an end the identification of citizenship with the nation state. Cities will rise in power and the movement of people will become more fluid, ending the social contract that guarantees the welfare of a citizen within fixed borders. The idea of full employment, of a full-time job paying enough to support a family for all who want it, is also in its dying days. Both the nature of work and the influence governments have over employment have already changed irreversibly, although tax and regulatory policies have not yet adapted to the more fluid, riskier and more unequal world.

…

Putnam concluded that it had not grown enough to offset his gloomy conclusion. But the partial exception he makes for the third sector highlights its political potential. Consider the point raised by Ed Mayo, director of the New Economics Foundation, in an article where he argues against the desirability of conventional full employment. He writes: ‘The labour market exclusively defines how we organise and validate work within society (where those out of employment are dismissed as “economically inactive”). The results? We have two — twin — evils: mass unemployment on the one hand and a large amount of socially useful Nourishing the Grass Roots 73 work remaining undone on the other.

Prosperity Without Growth: Foundations for the Economy of Tomorrow
by Tim Jackson
Published 8 Dec 2016

Put otherwise, this shift increases the employment intensity of the economy and facilitates full employment. In a series of economic simulations, calibrated loosely for the Canadian and UK economies, Peter Victor and I have shown how this kind of structural shift, in combination with work-time policies, can indeed maintain high levels of employment, even as growth rates decline to (and below) zero.31 The transition to services offers a more ‘holistic’ solution to the employment challenge of a low-growth economy. The apparent ‘growth imperative’ arising from the pursuit of productivity is less decisive than the dilemma of growth suggests. There are routes to full employment that are entirely consistent both with stagnating demand and with improved prosperity.

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Prosperity without Growth remains the single most important book addressing this most critical of contemporary challenges.’ Jonathon Porritt, Founder Director of Forum for the Future ‘Tim Jackson spearheads the obvious truth that GDP growth is not necessary in order to achieve higher well-being in the rich world. Government intervention can produce the desired result, namely full employment, less inequity and reduced greenhouse gas emissions.’ Jørgen Randers, author of 2052: A Global Forecast for the Next Forty Years ‘Tim Jackson has brought his groundbreaking book bang up to date and substantially deepened its arguments. This extensively revised edition sets out more clearly than ever the dimensions of a new and different economics – working for people, planet and prosperity.

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And this continuing capital need both motivates the search for low-cost credit and highlights the dangers of credit drying up. It also explains why reducing capital costs indefinitely isn’t an option.13 When it comes to choosing which of the other two factors to target, a lot depends on the relative price of labour and materials. In a growing economy with full employment, wages tend to rise in real terms. Until very recently at least (Figure 1.1), material costs have tended to fall in real terms. So in practice, companies have invested preferentially in technologies that reduce labour costs even if this increases material costs: an obvious counter to the trend of resource productivity discussed in Chapter 5.14 For a company, then, higher labour productivity lowers the cost of its products and services.

Strange Rebels: 1979 and the Birth of the 21st Century
by Christian Caryl
Published 30 Oct 2012

The policies he proposed seemed to offer a tool for overcoming the problem of the destructive boom-and-bust cycles that seemed to plague capitalist economies. The Labour government of 1945, which touted its belief in “rational” economic decision making, was ready to follow suit. The centerpiece of Attlee’s New Jerusalem was “freedom from want,” which meant, in practical terms, full employment. Keynes had argued that the best way to sustain full employment was through government spending—even if it led to temporary budget deficits. Churchill had contributed to his Conservative Party’s defeat in the 1945 election by expressing skepticism about the degree of state control that a Beveridge-style reform program would entail.

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The speech that Callaghan gave at the 1976 Labour Party conference, authored by Jay, turned into something of a eulogy for Britain’s postwar economic system: For too long this country—all of us, yes this conference too—has been ready to settle for borrowing money abroad to maintain our standards of life, instead of grappling with the fundamental problems of British industry. . . . [T]he cozy world we were told would go on forever, where full employment would be guaranteed . . . that cozy world is now gone. . . . We used to think we could spend our way out of a recession and increase employment by cutting taxes and boosting government spending. I tell you in all candor that that option no longer exists, and that insofar as it ever did exist, it only worked on each occasion since the war by injecting a bigger dose of inflation into the economy followed by a higher level of unemployment as the next step.6 Finally, in November 1976, the United Kingdom was forced to ask the International Monetary Fund (IMF) for a $3.9 billion loan to tide it over through the crisis.

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“Now, when the war is abolishing landmarks of every kind, is the opportunity for using experience in a clear field,” the report declared. “A revolutionary moment in the world’s history is a time for revolutions, not for patching.” What the report proposed, however, was a distinctly British kind of revolution: a bureaucratic transformation of the state. It declared that full employment should be the goal of economic policy. It proposed the creation of comprehensive public pensions and unemployment insurance. It laid out the basis for a national health insurance system. And it argued for a broad expansion of public education at all levels. We have no record of how the young Margaret Thatcher regarded the report.

Technological Revolutions and Financial Capital: The Dynamics of Bubbles and Golden Ages
by Carlota Pérez
Published 1 Jan 2002

Thanks to the crash and the recession, there is a newfound readiness to accept such rules on the part of the – until recently arrogant – financial wizards, now sobered up. If, at this turning point, the institutional adjustment is successfully achieved, what follows may be a golden age. It can be a period of full employment and widespread productive investment, a period when production is at center stage, when at last the benefits of the system begin to spread down and an era of ‘good feeling’ sets in. The best face of capitalism can then be seen. It is the face of progress and of relative coincidence between individual and collective interests.

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Nevertheless, American historians have labeled the period the ‘Progressive Era’, putting the accent on the political changes and on the many attempts at controlling the trusts and establishing greater social justice, as opposed to the preceding callousness. 54 Technological Revolutions and Financial Capital ily as exuberant as in Frenzy. It can be felt across society and proceed at a healthy rhythm. Full employment – or the nearest thing to it, depending on the period – may become a realized possibility. When a mode of growth based on social cohesiveness is established, moral principles are in force, ideas of confidence flourish and business is satisfied about its positive social role. It is a time of advance in labor laws and other measures for social protection of the weak, a time for income redistribution in one form or another, leading to enlarged consumption markets.

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For the previous paradigm, John Maynard Keynes developed a new economics, providing both a different understanding and a whole new set of policy tools. Although the debate still rages,228 these policies, where applied, pretty much achieved their purpose of tempering the business cycle and supporting smooth growth, full employment and consistent investment, for the duration of the deployment period of the fourth great surge. That set of policies and that vision of economics lost effectiveness when the economy of the mass-production revolution, for which it was designed, became exhausted at the end of the 1960s. Once productivity stopped growing and investment opportunities dwindled, the whole basis of the model broke down and stagflation, that unusual combination of inflation with unemployment, rendered its main policy tools impotent.

What's Wrong With Economics: A Primer for the Perplexed
by Robert Skidelsky
Published 3 Mar 2020

But the propaganda for productive efficiency has latterly become so powerful that interest in moral efficiency has waned. The growth of inequality, in turn, has produced growing popular disenchantment with supposedly ‘efficient’ market outcomes. (For a further discussion, see Chapter 13.) Finally, the assumption of mainstream economists that economies have a spontaneous tendency to full employment leads them to ignore the ever-present possibility of crashes and weak recoveries. The heavy unemployment, poor growth, and depressed wages in most of Europe since 2008 is an example of scarcity created by bad economic policy. We are now in a position to criticise the way the Robbins definition sets up the economic problem.

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The sweeping denunciation of government failure pays no attention to the character of governance, or the distribution of power. It assumes that all states are inherently incompetent, if not also corrupt and predatory. But performance of the pre-modern state is no guide to what a modern state might achieve. The neoclassical parody ignores the fact that governments, dedicated to full employment or growth, have often picked winners. Consider Toyota, the Japanese automobile manufacturer. Starting as a tiny textile manufacturer it was propelled to world rank by acts of government: tariffs, exclusion of competitors, and subsidy. In Ha-Joon Chang’s words: ‘. . . had the Japanese government followed the free-trade economists back in the early 1960s, there would have been no Lexus.

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Geoffrey Hodgson, Economics and Institutions Anglo-American thinkers of the Enlightenment had an intense suspicion of institutions, which they saw as impediments to the flowering of individual liberty. The economists shared this attitude and perpetuated it. They have been wont to explain the frequent lapses from full employment by the existence of institutional impediments to fully competitive markets. But this begs the question of why institutions exist. Could it not be that many of them exist to protect society against the market, as Polanyi suggested? This raises another question. What is the advantage of theorising as though institutions are absent?

The Man Who Knew: The Life and Times of Alan Greenspan
by Sebastian Mallaby
Published 10 Oct 2016

The system had worked well for fifteen years, but then the New Frontier economists had embraced the goal of “full employment.” To preserve the fixed exchange rate, the United States had to avoid inflation, which would undermine the value of its money. But to attain full employment, the United States had to do the opposite—it had to accept inflation in accordance with the implication of the Phillips curve, which indicated that rising prices could sustainably boost the number of jobs in the economy. As the goal of full employment trumped the fealty to Bretton Woods, rising inflation eroded confidence in the dollar.41 Indeed, by the time Nixon’s advisers gathered at Camp David, the dollar-gold link was close to breaking.

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True to his new political persona, and betraying his old Randian one, Greenspan quickly disowned the quotation, insisting that his words had been taken out of context.75 But the damage had been done. Humphrey seized the opening to excoriate Nixon for being willing to accept less than “full” employment. The Nixon men turned to Arthur Burns, Greenspan’s professor from Columbia, to cast his student overboard. “I can say categorically,” Burns told the Washington Post, “that this does not reflect Mr. Nixon’s position. This world of ours won’t accept anything but a full employment policy.”76 • • • Humphrey caught up with Nixon in the lead-up to Election Day. The race was too close to call after the polls closed, and the outcome remained uncertain throughout most of the evening.

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By 1945, total federal spending had hit $95 billion, up from around $9 billion in 1939; expenditures during the war years were twice the total during the previous 150 years of U.S. history.7 Roosevelt’s sudden death from a cerebral hemorrhage in April 1945 did not shake the country’s enthusiasm for his activist approach. In the wake of Japan’s surrender, Truman promised to fight for a new law that would guarantee full employment. Such was the intellectual climate when Alan Greenspan entered the School of Commerce, Accounts, and Finance at New York University. Statist faith was at its peak; laissez-faire ideas were in abeyance. “In 1945 no articulate, coordinated, self-consciously conservative intellectual force existed in the United States,” declared George Nash, the great historian of the conservative movement.

Currency Wars: The Making of the Next Gobal Crisis
by James Rickards
Published 10 Nov 2011

Then again in 2007–2009, when it should have closed insolvent banks but instead provided liquidity. The upshot of these two episodes, curiously, is that the Fed has revealed it knows relatively little about the classic arts of banking. In 1978, the Humphrey-Hawkins Full Employment Act, signed by President Jimmy Carter, added management of unemployment to the Fed’s mandate. The act was an explicit embrace of Keynesian economics and mandated the Fed and the executive branch to work together in order to achieve full employment, growth, price stability and a balanced budget. The act set a specific numeric goal of 3 percent unemployment by 1983, which was to be maintained thereafter. In fact, unemployment subsequently reached cyclical peaks of 10.4 percent in 1983, 7.8 percent in 1992, 6.3 percent in 2003 and 10.1 percent in 2009.

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In fact, unemployment subsequently reached cyclical peaks of 10.4 percent in 1983, 7.8 percent in 1992, 6.3 percent in 2003 and 10.1 percent in 2009. It was unrealistic to expect the Fed to achieve the combined goals of Humphrey-Hawkins all at once, although Fed officials still pay lip service to the idea in congressional testimony. In fact, the Fed has not delivered on its mandate to achieve full employment. As of 2011, full employment as it is conventionally defined is still five years away, according to the Fed’s own estimates. To these failures of price stability, lender of last resort and unemployment must be added the greatest failure of all: bank regulation. The Financial Crisis Inquiry Commission created by Congress in 2009 to examine the causes of the current financial and economic crisis in the United States heard from more than seven hundred witnesses, examined millions of pages of documents and held extensive hearings in order to reach conclusions about responsibility for the financial crisis that began in 2007.

…

Ed Koch, the popular mayor of New York in the 1980s, was famous for walking around the city and asking passersby, in his distinctive New York accent, “How’m I doin’?” as a way to get feedback on his administration. If the Fed were to ask, “How’m I doin’?” the answer would be that since its formation in 1913 it has failed to maintain price stability, failed as a lender of last resort, failed to maintain full employment, failed as a bank regulator and failed to preserve the integrity of its balance sheet. The Fed’s one notable success has been that, under its custody, the Treasury’s gold hoard has increased in value from about $11 billion at the time of the Nixon Shock in 1971 to over $400 billion today. Of course, this increase in the value of gold is just the flip side of the Fed’s demolition of the dollar.

The Curse of Cash
by Kenneth S Rogoff
Published 29 Aug 2016

Taylor’s 1993 formulation assumed equal weights on stabilizing inflation and output, with inflation deviations measured around a target level presumed to be 2%, and output deviations measured around potential output (loosely speaking, the rate of output consistent with full employment).4 When Taylor formulated his rule in the early 1990s, it seemed reasonable for him to build his approach on the assumption that a normal Federal Reserve overnight policy interest rate would be 4%. This presumed a normal real interest rate of 2% and an assumed target inflation rate of 2%. The original Taylor rule formulation specified that the interest rate ought to be adjusted according to i = 4 + 0.5(π – 2) + 0.5y,(original Taylor formulation) where y is the deviation of output from its full employment level, and π is the expected inflation rate.

…

Others, such as the United States Federal Reserve, practice flexible inflation targeting, which tends to mean that inflation is a factor in the central bank’s interest rate decision, but not necessarily to the exclusion of other macroeconomic variables, notably output and employment. Among modern-day monetary rules that take multiple factors into account, perhaps the best known is the Taylor rule (discussed in the section on Taylor’s rule in the appendix), which posits that the central bank should set its policy interest rate according to deviations of output from its full-employment level and inflation from its target level. The Taylor rule has many virtues and is certainly a quantum improvement over the gold standard or the Friedman rule. But even the original Taylor rule, which had proved a very useful device for many years, is not reliable enough to enshrine in any kind of rigid law for central banks.

…

The original Taylor rule formulation specified that the interest rate ought to be adjusted according to i = 4 + 0.5(π – 2) + 0.5y,(original Taylor formulation) where y is the deviation of output from its full employment level, and π is the expected inflation rate. Even this simple formulation has considerable room for interpretation, for example, the central bank needs to determine exactly what inflation rate it wants to target, how to figure out whether the economy is at full employment, how to measure expected inflation, and so forth.5 There are also variants that allow for lagged output gaps. The basic Taylor formulation would not necessarily have produced negative interest rates in the financial crisis of 2008 (except perhaps at the early peak), in part because the baseline interest rate is high (4%), and in part because it takes a really big output gap to pull rates below zero; an output gap of 8%, multiplied by 0.5, subtracts only 4% from the policy interest rate.

Corbyn
by Richard Seymour

Almost uniformly, albeit at different paces and to differing degrees, they found themselves overwhelmed by the transformations in the global economy and the resistance of business to their attempts to keep the old status quo going. As the priorities of national states switched from full employment, as a condition for the old class compromise, to counter-inflation and balanced budgets, as a condition for businesses to keep investing, social democracy abandoned the policy instruments that had made it distinctive. Only in Sweden and Austria was there a brief period in which counter-inflation existed successfully alongside extensive public sector investment and an institutional commitment to full employment, but this did not survive the turn of the nineties. In Britain, New Labour had consecrated neoliberal orthodoxy before its election in 1997, such that nothing else was expected.

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Thanks to left-wing support, he was able to take the leadership after Gaitskell’s death in 1963. He was careful to avoid outright attacks on ‘fellow travellers’ in the fashion of his predecessor, and evinced an informality and comic turn that went with the grain of popular culture. Labour under his leadership was elected to government on an ambitious project for full employment and public investment, breaking thirteen years of uninterrupted Conservative rule. At first, everything seemed to be going exceptionally well, despite the tiny parliamentary majority with which the government was formed. Labour began to implement its National Plan for industry, secured agreement with the CBI and TUC, and implemented many of its policies including pension increases, rent controls and the abolition of prescription charges.

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Further, despite the enduring influence of Gaitskellite revisionism and the talk of ‘affluence’, the limits of the post-1945 settlement were becoming visible – the existence of a wide swathe of impoverished people, especially pensioners, was recognised.38 Even the early attempts by Lord Cromer, the Governor of the Bank of England and a close ally of the City, to force a reverse in policy were seen off. Speculative attacks on the currency – which Cromer advised Wilson signified investors’ demands that the government row back from its policy of full employment, use incomes policy to stifle wages and raise interest rates – were not enough to force the government’s capitulation at this stage. In the end, Cromer was replaced and returned to the family merchant bank Barings. Labour was confident enough in 1966 to call a new election and extend its mandate, gaining some 48 per cent of the vote compared to the Tories 41.4 per cent.

The Conservative Nanny State: How the Wealthy Use the Government to Stay Rich and Get Richer
by Dean Baker
Published 15 Jul 2006

The economic damage caused by protectionist measures depends primarily on how much they raise prices. The measures that sustain high wages for doctors, lawyers, and accountants have far more economic impact and do far more harm to the economy than most of the protectionist measures that have been proposed for textiles, steel, or other manufactured goods. Full-employment monetary policy from the Fed should also be front and center on our policy agenda. It is not acceptable to tell millions of people that they must go jobless just because some inflation fighting Fed chair wants to stage a pre-emptive strike against potential inflation. Inflation can pose a problem, but unemployment definitely does pose a problem, especially when the burden of higher unemployment is disproportionately borne by those at the bottom of the social-economic ladder.

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This means that if the economy is producing real gains for the bulk of the population, it will be much easier to obtain the revenue needed to address deep-seated social problems. Moving Beyond the Conservative Nanny State Framing The three policies described above – a trade policy focused on opening trade in high-end professional services, a full employment monetary policy, and national health care insurance – would go far towards reversing the growth in inequality in the United States over the last quarter century and insuring a decent standard of living for the entire population. Many of the other policies discussed in prior chapters could also go far toward both increasing economic growth and reducing inequality.

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“The Growth of Executive Pay,” Oxford Economic Papers, 21, no. 2: 283-303. Belman, D., E. Groshen, J. Lane, and D. Stevens. 1998. Small Consolation: The Dubious Benefit of Small Business for Job Growth and Wages, Washington, DC: Economic Policy Institute. Bernstein, J. and D. Baker. 2004. The Benefits of Full Employment, Washington, DC: The Economic Policy Institute. Blackford, M. 1998. The Rise of Modern Business in Great Britain, the United States, and Japan, Chapel Hill, NC: University of North Carolina Press:. 38-40. Burke, T. 2002. Lawyers, Lawsuits, and Legal Rights: The Battle Over Litigation in American Society, Berkeley, CA: University of California Press.

Fair Shot: Rethinking Inequality and How We Earn
by Chris Hughes
Published 20 Feb 2018

In 1955, a big corporation like Kodak spent $1,000 per year, roughly $8,000 today, on life insurance, retirement, sick pay, disability benefits, and vacation pay for each employee. Employees with 15 years of service or more received medical care for life, not just for themselves, but also for their dependents. This period of stable jobs and nearly full employment was a brief historical exception, but it has been burnished in our collective psyches as a golden age. The short period came to an end as globalization, rapid technological advancements, and the rise of finance modified the nature of jobs so that they became more precarious and piecemeal.

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RSA, December 2015. https://www.thersa.org/globalassets/reports/rsa_basic_income_20151216.pdf. Pew Research Center. “Public Trust in Government, 1958-2017.” May 3, 2017. http://www.people-press.org/2017/05/03/public-trust-in-government-1958-2017/). Paul, Mark, William Darity Jr., Darrick Hamilton, and Anne E. Price. “Returning to the Promise of Full Employment: A Federal Job Guarantee in the United States.” Insight Center for Community Economic Development, June 2017. https://insightcced.org/wp-content/uploads/2017/06/insight_fjg_brief_2017.pdf. Pew Charitable Trusts. “Americans’ Financial Security.” Financial Security and Mobility, March 2015. http://www.pewtrusts.org/~/media/assets/2015/02/fsm-poll-results-issue-brief_artfinal_v3.pdf.

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I use the term “one percent” broadly to describe the wealthiest Americans, households with assets of more than $10 million or incomes of $250k or higher. 40 the average doctor in my hometown last year made $189,000: Salary.com, “North Carolina Physician-Generalist Salaries.” 40 CEOs at S&P 500 companies who today, on average, are paid 347 times more: American Federation of Labor and Congress of Industrial Organizations, “Highest-Paid CEOs”; Mishel and Schieder, “CEOs Make 276 Times More than Typical Workers.” 40 96 percent of the ultra-wealthy one percent are white: Moore, “America’s Financial Divide.” 41 the Waltons, all of whom inherited their wealth from the Walmart empire, now controls as much wealth as the bottom 43 percent of the country combined: New America, “Monopoly and Inequality.” 41 The chasm between the rich and the poor has not been so wide since 1929: Saez and Zucman, “Wealth Inequality in the United States Since 1913.” 42 Before the second half of the twentieth century, work was more likely to be at home on the farm or in a short-term stint somewhere: Lebergott, “Annual Estimates of Unemployment in the United States, 1900–1954.” 44 Employees with 15 years of service or more received medical care for life: Wartzman, End of Loyalty, 105–107. 44 This period of stable jobs and nearly full employment was a brief historical exception: I think this is largely because the people who write our collective narratives and histories tend to be white men, the exact demographic best served by the labor market of this period. See Wartzman, “Populists Want to Bring Back the Blue-Collar Golden Age”; and Oxfam America and Economic Policy Institute, “Few Rewards.” 45 “For workers, the American corporation used to act as a shock absorber”: Wartzman, End of Loyalty, 5. 46 the numbers show it isn’t just millennials doing contingent work: Baab-Muguira, “Millennials Are Obsessed with Side Hustles.” 46 A quarter of the working-age population in the United States and Europe engage in some type of independently paid gig: Manyika et al., “Independent Work.” 46 the number of people working in contingent jobs balloons to over 40 percent of all American workers: Pofeldt, “Shocker: 40% of Workers Now Have ‘Contingent’ Jobs.” 46 of all the jobs created between 2005 and 2015, 94 percent of them were contract or temporary: Katz and Krueger, “Rise and Nature of Alternative Work Arrangements.” 46 Many of these jobs of the new economy pay poorly: Dews, “Charts of the Week”; Vo and Zumbrun, “Just How Good (or Bad) Are All the Jobs Added?”

Digital Disconnect: How Capitalism Is Turning the Internet Against Democracy
by Robert W. McChesney
Published 5 Mar 2013

How can the capitalists be so shortsighted, they wonder, as to oppose the use of government to build infrastructure, create jobs, and end stagnation, when other democratic governments have made capitalism operate far more efficiently and effectively? Economists Stiglitz and Robert Pollin each published books in 2012 with reasonable and thoughtful policy prescriptions for a full-employment, high-wage capitalism, but they command almost no support among the wealthy capitalists who subsidize American politicians.36 Can’t these business interests look at the historical record and see that capitalists have done far better and made more profits in the high-wage, high-growth, full-employment economies following the New Deal, arguably even in the social democratic nations of northern Europe? Why do they obsessively cling to the antiquated economic theories that were discredited in the 1930s and 1940s and have led present-day capitalism to crisis, stagnation, and decline?

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He cites a classic 1943 essay by the economist Michal Kalecki in which Kalecki argues that if the public realizes that the government has the resources to establish full employment, the realization would undermine the notion that the central duty of government is to create a climate in which business has confidence in the system and therefore eventually invests to create jobs. The “powerful indirect control over government policy” enjoyed by business would end, a prospect discomfiting to business leaders.37 “This sounded a bit extreme to me the first time I read it,” Krugman writes, “but it now seems all too plausible.”38 A successful state generating full employment might logically lead people to question why capitalists have so much economic power and what they provide that could not be better provided by more democratic means.

…

Dionne, “America Needs a Better Ruling Class,” Washington Herald News, Apr. 17, 2011. heraldnews.com/opinions/columnists/x1225326175/E-J-DIONNE-America-needs-a-better-ruling-class. 36. Stiglitz, Price of Inequality, chap. 12; Robert Pollin, Back to Full Employment (Cambridge, MA: MIT Press, 2012). 37. Michal Kalecki, “Political Aspects of Full Employment,” in Selected Essays on the Dynamics of the Capitalist Economy (Cambridge, UK: Cambridge University Press, 1970), 139. 38. Krugman, End This Depression Now!, 94–95. 39. The great irony for those economists (and activists) who believe capitalism can be reformed and want to reform it along New Deal or social democratic lines is that by swearing a loyalty oath to capitalism, they encourage their own irrelevance.

Bullshit Jobs: A Theory
by David Graeber
Published 14 May 2018

The regime of make-work jobs that existed in the Soviet Union or Communist China, for example, was created from above by a self-conscious government policy of full employment. To say this is in no sense controversial. Pretty much everyone accepts that it is the case. Still, it’s hardly as if anyone sitting in the Kremlin or the Great Hall of the People actually sent out a directive saying “I hereby order all officials to invent unnecessary jobs until unemployment is eliminated.” The reason no such orders were sent out was because they didn’t have to be. The policy spoke for itself. As long as you don’t say “Aim for full employment, but do not create jobs unless they conform to the following standards”—and make it clear you will be very punctilious about ensuring those standards are met—then one can be sure of the results.

…

Local officials will do what they have to do. While no central directives of this kind were ever sent out under capitalist regimes, at least to my knowledge, it is nonetheless true that at least since World War II, all economic policy has been premised on an ideal of full employment. Now, there is every reason to believe that most policy makers don’t actually want to fully achieve this ideal, as genuine full employment would put too much “upward pressure on wages.” Marx appears to have been right when he argued that a “reserve army of the unemployed” has to exist in order for capitalism to work the way it’s supposed to.7 But it remains true that “More Jobs” is the one political slogan that both Left and Right can always agree on.8 They differ only about the most expedient means to produce the jobs.

…

Nonetheless, the assumption that government is necessarily top-heavy with featherbedding and unnecessary levels of administrative hierarchy, while the private sector is lean and mean, is by now so firmly lodged in people’s heads that it seems no amount of evidence will dislodge it. No doubt some of this misconception is due to memories of countries such as the Soviet Union, which had a policy of full employment and was therefore obliged to make up jobs for everyone whether a need existed or not. This is how the USSR ended up with shops where customers had to go through three different clerks to buy a loaf of bread, or road crews where, at any given moment, two-thirds of the workers were drinking, playing cards, or dozing off.

War and Gold: A Five-Hundred-Year History of Empires, Adventures, and Debt
by Kwasi Kwarteng
Published 12 May 2014

It seemed to some that the ‘whole system of private enterprise is now on trial to demonstrate its capacity to provide a tolerably high level of employment’.18 This shift of emphasis was ‘traceable mainly to the empirical experience of the thirties, but a scientific or intellectual rationale for it has been provided by the doctrines of J. M. Keynes and Alvin H. Hansen’.19 In this new world, monetary policy would be downplayed and the idea of full employment now held sway. The Full Employment Act passed by Congress in 1945 enshrined the idea that it was ‘the duty of government to underwrite a stable high level of employment, using deficit spending as a major instrument if necessary’. The debt mountain faced by the United States seemed, at the beginning of the Cold War in 1946, enormous.

…

Keynes observed in his speech that times had changed. ‘Public opinion is now converted to a new model . . . of domestic policy.’ Bretton Woods reflected this shift of opinion. It is ‘above all as providing an international framework for the new ideas and the new techniques associated with the policy of full employment that these proposals are not least to be welcomed’, he added. Of course, he was being uncharacteristically modest. The ‘new ideas and the new techniques’ he referred to had come largely from his own inspiration and hard work.18 Keynes was right to emphasize the very restrictive discipline imposed by the old gold standard.

…

In 1946 the American economist Ralph Blodgett spoke gloomily of the likely prospect that ‘we shall find ourselves living in a planned and controlled economy long after the war has been officially declared to be at an end’. He painted a picture of creeping socialism. ‘To be sure, not many people are advocating a controlled economy as such.’ Instead, Americans ‘are asked to approve such attractive and innocent-sounding things as full employment guaranteed or underwritten by the government; [or] a system of social security, popularly known as the “cradle-to-the-grave” variety’. Blodgett, a professor at the University of Illinois, spoke apocalyptically about the ‘destruction’ of ‘the capitalistic or free enterprise system’ as a result of post-war developments which would, in his words, ‘ensure the future existence of a controlled and planned economy’.

Economics Rules: The Rights and Wrongs of the Dismal Science
by Dani Rodrik
Published 12 Oct 2015

This approach, popularized by the economist Steven Levitt, has been used to shed light on diverse social phenomena, ranging from the practices of sumo wrestlers to cheating by public school teachers, using careful empirical analysis and incentive-based reasoning.2 Some critics suggest that this line of work trivializes economics. It eschews the big questions of the field—when do markets work and fail, what makes economies grow, how can full employment and price stability be reconciled, and so on—in favor of mundane, everyday applications. In this book I focus squarely on these bigger questions and how economic models help us answer them. We cannot look to economics for universal explanations or prescriptions that apply regardless of context.

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What made the “new classical approach,” as it came to be called, a winner—at least in academia—was not its empirical validation. The real-world fit of the model was heavily contested, as was the realism of some of the key ingredients. But shortly after the arrival of the new theory, in the mid-1980s the US economy entered a period of economic growth, full employment, and price stability. The business cycle looked to be conquered in this era of “great moderation.” As a result, the descriptive and predictive realism of the new classical approach seemed, from a practical perspective, not to matter a whole lot. The great appeal of the theory lay in the model itself.

…

These concerns made it unlikely that SBTC on its own could account for what was happening with inequality. A third, catchall category of explanations focused on the wide range of policy and attitudinal changes that had taken place from the late 1970s on. Macroeconomic policy became more concerned about price stability and less focused on full employment. Trade unions shrank, workers lost bargaining power, and the minimum wage was allowed to lag behind prices. Workplace norms that precluded large wage dispersion—the gap between the highest and lowest paid employees—became weaker. Deregulation and the vast expansion of the finance sector enabled the amassing of fortunes that would have been unthinkable decades ago.21 In the end, it was clear that no single theory could fully explain the story of US inequality since the 1970s.

The Trouble With Billionaires
by Linda McQuaig
Published 1 May 2013

The task would require collective efforts, and co-operation between citizens and government. The key elements of his plan were: universal family allowances, a national public health service and a government commitment to maintaining full employment. Given that unemployment had hovered above a million – at times reaching three million – for most of the previous twenty years, the notion of a government commitment to full employment was nothing short of audacious. In devising his scheme, Beveridge had consulted extensively with Keynes, who supported it and whose theories were central to the notion that it was affordable. But, apart from Keynes, Beveridge had worked largely on his own, with little input or consultation with bureaucrats or members of cabinet, some of whom distrusted Beveridge as unduly independent-minded.

…

And so the slump continued, and even became worse. If this analysis sounded fairly straightforward, in fact it was an attack on one of the most basic premises of classical economics: the belief that the economy was self-correcting. Classical theory held that the economy would naturally achieve full employment. Once wages dropped low enough, employers would start hiring again. Keynes disputed this, arguing that as long as there was no demand for their products, employers wouldn’t start hiring, no matter how low wages fell. The classical theory failed to account for a crucial element: human psychology, particularly human reticence and fear.

…

And all this could be accomplished without setting off inflation, according to Keynes. It was a basic tenet of classical thinking that pumping extra money into the economy would simply set off inflation, leaving no one further ahead in the long run. Keynes agreed that that was true – under conditions of full employment. But he argued that when so many resources were idle, there was little prospect of inflation; the extra money circulating would not push prices up but would mostly have the effect of creating more employment. So, according to Keynes, one of the key concerns of classical economics – that government deficits would set off inflation – did not apply during a recession, when there was substantial idle capacity to absorb the extra money pumped into the economy.

A Little History of Economics
by Niall Kishtainy
Published 15 Jan 2017

The conventional economic thinking, which Keynesian economics replaced, said that attempts by the government to keep the economy moving, whether through fiscal or monetary policy, would be useless. The economy would find its own way back from a recession to ‘full employment’, the situation in which all the workers and factories were employed. How would it? Wages would fall, encouraging firms to hire more workers, and so would prices, encouraging people to buy up unsold goods. The Keynesians didn’t claim that the classical theory was totally wrong, just that it only applied in a situation of full employment. Keynes had looked at what happens when the economy is in a recession, at less than full employment. He said that prices and wages wouldn’t fall easily – they’ve already been agreed upon by firms and workers – so they don’t help goods to get sold and unemployed workers to get hired.

…

The government spends more or cuts taxes, which boosts demand in the economy. Firms produce more and hire more workers. Because there are so many unemployed workers, the extra demand can be satisfied without prices going up. This is the Keynesian economy. Later, all the factories are running and everyone is employed. This is the classical economy of full employment that you eventually get to in the long run. What happens if the government tries to boost demand? Because the economy is running at full capacity, it can’t make any more goods and the extra demand simply pushes up prices. The point of Keynesian economics was that before we get to the long run, governments must step in to help.

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pareto improvement Elizabeth I (i) Elizabeth II (i) employment, full (i) Engels, Friedrich (i) England’s Treasure by Forraign Trade (Mun) (i) entitlement (i), (ii) entrepreneurs (i), (ii) equilibrium (i), (ii), (iii), (iv), (v) exchange of goods (i), (ii) exchange rates (i) expectations, adaptive/rational (i), (ii), (iii), (iv) exploitation (i), (ii), (iii), (iv), (v) exports (i) and poor countries (i), (ii), (iii) externalities (i), (ii), (iii), (iv) Extraordinary Popular Delusions and the Madness of Crowds (MacKay) (i) failure, market (i), (ii), (iii), (iv) Fama, Eugene (i) famine (i), (ii), (iii), (iv) feminist economics (i) feudalism (i), (ii), (iii), (iv) financial systems (i), (ii) Finer, Herman (i) first price auction (i), (ii) First Welfare Theorem (i), (ii) First World War (i) fiscal policy (i), (ii) floating exchange rate (i) Florence (i) Folbre, Nancy (i) Fourier, Charles (i) framing (i), (ii) France agriculture (i) economic models (i), (ii) revolution (i), (ii), (iii), (iv) and taxation (i) Frank, Andre Gunder (i) free choice (i), (ii) free-market economics (i), (ii), (iii), (iv) free trade (i), (ii), (iii) Friedman, Milton (i), (ii), (iii) full employment (i) game theory (i), (ii), (iii) general equilibrium (i), (ii), (iii), (iv) General Theory of Employment, Interest and Money, The (Keynes) (i) Germany, infant industries (i) Ghana (i), (ii) Gilded Age (i) Global Financial Crisis (i), (ii) global warming (i) Goethe, Johann Wolfgang (i) gold (i), (ii) Golden Age (i) goods and services (i) government, and economies (i), (ii), (iii), (iv), (v), (vi), (vii) Great Moderation (i), (ii) Great Recession (i) Greece (i), (ii), (iii) gross domestic product (i) growth (i) and dependency theory (i) of government (i) and the Great Moderation (i) and Pakistan (i) and population (i) theory (i) Guevara, Ernesto ‘Che’ (i), (ii) guilds (i) Hamilton, Alexander (i) Hansen, Alvin (i) harmony, system of (i) Hayek, Friedrich (i), (ii) hedge funds (i) herds (i) Hicks, John (i) historical law of capitalism (i) HIV/AIDS (i) Hobson, John (i) Homobonus, St (i) human capital (i) human development (i), (ii) Human Development Index (i) imperfect competition (i), (ii) imperialism (i) Imperialism: The Highest Stage of Capitalism (Lenin) (i) imports (i), (ii), (iii) income (i), (ii) and bank loans (i) and capitalism (i) and communism (i) distribution of (i), (ii) and growth (i), (ii) national (i), (ii), (iii), (iv), (v) income per person (i), (ii) independent central banks (i) Industrial Revolution (i), (ii), (iii), (iv), (v) inequality (i), (ii) infant industries (i) inflation (i), (ii), (iii), (iv), (v) information economics (i), (ii), (iii) injection of spending (i) innovations (i), (ii) insurance (i), (ii) interest rates (i) British (i) and monetary policy (i) and recession (i) and usury (i) International Monetary Fund (i) investment (i) and the big push (i) and recession (i), (ii) invisible hand (i), (ii), (iii), (iv), (v) iron law of wages (i) Irrational Exuberance (Shiller) (i) Jefferson, Thomas (i) Jevons, William (i) just price (i) Kahneman, Daniel (i), (ii) Kennedy, John F.

The Bitcoin Standard: The Decentralized Alternative to Central Banking
by Saifedean Ammous
Published 23 Mar 2018

This was the central cause of the 1920 depression, but this, too, goes unmentioned. Most curiously, however, is how they completely ignore the recovery from the depression of 1920–21, which was termed the “last natural recovery to full employment” by economist Benjamin Anderson, where taxes and government expenditures were reduced and wages were left to adjust freely, leading to a swift return to full employment in less than a year.14 The 1920 depression saw one of the fastest contractions of output in American history (9% drop in a 10‐month period from September 1920 to July 1921), and also the fastest recovery. In other depressions, with Keynesians and Monetarists injecting liquidity, increasing the money supply, and increasing government spending, the recovery was slower.

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Source: George Hall, “Exchange Rates and Casualties During the First World War,” Journal of Monetary Economics. 5 Friedrich Hayek, Monetary Nationalism and International Stability (Fairfield, NJ: Augustus Kelley, 1989 [1937]). 6 A thorough accounting of Hoover's interventionist policies can be found in Murray Rothbard's America's Great Depression. 7 Quoted in Henry Hazlitt, The Failure of the New Economics. p. 277. 8 Otto Mallery, Economic Union and Durable Peace (Harper and Brothers, 1943), p. 10. 9 Robert Higgs, “World War II and the Triumph of Keynesianism” (2001), Independent Institute research article. Available at http://www.independent.org/publications/article.asp?id=317 10 Paul Samuelson, “Full Employment after the War,” in Seymour Harris, Postwar Economic Problems (New York: McGraw‐Hill, 1943). 11 After being investigated and testifying in front of Congress, White suffered two heart attacks and died from an overdose of medication, which may have been suicide. A good treatment of this episode can be found in Benn Steil's The Battle of Bretton Woods, which pushes the view that White was a Soviet spy.

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His theory begins with the (completely unfounded and unwarranted) assumption that the most important metric in determining the state of the economy is the level of aggregate spending across society. When society collectively spends a lot, the spending incentivizes producers to create more products, thus employing more workers and reaching full‐employment equilibrium. If spending rises too much, beyond the capacity of producers to keep up, it would lead to inflation and a rise in the overall price level. On the other hand, when society spends too little, producers reduce their production, firing workers and increasing unemployment, resulting in a recession.

The End of Work
by Jeremy Rifkin
Published 28 Dec 1994

In the first three years of the 1990S, unemployment has averaged 6.6 percent. 26 As the percentage of unemployed workers edged ever higher over the postwar period, economists have changed their assumptions of what constitutes full employment. In the 1950s, 3 percent unemployment was widely regarded as full employment. By the 1960s, the Kennedy and Johnson administrations were touting 4 percent as a full employment goal. In the 1980s, many mainstream economists considered 5 or even 5.5 percent unemployment as near full employment.27 Now, in the mid-1ggos, a growing number of economists and business leaders are once again revising their ideas on what they regard as "natural levels" of unemployment. While they are reluctant to use the term "full employment," many Wall Street analysts argue that The End of Work 11 unemployment levels should not dip below 6 percent, lest the economy risk a new era of inflation.28 The steady upward climb in unemployment, in each decade, becomes even more troubling when we add the growing number of part-time workers who are in search of full-time employment and the number of discouraged workers who are no longer looking for ajob.

…

Ferry of the Center for the Study of Democratic Institutions, liberal economists Robert Theobald and Robert Heilbroner, and J. Robert Oppenheimer, the director of the Institute for Advanced Study at Princeton. As discussed in chapter 6, they disagreed with the prevailing economic orthodoxy that technical innovation and rising productivity would guarantee a full-employment economy. On the contrary, the computer revolution, they contended, would increase productivity, but at the expense of replacing more and more workers with machines, leaving millions unemployed and under- 260 THE DAWN OF THE POST-MARKET ERA employed, and without sufficient purchasing power to buy the increased output of goods and services being produced by the new automated production technologies.

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See also Conyers, John, "Have a Four-day Workweek? Yes." American Legion, April 1980, p. 26. Quote from a personal letter by Conyers to Members of the House of Representatives, photocopy with the author, dated February 15, 1979, in Hunnicutt, p. 311. 30. Congressman Lucien Blackwell, U.S. Congress, House of Representatives, H.R. 3267, The Full Employment Act of 1994, March 23, 1994. 31. McCarthy, Eugene, and McGaughey, William, Non-Financial Economics: The Case for Shorter Hours of Work (New York: Praeger, 1989), p. 43. 32. Interview, May 6, 1994. Michael Hammer argues that "if you're going to reduce work hours and reduce compensation along with it, that's basically asking people to have a more communitarian approach to their incomes, which you mayor may not be able to do."

Termites of the State: Why Complexity Leads to Inequality
by Vito Tanzi
Published 28 Dec 2017

Having been introduced in an important and politically influential country, as was the United Kingdom, these programs – which created “a taxpayer-funded welfare state and full employment as a national goal” – would be imitated by several other countries (see Wapshott, 2011, p. 227). Keynes, who at the time of the preparation of the Beveridge Report had been spending much of his time on the other side of the Atlantic, thinking about and helping to create the Bretton Woods institutions, had not been directly involved with the recommendations contained in the Beveridge Report (see Marcuzzo, 2010). Those recommendations were not directly connected with the Keynesian Revolution, which dealt with the objective of stabilization and full employment and not directly with social reform.

…

There was also no mention of how the performance of the US economy might be affected, in the short and in the long run, by the creation of the promised programs. The classic economic problem, which had always worried economists, namely the existence of too many needs and too few resources, was not acknowledged, or it was downplayed. The assumptions must have been that the promises could be met with a better and more equitable use of resources. Full employment, which Keynesian policies promised could be achieved and maintained, would contribute to the needed resources. Perhaps, the implicit assumption was that the large public spending, which at that time was being used to fight the war, could be redirected toward more desirable and peaceful uses, once Welfare Policies 45 the war was over.

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This was a great fear of many Keynesian economists and also of many citizens at that time. A constant in some of the promises of the kind made by President Roosevelt in 1944, at least in peaceful times, has been that the economic problem could be dealt with, or at least alleviated, by making the economy operate at full employment and increasing the tax burden on the rich, while using efficiently the resources so obtained to pay for well-designed and efficiently delivered social programs. Regardless of whether the rich should or should not be taxed more, an issue to which we shall return later, the resources that could be obtained from taxing only the rich would not be likely to be sufficient to cover the costs of all the ambitious programs mentioned by President Roosevelt, unless those programs were delivered at a low, basic, or minimal level.

The Next Factory of the World: How Chinese Investment Is Reshaping Africa
by Irene Yuan Sun
Published 16 Oct 2017

These are daring undertakings in which entrepreneurs risk their life savings—and sometimes their lives—in foreign lands where they barely speak the language or understand the culture. The entrepreneurs I met are tough, gritty, unglamorous people living out adventure stories—a reminder that the boldest forms of entrepreneurship exist far from the air-conditioned offices of Silicon Valley. Part two explores the possibilities that industrialization is bringing to Africa: full employment, a new crop of homegrown factory owners, a more effective set of institutions, a path to prosperity for the marginalized. These are actualities that other regions of the world have achieved through industrialization. For Africa, at this early date, there are no assurances yet, but there are already many beginnings.

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As we walked through the plant together, Ahmed spoke to the workers in Hausa, a language from northern Nigeria not normally spoken in the central part of the country where the factory is located. It turns out that they were speaking Hausa because the workers weren’t from the surrounding area. Ahmed had literally brought his village to work. This is perhaps the most tantalizing possibility that becoming the next Factory of the World holds for Africa: full employment for its hitherto chronically underemployed but burgeoning population. The hope is that factories can provide jobs not just for rare remarkable individuals like Ahmed, but as in this case, for entire villages. Yet, as we shall see, this possibility feels deeply uncertain, even to some of those closest to the transformation.

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Indeed, other well-educated British commentators fretted about the laziness of workers, who whiled away entire days with little urgency: “[T]he hand-loom went to the slow chant of Plen-ty of Time, Plen-ty of Time” and few resisted the “temptation to lie in an extra hour in the morning.”32 Apparently, English workers not only were lazy on the job but also missed entire days of work; Mondays in particular were popular for not showing up. The great labor historian E. P. Thompson noted, “There are few trades which are not described as honouring Saint Monday: shoemakers, tailors, colliers, printing workers, potters, weavers, hosiery workers, cutlers, all Cockneys. Despite the full employment of many London trades during the Napoleonic Wars, a witness complained that ‘we see Saint Monday so religiously kept in this great city … in general followed by a Saint Tuesday also.’”33 But this antagonistic adolescent phase of British industrialization soon passed, as English workers became the first to figure out how to mold themselves to machine rhythms en masse.

The Great Economists Ten Economists whose thinking changed the way we live-FT Publishing International (2014)
by Phil Thornton
Published 7 May 2014

To sum up, Keynes was setting out a whole new system for understanding the economic system that broke with the classical school, which he said was a theory that applied only to a ‘special case’. He rejected the idea that a laissez-faire economy in which people and firms were left to themselves meant that all that was necessary to restore the economy to full employment was the existence of flexible prices and wages. An economic slump may not be self-correcting as there may be a deficiency in aggregate demand that results in spare capacity or what modern economists call the output gap. There can be limits to the effectiveness of monetary policy in dealing with 106 The Great Economists such a deficiency; and there is an important role to be played by active fiscal policy in stimulating demand.

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Samuelson, ‘The Impact of the General Theory’, Econometrica, July 1946. Chapter 5 • John Maynard Keynes107 Just before he returned to the Treasury he published How to Pay for the War, a booklet based on a couple of articles in The Times newspaper. From his experiences in the Great War, Keynes saw that rearmament would push the economy past full employment. He advised setting up a compulsory savings plan to take some of the steam out of excess demand in the economy and prevent inflation from attacking the livelihoods of the poorest. The revenue would be used to fund defence spending and be returned in the form of tax credits to people after the war.

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Some of his important ideas include: • His prediction that the reparations demanded by the Allies after the First World War were so large they would leave Germany perpetually poor and, therefore, politically unstable. • His introduction of the concept of aggregate demand as the sum of consumption, investment and government spending. • The idea that full employment could be maintained only with the help of government spending. • The paradox of thrift that if everyone tries to save during a recession the effect will be to cut consumer spending, leading to job losses and business failures and a worse recession. • The multiplier effect that says government spending of £100 that boosts people’s incomes will have a greater economic impact as those people will spend more money, so creating more jobs. • Wage stickiness – the idea that workers will refuse to accept cuts in their wages. • His work, The General Theory, is considered the foundation of modern macroeconomics. • The Keynesian school of economic thought, which takes his name, is one of the principal doctrines taught at colleges and universities. 

The Economists' Hour: How the False Prophets of Free Markets Fractured Our Society
by Binyamin Appelbaum
Published 4 Sep 2019

He must be a mathematician rather than a political economist.”6 The U.S. unemployment rate was still 17 percent at the onset of World War II.7 Keynes, who died in 1946, had regarded his work as an effort to salvage capitalism as a viable alternative to communism — to show that the market economy needed help, but that it did not need to be replaced. After World War II, that project gained new urgency for the Western democracies as they confronted the rise of the Soviet Union. In Britain, both major parties wrote full employment into their platforms after the war. The Conservative Party’s 1950 manifesto declared, “We regard the maintenance of full employment as the first aim of a Conservative Government.”8 In the United States, Democrats pushed a landmark law through Congress in 1946 that instructed federal policy makers “to promote maximum employment, production, and purchasing power.”

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William Miller, who sometimes laughed so hard at his own jokes that he couldn’t get to the punch line, and who passionately expressed a determination to stimulate job creation, particularly for minorities.32 Democrats also sought to write Keynesian economics more firmly into law by passing the Humphrey-Hawkins Full Employment Act in 1978, which enshrined “full employment” and “reasonable price stability” as the goals of fiscal and monetary policy. For proponents of activist economics, it seemed like a second sunrise, and they confidently predicted an economic revival. Instead it was the final act of the Keynesian era. Inflation rose inexorably during Carter’s first two years.

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But Friedman and other conservative economists firmly opposed any move to cut taxes, and Mundell did not have Nixon’s ear.6 Frustrated and convinced of the wisdom of his own advice, he paid ten thousand dollars for a run-down palazzo outside Siena, Italy, in 1969, reasoning that inflation was inevitable, and property would be a good hedge.7 The conference in Bologna two years later, and about one hundred miles from Mundell’s palazzo, gave him the opportunity to try again. His main target was the Keynesian view that the Federal Reserve could stimulate economic growth by holding down interest rates — basically accepting more inflation as the price of more jobs. Mundell, like Friedman, argued that inflation “is neither necessary for, nor conducive to, full employment.”8 Indeed, he argued inflation could increase unemployment. But Mundell also opposed the monetarist view that the cure for inflation was to sharply restrict the growth of the money supply, driving the economy into a recession. He noted dryly that if the monetarists were right about the cure for inflation, the American people might reasonably prefer to live with the disease.

Your Money or Your Life: 9 Steps to Transforming Your Relationship With Money and Achieving Financial Independence: Revised and Updated for the 21st Century
by Vicki Robin , Joe Dominguez and Monique Tilford
Published 31 Aug 1992

Workers were educated to consider employment, not free time, to be their right as citizens (life, liberty and the pursuit of the paycheck?). Benjamin Kline Hunnicutt, in Work Without End, illuminates the doctrine of “Full Employment”:Since the Depression, few Americans have thought of work reduction as a natural, continuous, and positive result of economic growth and increased productivity. Instead, additional leisure has been seen as a drain on the economy, a liability on wages, and the abandonment of economic progress.10 The myths of “growth is good” and “full employment” established themselves as key values. These dovetailed nicely with the gospel of “full consumption,” which preached that leisure is a “commodity” to be consumed rather than free time to be enjoyed.

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These dovetailed nicely with the gospel of “full consumption,” which preached that leisure is a “commodity” to be consumed rather than free time to be enjoyed. For the last half century full employment has meant more consumers with more “disposable income.” This means increased profits, which means business expansion, which means more jobs, which means more consumers with more disposable income. Consumption keeps the wheels of progress moving, as we saw in Chapter 1. So we see that our concept (as a society) of leisure has changed radically. From being considered a desirable and civilizing component of day-to-day life it has become something to be feared, a reminder of unemployment during the years of the Depression.

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From being considered a desirable and civilizing component of day-to-day life it has become something to be feared, a reminder of unemployment during the years of the Depression. As the value of leisure has dropped, the value of work has risen. The push for full employment, along with the growth of advertising, has created a populace increasingly oriented toward work and toward earning more money in order to consume more resources. This is no more evident than in our relationship to our automobiles. Once vehicles of leisure, they are now office extensions. We wear our wireless headsets to maneuver traffic while we make deals on our cell phones. There are even devices that make the passenger seat into an office. A while ago, a friend who traveled a lot was asked where he lived.

Straight Talk on Trade: Ideas for a Sane World Economy
by Dani Rodrik
Published 8 Oct 2017

But in most economic areas—taxes, trade policy, financial stability, fiscal and monetary management—what makes sense from a global perspective also makes sense from a domestic perspective. Economics teaches that countries should maintain open economic borders, sound prudential regulation, and full-employment policies, not because these are good for other countries but because they serve to enlarge the domestic economic pie. Of course, policy failures—for example, protectionism—do occur in all of these areas. But these reflect poor domestic governance, not a lack of cosmopolitanism. They result either from policy elites’ inability to convince domestic constituencies of the benefits of the alternative, or from their unwillingness to make adjustments to ensure that everyone does indeed benefit.

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The Harvard economist Greg Mankiw listed some of them in 2009.2 The following propositions garnered support from at least 90 percent of economists: import tariffs and quotas reduce general economic welfare; rent controls reduce the supply of housing; floating exchange rates provide an effective international monetary system; the United States should not restrict employers from outsourcing work to foreign countries; and fiscal policy stimulates the economy when there is less than full employment. This consensus about so many important issues contrasts rather starkly with the general perception that economists rarely agree on anything. “If all the economists were laid end to end,” George Bernard Shaw famously quipped, “they would not reach a conclusion.” Frustrated by the conflicting and hedged advice that he was receiving from his advisers, President Dwight Eisenhower is said to have asked once for a “one-handed economist.”

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In 1981, the “trade adjustment assistance (TAA) program was one of the first things Reagan attacked, cutting its weekly compensation payments.”5 The damage continued under subsequent, Democratic administrations. In the words of Mishel, “if free-traders had actually cared about the working class they could have supported a full range of policies to support robust wage growth: full employment, collective bargaining, high labor standards, a robust minimum wage, and so on.” And all of this could have been done “before administering ‘shocks’ by expanding trade with low-wage countries.” Could the United States now reverse course and follow the newly emergent conventional wisdom? As late as 2007, political scientist Ken Scheve and economist Matt Slaughter called for “a New Deal for globalization” in the United States, which would link “engagement with the world economy to a substantial redistribution of income.”6 In the United States, they argued, this would mean adopting a much more progressive federal tax system.

The Classical School
by Callum Williams
Published 19 May 2020

As Blaug puts it, “a free-enterprise capitalist economy has an inherent tendency to return to full employment, which is indeed its normal state of economic activity”. The popular understanding of Say as a laissez-faire ideologue flows from this interpretation. If everything will be all right in the end, there is little need for the government to intervene. But is this quite the right interpretation? In fact, there is plenty to suggest that Say did not think that capitalist societies were destined to reach full employment eventually. For instance, Say was clearly worried a great deal about what economists today would call “technological unemployment”.

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The other face of mercantilism In a paper of 1952 William Grampp, a historian of economic thought, argued that the “objective of mercantilist doctrine was different from what it is usually thought to be”.10 The group’s goal, he suggests, was not simply to accumulate bullion for its own sake, as in the popular understanding, but something different: full employment. Grampp does not really explain why a group of thinkers emerged who all addressed themselves to improving employment rates. It might have something to do with how the economy was changing from the 17th and 18th centuries. Look at the British economy, for instance. Agriculture was becoming a relatively less important economic activity.

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Eli Heckscher, writing in the 1930s, characterises the classical political economists, reasonably fairly, as believing that the “desired results” were “expected to follow from the untrammelled forces of economic life” (see, for instance, Chapter 10 on Jean-Baptiste Say). The mercantilists did not believe this. They thought that “the desired results were to be effected ‘by the dextrous management of a skilled politician’”.11 In other words, you need state intervention to reach full employment. In this regard the mercantilists appear to have pre-empted John Maynard Keynes, who argued in favour of extra government spending during times of poor economic growth and high unemployment. Indeed, in his General Theory (1936), Keynes referred approvingly to mercantilist doctrine. What could be done, in the mercantilist view, to create lots of jobs?

The Haves and the Have-Nots: A Brief and Idiosyncratic History of Global Inequality
by Branko Milanovic
Published 15 Dec 2010

Another proequality instrument, guaranteed and compulsory full employment, should also be seen in its political context. Similarly to what we just saw, it was used as a political control mechanism. Its origins lay in two interconnected claims: Socialism will eliminate economic cycles (so there would be full employment throughout); and socialism, being a societywide project, requires the participation of all—hence, everybody was supposed to work (and not to idle about) and contribute to the creation of a new society. But some governments, especially the Soviets, used the idea of full employment in a very creative way: A dissident would be fired from his or her job, not given any other, and then imprisoned for what was called “vagrancy” or “parasitism”—that is, unwillingness to contribute to “socialist construction.”7 Although empirical studies invariably find inequality to have been low in socialism, the perception of many people who lived under that regime, and of many Western observers, is that inequalities between the top and the “rest” were huge.

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This was particularly the case in countries like Russia (after the revolution in 1917) and Hungary and Poland (after 1947) where large landholdings still existed. Private industrialists in all countries disappeared, their assets were nationalized, and stock markets were closed. Resource wealth was nationalized as well. Thus, top incomes were severely reduced. Second, full employment cut the bottom of the income distribution as nationalization cut the top. Everybody had a job, and however small the pay (since many of such make-believe jobs were quite unproductive), it was better than not having a job at all. Third, generalized compulsory and free education increased the overall education level of the population, and explicit policies introduced to limit wage spreads between intellectual and physical laborers as well as between the more and less skilled workers reduced the educational premium.

Wall Street: How It Works And for Whom
by Doug Henwood
Published 30 Aug 1998

From time to time businessmen lose their nerve and refuse this gamble, preferring to keep their wealth in money rather than embark it in the products of employment" (quoted in Moore 1988b, p. 249). The classicals were wrong; an economy will not necessarily come to rest with the full employment of capital and labor. To Keynes, the most crucial problem of a modern capitalist economy was evoking a sufficiently high level of investment to assure full employment, and it's here that uncertainty and the comforts of money work their devilment. Entrepreneurs will only invest if they expect the new investment to yield a greater income over its life than it will cost them to finance the asset; in Keynes's jargon, the marginal efficiency of capital (MEC) must be greater than the interest rate they pay their bankers.^ While this may not seem like an extraordinarily original idea at first, there are at least two points of interest in the formulation.

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If the natural rate is defined as the one that maintains the status quo, there can be many natural rates of interest, each associated with a different level of employment — "and, in general, we have no predominant interest in the status quo."^ RENEGADES If there is any rate of interest that deserves special status, Keynes argued, it's the one associated with full employment (CWVll, p. 243). One of the goals of economic analysis and policy should be to discover and attain that optimum rate. Interest rates are a function of the generosity or tightness of the central bank and the demand for money, which Keynes called the state of liquidity preference. Liquidity preference depended on three things in 77?

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Rentiers, while they may be socially functionless, are nonetheless the owners of the productive capital stock, and the creditors of its hired managers. They would never concede to their "euthanasia," since they have never thought their condition terminal, at least since the mid-1930s. Nor would employers ever consent to a regime of full employment; it would be the death of work discipline. One gets the sense, reading Keynes, that the driving force behind capitalism is sentiment, the bullish or bearish state of expectations, and that social reality is important only insofar as it changes expectations through surprise, pleasant or unpleasant.

The Best Business Writing 2013
by Dean Starkman
Published 1 Jan 2013

His blog, Interfluidity, is always provocative, wonky, and host to extremely high-level discussions. Here, he develops a typically incisive theory of inequality, coming to the conclusion that unless and until we reduce it, we’ll never reach full employment. Waldman doesn’t pander to a broad audience, but if you put some effort into following his argument, he’ll always repay you with insights you can find nowhere else. I think there is a trade-off between inequality and full employment that becomes exacerbated as technological productivity improves. This is driven by the fact that the marginal benefit humans gain from current consumption declines much more rapidly than the benefit we get from retaining claims against an uncertain future.

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There is only a zero-sum competition for the right to be insured. The very rich live on the very same cruise ship as the very poor, and they understandably want to keep their lifeboat tickets. If insurance were not so valuable, it would be perfectly possible to have very high levels of inequality and have full employment. The very rich might employ endless varieties of servants to cater to their tiniest whims. They’d get little value from the marginal new employee, but the money they’d lose by paying a salary would have very little value to them, so the new hire could be a good deal. But because of the not-so-diminishing insurance value of wealth, the value of hiring someone to scratch yet another trivial itch eventually declines below the insurance value of holding property or claims.

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In “middle-class” societies, wealth is widely distributed and most peoples’ consumption desires are not nearly sated. We constantly trade off a potential loss of insurance against a gain from consumption, and consumption often wins because we have important, unsatisfied wants. So we employ one another to provide the goods and services we wish to consume. This leads to “full employment”—however many we are, we find ways to please our peers, for which they pay us. They in turn please us for pay. There is a circular flow of claims, accompanied by real activity we call “production.” In economically polarized societies, this dynamic breaks down. The very wealthy don’t employ everybody because the marginal consumption value of a new hire falls below the insurance value of retaining wealth.

Last Trains: Dr Beeching and the Death of Rural England
by Charles Loft
Published 27 Mar 2013

For all Lennox-Boyd’s talk of commercial freedom during the debates over the Transport Bill in 1952, the greatest restriction on the railways’ commercial freedom in the 1950s was the government’s tendency to treat the nationalised industries, in the Treasury’s words, as the ‘handmaidens of other policies’, by constantly involving itself in their pricing decisions and industrial relations.82 The electoral success of the Conservatives during the 1950s was largely dependent on convincing potential Labour voters that the Conservatives could be trusted to deliver prosperity while maintaining full employment and avoiding confrontation with the unions. This was particularly important in 1951–5, when the Conservatives had only a small parliamentary majority. At the time, railway wages were subject to a complex and almost constant process of annual negotiation, the shortcomings of which were evident in dissatisfaction over pay, poor productivity, difficulty recruiting staff and regular threats of a strike.

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When the settlement was followed by the usual application for increased charges, the Cabinet saw an opportunity to demonstrate its determination to break out of the wage-price spiral, using the BTC as an example. Anthony Eden had succeeded Churchill as Prime Minister in April 1955, winning an election with a secure majority the following month. Unwilling to pursue legislative curbs on trade unions, a formal incomes policy or to abandon the commitment to full employment, Eden’s government attempted to create a wage and price ‘plateau’. Ministers could only exhort private sector employers and the trade unions to show restraint and keep wages and prices stable, but they could impose such policies on the nationalised industries (albeit informally through discussion with their chairmen).

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Macmillan is remembered today for the apparent complacency of his comment – made in a speech some six months after he became Prime Minister – that ‘most of our people have never had it so good’, but the theme of his speech was the danger to that prosperity posed by inflation and the uncertainty over whether it was possible for Britain to combine full employment, stable prices and economic growth.126 Divisions in his government over how to address this problem cost Macmillan his Chancellor and two Treasury ministers at the start of 1958. Even as he appeared to epitomise ‘Old England’ to the satirists who rose in response to the mood of dissatisfaction that typified the turn of the decade, Macmillan was as aware as anyone of the need to modernise and it was the question of how to do this that kept him awake at night.

The Myth of Capitalism: Monopolies and the Death of Competition
by Jonathan Tepper
Published 20 Nov 2018

According to the Federal Reserve Bank of Atlanta, in 2005 the top 10 home construction firms had only 25% market share. However, after the recession, when lending to small builders dried up, the market share of big builders rose in regions where small banks shut down. The Dodd–Frank Act has been called the 2010 Full Employment Act for Lawyers, Accountants, and Consultants.55 For large banks that already had armies of compliance workers, the act was burdensome, but not lethal. For small banks, the Act was an insurmountable barrier to entry. Jamie Dimon, the CEO of JP Morgan, has said that Dodd–Frank creates a “moat” around the big banks.56 In 2015 at an investor conference, Lloyd Blankfein, then CEO of Goldman Sachs, explained how higher regulatory costs are killing competition.

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(Dancing Unicorn Books, 2016). 11. http://consumerfed.org/wp-content/uploads/2016/12/Overcharged-and-Underserved.pdf. 12. https://www.freepress.net/blog/2017/04/25/net-neutrality-violations-brief-history. 13. https://www.cnet.com/news/fcc-formally-rules-comcasts-throttling-of-bittorrent-was-illegal/. 14. Barry C. Lynn, Cornered: The New Monopoly Capitalism and the Economics of Destruction (Hoboken, NJ: Wiley, 2010). 15. https://www.salon.com/2013/07/08/how_%E2%80%9Cecon_101%E2%80%9D_is_killing_america/. 16. Michał Kalecki, Capitalism: Business Cycles and Full Employment, vol. 1 of Collected Works (Oxford, UK: Oxford University Press, 1990), 252. 17. http://investigativereportingworkshop.org/connected/story/comcast-lures-former-fcc-aides-lobby-nbc-merger/. 18. https://www.newyorker.com/tech/elements/the-oligopoly-problem. 19. Capital Returns: Investing Through the Capital Cycle: A Money Manager's Reports 2002–15 (Palgrave Macmillan), p. 27.

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Available at SSRN: https://ssrn.com/abstract=826453 52. https://www.federalreserve.gov/econresdata/feds/2014/files/2014113pap.pdf. 53. https://www.manhattan-institute.org/sites/default/files/R-NG-0417.pdf. 54. https://ilsr.org/vanishing-community-banks-national-crisis/. 55. http://mjperry.blogspot.com/2011/09/dodd-frank-2010-full-employment-act-for.html. 56. http://www.washingtonexaminer.com/goldman-and-jpmorgan-sit-safely-behind-the-walls-of-dodd-frank/article/2560179. 57. https://www.wsj.com/articles/regulation-is-good-for-goldman-1423700859. 58. https://www.nytimes.com/2018/06/22/business/dealbook/banks-stress-test.html. 59. https://www.washingtonexaminer.com/goldman-sachs-wants-regulation-not-laissez-faire. 60. http://business.financialpost.com/news/economy/sp-moodys-boosting-rating-fees-faster-than-inflation. 61. https://www.reuters.com/article/businesspro-us-usa-ratings-competition-a-idUSTRE55N4VU20090624 62. https://www.fdic.gov/regulations/reform/altman1.pdf. 63. https://www.washingtonpost.com/blogs/wonkblog/post/the-pentagons-435-hammer/2011/05/19/AGoGKHMH_blog.html?

Winds of Change
by Peter Hennessy
Published 27 Aug 2019

A trade-union movement obsessed with avoiding a return to the mass unemployment of the 1930s, clinging to rulebooks and inter-union demarcations that put a highly effective brake on technical innovation and economic growth. The benefits of the British New Deal in terms of a better-fed, healthier and more formally educated full-employment society were assumed – rather than praised – by the ‘What’s Wrongers’. The contrast between the prewar Britain of 1939 and the mass-consumption society of twenty years on were somewhat discounted. Nor did their critique carry all before it in party-political terms.27 The Conservatives, under a hereditary Scottish aristocrat in the person of Sir Alec Douglas-Home, very nearly fought the Labour Party, under the gritty more-meritocratic-than-thou Harold Wilson, to a draw in the general election of October 1964 – partly, it could be argued, because Macmillan and Douglas-Home had picked up the modernization theme and run with it themselves.

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Essentially, there were three of them – two that would have faced any early 1960s premier; and one personal to him – their effect being that, though a determined modernizer by temperament and conviction, he did not look or sound the part by the autumn of 1962, especially after the ‘Night of the Long Knives’ the previous July when he sacked a third of his Cabinet, including the hapless Selwyn Lloyd. The first of the two impersonal intractables was the persistent undertow of the UK’s relative economic decline since the mid-nineteenth century. The second was the increasing stress upon the postwar ‘British New Deal’ built on the combined model of Keynesian full-employment economics and Beveridgite welfare provisions, the twin bibles of the late-1940s settlement. By 1960 the twinned magic of the incomparable polymath of twentieth-century economics, J. M. Keynes, and its arch social planner, William Beveridge, was plainly not working as intended. The British people were fully employed and far healthier and better educated than they had ever been, but the great cumulative purpose of that British New Deal – the easing of class antagonisms and industrial tensions in a benign, upward spiral of self-fulfilling economic progress and industrial productivity and growth-funded social peace and justice – was still highly elusive.

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He could also have done with that most supple of minds to help him with the financial problems created by an overextended defence budget (itself partly the product of residual colonial responsibilities and a string of costly imperial bases still girdling the globe), the burden of sustaining the world’s second reserve currency and a sterling area the funding of whose wartime-accumulated sterling balances brought on a perpetual migraine in the Treasury, and the risk of inflation. Keynes had died at Easter 1946 without leaving any characteristically subtle yet practical plan for dealing with the problems of wages and salaries in a full-employment economy. He had enabled the postwar British government to, as it were, put the Thirties right, but he had not given them a blueprint for the late Fifties and early Sixties, as his colleagues and disciples recognized. One of them, the Cambridge economist Austin Robinson, who had worked in Whitehall’s Central Economic Planning Staff in the late 1940s, wrote of Keynes’s legacy that the ‘problems of preventing inflation in an over-full economy are not those of preventing the cruelties of unemployment in the 1930s.

Sleeping Giant: How the New Working Class Will Transform America
by Tamara Draut
Published 4 Apr 2016

Working-class union women, particularly in the Amalgamated Clothing Workers of America, led their unions and the AFL-CIO to take up the cause of child care and put it at the top of the agenda.11 Black unionists led by A. Philip Randolph campaigned for a so-called Freedom Budget for All Americans that would provide a government guarantee of full employment, a higher minimum wage, and a basic income for those who couldn’t work, along with major new investments in education and health care. Randolph unveiled the plan at a White House conference in 1966, just three years after the March on Washington for Jobs and Freedom. At the time, arguing for full employment was a strategic way to end the often zero-sum politics between whites and blacks, where a gain for one race was often seen as a loss for the other.

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• Extend elementary school to include two years of preschool for children between the ages of three and five. • Reinvest in state public higher education to achieve debt-free public college for all working- and middle-class students. A Better Deal for Society • Revitalize our nation’s infrastructure, including addressing climate change, to ensure full employment. • Establish a National Truth and Reconciliation Commission on Racial Healing to provide full accounting of our nation’s violent racial history and to address its legacy in residential segregation, occupational segregation, the racial wealth gap, and oppressive criminal justice and policing policies

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Kurtz, “Subway Leads Fast Food Industry.” 6. Annalyn Kurtz, “10 Big Overtime Pay Violators,” CNN Money, August 5, 2014, at http://money.​cnn.​com/​gallery/​news/​economy/​2014/​03/​13/​overtime-​violations/​?iid=EL. 7. Ibid. 8. Ross Eisenbrey, “Improving the Quality of Jobs Through Better Labor Standards,” Full Employment, April 2, 2014, at http://www.​pathto​fullem​ployment.​org/​wp-​content/​uploads/​2014/​04/​eisenbrey.​pdf. 9. Brady Meixell and Ross Eisenbrey, “An Epidemic of Wage Theft Is Costing Workers Hundreds of Millions of Dollars a Year,” Economic Policy Institute, September 11, 2014, at https://docs.​google.​com/​viewer?​

The Knowledge Economy
by Roberto Mangabeira Unger
Published 19 Mar 2019

Economic growth remains subject to repeated interruptions, failures, and slumps because breakthroughs of constraints on supply do not automatically ensure corresponding breakthroughs of constraints on demand or vice versa. There is no way to implement through contract, at the level of the economy rather than of the firm, the bargain that Henry Ford half facetiously offered his workers: to pay them so well that they could buy his cars. The solution to the accommodation of supply and demand at full employment is not contractual but institutional. Under the conditions of contemporary economies only an inclusive vanguardism—the most radical and encompassing form of breakthrough of the constraints on both supply and demand—can ensure that the growth of supply will be enough to sustain the growth of demand and the growth of demand to support the growth of supply.

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It was thus similar to the view that I have just sketched in that it gave reason to disbelieve that the market economy, as it was then or is now constituted, would correct itself and perform its expected role of assigning all resources to their most efficient uses. To assign all resources, including labor, to their most efficient uses, it would have to maintain full employment. One way to mark how the approach that I have just sketched differs from Keynes’s view is to suggest in what ways Keynes’s doctrine—and the policy prescriptions to which it gave rise—are deficient from the perspective of the proposed alternative. The first limitation of Keynes’s view is that it offers a theory of a special case: one of the many ways in which supply and demand may fail to adjust, or adjust only at a diminished level of employment and activity.

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In such a theory there is no basis for saying that the economy is either naturally susceptible to a failure in the reciprocal adjustment of supply and demand or not. It is possible to say only that at any moment, given certain specific assumptions (e.g., about the power of labor to defend the wage against reductions, the power of capitalists to control investment decisions, and the power of savers to withhold saving from productive investment), full employment may not be reached because of a foreseeable combination of circumstances. For this combination, there exists a specific remedy. By contrast, in the view that I outline here the economy remains in perpetual disequilibrium—supply and demand fail to adjust to each other and to provide a mechanism for repeated breakthroughs of the constraints on supply and demand—until something happens.

Open: The Progressive Case for Free Trade, Immigration, and Global Capital
by Kimberly Clausing
Published 4 Mar 2019

Surely if we made these goods, there would be more factory jobs, more demand for those workers seeking such jobs, and resulting improvements in income equality. First, consider the effect on the total number of jobs if we began to manufacture all the products that we now import. In June of 2018, the unemployment rate was 4.0 percent. Most economists believe this unemployment rate represents full employment. What does “full employment” mean? In a dynamic economy, some workers will always be between jobs, and some workers may be living in places where job opportunities are too few, but nationwide unemployment much lower than 4 percent would create upward pressure on wages and prices, resulting in inflation rather than additional job creation.

…

Rapid reversals can also shift the allocation of the economy’s resources across sectors too abruptly, creating large transition problems. There are also less obvious dangers associated with running trade deficits. They likely change the composition of jobs in the economy, even if they do not change the total number of jobs. Chapter 3 described how, when the economy is at full employment, international trade does not affect the total number of jobs, but it does affect their allocation, by adding jobs in export industries (such as airplanes, software, and soybeans) and taking jobs away from import industries (including shoes, clothing, and steel). A Modern Greek Tragedy In 2007, the current account deficit in Greece was an astonishing 14 percent of GDP.

…

Chris Buckley, “China’s New Bridges: Rising High, But Buried in Debt,” New York Times, June 10, 2017. 12. Unfortunately, recent tax legislation—known the Tax Cuts and Jobs Act—violates this principle. TCJA will increase deficits by about $1.5 trillion over the coming ten-year period, at a time when the economy is already at, or perhaps beyond, full employment. As the legislation was passed in December 2017, the unemployment rate was 4.1 percent. 13. These facts are based on 2014 data from the US Bureau of Economic Analysis survey of US multinational companies and their affiliates abroad. 10. A Grand Bargain for Better Tax Policy 1. The official title of the law is Public Law 115-97. 2.

When Money Dies
by Adam Fergusson
Published 25 Aug 2011

Poincare, soon to become Prime Minister of France, did not believe in a fixed sum and resigned the chairmanship of the commission.) As the mark improved, so unemployment rapidly rose, reaching 6 per cent of the work force in the summer of 1920 — a condition which a 'buyers strike' may have worsened. Full employment thereafter became a primary objective of both government and unions, at the mark's expense. Lord D'Abernon, who was to be British Ambassador in Berlin for more than six years, arrived at his post in June 1920. A man more practically versed in money matters than most in office in that city, he dutifully recorded both in his diaries and in. his despatches home the mark's precise course over the brink and far down into the depths.

…

Hugo Stinnes himself, the richest and most powerful industrialist in Germany, whose empire of over one-sixth of the country's industry had been largely built on the advantageous foundation of an inflationary economy, paraded a social conscience shamelessly. He justified inflation as the means of guaranteeing full employment, not as something desirable but simply as the only 43 course open to a benevolent government. It was, he maintained, the only way whereby the life of the people could be sustained. The President of the Reichsbank whose industrial interests were negligible did not in essence depart from this argument, and in a speech on German currency in May 1922 greatly vexed Lord D'Abernon because he had (in the ambassador's words) 'pressed into the shortest space the maximum number of fallacies and errors'.

…

In East Prussia, for example, seeing from a 93 distance the imminent collapse of central Germany, the businessmen and landowners of Konigsberg sought to secure a backdoor for their exports. In this outwardly prosperous district, the ruling class were reported to be quite prepared to leave the ship for another refuge if it sank, and even to leave central Germany to starve if it could provide no market for agricultural produce. East Prussia still enjoyed full employment. In spite of the steps they were now taking to safeguard the future, it was notable that the rich of the state had contributed generously towards the Ruhrspende — the fund to support the struggle against France, The isolation produced by the Treaty of Versailles, cutting the area off from Germany proper, had led to the revival of many industries, and latterly an electricity station had been built to cope with the coal shortage.

Rethinking Islamism: The Ideology of the New Terror
by Meghnad Desai
Published 25 Apr 2008

฀Still,฀on฀balance,฀the฀Second฀if฀not฀the฀First฀ World฀ War฀ was฀ fought฀ against฀ an฀ inherently฀ evil฀ philosophy฀ of฀ fascism฀ in฀ its฀ German,฀ Japanese฀ and฀ Italian฀ variants.฀ There฀ was฀ some฀justification฀in฀the฀Allies฀claiming,฀as฀they฀did฀in฀the฀Atlantic฀  Charter฀ that฀ they฀ were฀ fighting฀ the฀ battle฀ for฀ the฀ four฀ freedoms.฀ The฀battle฀won,฀the฀democracies฀fought฀to฀achieve฀full฀employment฀ and฀mass฀prosperity฀while฀conducting฀a฀cold฀war฀against฀the฀Communist฀empire.฀The฀experience฀of฀the฀Holocaust฀taught฀the฀West฀ the฀horrible฀costs฀of฀intolerance฀and฀anti-Semitism.฀What฀happened฀ in฀ Germany฀ was฀ the฀ extreme฀ end฀ of฀ a฀ long฀ history฀ of฀ Christian฀ anti-Semitism฀which฀prevailed฀in฀the฀Allied฀countries฀right฀up฀to฀ ฀if฀not฀beyond.

…

฀The฀World฀Wide฀Web฀arrived฀in฀the฀s฀and฀gave฀ even฀the฀most฀isolated฀individual฀access฀to฀information฀about฀the฀ means฀of฀terror฀and฀enabled฀contact฀with฀friends฀in฀any฀part฀of฀the฀ world. The฀ oil฀ shock฀ also฀ accelerated฀ international฀ migration,฀ which฀ had฀slowed฀down฀after฀the฀First฀World฀War฀and฀resumed฀after฀฀ but฀ was฀ still฀ limited.฀ Full฀ employment฀ in฀ the฀ West฀ had฀ created฀ a฀ need฀ for฀ unskilled฀ labour฀ which฀ the฀ periphery฀ of฀ the฀ British,฀ Dutch฀and฀French฀empires฀was฀quite฀willing฀to฀provide.฀A฀diaspora฀ was฀slowly฀growing฀in฀the฀West฀of฀people฀from฀the฀Third฀World.฀ After฀,฀the฀oil-exporting฀countries฀imported฀labour฀from฀South฀ and฀ Southeast฀ Asia฀ and฀ North฀ Africa.฀ The฀ deregulation฀ of฀ capital฀ markets฀ and฀ the฀ increasing฀ liberalisation฀ of฀ trade฀ for฀ the฀ rich฀ countries฀also฀created฀a฀need฀for฀skilled฀immigrant฀labour.

…

฀Communism฀had฀the฀declared฀ambition฀of฀overtaking฀capitalism฀in฀the฀ material฀production฀of฀goods฀and฀services.฀It฀criticised฀capitalism฀ for฀its฀waste฀and฀inefficiencies,฀its฀unemployment฀and฀trade฀cycles,฀ its฀ inequalities฀ of฀ income฀ and฀ poverty฀ amidst฀ plenty,฀ and฀ so฀ on.฀ Ultimately,฀ through฀ ฀ years฀ of฀ Keynesian฀ full฀ employment฀ and฀ growth,฀ and฀ despite฀ the฀ stagflation฀ caused฀ by฀ the฀ oil฀ price฀ rise,฀ the฀Western฀democracies฀came฀through฀with฀their฀economies฀more฀ productive฀and฀raising฀living฀standards฀faster฀than฀could฀the฀Soviet฀ Union.44 Today฀ the฀ challenge฀ of฀ Communism฀ in฀ the฀ economic฀ sphere฀ has฀mutated฀into฀the฀movement฀against฀globalisation.

Last Best Hope: America in Crisis and Renewal
by George Packer
Published 14 Jun 2021

Start with the landscape that lay open to the virus. In the prosperous cities, a class of globally connected desk workers dependent on a class of precarious service workers. In the countryside, decaying communities in reaction against the modern world. On media, endless vituperation among different camps. In the economy, even with full employment, a large and growing gap between triumphant capital and beleaguered labor. In Washington, a hollow government led by a con man and his morally bankrupt party. Around the country, a mood of cynical exhaustion, with no vision of a shared identity or future. A crisis as massive and new as a pandemic brings an almost inevitable failure of imagination.

…

If Trump were a fascist, he would have used the pandemic to seize control of industry, suspend individual liberties, and place the public under a regime of strict surveillance. In fascism, capitalism serves the state, not the other way around. The fascists were a vanguard of the future. They whipped up collective energies for visionary national goals—full employment, rearmament, conquest, and genocide. Look at pictures of fascist rallies. The faces in the crowd are ecstatic, the masses feel themselves elevated, they’re ready to undertake superhuman feats of exertion for the leader, risk their lives, give their lives. Americans came to Trump’s rallies for the fun, the red meat.

…

They protested “cultural appropriation” in the Vietnamese sandwiches prepared by dining hall workers (banh mi is made with grilled pork and pickled vegetables on a baguette, not pulled pork and coleslaw on ciabatta). The $12-an-hour dining hall workers reacted with bemusement, or sullen rage. These incidents of “political correctness,” amplified by right-wing media, whipped up hatred of elites out in Real America. The culture wars raged on, as bloody-minded and durable as the Thirty Years’ War, a full-employment program for pundits of every type. Some worried about a generation of ultra-sensitive children coddled by ultra-indulgent adults. Others dismissed the worry as a lot of hand-wringing over kids being kids. Wise heads in Smart America said, “Wait till they find out how the world really works.” But it was the world that changed, not the students

The Corona Crash: How the Pandemic Will Change Capitalism
by Grace Blakeley
Published 14 Oct 2020

The one it replaced has variously been called the post-war, social democratic, or Keynesian consensus.23 Under this growth model – underpinned by an increase in the power of labour relative to capital that emerged from the Second World War and the institutionalisation of this political settlement both domestically through the rise of state planning and internationally with the creation of the Bretton Woods institutions – the state committed itself to promoting full employment through public spending. This commitment bolstered the power of organised labour, which developed a corporatist relationship with the nation-state. The system of capital controls and exchange rate pegging agreed upon at the 1944 Bretton Woods conference supported the development of social democracy in the West and facilitated the emergence of a unique period of high growth, low unemployment and falling inequality.

…

The UK became an internationalised and financialised economy, with a significant professional-managerial class whose high wages were premised upon hyper-exploitation lower down the global value chain.28 Today, the British economy is more dependent upon the services sector than any other G7 economy.29 The bulk of the lower middle and working classes did not, however, immediately stand to benefit from Thatcher’s transformation of the economy. As the state replaced the targeting of full employment with the targeting of inflation as the aim of macroeconomic policy, and as anti-union legislation accompanied the precaritisation of work, the power of workers declined drastically relative to their bosses. With low wages and a small state, households came to rely on dissaving and credit to fund their consumption – and businesses relied on this credit-fuelled consumption for their returns.

Affluenza: When Too Much Is Never Enough
by Clive Hamilton and Richard Denniss
Published 31 May 2005

And the richer we become as a society the more unwilling we are to sympathise with those at the bottom of the heap. We have been unable to make the necessary changes to social structures to reduce poverty because of the majority’s preoccupation with protecting their own incomes, a preoccupation nurtured every time a political party declares that its priority is more growth. The goal of full employment has consistently been sacrificed to the interests of higher incomes for the wealthy. In a society where too much is not enough, social justice is an impossible goal. To solve the problem of poverty, real deprivation, we must first solve the problem of affluence, imagined deprivation. Yet that must be done in the face of the formidable pressures applied by consumerism itself, which, having solved poverty materially, must constantly recreate it psychologically.

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CHAPTER 11 1 Lambesis Agency 2004, L Style Report, 9th edn, <http://www.lstylereport.com> [11 January 2005]. 209 INDEX Abbott, Tony, 133 advertising, 4, 28, 36–40, 41, 43, 55, 61, 101, 109, 120, 126,172, 187 and neuroscience, 41–2 fake memories in, 46 children and, 47, 50–51 of breakfast cereals, 48–50, 150–1 of cars, 10, 45 of junk food, 51 of margarine, 43 of tobacco, 51–2, 125 of vitamins, 94 restrictions on, 188 use of nagging, 53–4 affluenza, defined, 3, 7 alcohol, 115–17, 180 annual leave see holiday leave anorexia, 16 appliances, 22–3, 37, 38 attention deficit hyperactivity disorder, 55 Aussie battler, 3, 133–4, 136, 139, 151, 180, see also politics Australian Labor Party, 3, 137–9, 151, 191 bankruptcy, 72–3, 175 banks, 12, 75–6, 77–80 barbecues, 23–4 210 INDEX Blair, Tony, 191 botox, 37, 128 brands, 23, 34, 38–40, 41–33, 45, 53, 55, 56, 110, 187 brand loyalty, 39, 55, 189 brand disloyalty, 190 see also advertising; marketing Bray, Robert, 66 Buddhism, 17 caesareans, 34 Calvinism, 16, 17 cars, 10, 13, 45 4WDs, 44–5, 188 see also advertising celebrity, need for, 56–7 children, 21 advertising and, 47–57, 150 and clothes, 33–4 as fashion accessories, 33 behavioural problems of, 55 financial calculus of having, 34–5, 142–5, impact of materialism on, 149–50 sexualisation of, 57 tinys, 52–3 tweens, 55–7 see also downshifting choice, alleged benefits of, 40–1 clothes, 13, 45, 166 see also children Coalition Government, 136–9 see also Liberal Party community, 95, 119, 146, 148, 183 compulsive shopping, 15, 61 see also oniomania conscious consumption, 166, 186–90 conspicuous consumption, 8, 88, 96 cosmetic surgery, 10, 57, 127–9, see also botox cosmetics, 37 Costello, Peter, 35, 141 credit cards, 10–2, 19, 72–81, 102, 103 see also debt debt, 71 passim, 137, 179 attitudes to, 74, 75 Debtors Anonymous, 61, 80–1 foreign debt truck, 82 home equity loans, 79–80 marketing of, 71, 75–7 national debt, 81–4 211 AFFLUENZA deferred happiness syndrome, 89–2, 98, 169 deferrers, 175–6 see also deferred happiness syndrome democratisation of luxury, 26 depression, 16, 38, 93, 114 deprivation, 3, 66, 192, see also poverty, hardship disease-mongering, 120–7 doorbuster sales, 78 downshifters characteristics of, 154–6 motivations of, 156–7, 158 passim new lifestyle of, 165–7 regrets of, 173 downshifting, 17, 152, 153 passim, 180 children and, 156, 159, 160, 166–7 defined, 153 for dogs, 33 politics of, 175, 183–6 reactions to, 176–70 drugs, 114–16, 118 Easterlin, Richard, 6 Eckersley, Richard, 148 economic growth, 3, 4–5, 62–3, 114, 118, 136, 141, 159, 185, 190, 193 environment, 111, 112, 157, 179, 190, 193, 194 evangelical Christianity, 182–3 family size, 20–1 federal election 2004, 3, 136–8 female sexual dysfunction, 121–3 feminism, 27 flexible work hours see work hours Frank, Robert, 9 Frey, Bruno, 63 full employment, 192 gratifiers, 175 growth fetishism, viii, 18, 142, 193 Guevara, Che, 28 happiness, 58, 63–4, 113, 118, 127, 146, 152, 175–6 hardship imagined, 64 genuine, 66 212 INDEX Hayek, Friedrich, 186 health, 113, 156, 157, 164, 166, 179, 193 see also work hours hedonic treadmill, 6, 58, 184 holiday leave, 87, 88, 93 Hood, Robin, 190 houses, 13, 20, 60, 101 size of, 20, 21–2, 37 prices of, 20, 21–2, 134, 137, 179 Howard, John, 82, 138, 141, 142 Idell, Cheryl, 53 identity, 13–4, 45 imports, 73, 83–4 incomes, 4, 58–9, 112 Indigenous Australians, 113 intermittent husband syndrome, 91 karoshi, 92 Kasser, Tim, 14 Klein, Naomi, 38 Latham, Mark, 137, 138 Liberal Party, 136, 138, 139, 151 Luis Vuitton, 9, 28 luxury fever, 8–10, 12, 19, 135, 143, 178 luxury goods, 9–10, 13, 16, 19, 21, 26, 127, 170 Mandelson, Peter, 191 marketing, 13, 28, 37–8, 42, 45, 47, 53, 104, 110–1, 118, 120, 126, 179 see also advertising materialism, 14–5, 17, 47, 55, 89, 119, 154, 184 and values, 146–52 meningococcal disease, 120 middle class, 8–9, 59, 74, 136 middle-class welfare, 139-42, 180 Mill, John Stuart, 138, 186 money, 5, 7, 11, 16–7, 19, 58, 63, 67–8, 80, 97, 98–9, 103, 107, 112, 120, 139, 143–4, 148, 152, 159, 166, 171, 175–7, 178, 187 hunger for, 6, 17, 18, 137, 146, 180, 183–4 see also debt money coma, 80 Moynihan, Ray, 121, 123 213 AFFLUENZA needs, 4, 7, 29, 59–63, 65, 66, 100, 147, 148 neoliberalism, 7, 17, 36, 39–40, 79, 138 as new form of oppression, 186 of relationships, 182 of tax cuts, 136, 139 of the Aussie battler, 133–5, 151 of welfare, 139, 140, 141, 180 of wellbeing, 193–4 progressive, 181, 182 pornography, 151 post-materialism, 4, 155, 157, 184 poverty, 18, 181, 190–2 poverty line, 66–7 presenteeism, 94 privatisation, 40 psychology, role in marketing, 36–41, 46, 51, 53–4, 61 obesity, 118 obsolescence, 110 oniomania, 15–6 see also compulsive shopping Olsen twins, 57 O’Neill, Jessie, 7 ovens, 22–3 overconsumption, 7, 19 passim, 72, 96, 122, 178 overwork see work hours Pavlov, Ivan, 41, 47 plastic bag levy, 103 pets, 28–33 humanisation of, 30, 33 pharmaceutical companies, 120–1, 126 Pocock, Barbara, 98 politics, 60–1, 66, 119, 183 conservative, 144, 181, 190 of choice, 168, 172 relationships, 14, 81, 97, 179, 193, 194 relationship debts, 175 see also work hours retail therapy, 16, 100–1 retirement anxiety, 92, 173–4 right-hand ring, 27 Ritalin, 118 Roberts, Kevin, 39 saving, 71, 82 see also debt 214 INDEX Schor, Juliet, 48 sea change, 153, 155 see also downshifting self-storage industry, 25, 102 social anxiety disorder, 124–6 status, 170 Stutzer, Alois, 63 suffering rich, 63 sunglasses, 25–6 television, 9, 21, 22, 60, 183, 188 lifestyle programs, 37 sales, 24–5 Trapaga, Monica, 49–50 trickle down theory, 191 twin deficits theory, 83 values, 180–3 see also materialism Veblen, Thorstein, 8 Vidal, Gore, 6 voluntary simplicity, 154, 187 see also downshifting wasteful consumption, 100 passim, 179, 190, 194 and guilt, 106–8, 112 wealth, 81–2 whitegoods, 23 see also appliances wellbeing, 14, 40, 54, 58, 113, 115, 118, 142, 163, 190 wellbeing manifesto, 193, 217–24 work hours, 81, 91, 95–6, 158, 161, 163, 174, 179 and children, 90–1 excessive, 85–9, 158 impact on communities, 95–7 impact on health, 90–4, 122 impact on relationships, 85, 90, 91, 97–9, 122, 149 working class, 8–9 workophiles, 87 215 A political manifesto for wellbeing Preamble Australians are three times richer than their parents and grandparents were in the 1950s, but they are not happier.

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Workplaces that provide secure, rewarding jobs should be encouraged. Workplace flexibility, including quality part-time jobs, should operate in the interests of employees as well as employers. Unemployment is more damaging than just the loss of income, and disparaging unemployed people serves only to increase their anxiety and sense of exclusion. Pursuing full employment is essential to a wellbeing economy, as is ensuring decent minimum workplace standards. Satisfying work can be found inside and outside the home. Work in the household is essential to the health and wellbeing of families and communities but, because it is outside the economy, it is ignored. Governments should value this work, and employers need to adapt to the realities of family life.

Why Women Have Better Sex Under Socialism: And Other Arguments for Economic Independence
by Kristen R. Ghodsee
Published 20 Nov 2018

Women have always been used as a reserve army of labor when the men are off at war (just like American women’s employment during the World War II era of Rosie the Riveter). But unlike the United States and West Germany, where women were “let go” after the soldiers returned home, East European states guaranteed women’s full employment and invested vast resources in their education and training. These nations promoted women’s labor in traditionally male professions such as mining and military service, and mass-produced images of women driving heavy machinery, especially tractors.8 For example, while American women were stocking their kitchens with the latest appliances during the postwar economic boom, the Bulgarian government encouraged girls to pursue careers in the new economy.

…

Also, it attenuated female poverty, especially in the case of mothers who practically all started to work, and of older women who obtained a pension in their own right.” State socialist countries could promote women’s economic autonomy because the state was the primary employer and it guaranteed each man and woman full employment as a right and a duty of citizenship. In the democratic socialist countries of northern Europe, women’s employment is voluntary, but the state promotes their labor force participation by providing the social services necessary to help citizens combine their roles as workers and parents.11 Socialist states also try to counter the persistent discrimination against women by expanding opportunities for public sector employment.

…

In my research in the archives of the Bulgarian Women’s Committee, for instance, I discovered many letters to the relevant ministries complaining about the lack of funds allocated for the crèches and kindergartens. Here again, the northern European countries of Sweden, Norway, Denmark, and Finland did much better. They invested state funds to build child care facilities to promote women’s full employment. By the end of the Cold War, Scandinavian female labor force participation rates were second only to those of women in the Eastern Bloc.9 Upon publication of my op-ed in the New York Times, I received countless messages from Western readers who discussed their own frustrations. Many women who grew up in the Eastern Bloc also wrote me to relate their memories and opinions about life under socialism, confirming with their personal anecdotes that not all was so bleak behind the Iron Curtain.

The Financial Crisis and the Free Market Cure: Why Pure Capitalism Is the World Economy's Only Hope
by John A. Allison
Published 20 Sep 2012

Unfortunately, the Fed is constantly manipulating the value of the dollar. The Fed is charged with two goals, controlling the price level and maintaining full employment. In practice, the full-employment goal almost always has priority. This is because the Fed is a political institution (despite its theoretical independence), and because Congress cares more about full employment than about price levels. (Ironically, a debased dollar will ultimately undermine the Fed’s full-employment policy goal.) The most fundamental cure for this crisis and future financial crises would be to eliminate the Federal Reserve. The United States has already had two failed central banks.

The Darwin Economy: Liberty, Competition, and the Common Good
by Robert H. Frank
Published 3 Sep 2011

The key step would be to pass the surtax right away, but delay its implementation until the economy was once again operating near full employment. Mere announcement that the tax was coming would spur a flood of additional high-end spending as wealthy families rushed to build mansion additions and stage lavish parties before the tax took effect. Granted, that might not be the best way to stimulate additional spending. But it would clearly be better than standing idly by while total spending remains far too low to support full employment. In the long run, a progressive consumption tax would gradually shift the composition of final spending away from consumption toward investment, causing productivity to grow more rapidly.

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Only someone who thinks that people have a right to PARALYSIS 15 cause undue harm to others could object that such taxes violate anyone’s rights. And because such taxes make the national economic pie bigger, it makes little sense to object that we can’t afford them. The new taxes should be phased in only after the economy is back at full employment. But even with federal taxes at their lowest level since the 1950s, we’re unlikely to summon the political will to take that step until leaders stop insisting that all taxes are evil. Shifting tax policy in this way would place additional resources at our disposal. Without having to sacrifice anything we value, we could generate more than enough revenue to eliminate government debt and refurbish long-neglected public infrastructure.

…

But prudent public investment does not impoverish our grandchildren at all. On the contrary, when the government borrows money at 4 percent and invests it in a project that yields 18 percent during an economic downturn, the effect is not only to put people to work who otherwise would have been sitting idle but also to enrich our grandchildren. In an economy at full employment, it would of course be even better to pay for such investments with tax revenue rather than with borrowed money. But antitax rhetoric has apparently ruled out that option, even for residents who would directly benefit from the specific government investments being paid for. Thus, as Wall Street Journal reporter Lauren Etter notes, many of the North Dakota residents who complain most bitterly about the deteriorating quality of their roads seem disinclined to consider the obvious remedy: “In June, Stutsman County residents rejected a measure that would have generated more money for roads by increasing property and sales taxes.

Rethinking the Economics of Land and Housing
by Josh Ryan-Collins , Toby Lloyd and Laurie Macfarlane
Published 28 Feb 2017

The prevailing idea that free markets would automatically adjust and provide full employment had failed. The main plank of Keynes’s theory is the assertion that aggregate demand ‒ measured as the sum of spending by households, businesses and the government ‒ is the most important driving force in an economy. Moreover, prices, and especially wages, respond slowly to changes in supply and demand, resulting in periodic shortages and surpluses, especially of labour. Keynes asserted that free markets have no self-balancing mechanisms to counter this and achieve full employment, and therefore justified government intervention through public policies that aim to achieve full employment and price stability.

…

Figure 4.1 New houses built by tenure (United Kingdom) (source: Office for National Statistics, 2016a) Figure 4.2 Trends in tenure type from 1918 to 2013 (Great Britain) (%) (source: Office for National Statistics, 2016b; figures for 1918 and 1939 are for England and Wales only) Post-war Britain – along with much of the developed world – enjoyed high levels of economic growth, moderate rates of inflation and full employment. Economic policy making was dominated by Keynesian thought (see Box 4.3) and the pursuit of bold social reforms such as the establishment of the welfare state, the nationalisation of the railways and the creation of the National Health Service. This period is often described as the ‘Golden Age of Capitalism’, and lasted until the collapse of the Bretton Woods fixed exchange rate regime in 1971.3 In the mixed economy of the Keynesian era, state-sponsored house building by councils coexisted with development by private firms, and to a much lesser extent by non-profit housing associations.

…

Keynes asserted that free markets have no self-balancing mechanisms to counter this and achieve full employment, and therefore justified government intervention through public policies that aim to achieve full employment and price stability. Keynes’ ideas became widely accepted after the Second World War and provided the main inspiration for economic policy makers in Western industrialised countries. However, Keynesian economics began to fall out of favour in the 1970s as many economies experienced slow economic growth, high unemployment and rising inflation, a phenomenon which is often referred to as stagflation. This mixed economy in both housing supply and tenure was supported by strict financial regulations which restricted the amount of credit that could flow into the private housing market (see Chapter 5), and a tax regime designed to balance the economic position of homeowners and renters.

The Fourth Age: Smart Robots, Conscious Computers, and the Future of Humanity
by Byron Reese
Published 23 Apr 2018

So we should be mindful of how and where we implement technology. 9 * * * Will Robots Take All Our Jobs? The public discourse about robots is overwhelmingly about their impact on jobs, and therefore we will explore this topic in detail. The question at issue is this: Will automation, on net, eliminate more jobs than the economy will create, or will we remain close to full employment? An incalculable amount of analysis and opinion has been written on this question, and while it seems like a straightforward one, it is devilishly complex. That is why survey after survey of technologists, economists, and futurists show that they are almost evenly split on the answer to this “simple” question.

…

From 1900 to 1950, probably half the jobs vanished, mostly in farming. From 1950 to 2000, another half, many of which were manufacturing. And most, if not all, of this disruption was caused by technology. To believe that technology is a net destroyer of jobs, one must explain the fact that all this disruption happened during a period of full employment, rising gross national product, and rising wages. (The Great Depression, a decade that defies the trend, was not caused by technology, but rather by macroeconomic forces.) But was the twentieth century in the United States anomalous? If we look beyond our own shores, one way to tackle the question is to compare places with lots of robots to places without them.

…

If the answer to that is yes, which I emphatically believe, then we want all new jobs to be created at the top, so that everyone gets a chance to move up a rung on the ladder of success. Possibility Three: The Machines Take None of the Jobs Possibility three is that the machines, on net, take none of the jobs and that we will remain at essentially full employment. Recalling our earlier foundational questions, those who identify with possibility three have many of the same assumptions as those who identify with possibility two. Dualists can readily identify with this view, as can those who see the “self” as either an emergent property or the soul, something that would be difficult to reproduce mechanically.

American Made: Why Making Things Will Return Us to Greatness
by Dan Dimicco
Published 3 Mar 2015

Government can encourage all of this without picking winners and losers or taxing less-favored sources of energy out of existence. Spurring energy development must go hand in hand with revitalizing American manufacturing. As DiMicco explains in chapter 10, creating real wealth is the only path back to full employment. There are some signs of a manufacturing renaissance in the United States, owing to a growing disenchantment with China and the natural gas boom here at home. But it’s early yet. In order for that nascent renaissance to reach full flower, DiMicco says state and federal governments must unburden business and manufacturing from the regulations and permitting hurdles that have been pouring down on them for years.

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I know people who look at the economic landscape and say, “Well, that’s it. Game over.” That kind of fatalism isn’t helpful. No problem is unsolvable. It’s time to de-emphasize the extremes and return to the fundamentals of creating, innovating, making, and building things. It’s the only road that leads back to full employment in the United States, and it’s the path Nucor has been following for almost 50 years. Nucor and companies like ours have created real wealth, not phony bubble wealth. Accelerating a Manufacturing Renaissance If the United States is going to escape the cycle of bubbles and resolve its systemic economic problems, the nation must choose to close the national infrastructure deficit and cultivate an energy revolution with natural gas as the road to travel.

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Myers, 173 Carnegie, Andrew, 7, 74–75, 78 Carter, Jimmy, 54, 58 Caterpillar, 59, 70, 95 China accountability and, 117–19 “Buy American” and, 136–37 currency manipulation, 101, 107 economic growth, 63–72, 99–100 environment and, 195, 198, 209–10 free trade and, 13, 96, 99–107, 135 impact on international trade, 30, 63–74, 88, 117, 192–93, 213–18, 220–21 infrastructure and, 162, 166, 170 innovation and, 114, 116–17 intellectual property and, 117 Kyoto Protocol and, 195 labor costs and, 64 manufacturing and, 17, 158, 205–6 regulation and, 147–49 skills gap and, 122, 125 space program, 52 steel industry and, 109 U.S. stimulus and, 95, 135–37, 145 WTO and, 216–18 Clean Air Act, 174, 209 Clean Water Act, 174, 209 Clinton, Bill, 65–67, 140 Cold War, 45, 63 construction sector, 2, 15, 33–34, 72, 75, 85, 89, 102, 104, 131–36, 155, 157, 169, 171–74, 178, 197, 202, 221 Consumer Electronics Association, 114 copyright, 119, 213 counterfeiting, 214 Dana, Charles, 4 Datong, 118 DiMicco, Dan, 3–19 direct reduced iron (DRI), 154, 156, 158, 186, 192–93, 222 Dodd, Chris, 180 Duke, Mike, 22 Durbin, Dick, 36 Eagle Ford shale formation, 197 economic crisis Americans leaving labor force, 26 importants statistics, 25–33 lessons learned, 39–41 overview, 21–25 path to full employment, 28 political leadership and, 35–39 real unemployment rate, 29 sectors that need jobs, 33–35 youth unemployment and student debt, 31 education author and, 5 Bush and, 23 career and, 30 Eisenhower and, 45 government spending and, 93, 124, 196, 212, 227 Kennedy and, 48 manufacturing and, 212 National Defense Education Act, 45 skills and, 14, 48, 79, 124–32 U.S. public schools, 14, 45, 48, 79 see also student debt Eisenhower, Dwight, 45, 47, 164 Emanuel, Rahm, 23, 140 energy resources “all of the above” strategy, 169, 190–95 costs and benefits, 196–99 domestic production of, 87, 89 government policy and, 17–18, 39 green energy, 143–47, 157 job creation and, 157 natural gas production, 90, 184 overview, 183–90 steel and, 103 trade deficit and, 87 U.S. oil production, 185 Enron, 12, 77 Environmental Protection Agency (EPA), 152–53, 156 Evans, Don, 110–11 Farouk Systems, 214 federal budget deficit, 11, 21–22, 83, 133 Feinstein, Dianne, 36–37 fiscal cliff deal, 40, 83, 88, 141, 226 Forbes, 9, 83, 197 Ford, Gerald, 54, 58 Ford, Henry, 4 Ford Motor Company, 97, 130 free trade, myth of impacts of China’s currency manipulation, 101 need for government-to-government solutions, 109–12 overview, 93–95 standing up to cheaters, 107–8 why free trade doesn’t work, 96–107 General Agreement on Tariffs and Trade, 102, 106 General Electric, 26, 46, 49, 59, 95, 114, 146 General Motors, 37, 130 Gospel of Wealth, The (Carnegie), 74–75 Great Depression, 47, 55, 134, 164 Great Recession areas hardest hit by, 122 causes of, 203 effect on US economy, 1–2 global impact of, 11 Nucor and, 8 Obama and, 2, 22–23, 191–92 green energy, 143–47 see also energy resources Greenpeace, 191 Hagel, Chuck, 180 Hazeltine, Barrett, 48–49 health care, 22–23, 34, 140–41, 181, 196 Hoover Dam, 164 housing bubble, 12, 76, 121, 132, 203 Hutchison, Kay Bailey, 180–81 I-Bank, 180 see also infrastructure Immelt, Jeffrey, 114 infrastructure China and, 162, 166, 170 expediting spending on, 72–74 global competitiveness of US, 165 job creation and, 169 national infrastructure bank, 178–81 needs, 168–71 overview, 161–68 paying for improvements, 175–78 return on spending, 163 state vs. federal spending on, 176 innovation, myth of areas hit hardest by Great Recession, 122 education and training, 124–32 jobs in innovative industries compared to manufacturing, 115 Kindle’s impact on US trade deficit, 118 overview, 113–19 skills gap myth, 120–23 irrational defeatism overview, 81–88 realism vs. mythology, 88–91 Iverson, Ken, 7, 9, 62, 78, 222, 223–25 Jarrett, Valerie, 22 Jindal, Bobby, 155–56 job-training programs, 123, 130 John Deere, 95, 130 Jordan, Jim, 151 Kaiser, Henry, 4 Kellogg-Briand nonaggression pact of 1928, 106 Kennedy, John F., 44–48, 52 Kerry, John, 38, 180 Keystone XL pipeline, 192 Kindle, 117–18 see also Amazon Kozlowski, Dennis, 76 Krywko, Mark, 213 Kyoto Protocol, 148, 195 Lay, Ken, 76 layoffs, League of Nations, 106 Lehman Brothers, 43, 76 liquefied natural gas (LNG), 187–88 Locke, Gary, 114 Madoff, Bernie, 76 manufacturing sector accelerating a manufacturing renaissance, 204–7 accountability and, 219–20 anti-dumping initiations since 1999, 217 economic multiplier of, 202 fostering innovation in, 220–23 overview, 201–4 relationship between government and business, 208–12 risk and, 223–27 signs of renaissance, 212–18 tax rates by country, 211 Mars, 43–44, 52 see also NASA; space exploration Marshall Plan, 54, 56, 134 McCain, John, 143, 167 McDonald’s, 84 McKinsey, 84, 121 Medicare, 21 mercantilistic policies, 14, 65, 68, 99–102, 107, 198, 217 Mexico, 17, 66, 95, 190, 198 multiplier effect, 137–38, 190, 202, 207, 216 myths that distract us American industrial policy, 156–59 “Buy American,” 136–37 federal spending, 133–35, 140–42 infrastructure, 138–40 Nucor’s experience in Louisiana, 153–56 overview, 133–40 regulation, 147–53 stimulus and green jobs, 143–47 see also free trade, myth of; innovation, myth of NASA, 5, 44, 46, 49–52 see also Mars; space exploration National Defense Education Act, 45 Nissan, 54 Nixon, Richard, 54, 58 North American Free Trade Agreement (NAFTA), 66 Nucor, 3–10, 15, 18, 51, 54, 61–63, 77–80, 82, 84, 103, 110–12, 127–30, 134, 145, 151, 153–56, 158, 165, 186, 189, 192–93, 204, 209, 219, 221–27 Obama, Barack attempts to fix US economy, 22–26, 38, 143, 150 China and, 106–7 conflict with business leaders, 150 economic stimulus, 15, 93, 134–35, 172 education and, 127 energy exports and, 187–88 exports under, 40 Great Recession and, 2, 22–23, 191–92 green energy and, 145–46, 191 infrastructure projects and, 172, 174, 180–81 innovation and, 114 international trade and, 95, 106–7 Keystone XL pipeline and, 192 NASA and, 51–52 private industry and, 219–20 regulation and, 157 skills gap and, 120 unemployment numbers and, 26, 39–40, 93, 114 OECD, 211 O’Neill, Paul, 110 O’Neill, Tip, 59 Palin, Sarah, 167 patents, 117, 119, 213 Plaza Accord, 58–63, 108 Procter & Gamble, 105 Reagan, Ronald, 47, 59–60, 63–65, 108 Reid, Harry, 36 Republican Party “Buy American” and, 95 economy and, 38–39, 86, 141, 144 government spending and, 11, 133 infrastructure and, 167, 181 national debt and, 11, 35–36 regulation and, 151 stimulus and, 86, 91, 93, 95 Rockefeller, John D., 74 Rocketdyne, 46 Romney, Mitt, 88, 107, 120, 191 Russia, 45, 47, 51, 95, 102, 116, 135, 147 Schultz, Howard, 22 Schumer, Chuck, 36–37 Schwarzenegger, Arnold, 136, 143 Seidenberg, Ivan, 22 September 11, 2001, 23–24 sequester, 40 service industry, 10, 12, 15, 18, 33–37, 51, 76, 89, 127, 203 shale, 17, 39, 157–58, 183–85, 189, 191, 194, 196–97, 199 Shami, Farouk, 214 Shapiro, Gary, 114 Sharan, Sunil, 146 Sierra Club, 191, 193 Sleek Audio, 213 Smith, Adam, 65, 101–2 Social Security, 24, 32 space exploration Apollo program, 46 Cold War and, 45 history of, 43–47 inspiring a generation, 48–52 Kennedy and, 44–46 Obama and, 51–52 public-private partnerships and, 46–47 Soviet Union and, 45–46 see also Mars; NASA Sputnik crisis, 45, 116 Stahl, Leslie, 94–95 Starbucks, 22 steel industry “Buy American” and, 135–36 Carnegie and, 7, 74 China and, 102–4, 118, 218 energy and, 186–88, 192 flat-rolled, 9 infrastructure and, 90, 139 innovation and, 221 international trade and, 14, 58, 95–97, 102–4, 109, 218–19 irrational defeatism and, 84–85 Nucor and, 3–10, 51, 62–63, 82, 145, 153–56, 186, 221–24, 226 Plaza Accord and, 62 regulation and, 145, 149, 153–54 Republic Steel, 5, 50 skills gap and, 125, 128–30 stimulus and, 135–36, 139 U.S. manufacturing and, 3, 6, 109–12 Vulcraft and, 7 WTO and, 219 Yamato Steel, 221 stimulus “Buy American” and, 94–95, 135–37 China and, 95, 135–37, 145 failures, 15, 134–35 green initiatives and, 35, 143–47 infrastructure and, 93–95, 166, 172 passage of, 15 politics of, 91, 134 Republican Party and, 86, 91, 93, 95 subsidies, 35 taxes and, 94–95, 135, 137–38 unemployment and, 93–94, 146 student debt, 30–32 Summers, Larry, 114 tariffs, 60, 63, 67, 96, 98, 102, 106, 111, 206 taxes Bush and, 23 environmental issues and, 145, 148–50 federal government and, 73–74 fiscal cliff deal and, 226 free trade and, 96 gas tax, 176–77 Great Recession and, 83 infrastructure and, 90–91, 163, 173–76 innovation and, 86, 180, 220–21 international trade and, 68–69, 71, 96, 100, 102, 117, 205 manufacturing sector and, 68–69, 86, 204, 210–12, 220 politics and, 36, 93 public-private partnerships and, 46–47 revenue from, 19, 40, 46, 140, 155, 183, 196–99 stimulus and, 94–95, 135, 137–38 tax credits, 86, 145, 221 tax cuts, 23, 36, 93 tax rates by country, 211 Tianrui, 118 Toyota, 37, 54, 60 Trumka, Richard, 135 unemployment age and, 30–32 construction sector and, 2 decline in, 2, 27 education and, 30–31, 127 energy sector and, 196 Great Recession and, 3, 22, 25–30, 36, 93–94, 122 innovation and, 114 measuring, 25–27 politics and, 39, 212 real unemployment rate, 29, 39 skills and, 85, 205 stimulus and, 93–94, 146 student debt and, 30–31 see also job creation United Nations, 106, 198 U.S. foreign trade adult conversation, 56–58 changes in global manufacturing and, 57 China’s impact on, 63–72 competitive advantages, 72–74 growth of financial sector, 75 low labor costs and, 64 Plaza Accord, 58–63 public view of, 53–54 real wealth and its opposite, 74–80 US foreign aid and, 55–56 U.S.

Liberty's Dawn: A People's History of the Industrial Revolution
by Emma Griffin
Published 10 Jun 2013

But women had very few opportunities to improve their income and prospects outside the mills, 4017.indd 96 25/01/13 8:21 PM women, work and the cares of home 97 even in the factory heartlands. No doubt dressmakers had brighter prospects in the large industrial towns than those living in the country, but needlework still remained a fragile industry with poor prospects for full employment throughout the year. The opportunities for women seeking to make money by doing other people’s washing and cleaning were also likely to be good in large towns and cities, but the low pay meant that even though finding employment was easier, the benefit of that employment was in reality very small.

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Little surprise, then, that so many married women stayed out of the workplace altogether. It all poses something of a puzzle. It is undeniable that much more work was available in the cities than in the country. This was why the population was migrating towards the towns. This was why many adult men were starting to enjoy full employment and taste all the benefits that came with it. This was why children were being hustled into the workplace at ever younger ages. Yet married women did not move into the workforce en masse to take advantage of these opportunities. As the chance of earning a good wage improved, families clung more tightly to the traditional model of a breadwinning husband and a homemaking mother.

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As he wrote in his vernacular way, when he first started attending the chapel at Bramley he was puzzled by some of the Baptists’ customs, but ‘reading for myself in the [Bible], i found it to be true . . . i agreed with their doctrines such as original sin, regeneration by grace, Baptizam and the Lord Suppor, free justification and adoption, the final perseverance of real believers, the eternal happiness of the rigteous and so on’.49 The extent to which the evangelical movement drew in even those with the most impoverished backgrounds is truly striking. Night schools and mutual improvement classes were in theory open to all. In reality, those who took part were usually at some remove from poverty. Most were in full employment and those working in urban and skilled trades were considerably more at home in such institutions than unskilled or agricultural workers. It is undeniable that the Nonconformist churches were also popular with respectable working men following an upward trajectory. But there, sitting in the pews beside them, were men and women whose trajectory was heading anywhere but upwards.

Unequal Britain: Equalities in Britain Since 1945
by Pat Thane
Published 18 Apr 2010

Age 65 in 1970: ● Born 1905, when there were still high levels of poverty ● Left school aged 12–14, in the midst of the Depression ● University attended by 1.8 per cent of age group, but this opportunity was 80 per cent lower if female ● If male, probably fought in World War II; if female, fewer pregnancies than for previous generations and a falling birth rate ● Gained in later life from post-war full employment, NHS, improved housing (probably rented), pensions, better opportunities for children, more leisure, perhaps first holidays abroad ● Average life expectancy at age 65: men 77 years, women, 81 years. Age 65 in 2000: ● Born 1935 ● Early years dominated by economic Depression and war then, postwar, full employment, improved education and health ● Left school aged 15 or older; 5.4 per cent attended university (female opportunity to attend university still 75 per cent lower) ● Married and had children in early 20s; increased risk of divorce, triggering poverty for women ● Increased opportunity for home ownership ● More likely than previous generations to be in service industry than heavy industrial employment; possibly unemployed during 1980s ● Average life expectancy at age 65: men 81 years, women 84 years. 24 U N E Q UA L B R I TA I N Age 65 in 2040: ● Born 1975 ● Possibly experienced family unemployment in early years ● Left full-time education aged 16–21; 40 per cent attended university, 50 per cent of students female ● Married/partnered/and had children (if any) in 30s ● High mortgage, student debt, unlike previous generations ● Probably skilled white-collar job.

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The chapters that follow should be read in the context of key aspects of change in Britain since 1945: 4 ● ● ● ● ● U N E Q UA L B R I TA I N Population — 1945 to early 1970s: high birth rate compared with the periods immediately before and after; falling death rate; high marriage rate and low divorce and ‘illegitimacy’ rates; rising immigration, first from Europe then from the Commonwealth — early 1970s to the present: falling birth rate; falling marriage rate; rising divorce and ‘illegitimacy’ rates; increasing life and health expectancy; substantial immigration from the Commonwealth, then increasingly from other European countries and from crisishit countries worldwide. Work — 1945 to 1970s: full employment (for men); high but falling levels of industrial employment; increasing female employment, a large proportion of it part-time — mid-1970s to present: decline of heavy industry; increased service employment, on a spectrum ranging from low-paid (such as fast-food and call-centre industries) to high-paid work (such as financial services) — early 1980s to mid-1990s: high unemployment, particularly among men, older workers and some minority ethnic groups — 1980s to present: increased hours of work and of reported stress at work, but not the extreme shift away from the ‘job for life’ towards short-term contracts often assumed, except in a few sectors;1 steadily expanding range of employment open to women (although much of it still part-time) and members of some minority ethnic groups, but still with inadequate pay, promotion and training opportunities; unemployment rising again in 2008–9.

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Issues of particular interest to women, such as work–life balance, equal pay, maternity and paternity leave, child care, and domestic violence have become more central to political debate, championed by senior Labour women such as Tessa Jowell, Margaret Hodge, Harriet Harman and Patricia Hewitt. CONCLUSION 69 The changed position of men in the workplace and the home since the 1940s has influenced gender roles and relationships. Broadly, from the late 1940s to the 1970s, male full employment, high marriage rates and the tendency of married women to take time out of the workplace to care for children, followed by part-time employment, reinforced the already strict gender division of labour in and outside the home. The restructuring of the labour market in the 1980s polarized male (and full-time female) workplace experiences between unemployment and ‘over-employment’, with increasing hours and workplace stress, while in some areas more women than men could find paid employment.

Inequality and the 1%
by Danny Dorling
Published 6 Oct 2014

There should be an end to the practice, used even by government, of forcing workers to reapply for their own jobs at a reduced rate of pay. People in power often suggest that, as the demand for labour falls, full employment can be maintained by reducing real wages – for example, by ensuring that any wage increases are less than the rate of inflation. But the wage level at which this full employment is achieved does not necessarily allow human dignity, or even survival. Also, as real wages fall, those who are still employed spend less. Good jobs become scarcer. Simultaneously hate crime and other forms of violence increase.

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Making the elderly work until they die is not good for their health. Keeping the young out of decent work is not good for their health. People should be able to choose to work and to retire when they want to. Being forced to work is a recipe for bad work, and at the extreme is slavery. We need to realise that we only achieved full employment when we had a far more equitable distribution of wages and salaries and people had choices over what work they did. That condition of equity may have emerged out of war, but it was maintained for decades by government policy. However, as businesses become increasingly automated, the downward trend in employment will continue.

Postcapitalism: A Guide to Our Future
by Paul Mason
Published 29 Jul 2015

Somewhere else, out of the limelight, you will come across people picking up the pieces: food banks run by churches and charities; Citizens’ Advice Bureaux whose main business has become advising those swamped by debt. Just one generation earlier these streets were home to thriving real businesses. I remember the main street of my home town, Leigh, in northwest England, in the 1970s, thronged on Saturday mornings with prosperous working-class families. There was full employment, high wages and high productivity. There were numerous street-corner banks. It was a world of work, saving and great social solidarity. Smashing that solidarity, forcing wages down, destroying the social fabric of these towns was done – originally – to clear the ground for the free-market system.

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For the entire period between 1870 and 1950 it had averaged 1.3 per cent.5 Real incomes soared: in the USA, the majority of households saw their real incomes rise by more than 90 per cent between 1947 and 1975;6 in Japan the average real income increased a staggering 700 per cent.7 Across the developed world, the new techno-economic paradigm was clear – even if each country had its own version. Standardized mass production – with wages high enough to drive consumption of what the factories produced – was unleashed across society. There was male full employment and, subject to cultural variations, increased employment of teenagers and women once the reconstruction phase was over. In the developed world, people moved from the land to the factories in large numbers: between 1950 and 1970 the agricultural workforce in Europe declined from 66 million to 40 million; in the USA it collapsed from 16 per cent of the population to just 4 per cent.8 The most frenetic period of growth in human history was bound to produce glitches.

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There are clear signs of a productivity slowdown in the pre-1973 data, and of a fall in the ratio of output to capital invested.25 Productivity, as a counter-tendency to the downward pressure on profits, ran out of steam. But as conditions tightened, the sheer strength of working-class bargaining power in countries with full employment and no will to break the post-war social contract made wage cuts a non-starter. Rather, managers were forced to increase wages and non-wage benefits, while reducing working hours. As a result, a ‘profit squeeze’ kicked in. Comparing profit rates for America, Europe and Japan in 1973 to their respective peak years during the boom, Andrew Glyn found that in each case they had fallen by one-third.

The Future of Money
by Bernard Lietaer
Published 28 Apr 2013

This amounted to a straight denial of the reality of the actual service rendered for free. 'The old measures of GNP were still confusing crude growth with smart and wise growth. The Information Age objective of 'Full Potential" has now replaced the Industrial Age idea of “ full Employment". 'Full Potential" refers to the use of someone's leaning capacity end the opportunity fully to develop one’s gifts. Just as was the case with Full Employment, one can never reach 100% of the Full Potential for a population. 'In retrospect, it was only by liberating me extraordinary potential of human creativity, of all humans, that then was any hope for Planet Earth. Human creativity " something, which in past generations was the privilege of only a tiny minority: a few artists, scientists and some other members or the intelligentsia.

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Such levels of unemployment are unprecedented since the Treaty of Rome created the European Common Market in 1958. For several countries including Germany the current level is even the highest since the Depression of the 1930s. Furthermore, there is a growing consensus that this unemployment situation will not be solved through economic growth. 'Full employment can no longer be taken for granted as the automatic outcome of growth-creating economic policies' concludes a European green paper. A French study showed that even the high post-war rates of growth of 5% resulted in an annual employment increase of just 0.2%, and that this trend for jobless growth is getting stronger over time.

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Each government participating in the EMU is giving the levers of control over the euro money supply to the European Central Bank. The ECB will by definition be less responsive to the requirements of any one country's unemployment situation. 2. The Maastricht Treaty gives the ECB a single objective: to ensure price stability. Full employment is specifically not one of its official priorities. 3. Finally, the only other traditional tool available - the fiscal one has similarly been put under severe constraints. The maximum limit of 3% of government deficit financing is supposed to be a permanent one and most governments are adopting the euro with their spending at or dose to this straitjacket target limit.

The Ministry for the Future: A Novel
by Kim Stanley Robinson
Published 5 Oct 2020

The specific principal tasks that central banks were charged with could no longer be fulfilled if the climate emergency got out of hand. In other words, central banks would fail in their principal tasks if they did not save the civilization that had charged them with those tasks. And although it was true that full employment would always remain a key objective for them, she finished, it wasn’t such a victory if the remnant of humanity that survived the crash ended up working as scavengers and peasant farmers. That wasn’t the kind of full employment that the world had in mind when central banks were created. She saw that Yablonski and the Europeans were offended at this final sarcasm, and she pondered for a moment simply shouting suddenly in their faces, or taking her shoe off and pounding the table Khrushchev style.

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In fact, at the end of the agreement they all lent some fiat money of the ordinary kind, pooled into a fund administered through the BIS, which would be enough to pay for this new bureaucracy of verification that would have to be created to certify that carbon was really being sequestered. This was a bureaucracy so vast no single bank could afford it, nor of course the ministry, not even close. It was almost a full employment plan all by itself. So it was a total program. Mary’s team wrote it up in detail, in consultation with the bankers on hand and their staffs, taking all their suggestions and folding them in, and then in the end, after each bank had consulted with its government back home, they announced it, and offered the first tranche of carbon coins for purchase.

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Wilson’s great books shot to the top of the non-fiction bestseller lists, and we could continue the work with more understanding and public support. On to the Half Earth! 73 Modern Monetary Theory was in some ways a re-introduction of Keynesian economics into the climate crisis. Its foundational axiom was that the economy works for humans, not humans for the economy; this implied that full employment should be the policy goal of the governments that made and enforced the economic laws. So a job guarantee (JG) was central to MMT’s ideas of good governance. Anyone who wanted a job could get one from the government, “the employer of last resort,” and all these public workers were to be paid a living wage, which would have the effect of raising the private wage floor also to that level, in order to remain competitive for workers.

How to Change the World: Reflections on Marx and Marxism
by Eric Hobsbawm
Published 5 Sep 2011

The advance of both during and after the Second World War seemed, at least in Europe, to require from governments and employers alike a counter-policy of full employment and systematic social security. 412 Marx and Labour: the Long Century But the USSR no longer exists, and with the fall of the Berlin Wall capitalism could forget how to be frightened, and therefore lost interest in people unlikely to own shares. In any case, even the spells of mass unemployment in the 1980s and 1990s seemed to have lost the old power of radicalising their victims. However, it was not only politics but also the economy that proved to require reformism and especially full employment after 1945 – as both Keynes and the Swedish economists of Scandinavian social democracy had predicted.

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Elsewhere communist parties between the wars scored a maximum of 6% of votes (Belgium, Norway, Sweden), and even that only briefly. After the Second World War the symbiosis was pursued more systematically as part of a policy of structural reform of Western capitalism by means of the deliberate policy of full employment and what became the welfare state, and on the basis of the massive advances of the capitalist economies in the post-1945 decades (1947–73). Would this conscious attempt to integrate labour have emerged without the traumatic experiences of the great inter-war depression and the rise of Hitler’s Germany?

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Even before World War One the policies of the ruling classes, faced with growing political democratisation (accelerated by pressure from the new labour parties), had begun to shift 408 Marx and Labour: the Long Century towards social reform. In the non-fascist countries this process was accelerated between the wars, but it did not become systematic until after the Second World War, under the slogans ‘full employment’ and ‘the welfare state’. Even before 1914 democratisation and economic growth encouraged an open recognition of the value of moderate labour movements, though imperial Germany remained a major exception. In consequence, labour movements and parties became in practice identified with their nation-states.

Money: 5,000 Years of Debt and Power
by Michel Aglietta
Published 23 Oct 2018

To conform to the collective norms that prevail in democratic nations, and thus to allow money to enjoy ethical confidence, economic policy must respect three principles: a guarantee principle that maintains the stability of finance and of money’s purchasing power; a growth principle that preserves sustainable full employment (potential growth); and a principle of justice that establishes an acceptable level, relative to the nation concerned, of income redistribution, of risks, and of access to credit. THE PAYMENT HIERARCHY IN NATIONAL MONETARY SYSTEMS National payment systems are networks of interlocking networks.

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On the one hand is the Anglo-Saxon, Keynesian macroeconomic regulation (excepting the short ‘monetarist’ period of the 1980s). On the other is German ordoliberalism (Table 4.3). Table 4.3 Contemporary monetary doctrines Anglo-Saxon Keynesianism German ordoliberalism Dominant principle Growth (full employment) Justice (welfare state) Stability guaranteed by civic rules Social-market economy Assumptions regarding social cohesion Finance is chronically unstable because capitalism is traversed by social conflicts that the markets are unable to regulate. The market system is able to regulate the economy, on condition that it is structured by an order of public rules that will protect civil society from any arbitrary power.

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Various structural factors influenced choices over monetary regulation: the existence or otherwise of developed public debt titles markets; the degree of protection of the banking system, and thus its solidity faced with the risk of insolvency; the predominance of intermediated financing or recourse to capital markets; the extent and tightness of exchange controls; and the explicit regulation of interest rates by the authorities, as well as their implicit regulation by the banking oligopoly. These were nationally separate systems of limited openness. Within these systems, monetary policy was a backup for an economic policy seeking firstly to achieve full employment, and secondly to stabilise the balance of payments. Price stability was only considered in relative terms: for the most open countries it had to be made competitive with inflation in other countries, while for the largest countries – first of all the United States – it was considered in terms of arbitrating between inflation and underemployment.

How to Be a Liberal: The Story of Liberalism and the Fight for Its Life
by Ian Dunt
Published 15 Oct 2020

Government was no longer viewed as simply a threat, or just as a nightwatchman overseeing national security. It now had a more general and active role to help and protect people. Keynes’ insistence that the government had a duty to maintain full employment was accepted around the world. The Australian premier, John Curtin, introduced a ‘full employment in Australia’ programme in 1945. In Britain, the wartime coalition established full employment and a full welfare state as national goals. A National Health Service was established after the war, which would help anyone, for free, at any time, to treat any condition. It was one of the most daring, radical inventions in British political history and became the UK’s most cherished institution.

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It then spread quickly outward and converted more followers. By the time the Second World War was over, the age of laissez-faire had passed with it. One of the oddities of Keynesianism was just how influential it proved to be. In the strict sense, it was no more than a programme for ensuring demand during a downturn, through a commitment to full employment. Once that period of instability was over, things would go back to normal and, in Keynes’ words, ‘the classical theory comes into its own again from this point onwards.’ But the political effects of Keynesianism went much further. It established the principle that the market did not always reach equilibrium.

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See European Union (EU) EU referendum campaign and result 1 government response and May 1 Johnson as prime minister 1 Trump and nationalism 1 euro 1 European Central Bank (ECB) 1, 2, 3, 4 European Coal and Steel Community 1 European Convention on Human Rights (ECHR) 1, 2 European Court of Justice 1, 2, 3 European Economic Community 1 European Parliament 1 European Union (EU) Charter of Fundamental Rights of the European Union 1 EU citizens 1 EU referendum 1 Greece financial crisis 1 Hungary and Orbán 1, 2 institutions 1 migrants and refugees 1 origins 1 post-war cooperation 1, 2 Russia and Ukraine 1 Troika programmes 1, 2 UK leaves 1 eurozone 1, 2, 3 Evergreen State College 1 Exclusion Crisis 1, 2, 3, 4 executive power 1, 2, 3, 4 Exhibit B show 1 experts 1, 2, 3 Facebook 1, 2, 3, 4, 5, 6, 7, 8, 9, 10 Fairfax, Thomas 1, 2, 3, 4, 5, 6, 7 A Remonstrance from his Excellency Sir Thomas Fairfax 1 fake news 1 family separation policy 1 Fannie Mae (Federal National Mortgage Association) 1 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general will 1, 2, 3, 4, 5 Generation Identity 1 generation snowflake 1 German Workers’ Party 1 Germany Austria-Hungary alliance 1 First World War 1 Greece financial crisis 1 interwar economy 1 migrants and refugees 1 Nazi rule 1, 2 post-war cooperation 1 Second World War 1 welfare state 1 Gestapo 1, 2 Gingrich, Newt 1, 2 Ginnie Mae (Government National Mortgage Association) 1 Girondins 1, 2, 3 Glass-Steagall Act 1, 2, 3 gleichschaltung 1 Glorious Revolution 1, 2, 3, 4 Google 1, 2, 3 Gove, Michael 1, 2, 3 government American independence 1 debt and austerity 1 financial crisis measures 1 and institutions 1 legitimate government 1 Locke on 1, 2, 3, 4 post-war Keynesianism 1, 2, 3 Smith on 1, 2 Government Sponsored Enterprises (GSEs) 1 Gramm–Leach–Bliley Act 1 Great Depression 1, 2, 3, 4, 5, 6, 7, 8, 9, 10 Greater London Council 1, 2, 3 Great Terror, Russia 1 Greece 1, 2, 3, 4, 5 Greenspan, Alan 1, 2 group identity 1, 2, 3, 4, 5, 6, 7, 8 Guatemala 1 Guérin, Jules 1 guillotine 1, 2, 3, 4 gulags 1, 2, 3, 4 Gyurcsány, Ferenc 1 haircuts (finance) 1, 2 Haiti earthquake 1 half-truth 1, 2 Hall, Stuart 1 Hamilton, Gene 1 Handsworth riots 1 Hannity, Sean 1, 2 Hardenberg, Charlotte von 1 Hardy, Henry 1 harm principle 1, 2, 3, 4 Hayek, Friedrich Capital Consumption 1 on communism end 1 Constitution of Liberty 1 death of 1 economic thought 1 and Keynes 1 on Mill and Taylor 1, 2 Nobel Prize 1 post-war economics 1, 2, 3 The Road to Serfdom 1 state intervention 1, 2, 3 Hayek, Laurence 1 Heads of Proposals 1, 2, 3 health care 1, 2, 3, 4 health tourism 1 Heart of Texas 1 Hébert, Jacques 1, 2, 3 Hébertists 1, 2 Henry, Major Hubert-Joseph 1, 2 Herder, Johann Gottfried von 1 heresy 1, 2, 3, 4, 5 higher and lower pleasures 1, 2 higher self 1 Himmler, Heinrich 1, 2 Hitler, Adolf 1, 2, 3, 4, 5, 6, 7, 8, 9 Hobbes, Thomas 1 Leviathan 1 Holdheim, William 1 Hollander, Jacob Harry 1 Holocaust 1, 2 Holodomor 1 home ownership 1 homophobia 1, 2 homosexuality 1, 2 Hostile Environment 1, 2, 3, 4, 5 House of Commons 1, 2, 3, 4, 5, 6 House of Lords 1, 2, 3 House of Representatives 1 housing 1, 2, 3 Howard, Michael 1 Huber, Ernst Rudolf 1 human rights 1, 2, 3 Hume, David 1 Hungary 1, 2 hyperinflation 1, 2, 3 hypertext 1 hypotheses 1 identity cultural appropriation 1 cultural identity 1, 2 cultural relativism 1 group identity 1, 2 identity and belonging 1 national identity 1, 2, 3, 4, 5, 6 nationalism 1, 2 Orwell on patriotism 1, 2 identity cards 1 identity politics cultural appropriation 1 culture war 1 difference 1 disagreement 1 group identity 1, 2 intersectionality 1, 2 marginalised groups 1, 2 origins 1 right-wing identity politics 1 social media 1 identity war 1, 2 Ignatieff, Michael 1 IMF (International Monetary Fund) 1, 2 immigration EU referendum 1, 2 France anti-semitism 1 Hungary and Orbán 1 liberalism of the future 1 nationalism 1, 2, 3 right-wing identity politics 1, 2, 3 UK policy 1 US policy 1, 2 imperialism 1, 2, 3 incommensurable goods 1, 2 Independents (English Civil War) 1, 2 individual Berlin on 1, 2 communism and fascism 1, 2, 3, 4 Constant 1, 2, 3, 4, 5 Descartes 1, 2, 3, 4 identity 1, 2, 3 invention of teenager 1 Keynesianism 1 Levellers 1 liberalism 1, 2, 3 Locke 1, 2, 3 Marxism 1, 2 Mill 1, 2, 3, 4, 5 nationalism 1 Orwell 1, 2 Overton 1 Puritans 1 and reason 1 Smith 1 individualism 1, 2, 3, 4, 5 individual rights 1, 2, 3, 4, 5, 6, 7, 8, 9 industrial revolution 1, 2 inflation 1, 2, 3, 4, 5, 6 information flow 1, 2, 3 Instagram 1, 2, 3 institutions 1 Intellectual Dark Web 1 intellectual property 1 interest rates 1, 2, 3 internal emigration 1 International Brigades 1 international law 1 International Monetary Fund (IMF) 1, 2 international relations 1 internet 1, 2, 3 intersectionality 1 investment banks 1, 2, 3, 4, 5 invisible hand 1, 2, 3, 4 Iraq 1, 2, 3 Ireland 1, 2 Ireton, Henry 1, 2, 3, 4 Islam 1 Italy 1, 2, 3, 4, 5, 6, 7 Jacobins 1, 2, 3, 4, 5, 6, 7 James II 1, 2, 3, 4, 5, 6, 7 Japan 1 Javid, Sajid 1, 2 Jehovah’s Witnesses 1 Jews anti-semitism 1, 2, 3 Berlin’s identity 1, 2 Dreyfus Affair 1, 2 Germany 1, 2, 3 group identity 1 Levellers 1 right-wing identity politics 1 Second World War and Holocaust 1 St Louis ship 1 Johannot, Marie-Charlotte 1 Johnson, Boris 1, 2, 3, 4 Johnson, Lyndon 1 journalism 1, 2, 3, 4 Joyce, George 1 JP Morgan 1, 2 judiciary 1, 2 Juncker, Jean-Claude 1 justice 1, 2 Kant, Immanuel 1 Kennedy, John F 1 Keynes, John Maynard The General Theory of Employment, Interest and Money 1 and Hayek 1, 2, 3 post-war economics 1, 2, 3, 4, 5 state intervention 1 Time Man of the Year 1 death of 1 Keynesianism 1, 2, 3, 4 Khader, Naser 1 knowledge 1, 2 Kogon, Eugen 1 Komsomol 1 Kosinski, Michal 1 Krugman, Paul 1 Kruks, Sonia 1 Kukathas, Chandran 1 kulaks 1, 2 Kurdi, Alan 1, 2 Kymlicka, Will 1 labour 1, 2, 3 Lagarde, Christine 1, 2 laissez-faire austerity measures 1 communism 1 Constant 1, 2 financial crisis 1 Hayek 1, 2 inflation policy 1 liberalism 1, 2, 3, 4, 5 Mill 1, 2, 3, 4, 5 post-war economics 1, 2, 3 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After the New Economy: The Binge . . . And the Hangover That Won't Go Away
by Doug Henwood
Published 9 May 2005

The lead designers of the fixed exchange rate system, John Maynard Keynes firom Britain and Harry Dexter White from the United States, thought it important to insulate countries fi-om the pressures of international capital markets. Quaintly, the 220 After the New Economy point of national economic policy was thought to be the encouragement of full employment, and, in the eyes of Keynes and White, free international capital movements would undermine such poUcies. To financiers, the full employment policies are frequently equated with inflation, and any country pursuing such poUcies in a world of HberaHzed finance would be punished with capital flight. There was intellectual opposition to the system from the free-market right, which hated the idea of state-specified exchange rates taking precedence over market-determined ones, and some grumbHng from Wall Street and the City of London, but those forces were pretty marginal in the 1950s and early 1960s.

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What had changed structurally, aside from permanent war mobilization, was the growth of the welfare state and sustained low unemployment rates. In his classic paper, Michal Kalecki (1943) explored the reasons why economic policymakers would never tolerate an unemployment rate approaching zero for long: Indeed, under a regime of permanent full employment, the "sack" would cease to play its role as a disciplinary measure. The social position of the boss would be undermined, and the self-assurance and class-consciousness of the working class would grow. Strikes for wage increases and improvements in conditions of work would create political tension.

Respectable: The Experience of Class
by Lynsey Hanley
Published 20 Apr 2016

Sixth-form students told the House of Commons Education Committee that the EMA provided not only practical help to stay on in education, but gave them a sense that the government recognized and cared about those from low-income backgrounds, which in itself had a ‘massive’ impact on their motivation.4 (The EMA was abolished in 2011.) Periods of economic growth and recession have respectively widened and narrowed job opportunities. Government policy has also meant that, at some times more than others, it has been easier to achieve mobility through the mechanisms of well-resourced state education, full employment and universal goods such as the NHS. (I make this observation as someone who believes that a strong welfare state supports, rather than infantilizes, people.) Significantly, though, if you were of working age in the fifties and sixties, you had a chance to escape the poverty associated with being working class, without necessarily having to leave behind the people and culture of that class.

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What actually helped people the most – the mechanism by which most escaped dire poverty in the postwar period – was not the reorganization of compulsory education, since academic excellence was still deemed possible only for the ‘brightest’. It was a combination of factors, the most obvious being full employment, which gave workers better pay, greater choice and more chances for advancement (because they didn’t have to remain stuck in a bad job for fear of not being able to find another one). There was also the continued popularity of night school and other forms of non-compulsory education, such as the Workers’ Educational Association and university extra-mural departments; and the fact that the basic security provided by the welfare state allowed parents to relieve their children of the grinding poverty of their own childhoods.

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In their study ‘Living Inferiority’, Simon Charlesworth, the sociologist Paul Gilfillan and the epidemiologist Richard Wilkinson argue that the quality of social relations in working-class areas has deteriorated with the decline of industry there, and that relationships between atomized, unemployed or insecurely employed men are now characterized by violence or the threat of it.14 They argue that, during the postwar era of virtually full employment, the dignity of having work gave men better opportunity to develop a sense of fairness, solidarity and honour. I’m only partially convinced that having work – any work – automatically made men’s lives better before that point, or that irresponsibility and nihilism among young working-class men did not exist.

A World of Three Zeros: The New Economics of Zero Poverty, Zero Unemployment, and Zero Carbon Emissions
by Muhammad Yunus
Published 25 Sep 2017

Yet this stronghold of free-market dynamism has long been plagued by the seemingly insurmountable problem of unemployment, which condemns millions of people to idleness. The intractable nature of this problem has even driven economists to invent the self-contradicting concept of “full employment.” This does not refer to full employment at all but rather to some vaguely defined minimum level of unemployment—perhaps 4 or 5 percent—that leaves an “acceptable” number of millions of people on the scrap heap. That term tells the world not only that it is okay to leave millions unemployed, but that you are lucky to get away with such an insignificant number!

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See agriculture fertilizers, 46 finance governments and, 242–243 Grameen Bank and, 244 social business and, 242–248 See also microfinance financial institutions banks and, 217 complex contracts of, 234–235 conventional banks and, 29 corruption and, 214 governments and, 214 microfinance and, 238 poor people and, 25 SDGs and, 131 unbanked and, 25 wealth concentration and, 25, 237 financial systems basic purpose of, 47 economic crisis and, 231 economic reform and, 248–257 Grameen Bank and, 22–25 legal systems and, 231–236 Flannery, Matt, 183 Food Assembly, 188, 189 food markets, 43–45 food prices famine and, 42 meat increase demand and, 44–45 rise of, 42 social business and, 51 food production, 43 fossil fuels, 44 Foundation for Economic Education, 146 France agriculture and, 191 poor people in, 61 social business and, 64 See also Paris free market framework of, 229 living standards and, 8 pessimism from, 119 power of, 262 as regulator of wealth, 7 selfishness-driven players and, 18 wealth concentration and, 17–18 French Action Tank economic innovation at, 153 poverty and, 60–65 social businesses of, 61 French Potato Growers Association (GAPPI), 140 Fukushima, 100 full employment, 91 GAI. See Grameen America, Inc. GAIN. See Global Alliance for Improved Nutrition GAPPI. See French Potato Growers Association GCL. See Grameen Creative Lab GDP. See gross domestic product GEM. See Global Entrepreneurship Monitor gender equality, 123, 128 Giving Pledge, 244, 245 Global Alliance for Improved Nutrition (GAIN), 51 Global Entrepreneurship Monitor (GEM), 35 global pollution, 98 Global South, 92, 209 globalization economic crisis and, 47 food markets and, 43 new era of, 14 technology and, 176 Golden Bees operations of, 38 poor people and, 39 social business of, 37 Uganda and, 37 YSB and, 57 Good Bee, 162 good governance, 225 corruption and, 204–208 elections and, 201 elements for, 210–221 human rights and, 200, 221 infrastructure and, 210 technology and, 212 governments budgets for, 243 charity and, 213 civil institutions and, 220 corporate control and, 224 corruption in, 205 crony capitalism and, 206 economic growth and, 209 entrepreneurs and, 209 finance and, 242–243 financial collapse avoided by, 232 financial institutions and, 214 infrastructure and, 247 people’s vision with, 208 poor people and, 246 problems for, 208–210 public opinion mobilized by, 20 social business and, 247 social business funds and, 254 tyranny in, 224 Grameen America economic distress and, 85 microcredit bank of, 12–13 poor people and, 50 Grameen America, Inc.

The Next Decade: Where We've Been . . . And Where We're Going
by George Friedman
Published 25 Jan 2011

In Japan, the reluctance to downsize was based on the social contract whereby a worker committed himself to one company for life and the company reciprocated. The Japanese honored the tradition by maintaining near full employment while allowing the growth rate to slip to almost nothing. Western economists dubbed the twenty years during which the Japanese economy stagnated the “lost decades,” but this is a misunderstanding of Japanese objectives, or rather the imposition of a Western point of view on Japanese values. Sacrificing growth in order to maintain full employment was for this highly cohesive society not to lose a decade but to retain a core interest. At the same time, Japan’s birthrate dropped well below the 2.1 children per woman needed to maintain its population.

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At the same time, Japan’s birthrate dropped well below the 2.1 children per woman needed to maintain its population. Now, with each generation smaller than the one before, the economy can no longer support retirees. In this way, debt and demography have created an enormous crisis for Japan. During the next ten years, the Japanese will no longer be able to maintain full employment by exorbitantly increasing their debt, both public and private. Like the Chinese, they will have to shift economic models. But the Japanese have one overwhelming advantage: they do not have a billion people living in poverty. Unlike the Chinese, they can absorb austerity, should it be required, without inviting instability.

The Last Days of Disco
by David F. Ross
Published 5 Dec 2014

Salvation had arrived in the distinctive form of Jimmy Stevenson: newly out of prison and one of the more than three million unemployed, but, tonight, riding to the rescue in a beige 1972 Volkswagen Campervan. 18TH FEBRUARY 1982 INTERVIEW FOR THAMES TELEVISION’S TV EYE Llew Gardner, journalist for Thames TV ‘Prime Minister, can I ask you something? Will we ever return to full employment, Prime Minister? What was known as full employment?’ Mrs Margaret Thatcher, the Prime Minister ‘I don’t know. It depends on your definition of full employment.’ THE THREE BEFORE EIGHT TEN MONTHS EARLIER … Jimmy Stevenson was there on the night Bobby Cassidy’s dreams of being a DJ were born. Having had his musical interest ignited by punk, Bobby found a true home in the Mod revival of the late ’70s.

Where Does Money Come From?: A Guide to the UK Monetary & Banking System
by Josh Ryan-Collins , Tony Greenham , Richard Werner and Andrew Jackson
Published 14 Apr 2012

Cardiff: University of Wales Press. pp. 50-55 38 Ibid. pp. 50-1 quoting from Orsingher, R., (1964). Banks of the World: A History and Analysis. Paris: viii 39 Davies (2002). op .cit. p. 50 40 Innes, A.M., (1913). What is Money? Banking Law and Journal May: 377-408 41 Davies (2002). op. cit., p. 663 42 Wray, L. R., (1998). Understanding Modern Money: The Key to Full Employment and Price Stability, Chapter 3. Cheltenham: Edward Elgar p. 43 43 Grierson, P., (1977). The Origins of Money, London: Athlone Press, pp. 19-21 44 Wikipedia (n.d.) Retrievable from http://en.wikipedia.org/wiki/Wergeld 45 Greirson (1977). op. cit. p. 43 46 Innes (1913). op. cit. 47 Wray (1998). op. cit.

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p=175 and http://www.neweconomics.org/blog/2012/07/05/quantitative-easing-a-wasted-opportunity 26 Peston, R., (n. d.). How Credit Easing Works, BBC News, http://www.bbc.co.uk/news/business-17437484 27 Graeber, D., (2011). Debt: The First 5000 years, Melville House Publishing: Brooklyn, New York 28 Wray, R., (1998). Understanding Modern Money: The Key to full-employment and price stability, Cheltenham: Edward Elgar 29 Innes, A. M., (1913). What is Money, Banking Law Journal (May 1913): 377-08. 30 Carruthers, B. G. and Babb, S., (1996). The Colour of Money and the Nature of Value: Greenbacks and Gold in Postbellum America, American Journal of Sociology, 1010:1556-91 31 Davies, G., (2002).

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International Review of Financial Analysis (In Press). Withers, H., (1909). The Meaning of Money. London: Smith and Elder World Bank, (1993). The East Asian Miracle, Economic Growth and Public Policy. Oxford: Oxford University Press Wray, L. R., (1998). Understanding Modern Money: The Key to Full Employment and Price Stability. Cheltenham: Edward Elgar ABOUT THE AUTHORS Josh Ryan-Collins is a Senior Researcher at nef (the new economics foundation) where he is leading a programme of research on the history and practice of monetary systems. He is studying for a PhD in finance at the University of Southampton.

Value of Everything: An Antidote to Chaos The
by Mariana Mazzucato
Published 25 Apr 2018

The SNA's emergence in the early post-war years owed much to recent economic, political and intellectual developments. The experience of depression and war weighed heavily on policymakers' minds. Many countries saw wartime planning, which was based on unprecedented amounts of economic information, as a success. Political pressures were important too. In the US, the New Deal of the 1930s and full employment during the war led many voters to believe that government could intervene benignly and progressively in the economy. In Europe, the strength of leftwing parties after the war - exemplified by the Labour Party's 1945 election victory in the UK - also changed, and marked a change in, people's attitudes, and made fuller and more accurate national accounts essential.

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The number of mutual pension providers - companies owned by their members - has steadily declined as they convert to shareholder-owned companies or consolidate in order to compete with them. Although the pensions industry existed in the early twentieth century, it came of age in the post-war years with the rise of the welfare state. In an era of full employment, often in large enterprises, compulsory pension schemes to which employers and employees contributed piled up enormous assets. Voluntary pension savings were common too. Life insurance has also been an important savings vehicle, but payments into life insurance policies have not generally been compulsory.

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It is not that financial actors should not make money, or that they do not create value; but that the collective effort involved in the value-creation mechanism should be reflected in a more equitable share of the rewards. This is tied to Keynes's notion of ‘socialization of investment'. He argued that the economy could grow and be better stabilized, and hence guarantee full employment, if the quantity and quality of public investment was increased. By this he meant that funding investment in infrastructure and innovation (capital development) ought to be done by public utilities, public banks or co-operatives which direct public funds towards medium- and long-term growth rather than short-term returns.

Chokepoint Capitalism
by Rebecca Giblin and Cory Doctorow
Published 26 Sep 2022

Bradley Thomas, “Why Bernie Sanders’s Universal Job Guarantee Is Fool’s Gold,” Foundation for Economic Education, Oct. 25, 2019, https://fee.org/articles/why-universal-job-guarantees-are-fool-s-gold. 27. Naomi Klein, On Fire: The Burning Case for a Green New Deal (New York: Penguin, 2019). 28. Mark Paul, William Darity Jr., and Darrick Hamilton, “The Federal Job Guarantee—A Policy to Achieve Permanent Full Employment,” Center on Budget and Policy Priorities, Mar. 9, 2018, https://www.cbpp.org/research/full-employment/the-federal-job-guarantee-a-policy-to-achieve-permanent-full-employment. 29. Andrew Van Dam, “The U.S. Has Thrown More Than $6 Trillion at the Coronavirus Crisis. That Number Could Grow,” Washington Post, Apr. 16, 2020, https://www.washingtonpost.com/business/2020/04/15/coronavirus-economy-6-trillion. 30.

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But it didn’t want defense workers and soldiers’ families buying up the same stuff they needed, so they convinced those people to stash away their money in “war bonds,” which kept their war wages out of circulation and then dribbled them out once production reverted to peacetime goods. Where that wasn’t enough, they imposed rationing to limit the amount of key goods and materials the private sector was allowed to buy. If we decide to prioritize full employment in dignified and socially useful work, there are ways to achieve it without blowing the economy up. Right-wing economists criticize job guarantees by arguing that offering everyone a good job would create “pressure to introduce a higher wage or certain benefits that the private sector doesn’t offer.”32 They’re so close to getting it.

Ellul, Jacques-The Technological Society-Vintage Books (1964)
by Unknown
Published 7 Jun 2012

During the realization of a plan, a constant readaptation of means and ends is simultaneously effected, assuring a greater cohesion of the ensemble, if not a greater certainty of realization. Finally, it seems to me important, in connection with the plan itself, to emphasize the need for utilizing the labor force efficiently. It would appear that full employment is an internal necessity, not The Technological Society (177 merely a momentary circumstance, of the plan. Charles Bettelheim has demonstrated that without full employment there is no possi­ ble satisfaction of the totality of social needs. In this connection, wages change their character and become a part of the social product The plan ought, therefore, to provide for both full employ­ ment and the assignment of the labor force in accordance with the requirements of the production plan.

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In order for the plan to be realized, the use of the labor force must also be integrated into i t This is recognized by Great Britain, for example, in its eonception of full employment The application of the plan likewise presupposes planning of housing and of voca­ tional guidance, apprenticeships, and schools. Moreover, it quickly becomes clear that there is a need too for social security ( a neces­ sary psychological and sociological element if full employment is to function without too violent a shock to human nature). This in­ terrelation is not imaginary and gratuitous. Internal necessity con­ nects the elements of the plan, and it is folly to think of breaking its links.

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And the United States adopted a planned regime when it was challenged by war— it may be added, with all the care and precaution presupposed by the critical democratic sensibility of the Anglo-Saxons. Shortly after reconversion, in 1950, however, the Americans were obliged to embark on a new program. It was not merely an arma­ ments program ( which had certain advantages in connection with full employment), but a sound program encompassing a group of countries, as indicated by Truman’s Point Four. These programs presupposed a planned economy. It would seem that we are today unable to escape the facts. And the facts direct us toward the planned economy, regardless of our theoretical judgments in the matter.

Confronting Capitalism: How the World Works and How to Change It
by Vivek Chibber
Published 30 Aug 2022

If left to itself, the market is both fair and maximally efficient. As long as people want to work, everyone will find a job; if they have special skills, the market will recognize and reward them for it; if they have an idea that will make money, banks will give them the credit to start their own business and become rich. Markets spontaneously tend toward full employment, and they reward people for their talents. The problem is that governments won’t leave them alone. Politicians and special interests pile on regulations that squelch entrepreneurial initiative; they launch welfare schemes that get people hooked on welfare; they don’t let goods flow freely across borders; and so on.

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Instead of figuring out what the best time might be to walk into the boss’s office and threaten to quit, they work as hard as they can to hang on to the job they have. There are some situations when workers, even those with average skills, find their bargaining situation improved. This happens when unemployment is very low and jobs are easier to find in all sectors of the labor market. It’s what economists call “full employment.” In those situations, individual-level strategies can work to some extent, and they have. Workers find that, instead of worrying about competing with other poor souls on the job market, it’s employers who have to worry about finding applicants to fill the positions they advertise. This changes the power balance somewhat between the two.

The Inequality Puzzle: European and US Leaders Discuss Rising Income Inequality
by Roland Berger , David Grusky , Tobias Raffel , Geoffrey Samuels and Chris Wimer
Published 29 Oct 2010

Neither society nor the individual can afford to be on the outside, to be excluded. To have a high employment level is the secret. The Scandinavian model has the advantage of a very big public sector. Yes, we pay a lot taxes. But on the other hand, you cannot have close to full employment in a society without having a very strong public sector, and you can’t have a 100 P.N. Rasmussen very strong public sector without having full employment. So full employment and the welfare state go hand-in-hand. What are your views about CEO compensation? Not only cleaners, taxi drivers, and unskilled workers have rights and duties; this also applies to CEOs, the bankers, and hedge fund managers.

The Cost of Inequality: Why Economic Equality Is Essential for Recovery
by Stewart Lansley
Published 19 Jan 2012

At the heart of this economic leap-in-the-dark was a switch in economic and political philosophy from the ‘managed capitalism’ of the post-war era to what might be called ‘market capitalism’. Central to the new philosophy was a belief in efficient and self-regulating markets. In the UK from the early 1980s, the commitments of managed capitalism to full employment, progressive taxation and inclusive welfare were dropped. Of course, the effect of this process was not a return to the much more laissez faire capitalism of the 1920s. Even by the mid-1990s, the state retained a major role in the running of the economy, with higher levels of public spending as a share of output than in the 1950s and 1960s.

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Though the British and American economies did ultimately recover from the Great Depression—one of the deepest and longest in modern history—recovery was slow and too weak to prevent the persistence of widespread unemployment. Keynes argued strongly in 1933 that the stimulus packages eventually applied to boost purchasing power through public works in the United States and the United Kingdom were inadequate.300 As a result, full employment was not achieved until the end of the decade with the start of significant war spending. There is now a strong body of opinion that attributes a good deal of the blame for the Wall Street Crash and the Great Depression that followed on the mal-distribution of income. The 1920s was a time of low wages and irregular employment for many Americans, while the middle class represented only a small group in society.

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There are also strong parallels between the dominant economic doctrines of the two periods, and their central belief in laissez-faire and the self-regulating nature of markets, without the need for government intervention or adequate wages to tackle shortfalls of demand. According to today’s market theorists, full employment can be secured by allowing wages to fall until equilibrium and stability is restored. This is remarkably similar to the ideas that helped to intensify the recessionary pressures that stemmed from the 1929 crash. There is also one final and particularly striking parallel. What Galbraith described as the ‘inordinate desire to get rich quickly’ of the 1920s returned in the decade leading to 2008-2009, bringing a range of business strategies that simultaneously undermined the foundations of the real economy.320 Notes 292 C Brown, ‘Does Income Distribution Matter for Effective Demand?’

Losing Control: The Emerging Threats to Western Prosperity
by Stephen D. King
Published 14 Jun 2010

While the desire to control inflation is now a central tenet of monetary policy, the shift during the 1970s towards a focus on inflation rather than unemployment as the main macroeconomic policy objective represented a remarkable change of view compared with the 1960s, when most policymakers believed in the pursuit of full employment and didn’t worry too much about inflation. The best economic ideas tend, eventually, to go out of fashion, upstaged by unexpected or irregular economic developments. The shift in stance is summed up nicely in two well-known quotes. The first, ‘we are all Keynesians now’, is commonly attributed to US President Richard Nixon in 1971, although the original source was a tongue-in-cheek Milton Friedman in a 1965 edition of Time magazine, lamenting the dominance at the time of the intellectual ideas stemming from John Maynard Keynes’s General Theory of Employment, Interest and Money.2 The conventional wisdom held that Keynesian demand-management policies – changes in tax and public-spending levels to foster a desired level of economic activity – would bring about full employment.

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The first, ‘we are all Keynesians now’, is commonly attributed to US President Richard Nixon in 1971, although the original source was a tongue-in-cheek Milton Friedman in a 1965 edition of Time magazine, lamenting the dominance at the time of the intellectual ideas stemming from John Maynard Keynes’s General Theory of Employment, Interest and Money.2 The conventional wisdom held that Keynesian demand-management policies – changes in tax and public-spending levels to foster a desired level of economic activity – would bring about full employment. These policies were to be actively used at all times to avoid a repeat of the economic calamities of the 1930s Depression. A handful of years later, with the onset of the excessive inflation of the 1970s, this view of the world was gradually rejected. Jim Callaghan, the UK prime minister at the time, administered the coup de grâce for Keynesian demand-management policies, at least from a British point of view, at the Labour Party conference in 1976: We used to think that you could spend your way out of a recession and increase employment by cutting taxes and boosting government spending.

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I tell you in all candour that that option no longer exists, and in so far as it ever did exist, it only worked on each occasion since the war by injecting a bigger dose of inflation into the economy, followed by a higher level of unemployment as the next step.3 Put another way, if everyone knew a government was prepared to guarantee full employment through demand-management policies, it no longer mattered how far individual prices and wages rose. With everyone thinking along similar lines, inflation was bound to take off. Meanwhile, if some prices and wages rose faster than others, there would be an arbitrary and unfair redistribution of income and wealth.

The Economics of Belonging: A Radical Plan to Win Back the Left Behind and Achieve Prosperity for All
by Martin Sandbu
Published 15 Jun 2020

This held out the promise, and to a greater or lesser extent the reality, of allowing everyone to participate in the economy with a reasonably similar social status. It is hard to argue that welfare systems achieve that purpose today in most Western countries. Originally designed around the industrial society norm of full employment of male breadwinners in lifetime jobs, they have struggled as much as industrial society itself to adapt to the technology-driven transformation of Western economies. This tie to the old industrial economy is evident in two principles woven into the very tissue of Western benefit systems to decide who is deserving of benefits: a desire to reward effort in those judged able to work and an assumption that those who are able can be neatly divided from those unable to work.

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That explains why the results of the 1980s fiscal stimulus and the 2000s credit stimulus were so ephemeral. But it also shows that they are no argument against a high-pressure economy, provided other policies of economic belonging are also in place. Notwithstanding an avoidably slow recovery, most Western economies are now approaching full employment or have already passed it. But it would be wrong to think that this renders macroeconomic policy irrelevant in pursuit of the bigger goal of rebuilding an economy of belonging. Another downturn will come sooner or later—at the time of this writing, pessimism is again in the air—and cyclical swings are an inevitable part of market economies.

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Galston, Countering the Geography of Discontent: Strategies for Left-Behind Places, Brookings Institution report, November 2018, https://www.brookings.edu/research/countering-the-geography-of-discontent-strategies-for-left-behind-places/; and Timothy J. Bartik, Helping Manufacturing-Intensive Communities: What Works?, Center on Budget and Policy Priorities, Policy Futures report, 9 May 2018, https://www.cbpp.org/research/full-employment/helping-manufacturing-intensive-communities-what-works. 15. “The Biggest Tax Cut You’ve Never Heard Of,” Economist, 17 November 2018, https://www.economist.com/leaders/2018/11/17/the-biggest-tax-cut-youve-never-heard-of; Sarah O’Connor, “Big Companies Are Pushing Governments Around,” Financial Times, 13 November 2019, https://www.ft.com/content/d2472b06-e68e-11e8-8a85-04b8afea6ea3.

23 Things They Don't Tell You About Capitalism
by Ha-Joon Chang
Published 1 Jan 2010

The enthusiastic proclamations of our success in controlling price volatility during the last three decades have ignored the extraordinary instability shown by economies around the world during that time. There have been a huge number of financial crises, including the 2008 global financial crisis, destroying the lives of many through personal indebtedness, bankruptcy and unemployment. An excessive focus on inflation has distracted our attention away from issues of full employment and economic growth. Employment has been made more unstable in the name of ‘labour market flexibility’, destabilizing many people’s lives. Despite the assertion that price stability is the precondition of growth, the policies that were intended to bring lower inflation have produced only anaemic growth since the 1990s, when inflation is supposed to have finally been tamed.

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The top Russian scientists were as inventive as their counterparts in capitalist countries, but the rest of the country did not seem able to live up to the same standard. What was going on? In pursuit of the communist vision of a classless society based on collective ownership of the ‘means of production’ (e.g., machines, factory buildings, roads), the Soviet Union and its communist allies aimed for full employment and a high degree of equality. Since no one was allowed to own any means of production, virtually all enterprises were run by professional managers (with minor exceptions such as small restaurants and hairdressers), preventing the emergence of visionary entrepreneurs, like Henry Ford or Bill Gates.

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Given the political commitment to high equality, there was a clear cap on how much a business manager, however successful, could get. This meant that there was only a limited incentive for business managers to turn the advanced technologies that the system was clearly capable of producing into products that consumers actually wanted. The policy of full employment at all costs meant that managers could not use the ultimate threat – that of sacking – to discipline workers. This contributed to sloppy work and absenteeism; when he was trying to reform the Soviet economy, Gorbachev frequently spoke of the problem of labour discipline. Of course, all this did not mean that no one in communist countries was motivated to work hard or to run a good business.

Nine Crises: Fifty Years of Covering the British Economy From Devaluation to Brexit
by William Keegan
Published 24 Jan 2019

One of the towering figures of Cambridge economics at the time was Professor Nicholas (Nicky) Kaldor – later a Labour life peer – who subsequently incurred much opprobrium in the largely Conservative (and xenophobic) British press as one of the two ‘Hungarians’ who were brought in from academia to advise the 1964–70 Wilson governments. The other was Thomas Balogh; Denis Healey, then Defence Secretary, used to refer to them as Buda and Pest. After the post-1945 reconstruction had taken place, when wartime controls had been abandoned and (virtually) full employment achieved, the big macroeconomic obsession in the UK became the rate of economic growth and how to boost it. Kaldor produced various growth models and I vividly recall an evening lecture in Mill Lane, Cambridge, in the early 1960s when the veteran economist Sir Dennis Robertson made fun of ‘Kaldor Mark I’ and ‘Kaldor Mark II’ in front of an audience of the great and the good which included Kaldor himself in the front row.

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The higher price of imports and cheaper exports would inevitably make the trade and balance of payments deficits worse before they got better, when, it was hoped, via the workings of the price mechanism and the impact on profitability, the volume of exports would rise and the import bill would be lower than it might otherwise be. There were many nervous moments. The essence of the policy was to move resources into exports (or ‘import saving’). In an economy close to full employment, this required restraint on domestic spending – both public and private. The sense of urgency was communicated to the public by restrictive budgets and tight controls on hire purchase (HP) agreements; arrangements which may seem bizarre to a modern age. The phrase ‘hire purchase’ meant what it said: instead of waiting until they had saved enough money to buy a car or what became known as ‘consumer durables’ (refrigerators, washing machines etc.), people could enjoy their use from the start, hiring them until they had paid off the price and were able to own them outright.

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The title may have suggested that there were lots of things wrong with the state of the nation in the late 1950s and early 1960s, but for Shanks, the kind of Keynesian economics I learned at Cambridge had completely changed the world. Recessions, let alone depressions, were a thing of the past in the US and UK. Thus: Twenty years have not been long enough to accustom the British working class to the idea that full employment and prosperity are here to stay. Thus every temporary downturn of trade is treated like the coming of Armageddon, the return of the soup kitchen and the labour queue … It is easy to see how unrealistically gloomy this attitude is – and how self-defeating. Yet if Shanks had still been with us in the England of 2010 onwards, he would have seen the modern equivalent of soup kitchens all over London and in provincial towns.

Democracy and Prosperity: Reinventing Capitalism Through a Turbulent Century
by Torben Iversen and David Soskice
Published 5 Feb 2019

Protected service markets could also be used more directly as an employment buffer against business cycle swings, stabilizing the economy and facilitating the government’s commitment to full employment. Finally, protection of services against competition was seen, rightly or wrongly, as a means to ensure universalism in service provision and as inherently inseparable from the goal of modernizing society by extending telephone, postal, transportation, and other services to rural and less developed regions. Infrastructure, broadly construed, was a precondition for industrial development, and the future depended on the spread of industry. By combining economic growth and full employment with some measure of social justice, regulating and sheltering services from international competition became part and parcel of the European growth model.

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Top bureaucrats in the finance ministry are often recruited from central bankers, who also frequently move into careers in the financial sector, all sharing a conservative macroeconomic outlook (Adolph 2013). By aggressively signaling to the market, and to unions, that macroeconomic policies were now targeting inflation and balanced budgets rather than full employment, governments made a sharp policy break from the past. FIGURE 3.6. Central bank independence in 18 OECD countries, 1960–98. Source: This is essentially an index of common indexes of both political and economic independence of the central bank by Freitag (1999), as recoded in Brady et al. (2014).

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Capital account restrictions on capital inflows were abolished, and restrictions on bank lending and the regulatory separation of banking and insurance were lifted. This made it easier for new firms to get access to finance (often in foreign markets) and to hedge against risks, and it also allowed individuals much greater access to consumption loans and mortgages. The effect was to restore demand and (near) full employment, even as it also boosted real estate prices to the point where a bubble emerged in the mid-1980s (and again in the 2000s). In addition to financialization, publicly regulated utilities were privatized or deregulated, notably in telecommunication, and competition policies in a range of markets, including public services, were introduced or intensified.

The Euro and the Battle of Ideas
by Markus K. Brunnermeier , Harold James and Jean-Pierre Landau
Published 3 Aug 2016

Tensions particularly rose in the later stages of the Bretton Woods system, especially in the later 1960s, as Germany increasingly built up trade surpluses that reflected a favorable development of productivity gains as well as the containment of wage costs through a collaborative and collective approach to wage setting. (Trade surpluses would become the hallmark of late twentieth-century German-style capitalism.) By contrast, deficits in Germany’s trade partners reflected either lower innovation or (especially in late 1960s France and Italy) a less disciplined approach to wages in an era of full employment and increased social and political radicalism (reflected in large numbers of days lost in strikes). At the beginning, in the era of fixed exchange rates and controlled capital markets, even relatively small deficits could not be financed, and they produced immediate pressure on the exchange markets.

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As prices and wages only adjust slowly, quantities have to adjust. That is, price rigidities allow demand shocks to depress output and lead to underemployment. In contrast, in a world in which prices always flexibly adjust, the interest rate is constantly at its natural—or “Wicksellian”—level, and the economy is always at full employment. The same rigidities that depress output also give monetary policy its traction and allow central banks to stabilize the economy. The underlying mechanism is the following: because prices only adjust slowly, a reduction in the nominal interest rate automatically brings with it a decline of the real (inflation-corrected) interest rate, at least in the short run.

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Instead of being accommodative, the rate cut beyond the reversal rate becomes contractionary as it can destabilize the financial system. Hence, the reversal rate forms the effective lower bound on interest rate monetary policy. Large-Scale Asset Purchase Programs: Quantitative Easing (QE) Such pure interest rate policies, however, will not work if the interest rate required to rebalance the economy toward its full-employment equilibrium level is significantly below zero. Because nominal interest rates cannot go very far below zero, central banks that only have the interest rate tool at their disposal cannot in such an environment induce the extra required spending, as it can neither stimulate spending directly nor recapitalize the financial sector through fiscal redistribution.

The Battle of Bretton Woods: John Maynard Keynes, Harry Dexter White, and the Making of a New World Order
by Benn Steil
Published 14 May 2013

If the simple basic ideas can become familiar and acceptable, time and experience and the collaboration of a number of minds will discover the best way of expressing them.”87 The central argument of the book was revolutionary (at least to economists): the economy had no natural tendency toward full employment. High unemployment could persist indefinitely if governments did not intervene forcefully to boost consumption demand. Cheap money provided by the central bank was not enough. This was wholly contrary to classical economics, which held that protracted involuntary unemployment was a result of some interference in the workings of the price mechanism. Classical economics showed that full employment required flexible wages; Keynes showed why, with different assumptions, falling wages could actually worsen unemployment.

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This owes to the fact that “the mere circumstance of creation of one product immediately opens a vent for other products”; the creator supplies because he demands.91 Keynes argued that Say’s Law had everything the wrong way around; in fact, it was “expenditure [that] creates its own income.”92 It was demand, not supply, that determined the level of economic activity. It was investment that called forth the requisite savings, through its boosting of income; not the other way around. The result, in Keynes’s theoretical apparatus, was that demand, given the psychological factors that tended to depress it, could at any given time be insufficient to ensure full employment. Classical economics was wrong on this central issue, with terrible consequences when its prescriptions were followed. It was “a peculiarity of Keynes’s work,” FDR economic adviser Lauchlin Currie wrote in a review of The General Theory, “that he appears always to think of an increase in income as being generated by an increase in investment and never by an increase in consumption.”

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In the interests of preventing deflationary pressures, capital outflows, which were central to the automatic adjustment mechanism of the gold standard, needed to be subject to tight national controls (a position he began advocating as early as 1924). Governments needed to keep interest rates low enough to maintain full employment (a position he first articulated in his 1930 Treatise on Money), and not allow them to rise beyond this by dint of impersonal forces such as gold sales. Keynes set out to spend several days starting Wednesday, September 3, cloistered in Tilton drafting, as he explained to his mother, “a heavy memorandum on post-war international currency plans.”

The Extreme Centre: A Warning
by Tariq Ali
Published 22 Jan 2015

Sifting fact from fiction is not easy today, especially in the West; but even the apologists of the system are finding it increasingly difficult to portray the capitalist societies that emerged from the ruins of the Communist system, or those that renewed themselves in the post-Communist era, as exemplars of economic stability, full employment, continuous growth, social equality, or individual freedom in any meaningful sense of the word. Having defeated its old enemy ideologically and economically, the triumphant West is now living though the twilight of democracy. The ruling elites in the US and Europe, which so vigorously and shamelessly promoted their political system to win over the peoples of Eastern Europe, are now quietly disencumbering themselves of that very system.

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These were the factors that delivered a set of Keynesian, social democratic reforms. The popularity of this outcome can be judged by the three successive terms awarded to the New Deal president Franklin Roosevelt. Greatly helped by the war economy, the system created and sustained a long postwar boom that enabled rising wages, full employment and the welfare state. This boom ended in 1970. The series of defeats inflicted on the US and Western European labour movements in the decade that followed were the prelude to the era of neoliberal globalization. This was followed by the collapse of the Soviet Union and the decision of the capitalist-roaders in the Chinese politburo to take another great leap forward.

To the Ends of the Earth: Scotland's Global Diaspora, 1750-2010
by T M Devine
Published 25 Aug 2011

Since the majority were still family-controlled, partners were willing to sacrifice gains in difficult times to ensure the longer-term survival of the business until the hoped-for recovery took place. As intensive rearmament and the Second World War revived and then expanded the domestic economy, it might have seemed that Scotland had weathered the international storm and the nation’s greatest single challenge to domestic manufacturing since the Industrial Revolution. Virtually full employment returned by the early 1940s while post-war retooling and rebuilding, together with the temporary elimination of German and Japanese competition, seemed to bode well for the future. Ironically, by the 1950s, the traditional staple industries of Scotland were even more entrenched within the economic structure of the nation than they had been in 1939.

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The nation’s impact on the world economy receded with the continued malaise of the heavy industries, several of which were now kept afloat only by the nationalization of steel and coal in the 1940s, lavish government intervention in the 1960s and the overriding post-war policy by the state of a commitment to full employment. It was not, therefore, surprising that when the government withdrew life support in the 1980s and prioritized the control of inflation over the guaranteeing of employment the traditional pillars of Scottish industry disintegrated with frightening speed.9 The take-over of Scottish companies by outside interests speeded up so that by 1960 over 60 per cent of all manufacturing firms employing more than 250 people were owned by non-Scottish interests, primarily from England and the USA.10 Some concluded gloomily that Scotland had sunk to the level of ‘a branch-plant economy’.

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To the ‘stupefied surprise’ of the Glasgow Herald, Labour swept to power in the UK, notched up 17 Scottish seats and attracted nearly 48 per cent of the votes cast north of the border.37 Thus, when the expected independence of India became a settled fact in 1947, the concerns of the Scots were already more focused on the new welfare reforms in health, social security and pensions and employment prospects in the post-war economy. The Welfare State and the commitment of the Labour government to the pursuit of policies of full employment, rather than nostalgic dreams of empire, now became the new anchors of the union state. Two other factors were also relevant. First, Scottish emotional links of family and kindred were not mainly with India and the African colonies but rather with the Dominions of Canada, Australia, New Zealand and South Africa, the countries of mass Scottish settlement over many generations.

The Downfall of Money: Germany's Hyperinflation and the Destruction of the Middle Class
by Frederick Taylor
Published 16 Sep 2013

This was a crucial step-up for the working class, part of the process of learning how to run things and thereby building a new future for a democratic Germany under difficult post-war circumstances. The capitalists had been tamed, and their undoubted managerial skills could now be pushed in socially useful directions. Total and immediate socialisation would risk throwing the babies of efficiency and full employment out with the capitalist bathwater. Or so the story went.6 The Stinnes-Legien deal certainly contributed, alongside Ebert’s bargain with the military, to stemming the tide of extreme radicalism, of turning the movement of 9 November 1918 into the ‘reined-in revolution’ (gebremste Revolution).

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Britain after the Second World War, for instance, had to deal with a vast accumulation of debt, mainly owed to America. However, under the strong and on the whole efficient Labour government that succeeded Churchill’s wartime coalition, she nonetheless managed to keep up payments on her debt, while at the same time creating a welfare state and a free national healthcare system, and maintaining full employment. At the same time the British middle classes, though generally feeling somewhat shabby and impoverished during the post-war era, were not wholly ruined by the process. In fact, they survived sufficiently well to flourish again in the 1950s, once the phase of socialist austerity was over. Something similar to the British solution following the Second World War might, theoretically, have worked for Germany after 1918, if there had been a similar sense of national solidarity as was found among all classes in Britain in 1945; if, as in post-war Britain, the government had enjoyed a clear mandate for its policies; if the increasingly weak governments that ruled Germany after 1920 had not been hampered by their disunity and by an extreme, not to say violent, right-wing opposition.

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Combined with post-war shortages of affordable good quality food, and real wages that rarely rose up near the pre-war level and were usually much less, deteriorating living conditions also meant that diseases associated with deprivation and poverty rose sharply in the post-war inflation even during conditions of apparently full employment. The incidence in infants of rickets, caused by lack of vitamin D, a result of dietary insufficiencies but also of simple lack of access to sunlight, was estimated in 1921 for those under six months at 27.8 per cent, between six months and a year at 41.1 per cent, between a year and eighteen months at 40.2 per cent, for those between eighteen months and two at 32.4 per cent, and for those infants over two years old at 59 per cent.

How Markets Fail: The Logic of Economic Calamities
by John Cassidy
Published 10 Nov 2009

As with his intellectual heroes Smith and Mill, Hayek’s support for laissez-faire extended far beyond a belief in its economic utility: he viewed the free market as the only effective guarantor of individual freedom, and he reacted viscerally to what he saw happening around him in Great Britain. During World War II, Sir William Beveridge, a former colleague of Hayek’s at LSE, published two influential papers—“Report on Social Insurance and Allied Services” and “Full Employment in a Free Society”—that laid the intellectual basis for the postwar welfare state. Like Keynes, Beveridge was a member of the Liberal Party rather than a socialist. He agreed with Keynes that capitalism needed adult supervision: left untended, it had produced a worldwide slump and, ultimately, fascism.

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“It’s very academic, very mathematical, and it really doesn’t—I want to choose my words carefully here: it is nothing like as useful to the business community as it could be.” The Columbia economist Joseph Stiglitz, who was acting as chairman of the White House Council of Economic Advisers, said, “It’s very clear that new classical economics is irrelevant. You can’t begin with the assumption of full employment when the President is worried about jobs—not only this President but any President.” I would like to report that my article changed economics: it didn’t. I got some letters from (mostly elderly) economists complimenting me for pointing out the emperor’s naked state, but the reaction of the profession as a whole was one of denial.

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This excludes many areas where potential instabilities arise, such as the stock market, the commodities market, and the mortgage market. The mainstream model reduced Keynesian economics to a special case of the free market model in which, for some unexplained reason, prices and wages don’t adjust to ensure full employment. But Keynes, as he stressed in his 1937 paper, was primarily concerned not with wage rigidity, which he used mainly as an analytical device, but with how the economy operates in an environment of irreducible uncertainty about the future, populated by individuals who don’t know very much and are, therefore, susceptible to peer pressure and other inchoate factors such as psychology.

Sacred Economics: Money, Gift, and Society in the Age of Transition
by Charles Eisenstein
Published 11 Jul 2011

THE OBSOLESCENCE OF “JOBS” Ever since the dawn of the industrial era, we have borne an ever-present anxiety that we will be replaced by machines. And indeed this has come to pass for many, as machines take over functions once performed by humans. The only way to maintain full employment has been through growth, and yet here I am calling for an end to growth and an end to full employment (for money) as well. So, given that our age-old anxiety is upon us, let us examine what, exactly, it means for our labor to be replaced by a machine. To be taken over by a machine, the job one is doing must have been mechanical to begin with.

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In the new thinking, monetary policy strives to match the base interest rate to the economic growth (or degrowth) rate. Keynes estimated that it should be “roughly equal to the excess of the money-rate of interest over the marginal efficiency of capital corresponding to a rate of new investment compatible with full employment.” This formula would need to be modified if, as I suggest in Chapter 14, we should no longer and can no longer seek full paid employment as a positive social good (this is a necessary consequence of steady-state economics and not so scary in the presence of a social dividend). Essentially, though, what Keynes is suggesting is that the liquidity tax be set at a level to compensate for the excess of interest over the average return on investment in productive capital.

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Negative interest allows productive investment to continue, and money to circulate, even when the marginal return on capital is zero or less, while a commons-backed currency frees work to go toward nonconsumptive purposes. Next I will describe a third thread in the tapestry: the social dividend, which frees the purchasing power of workers from the need for full employment in the money economy. 1. GDP is likely to contract more quickly and less smoothly than population, perhaps by 1 to 2 percent per year, or about one-half per generation. This is on a global scale. In some countries growth will persist longer than in others. 2. Yong, “Fertility Rates Climb Back Up.” 3.

Crisis Economics: A Crash Course in the Future of Finance
by Nouriel Roubini and Stephen Mihm
Published 10 May 2010

But Marx’s vision was not widely shared. Most mainstream economists in the late nineteenth and early twentieth centuries advanced the idea that the economy is a self-regulating, self-correcting entity, one that will, if left to its own devices, generally move toward a state of equilibrium, with stability and full employment as inevitable results. For sure, crises come and go, but they will not stay. This quaint confidence disappeared in the Great Depression. That event transformed the discipline of economics as well as government policy. For this reason, the Great Depression looms large in the debate over how to handle the recent crisis.

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The General Theory is an exceedingly complex work and defies easy interpretation. Perhaps the simplest way to understand Keynes is to look at how he parted ways with economists of the classical and neoclassical schools. In the 1930s most of these economists believed that the economy is capable of regulating itself. Moreover, they assumed that full employment is the natural state of things, and that when wages go too high, the economy will necessarily contract. As unemployment rises, wages will start to fall. The conventional wisdom was that as wages fall, entrepreneurs will start to hire again, lured by the prospect of increased profits. The cycle then begins anew.

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For Keynes, the solution was simple: government would step into the breach and create demand, reversing the downward spiral. This insight became orthodoxy in the postwar years, as governments around the world adopted Keynesian prescriptions in order to keep economic slumps from deepening. The most enthusiastic and optimistic adopters believed they could use Keynes’s ideas to maintain something approximating “full employment.” An intervention that had originally been proposed as an emergency measure to forestall a full-blown depression became instead a means of keeping a nation’s economy on an even keel. In 1965 a Time cover story hailed Keynes as a visionary. The title of the story was a quotation—“We Are All Keynesians Now”—that captured the era’s mood.

Foolproof: Why Safety Can Be Dangerous and How Danger Makes Us Safe
by Greg Ip
Published 12 Oct 2015

Alfred Marshall had showed how individual markets worked, what we now call microeconomics. If demand for some commodity was perturbed, its price would fall until demand was restored, a condition called “equilibrium.” The overall economy was presumed to behave the same way: if the demand for labor suddenly shrank, wages would decline until full employment was restored. Prolonged periods of involuntary unemployment weren’t possible. Since the economy was largely self-regulating, there wasn’t much need for the federal government to intervene to right the ship, which is just as well since the government was tiny. In the 1930s, though, the Great Depression demonstrated that economies did not self-equilibrate.

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Keynes called this the “paradox of thrift.” It meant the economy could end up in a bad equilibrium rather than a good one. Thus was born a role for the government: if private individuals and businesses would not borrow and spend, the government would have to, and thereby push the economy back to “full employment,” which meant that everyone who wanted a job could find one. Between them, Fisher and Keynes provided an intellectual framework through which government could steer an economy away from both booms and depressions. Politically, the time was ripe; the economic devastation of the Great Depression made the public more amenable to activist government.

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The upshot was that every well-intended effort to make us safer had unintended consequences that did the opposite. Macroeconomic engineering faced a similar critique. Keynes’s disciples figured they could use the levers of monetary policy (i.e., interest rates) and fiscal policy (i.e., the budget) to stimulate demand and hiring, and keep the economy at full employment. And for a while, it worked. But eventually, this strategy began to drive up inflation. In 1967 Milton Friedman predicted that as workers got used to higher inflation, they would demand higher wages—negating any additional demand for labor. By the 1970s, he was proved right as both unemployment and inflation rose, and recessions worsened.

Running Money
by Andy Kessler
Published 4 Jun 2007

You guys have to sit in Silicon Valley and try to figure out what the world is going to look like in 20 years. Good luck. Around here, I’ve seen this movie already. I get to cheat. I know how it ends.” “Isn’t it maturing faster than the West did?” “You’d think. But they do all the same stupid things—bad laws, protectionist policies, full employment instead of quality employment. When I do find someone making money, I’ve got to worry about banks in the country overlending.” “Why does that matter?” I asked. “The U.S. trade deficit means dollars pile up around here. If the banks lend too much, foreign money pulls out, the currency starts dropping, interest rates go up to keep money in the country and my little moneymaker gets sucked into a nasty depression and becomes worthless.”

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When the steam turned to water, it created a vacuum, hopefully a strong enough vacuum to suck the piston down. This action then raised a rod that lifted a plunger of sorts, which tried to suck water up out of the mine. Ingenious for 1706, it huffed and puffed and barely had the power comparable to a horse or two. Since the engine broke down all the time, fixing it was a full employment act for technicians like James Watt. Plus, someone constantly had to seal the cylinder to make a strong vacuum and prevent steam from leaking out of the craggy-edged cylinder. Wet hemp, Jamaica’s finest, was the sealant of the day. The professor in charge of Watt at Glasgow University, Dr. Joseph Black, was teaching courses, theorizing about a concept known as latent heat, starting back in 1761.

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Their output of cars and laptops and VCRs and DVD players and memory chips and computer monitors and sneakers is booming, but something’s wrong. They have giant factories with lots of lower-wage workers who wind wire, screw screws, bolt bolts, wrap plastic and stick in power cords. But that’s not what anyone pays for anymore. Their economies achieve full employment, sure, but these countries are not economic powerhouses. Not anymore. We were investing in companies with no more than 50–100 workers, most of them highly paid programmers and engineers, whose occupational hazard is coming down off a caffeine buzz and an occasional late night Nerf gun injury.

When the Money Runs Out: The End of Western Affluence
by Stephen D. King
Published 17 Jun 2013

In 1943, Arthur Pigou (1877–1959) argued that, even allowing for the possibility of deficient demand, it need not persist: he suggested that, with falling prices and wages, the real value of money balances would rise and, hence, people would eventually spend more, thereby returning the economy back to full employment.3 Michael Kalecki (1899–1970) countered that, in a world of falling prices and wages, real debt levels would also rise, leading to wave upon wave of bankruptcies, thereby making the real balance effect largely irrelevant.4 Others suggested that, in the real world, wages and prices were typically ‘sticky’ and thus couldn't fall far enough to deliver the adjustment that might otherwise have returned an economy to full employment. And, much later, Milton Friedman (1912–2006) and Anna Schwartz (born 1915) argued that the Great Depression was less a failure of the private sector but, instead, a failure on behalf of the Federal Reserve to offer enough liquidity to a system desperately short of money: Friedman's monetarism is nowadays typically associated with the painful austerity established in the early 1980s by Margaret Thatcher in the UK and Paul Volcker in the US in a bid to bring inflation back to heel.

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Like Karl Marx before him, he thought capitalism was unstable. Unlike von Mises, he didn't think markets could easily heal. Instead, he came up with the idea of ‘deficient demand’, whereby the private sector, left to its own devices, could settle at a level of activity woefully too low to support full employment. This provided an automatic justification for policy activism. Keynes devised the ‘multiplier’, where an initial monetary or fiscal stimulus would lead to a much bigger overall effect on aggregate demand. For example, an increase in government spending funded by a larger budget deficit would create new jobs that, in turn, would boost aggregate household incomes, some of which would be spent on consumer goods, boosting company profits and, hence, triggering a new wave of job creation: the process would repeat itself, with each incremental increase in demand dependent on the extent of any increase in income spent rather than saved (the so-called marginal propensity to consume).

Municipal Dreams: The Rise and Fall of Council Housing
by John Boughton
Published 14 May 2018

Building on the Special Areas Act of 1934 (which sought to boost industry in four especially hard-hit regions), the Barlow Report in 1940 made far-reaching proposals to redistribute population and industry in order to both cut unemployment across the country and reduce congestion in London. Keynesianism may have been just a ‘General Theory’ in 1935, but had become official government policy in the 1944 White Paper on Full Employment. As that disdainful reference to the ‘car or the cinema’ suggests, consumerism was not entirely trusted to speak to our better natures; a ‘spirit of companionship’ was the higher goal. This was an ideal sometimes understood nostalgically as a revival of community feeling lost to industrialisation and urbanisation.

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Yes, and this historically has been a significant deficiency, ironically one which has been exacerbated by the housing policies pursued by governments of all stripes since 1979. The obvious riposte to my lament is to point to a changing world, a globalised economy which has edged out past assumptions of full employment and greater social equality with increased public investment as a means to both. But our unalloyed obeisance to the market seems to have created as many problems as it has solved. And those problems have been disproportionately visited upon the poorest of our people, those housed disproportionately on our council estates.

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Slum clearance in the 1930s combined with the impact of the Great Depression brought a poorer working class into council housing for the first time, and with it some of the perceived problems and demonising stereotypes applied to council tenants more generally in recent years. The policy shift reflected a political division between Conservative politicians who believed council housing should properly be reserved for the neediest (the market would provide for the rest) and those on the left who saw it as serving ‘general needs’. Full employment and rising living standards after the Second World War reinvigorated the sense that council housing catered predominantly for a relatively prosperous and aspirational working class. But, from the 1970s, politics and economics combined to lower its status and that of its community. The National Rent Rebate Scheme implemented in 1973 (it became Housing Benefit in 1982), increasing access to council housing for the less well-off, was a significant factor in the shift.

Squeezed: Why Our Families Can't Afford America
by Alissa Quart
Published 25 Jun 2018

Like pregnant workers who try to downplay or hide their pregnant state, second act-ers are also being asked to deny their biology. ONE BIG BIG WAY TO COUNTER THE SECOND ACT MYTHS WOULD BE to curb federal funding for for-profit schools, like the failed ITT chain or the colleges associated with Corinthian. Their degrees can be less likely to lead to full employment, yet may cost the same as or more than degrees from public universities or community colleges. Taking another tack, activist group the Debt Collective organized what they called the “Rolling Jubilee” which erased $17 million of more than 12,000 students’ loans by buying their debts from collection agencies for pennies on the dollar, with funds they raised from multiple donors.

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Fast-Forward Family: Home, Work, and Relationships in Middle-Class America. Berkeley: University of California Press, 2013. Kwak, Nancy H. A World of Homeowners: American Power and the Politics of Housing Aid. Chicago: University of Chicago Press, 2015. Livingston, James. No More Work: Why Full Employment Is a Bad Idea. Chapel Hill: University of North Carolina Press, 2016. Mittell, Jason. Complex TV: The Poetics of Contemporary Television Storytelling. New York: New York University Press, 2015. Murphy, Finn. The Long Haul: A Trucker’s Tales of Life on the Road. New York: W. W. Norton & Company, 2017.

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The Ottawa Citizen kvelled: Madeline Ashby, “Ashby: Let’s Talk about Canadian Values (Values Like a Universal Basic Income),” Ottawa Citizen, November 15, 2016, http://ottawacitizen.com/opinion/columnists/ashby-lets-talk-about-canadian-values-values-like-a-universal-basic-income. feminist theorist Kathi Weeks: Kathi Weeks, The Problem with Work: Feminism, Marxism, Antiwork Politics, and Postwork Imaginaries (Durham, NC: Duke University Press, 2011). “no longer socially necessary”: James Livingston, No More Work: Why Full Employment Is a Bad Idea (Chapel Hill: University of North Carolina Press, 2016). the journalist Judith Shulevitz wrote: Judith Shulevitz, “It’s Payback Time for Women,” New York Times, January 10, 2016. “impossible professions”: Barbara Almond, “The Fourth Impossible Profession,” Psychology Today, November 5, 2010, https://www.psychologytoday.com/blog/maternal-ambivalence/201011/the-fourth-impossible-profession.

How to Be Idle
by Tom Hodgkinson
Published 1 Jan 2004

In Nickel and Dimed, Barbara Ehrenreich discovers that many of her co-workers in restaurants and cleaning agencies are toiling in two jobs in order to meet the payments on - for example - a $4 ,000 jeep. Capitalism has promoted the job as a religion; but so too, tragically, has socialism. The left have been brainwashed with the socialist dream of ' full employment ' . But wouldn ' t full unemployment b e better? A world where everyone is free to create their own life, their own work, their own money. In his great essay ' The Soul of Man under Socialism ' (189 1 ) , Oscar Wilde pointed out the absurdity of the idea of full employment: ' It is to be regretted that a portion of our community should be practically in slavery, but to propose to solve the problem by enslaving the entire community is childish. ' We need to be responsible for ourselves; we must create our own republics.

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The summit of our lives ! The answer! The idea of the 'job ' as the answer to all woes, individual and social, is one of the most pernicious myths of modern society. It is promoted by politicians, parents, newspaper moralists and leaders of industry, on the left and on the right: paradise, they say, is 'full employment' . One key index to the success of a country is the size of its unemployed population. The more people have jobs, the better, we are told. 'Job ' is rarely defined with any precision to the teenager or to the student as they make their journey towards it, but the myth suggests to us that a ' good job ' will offer us ample money, a social life, status and work which we will find ' rewarding ' .

The Price of Time: The Real Story of Interest
by Edward Chancellor
Published 15 Aug 2022

It is the fallacy of overlooking secondary consequences.17 Hazlitt criticized the ‘new’ economics of his day which, he believed, considered only the short-term effects of policies on special groups and ignored the long-term effects on the whole community.18 He attacked what he called the ‘fetish’ of full employment. Schumpeter’s idea of ‘creative destruction’ must be allowed to operate unhindered, Hazlitt wrote, as it was as important for the health of an economy that dying industries be allowed to die as it was for growing industries to be allowed to grow.19 Hazlitt compared the price system in a competitive economy to the automatic regulator on a steam engine.

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But some economists maintain that Japan is a special case and that interest rates can be expected to climb as the world’s population ages.25 Mainstream economists, who believe that the level of interest is determined by the supply and demand for savings, refer to what they call the ‘natural rate’ of interest. This idea was championed by John Locke in the seventeenth century. In the 1930s, however, John Maynard Keynes and his followers rejected the concept of a natural rate that balanced the economy at full employment. Since the natural rate cannot be observed directly, this argument is difficult to settle. Yet if the rate of interest is linked to profitability, as most economists have believed since the time of Adam Smith, then interest rates and the pace of economic growth (i.e. the rate of return for the whole economy) must also be connected.26 Thus, the trend level of economic growth can be taken as a reasonable proxy for the natural rate.

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As for the supposed shortage of investment-grade debt, the stock of Treasury debt doubled in the post-crisis decade. If Treasuries were in short supply, it was largely because the Federal Reserve (and other central banks) had snapped up so many of them. In 2014, Larry Summers suggested that in the post-crisis period interest rates that were consistent with full employment were not consistent with financial stability.fn7 Seasoned market observers had no doubt that ultra-low rates were behind the frantic search for yield and that financial risks were mispriced. ‘[N]ever … have investors reached so high in price for so low a return,’ wrote PIMCO’s Bill Gross.49 ‘The Federal Reserve policy of zero per cent interest rates and monetary expansion,’ commented James Grant, ‘has, by design, forced investors further out on the risk–return spectrum than they would otherwise have been had short-term real interest rates been positive.’

Reaganland: America's Right Turn 1976-1980
by Rick Perlstein
Published 17 Aug 2020

Senators passed Humphrey-Hawkins with so many denuding amendments from Utah’s junior senator that it earned the nickname the “Humphrey-Hawkins-Hatch Act.” Representative Robert Taft Jr. of Ohio said, “I do not think any Republicans need fear voting for the bill because of any apprehension that there is a victory in the passage of the full employment bill, because there is no full-employment bill anymore.” The energy bill was called up next. A new sword of Damocles emerged: a surprise “mini-filibuster” from Senators Abourezk and Proxmire in protest of its tax breaks for industry. The two chambers had been working twenty hours straight through the weekend, missing game four of the World Series.

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“If that is true, then the 1976 platform of the Democrat Party charts the most dangerous course for a nation since the Egyptians tried a short-cut through the Red Sea.” (“Sit on desk.”) He castigated the Democrats’ endorsement of the bill cosponsored by Senator Hubert Humphrey and Congressman Augustus Hawkins, the African American representative of the Watts neighborhood of Los Angeles, to require the federal government to produce full employment, even if it had to create government jobs to do so—“so disastrous in its consequences to the national economy, that the Democratic leadership in the Congress dares not bring it up for a vote in this election year.” Reagan claimed it cost as much as twenty-three stacks of $1,000 bills piled as high as a fifty-story building and would produce “complete and total control of the nation’s economy from Washington.”

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Capitol Hill was in mourning. Hubert Humphrey had died on January 13 at the age of sixty-seven, after a long fight with cancer. Carter called him “a hero”—and worked to cut to ribbons the measure Humphrey had hoped to leave behind as his greatest legacy. As introduced in 1974, the Humphrey-Hawkins Full Employment Act would have required the federal government to lower the unemployment rate of 3 percent within eighteen months, first trying via labor-friendly monetary policy from the Federal Reserve, then, should that fail, by hiring people for government jobs at locally prevailing wages on projects decided upon by local planning boards; and to create wage and price controls; and to provide federal aid to states where employment lagged; and to give citizens the power to sue the federal government for failing to provide them with a job—which would be thus enshrined as a right.

The Populist Explosion: How the Great Recession Transformed American and European Politics
by John B. Judis
Published 11 Sep 2016

Iglesias described Podemos’s goal as “post-neoliberalism.” Its program that first year called for ending evictions, creating a government-funded guaranteed annual income, auditing Spain’s debt with a view to not paying what was “illegitimate,” making the Stability and Growth Pact “flexible” and making it include “full employment” in its objectives, democratization of Brussels and rejection of the Lisbon Treaty, repeal of Spain’s balanced budget law, and a 35-hour workweek. Together, these demands established a divide between it and the government and main political parties, as well as between the Spanish people and Brussels.

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It was stated clearly by economist Wynne Godley in the London Review of Books in 1992: What happens if a whole country—a potential ‘region’ in a fully integrated community—suffers a structural setback? So long as it is a sovereign state, it can devalue its currency. It can then trade successfully at full employment provided its people accept the necessary cut in their real incomes. With an economic and monetary union, this recourse is obviously barred, and its prospect is grave indeed unless federal budgeting arrangements are made which fulfill a redistributive role. And of course, no federal budgeting arrangements were made.

The Story of Work: A New History of Humankind
by Jan Lucassen
Published 26 Jul 2021

Yet only the Soviet and German dictatorships developed a fully fledged system of unfree labour consisting of three elements: increasing restrictions on the movement of ‘ordinary’ workers; compulsory work for prisoners of war and inhabitants of occupied countries; and a combination of terror, extermination and enslavement of socially unwanted parts of the populations of both home and occupied countries. These numbers subsequently dwindled as a result of full employment in Germany due to the preparations for war, but the unfree labour force grew again from 1938 to over 40 per cent by the time the Nazis were defeated in 1945. This was due, in particular, to the capture of foreign workers, who, as we have seen, were much more numerous than the still-impressive 2 million POWs.

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They wanted to reform the existing economic system without threatening private property. The 1944 White Paper on Employment Policy distinguished between frictional, structural and general unemployment and pleaded for ‘high and stable’ employment. Beveridge’s programmatic publication of that same year was entitled Full Employment in a Free Society. He advocated a strong role for government planning in the public sector, though private investment would continue. These ideas deeply influenced politics not only in Britain but across Europe. Because of the increased competition between the two great socio-political systems, Western European governments were now even more convinced than they had been after the First World War that they had to respond to workers’ claims by introducing fundamental changes to social and economic policies.

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In this widely read Penguin pocket reader, first published in 1969, reprinted several times and translated into many languages, this senior advisor to the Wilson Labour government was happy to announce: Mass unemployment was brought to an end by the Second World War. It never returned. Despite dire predictions in 1945, Britain has now enjoyed full employment for more than thirty years. Such a tremendous transformation might be expected to have many causes. But in fact the evidence points to one cause above all others: the publication in 1936 of a book called The General Theory of Employment, Interest and Money by John Maynard Keynes.146 The period is also characterized by an emphasis on international agreements.

Tightrope: Americans Reaching for Hope
by Nicholas D. Kristof and Sheryl Wudunn
Published 14 Jan 2020

When decent jobs disappear, the loss is not just economic but has consequences for self-esteem, family structure, substance abuse, hopelessness and even child abuse. One study found that for each percentage point increase in the unemployment rate in a county, the incidence of child neglect rose by 20 percent. Disappearing jobs is a problem that varies greatly by region. Economists debate whether the American economy overall is at full employment, but it certainly isn’t in Flint, Michigan, where 35 percent of men of prime working age were not employed in 2018. Hubs of the “knowledge economy,” based on technology and education, have prospered, while rural areas and industrial regions continue to struggle. Half of all zip codes have less employment today than they did in 2007, while San Francisco, Seattle, Boston and New York are flourishing.

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in Flint, Michigan, where 35 percent of men of prime working age were not employed: Edward Glaeser, Lawrence Summers and Benjamin Austin, “A Rescue Plan for a Jobs Crisis in the Heartland,” The New York Times, May 24, 2018. See also Benjamin Austen, Edward Glaeser and Lawrence Summers, “Saving the Heartland: Place-Based Policies in 21st Century America,” Brookings Institution, March 8, 2018. There’s growing interest in Congress in job-creation programs. But at a time of full employment, it may not make sense to introduce such a program at a national level. Rather, because of the regional variations, we should target high-unemployment areas. We can also create incentives for employers who create jobs, expand the Earned Income Tax Credit and also target at-risk demographics like juvenile delinquents with special interventions like Career Academies that have an excellent record of job creation.

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Friedman, A Few Thousand Dollars (New York: The New Press, 2018). wage insurance has bipartisan support: Robert J. Shiller, “How Wage Insurance Could Ease Economic Inequality,” The New York Times, March 11, 2016. federal job guarantee: L. Randall Wray, Flavia Dantas, Scott Fullwiler et al., “Public Service Employment: A Path to Full Employment,” Levy Economic Institute of Bard College, April 2018. “As an economist, I am always asked”: Joseph E. Stiglitz, Amartya Sen and Jean-Paul Fitoussi, “Report by the Commission on the Measurement of Economic Performance and Social Progress,” 2009. A NOTE ABOUT THE AUTHORS Nicholas D.

The Revolt of the Public and the Crisis of Authority in the New Millennium
by Martin Gurri
Published 13 Nov 2018

In 1987, President Ronald Reagan appointed Greenspan chairman of the Board of Governors of the Federal Reserve System – a portentous name for the central bank of the United States, usually called, without affection, “the Fed.” By law, the mission of the Fed was, and still is, to maintain the stability of prices while promoting sustainable growth and full employment. The claims behind these goals possessed what I can only describe as a magical quality. They presupposed powers of prophecy and control wholly detached from economic reality. The chairman of the Fed, like the genie in the Arabian Nights, was expected to tame the whirlwind. Greenspan’s appointment came in August.

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The architects of the stimulus bill passed in 2009 claimed that it would save or create 3.5 million jobs and significantly lower the unemployment rate. It would do so by spending a lot of money. Of necessity, that has been the chosen economic tool of government. Since World War II, Ormerod notes, governments have absorbed a much larger chunk of the national output in pursuit of worthy goals such as full employment. In Britain, where excellent statistics have been kept from the Victorian era onward, the size of the public sector as a proportion of the economy has doubled since 1946, compared to the period 1870-1938. Yet the difference in the average unemployment rate before and after the expansion of government was statistically negligible.

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It should be apparent by now that I’m less interested in originality than in democracy, which has been caught in the crossfire between the public and authority – sometimes, as in Egypt, literally so. The revolutionary impulse of the age has been fueled by strangely personal utopian expectations. The failure of democratic governments to deliver on equality, social justice, full employment, economic growth, cheap apartments, happiness, and a meaningful life, has driven the public to the edge of rejection of representative democracy as it is actually practiced. Some have gone over the edge. Failure has bred frustration, frustration has justified negation, and negation has paved the way for the nihilist, who acts, quite sincerely, on the principle that destruction of the system is a step forward, regardless of alternatives.

The Price of Tomorrow: Why Deflation Is the Key to an Abundant Future
by Jeff Booth
Published 14 Jan 2020

Ben Bernanke Senate confirmation hearing November 15, 2005 “We’ve never had a decline in house prices on a nationwide basis. So, what I think what is more likely is that house prices will slow, maybe stabilize, might slow consumption spending a bit. I don’t think it’s gonna drive the economy too far from its full employment path, though.” Ben Bernanke interview with CNBC February 14, 2007 “The weakness in housing market activity and the slower appreciation of house prices do not seem to have spilled over to any significant extent to other sectors of the economy.” Ben Bernanke semi-annual Monetary Policy Report to the Congress May 17, 2007 “We do not expect significant spillovers from the subprime market to the rest of the economy or to the financial system.”

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Another way of looking at this strategy is “growth at any cost to society.” A day will come, probably sooner than later, when we realize that the only thing driving our economies is the explosion of debt. If governments need to run huge deficits with extremely low interest rates for fear of growth failing, even in economies that are running at near full employment, imagine how the debt and deficits explode in a recession or depression when the economy falters. Once bond holders determine that governments have little ability to repay or service the debt, the risk premium (or interest rates) on the debt will rise. Sure, governments can monetize and make their currencies worthless, but as other central banks monetize as well, the strategy itself becomes irrelevant.

Wealth and Poverty: A New Edition for the Twenty-First Century
by George Gilder
Published 30 Apr 1981

Eltis and the Keynesians,” Lloyds Bank Review, no. 124 [April 1977], pp. 1–13), Kahn wrote that Keynes was much less concerned with hiking government spending to increase employment than with lowering interest rates to stimulate private investment. Kahn derided as “vulgar Keynesianism” the conventional formula that consumption, investment, and government spending together can be managed to achieve full employment. “There is no such thing as a definite level of full employment,” he wrote. 8 Keynes, The General Theory, p. 155. 9 Keynes (in The General Theory, pp. 297–298) writes, with explicit reference to his own mathematical models included in The General Theory: “It is a great fault of symbolic pseudo-mathematical methods...that they expressly assume strict independence between the factors involved and lose all their cogency and authority if this hypothesis is disallowed; whereas in ordinary discourse, where we are not blindly manipulating but know all the time what we are doing and what the words mean, we can keep ‘at the back of our heads’ the necessary reserves and qualifications and the adjustments we shall have to make later on, in a way in which we cannot keep complicated partial differentials ‘at the back’ of several pages of algebra which assume that they all vanish.

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Beyond the familiar appeals for “social change” and the “radical restructuring” of this and that, this concept of the sources of poverty is seen to dictate two lines of policy: for the primary market, it is a renewed emphasis on anti-discrimination suits and pressures, with quotas where necessary to break down entrenched patterns of de facto bias; and for the secondary market, it is full employment—a government-primed expansion of aggregate demand that improves the bargaining power of low-income workers and lifts increasing numbers of jobs into the primary sector. For observers more jaded about the magic of aggregate demand, Nathan Glazer offered a similar, though more sophisticated, analysis and a more sensible program.

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The activity is the same: a vision of opportunity to serve, a mobilization of capital and support, an organization of labor, and a marketing of product, but without, most of the time, any real sense of a bottom line or public demand. The ironic result is to destroy jobs and capital. The government boom in the name of full employment, in the vision of job entitlement and insurance, will end by reducing the availability of real work at inviting levels of pay. No matter how secure each bemused and pensioned government worker may feel, his future remains in the hands of the creators of wealth and the absorbers of risk. Production is the source of all demand, and as supplies of marketable products decline, so does the worth of the specious job contracts and blue-sky pensions of the public sector.

Capitalism in America: A History
by Adrian Wooldridge and Alan Greenspan
Published 15 Oct 2018

The mechanization of cotton picking boosted productivity and diminished job creation across the South and encouraged millions of black laborers to move to higher-paying jobs in northern factories. The government embraced a Keynesian policy of demand management regardless of which party held the White House. In 1946, Congress passed the Employment Act, which set the country the Goldilocks goal of full employment, full production, and stable prices, and also established the Council of Economic Advisers. Politicians interpreted Keynesianism in increasingly expansive terms—not just as a way of heading off depression but also as a way of ensuring permanent prosperity. How did America get into such a happy state?

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“In the early 1960s in Washington we thought we could do anything,” Daniel Patrick Moynihan reflected; “the central psychological proposition of liberalism . . . is that for every problem there is a solution.” In 1966, Walter Heller, one of Kennedy’s top economic advisers, pronounced that the “‘new economics’ would assure full employment, low inflation, and steady economic growth.”6 “Steady” understates it: national income, adjusted for inflation, grew at 4 percent a year from 1962 to 1974. By 1973, the nation’s real income was 70 percent higher than it had been in 1961. In the middle of the glorious 1960s, a top census official said that America’s most pressing problem would be how to consume all the wealth that it was producing: “a continuation of recent trends will carry us to unbelievable levels of economic activity in our own lifetimes.”7 Johnson’s closest economic advisers underestimated the cost of all these new entitlements, not just in the long term but even in the short term.

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It was only in the period from 1998 to 2004 that it regained its pre-1970 pace with growth of 3.5 percent a year (see chart). Economists are beginning to redefine the growth potential of the U.S. economy downward. The U.S. Congressional Budget Office (CBO) suggests that the “potential growth rate” for the U.S. economy at full employment of factors of production has now dropped below 1.7 percent a year. This implies a sustainable long-term annual per capita growth rate for America of well under 1 percent. U.S. BUSINESS SECTOR PRODUCTIVITY GROWTH Having looked as if it was charting a new economic course in the late 1990s, America now looks much like the rest of the advanced world.

1939: A People's History
by Frederick Taylor
Published 26 Jun 2019

Moreover, since a great deal of the country’s light-industrial capacity, reliant on exports and especially vulnerable to the slump in world trade, lay in the German-speaking areas, this caused an even more disproportionate rise in unemployment in the Sudetenland. In 1936, of the country’s 846,000 unemployed 525,000 were German-speaking.20 This brutal fact, and the lingering economic crisis, made Sudeten Germans, political and racial conflicts aside, look ever more enviously over the border into Nazi Germany, where by this time full employment was close to prevailing. The dramatic deterioration of economic life in the German-speaking parts of the CSR was illustrated by the situation in Gablonz (Czech: Jablonec), a majority-German town in the mountains of northern Bohemia, close to the German border. Its hitherto prosperous industries, most importantly glass and artificial jewellery production, collapsed along with the stock market in 1929, and this led to great distress in the area.

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At the front of the Monument, foot-high floral lettering spelled out the abbreviated version of one of Hus’s most famous pronouncements, which had been adopted as its motto by the post-1918 Czechoslovak Republic: Pravda Vitezi (‘Truth Prevails’).17 * There had been plenty of guns in evidence around Berlin that April, but not so much butter. True, Germany now enjoyed full employment – so conclusively, said the SD’s report on economic affairs, that with a mere 140,000 German males jobless at the end of March 1939 the authorities had decided not to publish employment figures in future. To do so would, it was claimed, indicate mostly just natural turnover in the labour market rather than actual shortage of work, and thereby give a false impression.18 However, wages remained low compared with those in other advanced industrial countries, especially for industrial workers.

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The Third Reich was still a capitalist society, but altogether more heavily regulated and directed by government than Britain or the USA (even taking into account the rush of government intervention following Roosevelt’s election and the ‘New Deal’). The primacy of rearmament trumped all normal business calculations. Nor, unlike contemporary Britain or America, could the Reich be called a ‘consumer society’. This was the case despite full employment, aspects of a welfare state, a superficial sheen of prosperity – ‘The beautiful illusion of the Third Reich’ as the historian Peter Reichel called it – and the simulation of plenty encouraged by all the various ‘people’s’ products. In fact, few of these actually succeeded (the Volkskühlschrank or ‘People’s Refrigerator’, for instance, got no further than the drawing board).

The Enlightened Capitalists
by James O'Toole
Published 29 Dec 2018

In exchange for the guarantee, workers agree to work overtime when Lincoln products are in great demand. The plan has worked well over the six decades it has been in place, although the company was forced to go to a thirty-hour week at the bottom of the 2008–9 recession. Such exceptions notwithstanding, full employment (on average, forty-five-hour weeks) has been the norm at Lincoln Electric, where it has not been unusual for workers to put in fifty-plus-hour weeks. To deliver on its unique promise of guaranteed employment, Lincoln’s managers pay inordinate attention to staffing levels, work scheduling, job assignments, and hiring practices.

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Instead, Iverson said, “We’ve joined with our employees to pursue a goal we can all believe in: long-term survival. We run Nucor first and foremost to ensure that, a decade or two from now, there will still be a place for our children and grandchildren to work without being laid off. That is our higher cause.”6 The means to achieving the company’s goal of sustainable full employment was, in Iverson’s reckoning, its “long-term perspective.” Yet he denied that that focus was altruistic: “Our executives worry about profitability as much as those in any company.” The basic reason why his competitors were not as successful as Nucor, he felt, was that they were too willing to satisfy the demands of Wall Street for short-term profit.

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Minnesota’s Marvin Windows and Doors has been family-owned for four generations, and many of its four thousand employees are second- and third-generation descendants of Marvin workers. The company was founded in 1912 with the purpose of providing work for chronically unemployed residents of host town Warroad, snuggled hard against the Canadian border. Today, Marvin Windows’ workforce easily outnumbers the town’s total population, but the company is still dedicated to full employment. During the 2007–8 recession, when the market for custom-made doors and windows shrank drastically, no one at Marvin was laid off. The sense of loyalty and community was so strong that older, higher-paid employees voluntarily reduced their work hours so their younger, lower-paid peers could maintain their incomes.1 There are, of course, notable exceptions to the behavior of the Marvin and Wegman families: marginal mom-and-pop concerns often lack resources to provide their workers with decent pay, benefits, or job security, and some small businesses take advantage of their size exemption from governmental regulations to exploit employees, even exposing them to unsafe and unhealthy working conditions.

The Cold War: A World History
by Odd Arne Westad
Published 4 Sep 2017

In France, quite a few who had condemned Communism in the 1930s now saw it in a more positive light because of the amount of Soviet sacrifice in the war against Hitler. Support for Communist parties in western Europe had never been greater. Most of the new Communists were young people who had come of age during the war. In their eyes Communism and the Soviet example were first and foremost about much-needed reform in their home countries. They wanted full employment and social services. Women who had joined the workforce during the war did not want to be forced back into patriarchal domesticity. Communists were genuinely admired by many for their role in the resistance to German occupation, including by people who regretted their own failure at taking up weapons.

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European Communist parties could benefit from the ensuing impoverishment of the workers, since it would prove that no capitalist system could deliver what the working class wanted. The efforts of Social Democrats to reform capitalism was therefore, in the Soviet view, at best irrelevant and at worst counterproductive. Only countries that consciously patterned themselves on the Soviet experience, which had shown that it could deliver full employment and economic growth, would gain in economic terms from the war’s end. The US perspective on conditions in Europe after the war ended was almost the diametric opposite of that of the Soviets. Americans feared the effects of an economic collapse and lasting poverty in Europe, one that could perhaps spread worldwide.

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Transport, repairs, or new machinery were requested by the individual factory and decided on, according to political priority, by state institutions allocated such tasks. Investment and output were imagined to be in perfect balance, and resources therefore utilized to the utmost. Distribution replaced the market as a mechanism of dividing the output. No factories ever closed, and no workers were laid off. There was therefore full employment at all times. The country was a socialist economic machine, the purpose of which was to maximize production. Reality, of course, diverged rather substantially from this economic ideal, as did capitalist practices from free market thinking in nonsocialist countries. Although much was achieved in terms of increasing production during the first decades of full economic planning, mainly in industry (socialist agriculture always lagged behind), growth slowed later.

A Classless Society: Britain in the 1990s
by Alwyn W. Turner
Published 4 Sep 2013

Between them, they destroyed the post-war consensus, which had always been a typically British muddled compromise of a mixed economy and a shared Christian heritage, held together by the fantasy of growing prosperity. That came to an end in September 1976, with James Callaghan’s speech to the Labour Party conference. ‘The cosy world we were told would go on for ever, where full employment would be guaranteed by a stroke of the chancellor’s pen,’ he said; ‘that cosy world is gone.’ The story of these three volumes is essentially the tale of the building of a new consensus. It’s not as cosy. A sizeable minority of the population has been effectively excluded from mainstream society, historically terrifying levels of unemployment – however the figures are disguised – have become entrenched, and the concept of a job for life has long since vanished.

…

Part of the problem was that the price of that recession had been so painful, as Major admitted: ‘Unemployment rose from 1.75 million on the day I became prime minister to a peak of just under three million.’ This was the price that had apparently been worth paying for getting inflation under control, and, in this respect at least, it had been a success; although there was no prospect of a return to full employment, the high rates of inflation, once so familiar, had been vanquished and did not reappear. Keeping inflation at bay during the subsequent recovery was seen by some as a tribute to the work of Kenneth Clarke as chancellor of the exchequer – the combination of growth and low inflation had last been achieved under Roy Jenkins back in the 1960s – but it brought its own problems.

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Though never pushed to its logical conclusion, this philosophy had inspired both the great reforming government of Clement Attlee in 1945 and, subsequently, some of the more radical thinkers on the left. It had come under threat, however, during the leadership of Hugh Gaitskell in the late 1950s, with an attempt to rewrite the clause. ‘The changing character of labour, full employment, new housing and the new way of living based on the telly, the fridge, the car and the glossy magazines – all these have had their effects on our political strength,’ argued Gaitskell. ‘We have to show we are a modern, mid-twentieth century party, looking to the future not to the past.’ But his attempt to rewrite the party’s aims was defeated at the 1959 conference, and thereafter the relevant passage from Clause IV was printed on every membership card as a token of a covenant.

The Empire Project: The Rise and Fall of the British World-System, 1830–1970
by John Darwin
Published 23 Sep 2009

But, for Attlee and his colleagues, there was little real choice in the road to recovery. The central plank in Labour's electoral platform, the glue that held the government, the party and its trade union supporters (the main source of its funds) together, was the promise of full employment, originally laid down in the wartime white paper in 1944. Full employment was the key guarantee that the sacrifices of wartime had not been in vain, and that victory had made possible a better, fairer, Britain. It could not be repudiated. It was also the essential condition without which Labour's whole social programme would quickly unravel.

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After 1918, the blueprint for social reconstruction had been largely torn up when the government abandoned most of the levers of economic control at the onset of depression. This pattern was not repeated after 1945. Instead, the Labour government embarked upon a huge social programme to extend educational opportunity, widen access to healthcare and (most fundamental of all) secure full employment. It also took charge of two basic industries whose renovation was vital to economic recovery: transport (including railways, harbours and road haulage) and the mines. The result was high levels of public expenditure for domestic recovery and social reform. Yet, at exactly the same time, spending on defence remained obstinately high.

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The Conservative party had won the election under a populist banner – ‘Set the people free!’ – that decried the bureaucratic austerity of the Labour regime. Rationing was indeed abandoned in 1954, and Labour's late nationalisation of the steel industry reversed. But there was no major departure from the domestic priorities of the previous government. Full employment remained at the centre of economic policy. The welfare state, its social corollary, was politically sacrosanct: indeed, one of its main Conservative architects, R. A. Butler, was Chancellor of the Exchequer from 1951 to 1955. The tax system was left much as it was.1 No great ideological shift separated the two phases of British post-war politics between 1945 and 1963, even if over particular issues (like the Suez crisis or entry into the Common Market) there was sometimes a wide gap between the two major parties.

The Gig Economy: A Critical Introduction
by Jamie Woodcock and Mark Graham
Published 17 Jan 2020

In particular, the growth of the service industries since the 1970s has seen another phase in which workers have to sell their labour power without much ability to collectively bargain over the terms. At the same time, the labour market was ‘“deregulated” and labour made more “flexible”’, as part of a political project to undermine workers’ rights, restoring ‘management’s “right to manage”’ (Munke, 2005: 63). A key part of this has been ‘a general move away from the full employment goal towards activation policies’ (MacGregor, 2005: 144). The result has been a growth in underemployment, and a decline of stable employment. It has also involved an increasing polarization of the types of jobs available (Kaplanis, 2007), with a growth in the number of low-paid ‘lousy jobs’ at the bottom (Goos & Manning, 2007).

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See https://www.theguardian.com/business/2016/jul/20/uber-driver-employment-tribunal-minimum-wage 6. See https://www.judiciary.uk/wp-content/uploads/2016/10/aslam-and-farrar-v-uber-employment-judgment-20161028-2.pdf 7. See https://www.fwc.gov.au/documents/decisionssigned/html/2018fwc6836.htm 8. See https://www.theguardian.com/law/2018/feb/07/couriers-carrying-blood-for-nhs-win-full-employment-rights 9. We thank Darcy du Toit for his insightful suggestions in this section. 10. In addition to whatever beneficial tax arrangements it is able to bring about. 11. See https://iwgbunion.files.wordpress.com/2017/07/iwgb-response-to-taylor-review1.pdf 12. As explained in the report ‘The ILO Minimum Wage Fixing Convention, 1970 (No. 131), provides for a minimum wage, taking into consideration: (a) the needs of workers and their families, taking into account the general level of wages in the country, the cost of living, social security benefits and the relative living standards of other social groups; and (b) economic factors, including the requirements of economic development, levels of productivity and the desirability of attaining and maintaining a high level of employment.

Europe old and new: transnationalism, belonging, xenophobia
by Ray Taras
Published 15 Dec 2009

In theory, any European law contrary to the values and objectives identified by the charter can now be declared null and void by the European Court of Justice. For example, the Court may force a rewriting of national laws regarding social and economic policy such as strikes, collective bargaining, and working hours. The Lisbon agreement added new social objectives to the charter, including full employment, eradication of poverty, and rights preventing social exclusion and discrimination. Two countries refused to sign the Charter of Fundamental Rights. Britain cited concerns over its ability to control social and economic policy and Poland was suspicious that its Catholicinspired moral and family policies would be open to challenge.

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In the east, a remarkably high proportion of the population—40 percent in some countries—still worked on the land in the late 1980s. Western European governments were beginning to address the problem of environmental degradation, while those in the east were concerned primarily with maintaining the fiction of a full employment economy in which environmental regulations had no place. The communist economies had reached a breaking point. By the late 1980s, they faced the conundrum “damned if you do, damned if you don’t.” In the 1970s, people’s incomes in eastern Europe had increased, but then what we may call “Huntington’s law” kicked in.

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By contrast, European social democracy was wrong-footed by its need to establish credentials as defender of the nation-state, thereby distinguishing itself from its leftist brethren in the internationalist camp spearheaded by the communists. Social democracy supported Christian democracy’s conceptualization of the social state and extended it farther with advocacy of full employment, welfarism, and social inclusion. As we discussed in the first chapter, communism’s collapse added further momentum for European enlargement and integration. In France, “many intellectuals—with the decline of Marxism, of universalism and of general ideologies promising a future paradise on earth—came back to a more realistic cause, and a democratic one: Europe.”45 After 1989, Europe became a democratic horizon for “the other Europe.”

Free Market Missionaries: The Corporate Manipulation of Community Values
by Sharon Beder
Published 30 Sep 2006

Everyone knows that we are subject today to a high degree of governmental control, but too many may come to believe that the efficiency being displayed by industry derives from this wartime incident of centralized planning and administration, rather than the qualities inherent within industry itself. 45 In the immediate post-war period, key business organizations were concerned about government intervention and controls on the one hand, and union activity on the other – Big Government and Big Labour. Proposals for further government intervention included price controls, a rising minimum wage, expanded unemployment insurance and tax reforms. Unions were active and in some cases demanding not just improved pay and conditions, income security and full employment through government spending, but also a say in corporate decisions 24 FREE MARKET MISSIONARIES in areas such as pricing and investment. They were advocating social planning and expansion of the welfare state.46 The way in which business in the US used its power and resources to oppose unionism was unique in scale and comprehensiveness.

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Although most people were in favour of private ownership and thought well of large corporations, a majority also thought that most businessmen did not have the good of the nation in mind when they made their decisions and therefore government oversight was necessary. Many believed that businesses made huge profits and, business leaders felt, few understood the relationship between profits and investment. Surveys showed that some 70 per cent of workers believed that the government should guarantee full employment. Many workers did not trust their employers and were not convinced of the value of free enterprise. A substantial number of workers, in fact, supported government ownership or control of the economy.52 PROMOTING BUSINESS VALUES 25 Business sought to deal with these threats by selling free enterprise on the basis that ‘if you control public opinion you have the government in your hand and labor behind the eight ball’.53 Public relations consultants, eager for business, promoted the need for their services.

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‘The diseases of poverty – TB, rickets, and others – returned.’22 Those forced into unemployment found that welfare had also been subjected to fundamentalist policies that included reduced entitlements and other ‘incentives’ to ensure the unemployed would accept any job that was offered, no matter how poorly paid. The government goal of full employment that had been thought to be necessary for social stability and cohesion was abandoned in the name of Friedman’s theory of a natural rate of unemployment (see Chapter 7).23 Free market policies were bad enough for affluent nations like Britain. Imposing such conditions on poor nations was devastating.

The AI Economy: Work, Wealth and Welfare in the Robot Age
by Roger Bootle
Published 4 Sep 2019

In the first three decades after the Second World War, in much of the Western world, productivity increased at an average annual rate of over 3 percent. There were several reasons for this good performance but the scope for capitalizing on the technological advances that had built up over the previous 20 years, and the high level of investment made possible by the combination of full employment and low interest rates, were prime among them. Something similar may be about to happen again. There will be two main factors driving such a surge in productivity growth. The first is the direct replacement of humans by “machines,” including AI, mirroring what has gone on now umpteen times during the last 200 years.

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It is far from inevitable that this will lead to job losses in those sectors. Rather, as professionals’ productivity improves, it is likely that their output will rise also. Meanwhile, new jobs that barely exist today, will spring up and multiply. Accordingly, I see no reason why the robot- and AI-infused economy of the future cannot be accompanied by full employment. Mind you, this is not necessarily a vision of the future that you will be bound to like. Quite apart from anything else, the destruction of many old jobs and the emergence of new ones will surely have implications for the makeup of society which could have decided political consequences – a subject that I take up in Part III.

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This favorable tax treatment of capital investment rests on three key assumptions: • Jobs lost in one occupation or sector would always be made up for by jobs created in other occupations or sectors. If this result did not occur naturally through the normal workings of the market, then various government programs to ease structural difficulties, supported by the authorities’ monetary and fiscal policies, designed to achieve full employment, would ensure that it nevertheless transpired in the end. • Society as a whole has a strong interest in achieving high levels of investment, which is the route to higher levels of GDP per capita and hence higher living standards. For a variety of reasons, companies may be reluctant to invest as much as is in the public interest.

Crashed: How a Decade of Financial Crises Changed the World
by Adam Tooze
Published 31 Jul 2018

As its protagonists were well aware, America’s crisis fighting exhibited massive inequity.38 People on welfare scraped by while bankers carried on their well-upholstered lives. But though the distribution of costs and benefits was outrageous, at least America’s crisis management worked. Since 2009 the US economy has grown continuously and, at least by the standards set by official statistics, it is now approaching full employment. By contrast, the eurozone, through willful policy choices, drove tens of millions of its citizens into the depths of a 1930s-style depression. It was one of the worst self-inflicted economic disasters on record. That tiny Greece, with an economy that amounts to 1–1.5 percent of EU GDP, should have been made the pivot for this disaster twists European history into the image of bitter caricature.

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The convention consisted of a commission of bigwigs headed by that old warhorse of French Europeanism former president Giscard D’Estaing.52 The proposal enshrined a new balance between centralized decision making by majority vote and the irreducible role of the European nation-states. It subordinated all the various institutions and treaties that had made up the pillars of European integration into a single overarching European Union. Europe’s ambition was defined as being a “social market economy” that prioritized full employment, “social justice” and “solidarity between generations” as well as the fight against “social exclusion and discrimination,” while also promising to be “highly competitive.”53 The constitution was a pleasing portmanteau of all the nostrums of good governance of the early 2000s. The European Trade Union movement gave its approval.

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Viewed in these terms, the effect of the crisis of 2007–2009 on the budgets of rich countries was spectacular. Whatever the politics of stimulus spending in Congress, the Bundestag or the House of Commons, the automatic stabilizers delivered a huge and timely stimulus. According to calculations by the IMF, if the US economy had been at full employment in 2009, the crisis-fighting policies adopted by the Bush and Obama administrations would have been enough to produce a deficit of 6.2 percent of GDP—this was the discretionary deficit. The actual general government deficit was 12.5 percent of GDP.22 More than half the support provided to aggregate demand was automatic or quasi-automatic.

Brit-Myth: Who Do the British Think They Are?
by Chris Rojek
Published 15 Feb 2008

This perception cast a shadow over the conduct of Blair’s tenure at Downing Street. This obscured the progressive policies conducted under his leadership, such as the devolution of power to Scotland, Northern Ireland and Wales; the granting of independence to the Bank of England; the reform of the House of Lords; the creation of a stable economy; the achievement of near-full employment; the reduction of child poverty; the rise in benefit for one-parent families; the halving of the number of pensioners living under the poverty line; and substantial investment in central public services. Blair came to office with high ideals, a modern Hercules ready to cleanse the Augean stable of the Conservative era.

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At the same time, globalization, multiculturalism and multi-ethnicity have changed the pattern and appearance of erstwhile domestic institutions and ways of living. Building the welfare state required an influx of new labour from the Commonwealth. In 1945, the architects of new Britain may have looked forward to a future of roast beef on Sunday, warm beer, full employment for all and the chance for everyone to develop their talent. What actually happened was that architecture, cuisine, fashion, language and education were redefined through the complex adaptation between Anglo-Saxon/Celtic customs and traditions and the influx of multi-ethnic and multicultural influences.

WTF?: What's the Future and Why It's Up to Us
by Tim O'Reilly
Published 9 Oct 2017

Coupled with the end of the Bretton Woods system, a gold exchange standard anchored to the US dollar, the commitment to full employment led to skyrocketing inflation. Inflation is good for debtors—it makes goods such as housing much cheaper, because you repay a fixed dollar amount of debt with future dollars that are worth much less. Meanwhile, you have more of those dollars, as your salary keeps going up. Ordinary goods cost more, though, which means that as a worker, you have to keep demanding higher wages. But inflation is very bad for the owners of capital, since it reduces the value of what they own. Starting in the 1970s, keeping inflation low replaced full employment as the fitness function.

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Like the characters in the Terminator movies, before we can stop Skynet, the global AI bent on the enslavement of humanity, we must travel back in time to try to understand how it came to be. According to political economist Mark Blyth, writing in Foreign Affairs, during the decades following World War II, government policy makers decided that “sustained mass unemployment was an existential threat to capitalism.” The guiding “fitness function” for Western economies thus became full employment. This worked well for a time, Blyth notes, but eventually led to what was called “cost-push inflation.” That is, if everyone is employed, there is no barrier to moving from job to job, and the only way to hang on to employees is to pay them more, which employers necessarily compensated themselves for by raising prices, in a continuing spiral of higher wages and higher prices.

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Federal Reserve chairman Paul Volcker put a strict cap on the money supply in an effort to bring inflation to a screeching halt. By the early 1980s, inflation was under control, but at the cost of sky-high interest rates and high unemployment. The attempt to bring inflation under control was coupled with a series of supporting policy decisions. Labor organizing, which had helped to promote high wages and full employment, was made more difficult. The Taft-Hartley Act of 1947 weakened the power of unions and allowed the passage of state laws that limited it still further. By 2012, only 12% of the US labor force was unionized, down from a peak above 30%. But, perhaps most important, a bad idea took hold. In September 1970, economist Milton Friedman penned an op-ed in the New York Times Magazine titled “The Social Responsibility of Business Is to Increase Its Profits,” which took ferocious aim at the idea that corporate executives had any obligation but to make money for their shareholders.

2312
by Kim Stanley Robinson
Published 22 May 2012

Wahram had thought it generally agreed that the whole development-aid model had been demonstrated to be an example of the Jevons Paradox, in which increases in efficiency trigger more consumption rather than less; increased aid had always somehow increased suffering, in some kind of feedback loop, poorly theorized—or else theorized perfectly well, but in such a way that revealed the entire system to be a case of vampiric rich people moving around the Earth performing a complicated kleptoparasitism on the poor. No one wanted to hear that news, so they kept on repeating errors identified four hundred years before, on ever-grander scales. So, the Planet of Sadness. There were of course very powerful forces on Earth adamantly opposed to tinkering from above in general, and to creating full employment in particular. Full employment, if enacted, would remove “wage pressure”—which phrase had always meant fear struck into the hearts of the poor, also into the hearts of anyone who feared becoming poor, which meant almost everyone on Earth. This fear was a major tool of social control, indeed the prop that held up the current order despite its obvious failures.

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So he seized a moment when she was catching her breath and said, “The problem is that what’s needed to be done has been clear for centuries now, but no one does it because it would take a very large number of people to enact it. Construction work, landscape restoration, decent farming, they all take huge numbers of people.” “But there are huge numbers of people! If the unemployed were mobilized, there’s your numbers. The revolution of full employment. The place is trashed, they’re cooked, they need to do it. In effect Earth needs terraforming as much as Venus or Titan! In fact it needs it more, and we’re not doing it.” Wahram thought it over. “Could it be sold that way, do you think? As a restoration? Appeal to the conservatives as well as the revolutionaries—or at least confuse the issue as to what is really happening?”

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Enough carbon dioxide was to be buried under the northern Rockies to make the project on balance carbon negative. The building and transport crews for the job were hired primarily from the Suffering South, as it had been called in the years when the West Antarctic Ice Sheet had come off and sea level made its biggest rise. The Florida work did not create full employment by itself, but riding the rails, Wahram had a lot of time to look at the passing country and think about it, and once he sent a note to Swan: Remember what you said on Venus about giving everyone here a job doing landscape restoration? It could work. So he rode the trains back and forth from Canada to Florida.

The Technology Trap: Capital, Labor, and Power in the Age of Automation
by Carl Benedikt Frey
Published 17 Jun 2019

Mitchell, 1988, British Historical Statistics (Cambridge: Cambridge University Press), 837, for 1830–1900. Real output per capita from N. F. Crafts, 1987, “British Economic Growth, 1700–1850: Some Difficulties of Interpretation,” Explorations in Economic History 20 (4): 245–68. Average full-employment weekly earnings for the United Kingdom for 1770–1882 from Feinstein 1998, appendix table 1, 652–53; average full-employment weekly earnings for the United Kingdom for 1883–1900 from Feinstein, 1990, “New Estimates of Average Earnings in the United Kingdom,” Economic History Review 43 (4): 592–633. Cost of living index for 1770–1869 from R. C. Allen, 2007, “Pessimism Preserved: Real Wages in the British Industrial Revolution” (Working Paper 314, Department of Economics, Oxford University), appendix 1.

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during a news conference in 1962, he responded: Well, it is a fact that we have to find, over a 10-year period, 25,000 new jobs every week to take care of those who are displaced by machines, and those who are coming into the labor market, so that this places a major burden upon our economy and on our society.… But if our economy is progressing as we hope it will, then we can absorb a good many of these men and women. But I regard it as the major domestic challenge, really, of the ’60s, to maintain full employment at a time when automation, of course, is replacing men.33 The tragedy of Kennedy’s assassination the following year didn’t end the automation debate. Soon after taking office, President Lyndon Johnson set up a National Commission on Technology, Automation, and Economic Progress. Like Kennedy, Johnson was not opposed to automation.

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It becomes more and more uncertain as hours input and arduousness of work fall below a point where the physical strain and other detriments of work impinge on health, family life, and full participation in social life, while at the same time the material standards of consumption rise. I do not know what workweek industrial and other workers will choose in the future. It is interesting to note that with substantially full employment in recent years, little reduction in average hours worked has occurred in non-agricultural employment in the United States.… At present, workers seem inclined generally to place a higher value on additional income than on more leisure, but this may not always be the case.103 The extract above is from a Bureau of Labor Statistics report that was first published in 1956.

Hard Times: The Divisive Toll of the Economic Slump
by Tom Clark and Anthony Heath
Published 23 Jun 2014

And, looking further ahead, will the bitter experiences of today's jobless fathers be visited on their children, too? The last time the storm hit this hard, Roosevelt in the US (and later, Beveridge in Britain) responded with a bold agenda that did not merely clear up the immediate disaster, but also sought to ensure that no future gale could bring the same misery. Alongside the aim of creating a full-employment economy to provide decent jobs, the ambition then was to build a comprehensive welfare state that would provide shared shelter whenever the economy faltered. Although policy has followed somewhat different paths in London and Washington this time, the recent record of both – upon which Chapter 8 concentrates – could reasonably be caricatured as knocking down storm defences.

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For the UK, the data is from the same 1958 cohort study (the National Child Development Survey) that we used in the analysis of scarring in civic life; for the US, however, we exploit a different, nationwide sample of people born a few years later, in the early 1960s, from the National Longitudinal Survey of Youth. While these Britons and Americans were all born into the very different post-war world of full employment, the young women of this generation had their early experience of work in the decidedly ‘hard times’ context of the early 1980s labour market. Taking the UK data first, British girls raised in ‘workless homes’69 spent on average 14% more of their total time as young adults without a job than did their peers from working homes; between the ages of 16 and 29 that adds up to a difference of about 1 year 10 months.

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Just listen to Roosevelt's second inaugural – ‘we refused to leave the problems of our common welfare to be solved by the winds of chance and the hurricanes of disaster’ – and you can hear how the New Deal was deliberately rooted in this sort of argument.4 The same logic animated Britain's post-war reconstruction. The ‘all in it together’ pitch supported not only social insurance and labour market protections, but also the macroeconomic commitment to full employment, which became a settled objective for governments in both the UK and the US until it was dislodged by alarm over the great inflation of the 1970s. Just as with taxes and spending, macroeconomic choices over interest rates and so on will create winners and losers, and the balance of political power between them will bear upon the direction of policy.5 But monetary policy in the Great Recession has been nothing like as controversial as during the Depression: this time reflationists have carried the day with relative ease in Britain and America, if not continental Europe.

The Blockchain Alternative: Rethinking Macroeconomic Policy and Economic Theory
by Kariappa Bheemaiah
Published 26 Feb 2017

The rule, introduced by economist John Taylor, was established to adjust and set prudent rates for the short-term stabilization of the economy, while still maintaining long-term growth. The rule is based on three factors: (i) Targeted versus actual inflation levels; (ii) Full employment versus actual employment levels; (iii) The short-term interest rate appropriately consistent with full employment (Investopedia). Its mathematical interpretation is: r = p + 0.5y + 0.5(p - 2) + 2. Where, r = the federal funds rate, p = the rate of inflation, y = the percent deviation of real GDP from a target (Bernanke, 2015). 16Contract theory was first developed in the late 1960’s by Kenneth Arrow (winner of the 1972 Nobel prize in economics), Oliver Hart and Bengt R.

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In their words, “… fiscal expansion can raise demand without worsening private sector balance sheets; indeed, government deficit spending actually improves private sector finances by providing income and safe government liabilities to accumulate in portfolios.... governments with monetary sovereignty are not financially constrained: they spend as they issue their own IOU’s [currency]. They can use this capacity to buy real resources, and in doing so to promote full employment.” We began this chapter by asking ourselves what is the definition of capitalism in the context of markets, regulation, and policy. As we have seen, these three pillars of capitalism are in a state of change and the current definitions and ideologies on which they function are being challenged.

House of Debt: How They (And You) Caused the Great Recession, and How We Can Prevent It From Happening Again
by Atif Mian and Amir Sufi
Published 11 May 2014

Fired autoworkers will try to get hired at the barbershop, but the inability of wages to decline will prevent them from getting a job. As a result, workers on Creditor Island become unemployed even though they never had any debt at all. This simple example assumes wage rigidity to prevent the reallocation needed to maintain full employment. Debtor Island workers need to switch from barbershops to the auto industry, and Creditor Island workers need to switch from the auto industry to barbershops. When a local economy suffers a demand shock, workers need to be reallocated from sectors catering to local demand to sectors catering to external demand.

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Using a few technical assumptions, we estimate that 4 million jobs were lost between March 2007 and March 2009 because of levered losses, which represents 65 percent of all jobs lost in our sample.3 Frictions, Frictions As mentioned in the last chapter, according to the fundamentals view, there shouldn’t be such widespread unemployment. Instead, the economy has mechanisms that should make it flexible and maintain full employment, even in the face of a large negative demand shock. For example, in the sectors and locations hardest hit, wages should decline. In the Central Valley in California, the sharp decline in demand should have lowered wages in restaurants, retail outlets, and other jobs catering to local demand. Lower wages should have encouraged retail establishments to keep workers rather than firing them.

Rules for Revolutionaries: How Big Organizing Can Change Everything
by Becky Bond and Zack Exley
Published 9 Nov 2016

Big organizing rarely works around a single issue. Our struggles are all connected. We can’t achieve universal health care until we have immigration reform. We can’t fix income equality until we deal with structural racism and the historical legacy of slavery. We can’t resolve national and global security issues or reach full employment without working as hard as possible to stop climate change. Big organizing also needs to have a clear and credible theory of change that explains why organizing matters. Bernie’s message was that if we wanted to win on all of the issues, we had to organize for a political revolution. So how do we talk to everybody about our big ideas?

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Climate change is contributing to war when drought contributes to civil unrest. Curtailing of our civil liberties through government surveillance gives police departments tools to suppress the movement to defend black lives and the work of antifracking activists. We won’t be able to move closer to full employment in the United States without a commitment to moving to 100 percent renewable energy in a short period of time. The elites are doing better than ever. But the vast majority of people in the United States are losing ground and they are hurting. The reasons are interconnected. The solutions are interconnected, too.

The Subterranean Railway: How the London Underground Was Built and How It Changed the City Forever
by Christian Wolmar
Published 30 Sep 2009

Of course everyone thinks of the Second World War, but, as this book shows, the Underground was even used briefly for shelter in the First. Another little-told story is how in the 1950s London Transport changed the demography of the capital by recruiting directly in the Caribbean and Africa for cheap labour to run the Underground and the buses at a time of full employment among the British population (see Chapter 15). Taking this all together, it is no exaggeration to say that the Underground helped build the London we know today more than any other institution. This book is an attempt to do justice to the achievement of the Underground pioneers not only for having produced a transport system which, for a time, was unparalleled anywhere in the world, but also for having helped create and transform the city.

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Between 1950 and 1965 the number of cars registered in London quadrupled, from under 500,000 to nearly 2 million and, as Ashfield had predicted, this had a major impact on the Underground. In the 1950s, the annual passenger totals on the Underground hovered around 670 million, as those taking to their cars were replaced by new workers since London was enjoying virtually full employment. Then, despite the advent of the new Victoria line, numbers went into a decline – partly because TV ownership was becoming universal and proving more of an attraction than the cinema or theatre which often involved a trip up to town on the Underground. The other social factor which affected the Underground was a tremendous labour shortage caused by the huge upsurge of jobs in the peripheral areas of the capital, notably on the Great West Road and the North Circular, as well as Heathrow Airport.

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Employing immigrants from the Commonwealth was encouraged by the Tory government in the 1950s – a fact which seems extraordinary in these days of obsession with the problems caused by ‘asylum seekers’ – and London Transport was to play a key role in attracting immigrants, leading the way by opening an office in Barbados. LT’s motives were hardly altruistic. With the post-war boom in full flow there was full employment, which meant that bus and Underground staff were in desperately short supply because of the low wages. This had been partly alleviated by the employment of women, who had started being taken on as bus conductors – but not drivers – at equal wages from 1951, but there was still a shortage and London Transport begun to cast widely for staff first within Britain, then Ireland and eventually the West Indies.

Capitalism and Freedom
by Milton Friedman
Published 1 Jan 1962

Publicly owned and operated toll roads, as noted above. This list is far from comprehensive. 1 A. V. Dicey, Lectures on the Relation between Law and Public Opinion in England during the Nineteenth Century (2d. ed.; London: Macmillan & Co., 1914), p.li Chapter III The Control of Money “FULL EMPLOYMENT” and “economic growth” have in the past few decades become primary excuses for widening the extent of government intervention in economic affairs. A private free-enterprise economy, it is said, is inherently unstable. Left to itself, it will produce recurrent cycles of boom and bust. The government must therefore step in to keep things on an even keel.

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Even during the so-called great days of the gold standard in the nineteenth century, when the Bank of England was supposedly running the gold standard skilfully, the monetary system was far from a fully automatic gold standard. Even then it was a highly managed standard. And certainly the situation is now more extreme as a result of the adoption by country after country of the view that government has responsibility for “full employment.” My conclusion is that an automatic commodity standard is neither a feasible nor a desirable solution to the problem of establishing monetary arrangements for a free society. It is not desirable because it would involve a large cost in the form of resources used to produce the monetary commodity.

Does Capitalism Have a Future?
by Immanuel Wallerstein , Randall Collins , Michael Mann , Georgi Derluguian , Craig Calhoun , Stephen Hoye and Audible Studios
Published 15 Nov 2013

If, however, the Europeans realize and act on their collective interests and if countries take the more Keynesian route being advocated by the French government of financing a stimulus (partly by higher taxes on those who are more able to pay), then this might prevent further worsening. In either case, recovery would probably eventually happen, though more slowly in the former case—and this time without the benefit of a world war. Whether recovery would ever restore full employment is something I will discuss later. Capitalism is subject to cycles, though whether they have a regular patterning through time is another matter. Occasionally the recession phase of the cycle gets much worse, partly through “internal” economic causes, partly through costly wars, stalemated politics, or ideologies generating policies inappropriate to the crisis.

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In the seventies and eighties, establishmentarian politics of muddling through and evasion delivered a fix that has lasted until yesterday. The New Left movements flared up and burned out as fast as fireworks. But the damage was considerable, especially when viewed in the longer-run perspective. The discredited and momentarily disoriented rulers began shedding their erstwhile commitments to industrial modernization, full employment, and welfare. In the West political systems had enough strength and resources to do this in a controlled manner, all the while calling it a new age of postindustrialism, flexibility, and globalization. In the Soviet bloc the process got out of hand, causing panic in the political and industrial elites.

Nickel and Dimed: On (Not) Getting by in America
by Barbara Ehrenreich
Published 2 Jan 2003

During the heyday of downsizing in the Reagan years, it very often was, and it still is for many inner-city residents who have no way of getting to the proliferating entry-level jobs on urban peripheries. When unemployment causes poverty, we know how to state the problem—typically, “the economy isn't growing fast enough”—and we know what the traditional liberal solution is—“full employment.” But when we have full or nearly full employment, when jobs are available to any job seeker who can get to them, then the problem goes deeper and begins to cut into that web of expectations that make up the “social contract.” According to a recent poll conducted by jobs for the Future, a Boston-based employment research firm, 94 percent of Americans agree that “people who work fulltime should be able to earn enough to keep their families out of poverty.”[57] I grew up hearing over and over, to the point of tedium, that “hard work” was the secret of success: “Work hard and you'll get ahead” or “It's hard work that got us where we are.”

Who Needs the Fed?: What Taylor Swift, Uber, and Robots Tell Us About Money, Credit, and Why We Should Abolish America's Central Bank
by John Tamny
Published 30 Apr 2016

What Smith’s story illustrates is that the Fed is now a lender of last resort only for banks that cannot secure private funding. Therefore, this function of the Fed must be shut down with the banking system and overall economy in mind. Through a congressional mandate (aka the Humphrey-Hawkins Full Employment Act), the Fed is required to balance unemployment with inflation. But as the previous chapter made plain, the two have nothing to do with one another. It’s also hard to control what one doesn’t understand. To the Fed, inflation is caused by prosperity, at which point it strives to fiddle with interest rates and money supply in order to limit the economy’s ability to grow.

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See federal government Gray, Freddie, 135 Grazer, Brian, 22–23, 24–25, 26 Great Depression, 106, 141–43, 147, 168 The Greatest Trade Ever (Zuckerman), 45, 120 Greenspan, Alan, 119, 120, 164 Greider, William, 121 Griffin, Ken, 41 Guest, Christopher, 22 Guillies, Wendy, 175 Hamm, Harold, 73 Hanks, Tom, 22 Hannah, Daryl, 23 Harbaugh, Jim, 16–18, 20, 21, 79, 103, 127 hard assets, 118 Harford, Tim, 32, 64–65 Hartnett, Josh, 24 Hastert, Dennis, 52 Hawaiian Airlines, 34–35 Hawn, Goldie, 24 Hayward, Steven, 49, 50 Hazlitt, Henry, 22, 64, 74, 113, 163, 176 Heaven Can Wait (film), 23 hedge-fund managers, 48 Heller, Walter, 54 Hemingway, Ernest, 91 Hendrickson, Mark, 80 high-yield “junk bonds,” 37–40, 126 Hilsenrath, Jon, 147, 148 Hoffman, Dustin, 23 Hoke, Brady, 16, 20–21, 78–79, 103, 115, 127, 128, 148 Hollywood Shuffle (film), 109 Hoover, Herbert, 142, 168 Hoover Institution, 102 housing booms and “easy credit,” 113–22 and value of the dollar, 116–22 housing market and mortgage-backed securities, 150–52 Howard, Ron, 22–23 How We Got Here (Frum), 118 Human Action (von Mises), 20 Humphrey-Hawkins Full Employment Act, 165 hyperinflation in post-WWII Germany, 90–91 IBM, 53 Imagine Entertainment, 22–23 inflation Friedman’s view of, 136 inability of Fed to control, 159–61, 165 and value of the dollar, 43 inherited wealth, 29–30 initial public offering (IPO), 29, 124 innovation and definitions of success or failure, 29–30 and entrepreneurs, 66 and failure, 57–58 The Innovators (Isaacson), 31 insider trading, 38 Inside the Nixon Administration (Burns), 170 Intel, 143 intellectual property rights, 9–10 interest rates and the cost of credit, 1–3, 13–14, 47–48, 147 and the Fed on inflation as source of economic growth, 156–61, 165–66 housing boom and “easy credit,” 113–16, 120–22 and quantitative easing (QE) program, 149–51 Internet banking, 108, 111 Internet “bubble,” 57–58 Internet job creation, 178–79 investment banking, 123 Iron Man (films), 25 Ishtar (film), 23 Jagger, Mick, 25 James, LeBron, 137–38 Japan after World War II, 128 Bank of Japan and Nikkei index, 152, 159 job creation and robots, 176–80 Jobs, Steve, 30–31 Johnson, Lyndon B., 49, 53 Johnson, Mark, 153 Jones, Jesse, 167 “junk bonds,” 37–40, 126 Kalanick, Travis, 12, 13 Karlgaard, Rich, 160 Kashgar, 138 Kauffman Foundation, 175 Keaton, Diane, 24 Kelly, Jason, 126 Kennedy, John F., 49–50, 169 Kennedy, Robert F., 34 Keynesian economics, 78–82, 88, 93–96, 140–41 Keynes, John Maynard, 78, 147 Kickstarter, 110 Kiffin, Lane, 20 Kinski, Nastassja, 24 Knowledge and Power (Gilder), 57 Kohli, Shweta, 107 Kohn, Donald, 156 Kornbluth, Walter, 22 labor as credit, 15–21 Laffer, Arthur, 55, 137, 157, 158 Laffer curves, 50, 54–55 Lawrence, Jennifer, 37–38 Lee, Spike, 109, 110 Lending Club, 107–8 Leubsdorf, Ben, 156 Levy, Eugene, 22 Lewis, Nathan, 72, 137, 141–42, 144 LewRockwell.com website, 94 Lisa computer, 30 Lombard Street (Bagehot), 46 Luck, Andrew, 16–17 McAdams, Hall, 89–90, 104 McConnell, Mitch, 51 Mack, John J., 123, 130 Madoff, Bernard, 163 Mann, Windsor, 78 Margolis, Eric, 94, 96 market “bubbles,” 56–63 market forces and government spending, 59–60 price of goods versus price of dollars, 1–2 von Mises on, 20, 152 market intervention and the Fed, 159–61 Mazursky, Paul, 24 Medicare, 53, 78, 174 Merrill Lynch, 120 Metro public transit, 10–11 Meyer, Urban, 17–18 Microsoft, 30–31, 125, 143, 155 Milken, Michael, 38–40, 114, 126 Mill, John Stuart, 76 Mindich, Eric, 45–46 Mission Asset Fund, 107 mobile phones, 53–54 monetarism, 135–36, 138 money and Chinese economy, 135–36, 137 and economic activity, 3, 136–37, 140, 143 and gold standard, 68 and the Great Depression, 141–43, 147, 168 market monetarism, 138–39 as measure of wealth, 67–68 monetarism, 135–36, 138 “money multipliers” and “fractional lending,” 87–90 private money supplies, 144–45 and stable currency, 137, 144 Money and Foreign Exchange After 1914 (Cassel), 119 Moore, Gordon, 31 Moore, Stephen, 50–51 Morgan, J.

Give People Money
by Annie Lowrey
Published 10 Jul 2018

At the end of her shift at Raising Cane’s, climbing into Luis’s car, one of the Ortiz daughters told me that she often did not eat dinner. “The smell of the chicken fills me up,” she said. The working poor, the precariat, the left behind: this is modern-day America. We no longer have a jobs crisis, with the economy recovering to something like full employment a decade after the start of the Great Recession. But we do have a good-jobs crisis, a more permanent, festering problem that started more than a generation ago. Work simply is not paying like it used to, leaving more and more families struggling to get by, relying on the government to lift them out of and away from poverty, feeling like the American Dream is unachievable—even before the robots come for all of our jobs.

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This left them with no safety net as their job searches dragged on. The 99ers were a subset of a huge pool of Americans who experienced long-term joblessness in the late aughts and early 2010s. The scale of job losses during and after the Great Recession was massive in scope and is shocking to remember from the warm perch of full employment in the early Trump years. Three in four people who responded to one 2010 survey had been laid off or had a close friend or family member who was out of work. Roughly one in three construction workers lost their job, as did one in four manufacturing employees. The number of people on the job declined by nearly 8 million, and it took seven years for the economy to restore all those positions.

Humans as a Service: The Promise and Perils of Work in the Gig Economy
by Jeremias Prassl
Published 7 May 2018

This showed that US gig economy workers were split about whether they preferred the security and benefits of working for a traditional company (41%) or the independence/flexibility of the on-demand economy (43%).77 The assertion that employment law somehow leads to rigid, inflexible work, however, is simply untrue. There may well be a business case for shift patterns and predictable working hours—but, legally, there is nothing at all to stop employers from giving workers full employment rights, as well as unlimited flexibility, from flexible shift arrangements to unmeasured working time. Any suggestion that employment rights are inherently incompatible with flexibility is a myth—and a harmful one at that. Responsibility Restored Sharing platforms, Vanessa Katz has argued, ‘often operate in legal gray areas, and the regulatory vacuum surrounding these services has raised complex legal questions’.78 This may be true in so far as some traditional regulatory areas, such as transport or local zoning, are concerned—but when it comes to questions of employment law, the issues are clearer than some would have us think.

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In the short term, however, ‘the very rapidity of these changes is hurting us and bringing difficult problems to solve’:1 We are being afflicted with a new disease of which some readers may not yet have heard the name, but of which they will hear a great deal in the years to come—namely, technological unemployment. This means unemployment due to our discovery of means of economising the use of labour outrunning the pace at which we can find new uses for labour.2 Similar fears have been voiced throughout the past century. President Kennedy, for example, regarded maintaining full employment ‘as the major domestic challenge, really, of the ’60s . . . when automation, of course, is replacing men’.3 Reality, however, couldn’t be further from vision of ‘three-hour shifts or a fifteen-hour week’.4 What happened? Why are we still at work? Today’s economists point to a number of factors, income or capitalization effects central amongst them.

99%: Mass Impoverishment and How We Can End It
by Mark Thomas
Published 7 Aug 2019

This is a specific case of the more general argument that government spending ‘crowds out’ private sector spending. This crowding-out can either be direct, or indirect. An example of direct crowding-out might be, for example, when the government hires someone into the civil service, and consequently that person cannot be hired by the private sector for any other purpose, however beneficial. At times of full employment, this crowding-out could be a real phenomenon. At times of mass unemployment or underemployment, it is far less plausible. Indirect crowding-out (sometimes known as Ricardian equivalence) happens when individuals or businesses observe increased government spending (which inevitably results from increased hiring) and deduce that, sooner or later, the additional spending will be recouped via higher taxes.

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An elected government should have an explicit duty to govern for the benefit of its entire population, not for that of a small and influential sub-segment: • economic policy must explicitly target the problem of mass impoverishment and ensure that all sectors of society benefit fairly from economic growth – one of the tasks of the Office for Budget Responsibility (or equivalent organization) should be to assess the impact of each proposed budget in terms of this explicit duty over the short-, medium- and long-terms; where there is redistribution, it should be progressive, not regressive; • the Office for Budget Responsibility should publish its ‘impoverishment ratio’ each year – that percentage of the population which is poorer in real terms than it was the year before – and its ‘leave-behind ratio’ – i.e. the percentage that has seen its income grow more slowly than the economy as a whole (in other words, more slowly than per capita GDP): this is the percentage who are being left behind by government policies; • maintenance of full employment for those able to work should be an explicit goal of government policies and central bank decision-making; • all proposed legislation should be assessed by the Office for Budget Responsibility to determine whether it tends to concentrate or to distribute income and wealth – regressive legislation that tends to concentrate income and wealth should require a two-thirds majority in both houses. 2.

The Divided Nation: A History of Germany, 1918-1990
by Mary Fulbrook
Published 14 Oct 1991

While autobahns would later be highly useful for the rapid movement of troops, they could also serve more immediate ideological ends, symbolizing the rebuilding of the community and the integration of its different parts into one future-oriented national whole. 13 Schacht's New Plan of 1934 marked the first stage in the planned development of autarky, (although Schacht himself was an opponent of out-and-out autarky) with bilateral trade agreements between pairs of countries not relying on certain international foreign currency exchanges. Page 84 By 1935, however, it was becoming clear that, despite the return towards full employment, Germany's economic problems were by no means resolved. With a shortage of foreign exchange reserves, a choice had to be made between the import of raw materials for the rearmament programme or of foodstuffs for consumers. Moreover, there were splits within industry: while some industries, most notably the great chemical combine I.

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Some industries benefited from close collaboration with the state; others attempted to resist interference; and while the Nazis attempted to control the direction of economic policy, they were by no means always successful; nor could they be, given their own partly mutually contradictory aims. Moreover, the successes of economic recovery and a return to full employment by 1936 had by 1939 generated a shortage of skilled labour, necessitating the conscription of workers into compulsory labour service on certain projects. There were also conflicts between aspects of Nazi ideology and the demands of reality: women, for example, despite Nazi views of their proper place being in the home, in fact participated in increasing numbers in paid employment outside the home, even before the more acute shortages of (iterally) manpower in wartime years.

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What is quite clear is that, far from achieving a social revolution, the effects of Nazi economic policies on society represented in large measure a continuation and perhaps exacerbation of previous socio-economic trends. Realities under Nazi rule by no means corresponded with pre-1933 election promises. While the return to full employment did mean jobs and a steady income for many, the associated withdrawal of trade union rights and collective bargaining, as well as the very variable rates of pay and conditions, rendered the experience at best an ambiguous one. Despite attempts by the All-German Federation of Trade Unions (ADGB) to reach a compromise with the new regime in April 1933, autonomous trade unions had been unequivocally smashed; and although many workers were prepared somewhat cynically to enjoy any holidays or outings Page 86 offered to them by organizations such as Strength through Joy, few really swallowed much of the propaganda about the 'harmonious factory community' and the like.

Protest and Power: The Battle for the Labour Party
by David Kogan
Published 17 Apr 2019

They leaked Philip Gould’s research that purported to show that separation was the main goal of the party, to the media. As usual, a review was ordered by the NEC and the argument came down to OMOV in candidate selection. For Smith it became a critical issue of leadership. He won over some key unions at that year’s TUC by committing a future Labour government to a charter of union rights and full employment. These promises were seen by Blair and Brown as inherently dangerous, but they paved the way for Smith to go to the Labour conference looking for the vital last pieces of support. He attached all-women shortlists to the package to gain some CLP support. Then John Prescott delivered a barnstorming speech to conference that argued they had to back Smith and reaffirm the link with the unions.

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The problems for Burnham were about to get worse. The Conservative’s welfare bill had been announced in the Queen’s speech. Its first reading was on 9 July and second reading 21 July. It contained a slew of proposals cutting or abolishing £12 billion of benefits mitigated by some language on apprenticeships and full employment. Harriet Harman decided that Labour had to demonstrate it understood the electorate’s apparent concern about high welfare costs. Andy Burnham knew that this would be a political problem for him and insisted on a discussion within the shadow cabinet. Harman agreed but positioned Yvette Cooper next to her as the first speaker.

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By the time it got to Burnham he had lost the tactical argument. Ayesha Hazarika: I think what Harriet was trying to do was just to show that Labour wasn’t a party that just opposed everything. There were some things in that bill that we did agree with as well. There was stuff on apprenticeship targets, there was stuff on full employment. These bills are never single issue, but it was just an impossible situation. The official position would be to abstain rather than vote against the government’s proposals. There was an overly complex voting tactic about voting for an amendment to stop the second reading but then abstaining on the main bill, but no one outside the PLP understood this.

The Great Transformation: The Political and Economic Origins of Our Time
by Karl Polanyi
Published 27 Mar 2001

They may or may not buy into lectures from free marketeers about the importance of wage flexibility (code words for accepting being laid off without compensation, or accepting with alacrity a lowering of wages), but they themselves can do little to promote such reforms, even if they had the desired promised effects of full employment. And it is simply not the case that individuals could, by offering to work for a lower wage, immediately obtain employment. Efficiency wage theories, insider-outsider theories, and a host of other theories have provided cogent explanations of why labor markets do not work in the manner that advocates of the self-regulating market suggested.

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Not before the last decade of the eighteenth century was, in either country, the establishment of a free labor market even discussed; and the idea of the self-regulation of economic life was utterly beyond the horizon of the age. The mercantilist was concerned with the development of the resources of the country, including full employment, through trade and commerce; the traditional organization of land and labor he took for granted. He was in this respect as far removed from modern concepts as he was in the realm of politics, where his belief in the absolute powers of an enlightened despot was tempered by no intimations of democracy.

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The Poor Law Commissioners appeared disturbed about the allegedly imminent danger of the spreading of Speenhamland methods to the manufacturing towns. It was recognized that the “Northern counties are least infected by it,” yet it was still asserted that “even in the towns it exists in a very formidable degree.” The facts hardly bear this out. True, in Manchester or Oldham relief was occasionally given to persons in health and full employment. In Preston at ratepayers meetings, so Henderson wrote, a pauper was vocal who had “thrown himself on the parish his wages having been reduced from one pound to 18 shillings weekly.” The township of Salford, Padiham, and Ulverston also were classed as practising the method of aid-in-wages “regularly”; similarly Wigan, in so far as weavers and spinners were concerned.

Vulture Capitalism: Corporate Crimes, Backdoor Bailouts, and the Death of Freedom
by Grace Blakeley
Published 11 Mar 2024

From the 1970s on, an increasing share of the US auto market was captured by imports, and US car manufacturers began to feel the pinch.56 Management argued that the competitiveness problem resulted from an overly militant labor movement, which was pushing labor costs to unsustainable levels, and unionists often acceded to this interpretation of events. With the bosses pushing aggressively for greater automation and the US state shrinking from its commitments to maintain full employment, wage growth stalled and the workforce dwindled. Plants were closed and layoffs stepped up, “and the contracts negotiated in the 1980s reflected this power decline.”57 Between 1979 and 1980, the number of Ford hourly paid workers dropped by nearly fifty thousand.58 While wage growth and the workforce dwindled, Ford became a cash cow for shareholders, who financialized the firm beyond recognition.

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As the political economist Benjamin Braun has argued, the problem with QE is that it shows that central banks aren’t as “independent” as they claim to be.97 The idea behind central bank independence is that there is a natural long-term rate of interest—the rate at which supply and demand for money are in equilibrium, prices are stable, and full employment is maintained—and the job of central bankers is to align the central bank rate with this “real” interest rate. They’re not supposed to influence the long-term state of the economy; they’re just supposed to align the state of the economy today with its long-term potential. With the emergence of QE, the idea of the natural long-term rate of interest suddenly disappeared.

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Gramsci, Prison Notebooks. 37. “They represent simply the most recent phase of a long process which began with industrialism itself.” Gramsci, Prison Notebooks. 38. Scott Lash and John Urry, The End of Organized Capitalism (London: Polity Press, 1987). 39. Michael Kalecki, “The Political Aspects of Full Employment,” Political Quarterly 14, no. 4 (October 1943): 322–30, https://delong.typepad.com/kalecki43.pdf. 40. Chamayou, The Ungovernable Society. 41. Ibid. 42. Allan Nevins and Frank Ernest Hill, Ford: Decline and Rebirth, 1933–1962 (ACLS Humanities E-Book, 2008). 43. Ibid. 44. Ibid. 45. Ibid. 46.

Age of Greed: The Triumph of Finance and the Decline of America, 1970 to the Present
by Jeff Madrick
Published 11 Jun 2012

In a key speech to the New York Economics Club that year, he sold the tax cut as an orthodox boon to business to improve incentives to invest, which infuriated Galbraith, then ambassador to India. 22 NIXON’S TEAM WAS OPEN: They developed their budget assuming tax revenues based on full employment—the full employment budget. 23 MCCRACKEN, A POLITICAL CONSERVATIVE: Herbert Stein, Presidential Economics: The Making of Economic Policy from Roosevelt to Clinton (Washington, D.C.: American Enterprise Institute, 1994), pp. 141–42; author interview with Paul McCracken, June 2004. 24 IF CONSUMERS EXPECTED PRICES TO RISE: Frank Levy and Peter Temin, “Inequality and Institutions in the 20th Century,” MIT Working Paper 07–17, May 1, 2007. 25 MANUFACTURING AND SERVICE GIANTS: Stein, Presidential Economics, pp. 159–60. 26 “AS CHIPS FLOATING”: Ibid., p. 141. 27 “NOW I AM A KEYNESIAN”: Stein, Fiscal Revolution in America, p. 548. 28 YET NIXON ATTACKED MANY OF JOHNSON’S PROGRAMS: Arthur J.

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When passed under Johnson in 1964, the highest tax rate was cut from the wartime level of 91 percent to 70 percent. And the economy grew strongly over the next four years, the unemployment rate falling to less than 3.5 percent. Thus, in times of high unemployment, deficits were now entirely acceptable, and Nixon’s team was open to a moderate amount of deficit spending at times. Only when full employment was reached should the budget be balanced, the economic consensus held, otherwise a deficit was appropriate. The head of Nixon’s Council of Economic Advisers was Paul McCracken, an Iowa farmer’s son from a deeply Republican region, who had been a member of Eisenhower’s CEA. McCracken, a political conservative by temperament, had nevertheless studied with Alvin Hansen, Harvard’s famous Keynesian, and accepted a moderate version of Keynesianism.

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This became known as the neoclassical synthesis, combining moderate Keynesianism with neoclassical principles. Some British followers of Keynes, including several prominent students such as Joan Robinson of Keynes’s university, Cambridge, however, believed that neoclassical principles did not as readily take hold once an economy was stimulated to full employment and more or less constant government policy intervention was required to keep economies efficient and unemployment low. Other so-called post-Keynesian schools of thought arose in America that had more in common with Cambridge, England, than Cambridge, Massachusetts, but the neoclassical synthesis dominated the major academic institutions in America. 37 “EVER SINCE THE NEW DEAL”: Friedman, Capitalism and Freedom, p. 75. 38 FRIEDMAN’S EARLY EFFORTS: For example, see Carl Shoup, Milton Friedman, and Ruth Mack, Taxing to Prevent Inflation: Techniques for Estimating Revenue Requirements (New York: Columbia University Press, 1943). 39 THE THEORY HELD THAT THE QUANTITY: The famous equation is MV = PQ, where M equals the money supply, V the velocity, P, the price of goods, and Q the quantity of goods.

Birth of the Euro
by Otmar Issing
Published 20 Oct 2008

The people there are paid shamefully. I had many discussions with him on this issue, we exchanged views as academics and later as central bankers. 17 The record is available on the European Parliament website. The countdown begins • 35 We always came back to the question of what is the trade-off between price stability and full employment or inflation and unemployment? Alan is always trying to convince me and I am trying to convince him. The main difference between the two of us is not about the long term or medium term, it is of course the short term, which you mentioned yourself. The main difference is that the Americans have no idea about our institutional environment, which is totally different.

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Here we also need to discuss problems of measurement in Europe. To date, there are no comparable studies for other countries. That needs to be carefully considered. I think that that level is a starting point. As regards joblessness or employment, we have moved away from targets. Beveridge once said that 3 per cent is the full employment target. In my view – today we can only dream of such numbers – we must all act to bring down this frighteningly high level of unemployment, which is in double figures virtually everywhere in Europe. That’s the objective. As to whether numerical targets are an aid to policy, I have my doubts. Torres Marques (Party of European Socialists): Professor Issing is – as already mentioned – the only member nominated for eight years, and I note that, while practically the same age as President Duisenberg, he is prepared to serve out the full term of his mandate, which means that he will be the one to maintain relations longest with the European Parliament.

What's the Matter with White People
by Joan Walsh
Published 19 Jul 2012

In the early 1970s, Big Business began to wake up to its class interests, even if Big Labor and the larger working class did not. The menace of inflation gave corporate America the excuse to turn on unions under the guise of public interest. Higher prices hurt everyone, after all. Newly assertive business groups and publications blamed rising prices on higher wages driven by the nation’s commitment “to full employment and maximum production,” in the words of Business Week in 1974. Fortune went further: “Organized labor has now become a destabilizing and dislocating force—made more unmanageable by large political influence.” In fact, labor’s political influence was waning, but a newly activist business community decided that unions were the problem—and convinced a lot of working-class people to go along.

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A Democratic attempt at labor law reform went down; so did a bid for a new Office of Consumer Representation, after a business lobbying effort that House Speaker Tip O’Neill called the most intense in twenty-five years. With unemployment and inflation running high, the newly emboldened probusiness conservatives found the headlines they needed to press their attack. A full-employment bill passed, but it was compromised beyond recognition or effectiveness. Carter’s chairman of the Federal Reserve, Paul Volcker, gave up on half of his job’s dual role: using the money supply to control inflation and unemployment. Volcker focused exclusively but unsuccessfully (until much later) on inflation.

The Internet Is Not the Answer
by Andrew Keen
Published 5 Jan 2015

In July 1945, Bush also wrote an influential paper for President Roosevelt entitled “Science, The Endless Frontier,”15 in which he argued that what he called “the public welfare,” particularly in the context of “full employment” and the role of science in generating jobs, would be improved by government investment in technological research. “One of our hopes is that after the war there will be full employment,” Bush wrote to the president. “To reach that goal, the full creative and productive energies of the American people must be released.” “As We May Think” reflects this same rather naïve optimism about the economics of the information society.

Listen, Liberal: Or, What Ever Happened to the Party of the People?
by Thomas Frank
Published 15 Mar 2016

It’s easy to remember the official, consensus reasons why we’re supposed to admire Bill Clinton—the achievements which the inevitable Spielberg bio-pic will no doubt illustrate with poignant and whimsical personal glimpses. First was the economy, which did really well while he was in office. So well, in fact, that we had something close to full employment for several years while the Dow hit 10,000 and the Nasdaq stock index went effing vertical—flush times that are almost inconceivable from our present-day vantage point. Surely that trumps everything. The other great source of the Clinton myth is the insane vendetta against him launched by the Republicans—what his former aide Sidney Blumenthal has called the “Clinton Wars.”

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If the former president had a little less modesty, his museum would probably find a way to trace that upward-trending pink line in the sky over Little Rock every night with a laser beam. They would trademark it, print it on T-shirts, baseball caps, and bags of New Economy potato chips. After all, this line demonstrates President Clinton’s one real accomplishment. Let us give Bill Clinton his due: This was a fine thing. When he was president, America came close to full employment. As a result, wages grew for several years—and for real, not just in nominal dollars. But it was prosperity buoyed up by an investment bubble. It did not reverse the long-term trend toward inequality that Clinton liked to talk about in 1992. It did the opposite. The share of the national income taken by the top 1 percent zoomed upward along with the Nasdaq during Clinton’s time in office.

The Future of Capitalism: Facing the New Anxieties
by Paul Collier
Published 4 Dec 2018

It wasn’t always like that, and it isn’t now. As the child of parents who were young adults in the 1930s, I learned vicariously how badly the state had failed. Through their stories I grasped the tragedy of the collapse into mass unemployment. States, and the societies they reflected, had lacked the sense of ethical purpose to see full employment as their responsibility. They also lacked the ideas that would have shown them what to do about it. In consequence, they dramatically mismanaged capitalism. The ideologies of fascism and Marxism were waiting in the wings. Only in Germany and Italy did either of them manage to take hold, but that was enough to trigger a global cataclysm.

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Governments were initially unreceptive, however; though the book came out in 1936, the escape from the Depression was because rearmament happened to boost demand. As Paul Krugman has wryly said, the Second World War was the largest economic stimulus package in history. But, post-war, Keynes’s analysis was used to maintain full employment, gradually becoming inadequate with the rise in inflation in the 1970s. States failed their people in the 1930s, and they are doing so again. Currently, the word ‘capitalism’ provokes widespread contempt. But behind the toxic word are the networks of markets, rules and firms that delivered both the miracle of 1945–70 and the tragedy of 1929–39.

Less Is More: How Degrowth Will Save the World
by Jason Hickel
Published 12 Aug 2020

We can also scale down the parts of the economy that are designed purely to maximise profits rather than to meet human needs, like planned obsolescence, where products are made to break down after a short time, or advertising strategies intended to manipulate our emotions and make us feel that what we have is inadequate. As we liberate people from the toil of unnecessary labour, we can shorten the working week to maintain full employment, distribute income and wealth more fairly, and invest in public goods like universal healthcare, education and affordable housing. As we’ll see in Chapter 5, all of this has been proven, over and over again, to have a powerful positive impact on people’s health and well-being. These are the keys to a flourishing society.

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This might seem like an impossible bind; and indeed it’s one reason why politicians consider degrowth to be so unthinkable. But there’s a way out. As we shed unnecessary jobs we can shorten the working week, going from forty-seven hours (the average in the United States) down to thirty or perhaps even twenty hours, distributing necessary labour more evenly among the working population and maintaining full employment. We can facilitate this process by introducing a job guarantee (a policy that happens to be resoundingly popular23), and roll out retraining programmes so that people laid off from shrinking industries can transition easily to others (renewable energy, public services, maintenance, etc.). This approach would allow everyone to benefit from the time that’s liberated by reducing material throughput.

How to Fix the Future: Staying Human in the Digital Age
by Andrew Keen
Published 1 Mar 2018

His name was Thomas More, and the book, written in Latin, was called Utopia—which can be translated into English as “No Place” or “Perfect Place.” More imagined an island outside time and space, a simultaneously dreamlike and nightmarish one-nation kind of place featuring a highly regulated economy, full employment, the complete absence of personal privacy, relative equality between men and women, and an intimate trust between ruler and ruled. In More’s Utopia, there were no lawyers, no expensive clothes, no frivolities of any kind. This no-place was—and still is—a provocation, a place forever on the horizon, an eternal challenge to the establishment, the most seductive of promises, and a dire warning.

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And mass alcoholism, Hobsbawm explains, created a “pestilence of hard liquor” across Europe.14 What he calls a “social and economic cataclysm” spawned not only a plague of “infanticide, prostitution, suicide and mental derangement” in the cities,15 but also the mass famines of 1795, 1817, 1832, and 1847 in the European countryside. Even places with full employment, Hobsbawm reports, were impoverished, with 52 percent of workers employed in a good trade in the Lancashire mill town of Preston living below the poverty line in 1852. And if you were one of the lucky few who survived till old age, Hobsbawm concludes, your life would be “a catastrophe to be stoically expected” since there was no government health care or social security system to support old people.16 I glance out the window of the Betaworks studio onto the cobblestoned Meatpacking District street and try to imagine the equivalent scene in February 1848 when Marx and Engels published their Manifesto.

Rule of the Robots: How Artificial Intelligence Will Transform Everything
by Martin Ford
Published 13 Sep 2021

,” Oxford Martin School Programme on Technology and Employment, Working Paper, September 17, 2013, www.oxfordmartin.ox.ac.uk/downloads/academic/future-of-employment.pdf, p. 38. 5. U.S. Bureau of Labor Statistics, “Unemployment rate (UNRATE),” retrieved from Federal Reserve Bank of St. Louis, July 18, 2020, fred.stlouisfed.org/series/UNRATE; Greg Rosalsky, “Are we even close to full employment?,” NPR Planet Money, July 2, 2019, www.npr.org/sections/money/2019/07/02/737790095/are-we-even-close-to-full-employment. 6. Organization for Economic Co-operation and Development, “Activity rate: Aged 25–54: Males for the United States (LRAC25MAUSM156S),” retrieved from Federal Reserve Bank of St. Louis, July 17, 2020, fred.stlouisfed.org/series/LRAC25MAUSM156S. 7.

Butler to the World: How Britain Became the Servant of Tycoons, Tax Dodgers, Kleptocrats and Criminals
by Oliver Bullough
Published 10 Mar 2022

This is why Greece had such a tough time after the financial crisis of 2007–8; its exchange rate is fixed because it’s a member of the euro, and it can’t restrict capital flows because of the rules of the European Union, so it had to sacrifice autonomy – its government lost the ability to do what it wanted. That wasn’t acceptable, however, to governments after the Second World War; with the horrors of the Depression of the 1930s still fresh in their minds, they wanted the power to create full employment. This was all part of a settlement that included the New Deal regulations in the United States, the welfare state in the UK and similar structures in other Western countries, all of which required governments to control investment levels in order to improve living standards. But if governments insisted on the autonomy to do what they wanted, they had to choose between the remaining two options.

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They would strip away the limits on moving money around and bring back the kind of free trade that had benefited Britain in the nineteenth century. The pound would remain fixed against the dollar, so inevitably – as with Greece today – the government would lose the autonomy it enjoyed to create full employment, to build social housing and to expand the health service. This was, Shonfield wrote, ‘the vicarious reassertion of the political power of the owners of wealth – not businessmen or people active in any way, but just owners – which the postwar revolution in Britain had set out to prevent’. Shonfield knew what he was writing about, and knew the class he was describing.

Crisis and Leviathan: Critical Episodes in the Growth of American Government
by Robert Higgs and Arthur A. Ekirch, Jr.
Published 15 Jan 1987

Of the latter sort, a leading example was the Keynesian illusion, the belief that the federal government's management of the economy, primarily by its fiscal policies, can prevent business declines and stabilize the economy as it grows. Herbert Stein has noted that "[t]he great weight assigned to full employment as a postwar goal certainly resulted from the achievement of full employment during the war against the background of ten years of depression." But the notion that wartime "full employment" had resulted from the huge federal deficits was false. Quite simply, unemployment fell mainly because of the buildup of the armed forces. Between 1940 and 1945 the number of persons classified as unemployed fell by about seven million, while the number of persons in the armed forces rose by more than eleven million (see Table 9.1).

Them And Us: Politics, Greed And Inequality - Why We Need A Fair Society
by Will Hutton
Published 30 Sep 2010

Between 1945 and the early 1970s governments could change their public borrowing upwards and downwards with reliable and predictable impacts on growth and employment. But over the 1960s the relationships began to weaken. Deficits delivered more inflation and less growth. Firms tended to raise their prices and trade unions their members’ wages, confident that governments would want to maintain the level of demand. Economies had reached full employment, and firms and unions had wised up to the opportunities that fiscal policy created – in essence, they used it to extract benefits from seemingly helpless governments. Consequently, a new market-fundamentalist consensus emerged. It declared that governments would simply generate inflation if they tried to boost employment above its natural level.

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They have done well over the last five or six decades; it is now their children who are dispro-portionately suffering – and the equation should be inverted. As David Willetts argues in his intriguing book The Pinch, written before he became Universities and Skills Minister, the generation born in the 1950s and 1960s has been extraordinarily blessed by largely full employment and booming house prices.19 They are the gilded pig moving through the British benefit and welfare python. Willetts estimates that they have received 118 per cent more in benefits than they have contributed. They have benefited from free university education. The majority of them will receive a generous pension on retirement.

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Jamie Doward, ‘Eastern European Immigration “Has Hit Low-Paid Britons”’, Observer, 17 January 2010, at http://www.guardian.co.uk/uk/2010/jan/17/eastern-european-immigration-hits-wages. 41 Ruth Sunderland, ‘Cameron’s Right about Marriage, but Wrong on How to Support It’, Observer, 10 January 2010, at http://www.guardian.co.uk/ commentisfree/2010/jan/10/ruth-sunderland-marriage-tory-policy. See also Nik Theodore (2009) ‘New Labour at Work: Long-Term Unemployment and the Geography of Opportunity’, Cambridge Journal of Economics 31: 927–39; Robert Rowthorn (2000) ‘Kalecki Centenary Lecture: The Political Economy of Full Employment in Modern Britain’, Oxford Bulletin of Economics and Statistics 62: 139–73; and Ioannis Kaplanis (2007) ‘The Geography of Employment Polarisation in Britain’, report, IPPR. 42 Steven Durlauf, ‘Groups, Social Influences and Inequality’, in Samuel Bowles, Steven Durlauf and Karla Hoff (2006) Poverty Traps, Princeton University Press.

Walk Away
by Douglas E. French
Published 1 Mar 2011

When Federal Reserve Chairman Ben Bernanke was questioned in 2005 about whether house prices might be getting ahead of the fundamentals, he replied: Well, I guess I don’t buy your premise. It’s a pretty unlikely possibility. We’ve never had a decline in house prices on a nationwide basis. So what I think is more likely is that house prices will slow, maybe stabilize: might slow consumption spending a bit. I don’t think it’s going to drive the economy too far from its full employment path, though. The same year Bernanke was testifying that housing prices wouldn’t go down, “economists estimated that roughly half of all economic activity was tied to housing,” wrote Peter S. Goodman in Past Due: The End of Easy Money and the Renewal of the American Economy, “either through home-building, the purchase of housing-related goods like furniture and appliances, or spending unleashed by people borrowing against the increased value of their homes.”

Are Trams Socialist?: Why Britain Has No Transport Policy
by Christian Wolmar
Published 19 May 2016

The pendulum swung even further towards roads and against the railways in 1961 when Marples appointed the notorious axeman, Richard Beeching, to head British Railways, which had been nationalized thirteen years previously. The shift towards motorization was now in full swing. Once the country started recovering from the austerity of the immediate post-war period, with full employment, rising wages and the relative costs of motoring falling, owning a car became feasible for the middle classes and even for blue-collar workers who were enjoying a period of stable employment. There was, at least initially, a built-in time advantage for drivers. They could get door to door more quickly, given that public transport had to be accessed by walking to a bus stop or station.

The Impulse Society: America in the Age of Instant Gratification
by Paul Roberts
Published 1 Sep 2014

In surveys, wealthy voters are significantly more likely to regard deficit reduction and government spending as having greater priority than unemployment, because the deficit affects interest rates and interest rates have a huge impact on investments. Studies find the wealthy only a third as likely as the general public to believe that the federal government should prioritize full employment and half as likely to support a federal minimum wage high enough to keep a family above the poverty line.25 As Tom Perriello, a former Democratic congressman, told The New York Times, big Democratic donors are “more likely to consider the deficit a bigger crisis than the lack of jobs.”26 This shift in the priorities of funders, says Perriello, who now raises funds for the left-of-center Center for American Progress,27 is injecting “an enormous anti-populist element” into Democratic politics and policymaking.

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Thor Olavsrud, “Big Data Analytics Lets Businesses Play Moneyball,” ComputerworldUK, Aug. 24, 2012, http://www.computerworlduk.com/in-depth/it-business/3377796/big-data-analytics-lets-businesses-play-money ball/. 6. Daniel Martin, Katz “Quantitative Legal Prediction—Or—How I Learned to Stop Worrying and Start Preparing for the Data-Driven Future of the Legal Services Industry,” Emory Law Journal, 62, no. 909 (2013): 938. 7. Gary Burtless, “How Far Are We From Full Employment” Brookings, Aug. 27, 2013. 8. Paul Krugman, “Defining Prosperity Down,” The New York Times, July 7, 2013, http://www.nytimes.com/2013/07/08/opinion/krugman-defining-prosperity-down.htmlsrc=recg; “Median Household Income, by Year,” table, DaveManuel.com, http://www.davemanuel.com/median-household-income.php; Robert Pear, “Median Income Rises, but Is Still 6% below Level at Start of Recession in ’07,” The New York Times, Aug. 21, 2013, http://www.nytimes.com/2013/08/22/us/politics/us-median-income-rises-but-is-still-6-below-its-2007-peak.html; past years’ data was adjusted usingthe CPI Inflation Calculator at the U.S.

The Second Machine Age: Work, Progress, and Prosperity in a Time of Brilliant Technologies
by Erik Brynjolfsson and Andrew McAfee
Published 20 Jan 2014

When technology eliminates one type of job, or even the need for a whole category of skills, those workers will have to develop new skills and find new jobs. Of course, that can take time, and in the meantime they may be unemployed. The optimistic argument maintains that this is temporary. Eventually, the economy will find a new equilibrium and full employment will be restored as entrepreneurs invent new businesses and the workforce adapts its human capital. But what if this process takes a decade?25 And what if, by then, technology has changed again? This is the possibility that Wassily Leontief had in mind his 1983 article when he speculated that many workers could end up permanently unemployed, like horses unable to adjust to the invention of the tractors.26 Once one concedes that it takes time for workers and organizations to adjust to technical change, then it becomes apparent that accelerating technical change can lead to widening gaps and increasing possibilities for technological unemployment.

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Indeed, as noted by economist Menzie Chinn, there is no visible relationship between top tax rates and overall economic growth, at least in the ranges the U.S. experienced.39 We don’t pretend that the policies we advocate here will be easy to adopt in the current political climate, or that if they somehow were all adopted they would immediately bring back full employment and rising average wages. We know that these are challenging times; many people have seen their fortunes suffer during the Great Recession and subsequent slow recovery and are being left behind by the twin forces of technology and globalization. Inequality and other forms of spread are increasing, and everyone is not sharing in all the types of bounty the economy is generating.

The Fourth Revolution: The Global Race to Reinvent the State
by John Micklethwait and Adrian Wooldridge
Published 14 May 2014

Keynes’s critique was far more devastating than Marx’s because it was couched in the language of modern economics and because it was written—and very well written too—from a position of exasperated sympathy with the system rather than angry hostility. In essence Keynes presented a way of saving capitalism from itself by the careful use of government spending. The central observation in The General Theory is that there is no natural tendency to full employment as classical economics had argued. On the contrary, capitalist economies might be destroyed by high levels of unemployment, which reduced demand and threatened social unrest. In slack economic times the role of central government was to boost demand by spending money on public works and unemployment pay.

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Louis Brandeis, the great American Supreme Court judge, once pronounced that “we can have a democratic society or we can have great concentrated wealth in the hands of a few. We cannot have both.” The golden age of Western democracy was arguably during the long postwar boom when inequalities of income were relatively compressed and nation-states offered full employment and expanding welfare provisions. Democracy has seemed less golden when so many of the spoils have gone to the top 1 percent. As our colleague Philip Coggan has pointed out, this contradiction, like many others, was manageable in the era of more, when the economy was growing and it was easy for both governments and their citizens to borrow.

The American Dream Is Not Dead: (But Populism Could Kill It)
by Michael R. Strain
Published 25 Feb 2020

Krueger and Orley Ashenfelter, “Theory and Evidence on Employer Collusion in the Franchise Sector,” NBER Working Paper No. 24831, July 2018. 17.Matt Marx, “Reforming Non-Competes to Support Workers,” The Hamilton Project, Policy Proposal 2018–04, February 2018. 18.Janna E. Johnson and Morris M. Kleiner, “Is Occupational Licensing a Barrier to Interstate Migration?,” NBER Working Paper No. 24017, December 2017. 19.Board of Governors of the Federal Reserve System, “Monetary Policy Report Submitted to Congress on February 17, 2000, Pursuant to the Full Employment and Balanced Growth Act of 1978: Monetary Policy and the Economic Outlook (section 1).” 20.The CPI-U-RS value for 2019 was not released at the time of writing, so all direct comparisons between wages deflated by this measure and the PCE take 2018 as the end year. 21.The data used to generate this graph are generously made available by the Economic Policy Institute on its website.

The Meritocracy Trap: How America's Foundational Myth Feeds Inequality, Dismantles the Middle Class, and Devours the Elite
by Daniel Markovits
Published 14 Sep 2019

Trump’s repudiationism succeeded by shifting the political frame—by winning the election’s argument, to create a new politics. On the eve of Trump’s victory, the U.S. military remained unmatched and effectively unchallenged; American diplomats and businesses dominated the world’s legal and economic order; the poverty rate approached historic lows; the labor market neared full employment; crime remained below historic levels; and the country’s standard of living neared an all-time high. Even if not booming, America remained tolerably healthy, comparing favorably to other countries in the present and also, in important ways, to its own past. Nevertheless, Trump relentlessly attacked the society that he sought to lead.

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These numbers reveal that uneducated and educated workers live in almost entirely separate worlds, which effectively never overlap. The least educated face a constant, demoralizing struggle to find work at all, while (contrary to popular stories of college graduates living in their parents’ basements) the most educated enjoy full employment. And when they do find jobs, only about one worker in fifty from the bottom half of the educational distribution earns as much as the median worker from the top twentieth. FIGURE 10 Incomes of the Bottom 90 Percent and Per Capita Consumption and Debt over Time (Ten-Year Moving Averages) FIGURE 10 shows per capita consumption, household debt, and mean income for households in the bottom 90 percent of the income distribution, from 1947 through 2010.

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See Bureau of Labor Statistics, “Industries at a Glance: Securities, Commodity Contracts, and Other Financial Investments and Related Activities,” accessed August 15, 2018, www.bls.gov/iag/tgs/iag523.htm#about. Reached by subtracting employment numbers for production and nonsupervisory employees from full employment numbers. The average hourly earnings in this sector, according to the BLS, is $54, for annual earnings of about $100,000. The supervisory employees may reasonably be thought to earn well above average wages, and given that they represent only about one-third of the total employees, this makes it reasonable to suppose that they earn in the neighborhood of the 1 percent threshold.

The Relentless Revolution: A History of Capitalism
by Joyce Appleby
Published 22 Dec 2009

With cheap land, easy credit, and ready markets at home and abroad for their crops, they flourished. Some would break in new land and then sell it at a considerable profit when others moved to the area. Access to land meant maximizing family labor. One Ohio pioneer, finding that his hundred-acre farm did not offer “full employment” for his sons, plunged all his savings into buying enough land to absorb their full working capacity. Farmers not only thought in terms of capitalizing their labor but considered their sons’ labor in those terms as well. Although much of the land in Ohio was poorly drained, most chroniclers of the frontier remarked on its astounding yields.

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A realist might add that the two systems of belief and governance were too divergent to make any other outcome likely. Free enterprise, free elections, and the personal freedoms of movement, speech, religion, and political participation came to epitomize the West’s cherished values; the Soviets extolled their full employment, public ownership of the nation’s goods, and equality of treatment for its people. Anticommunism united the nations of Western Europe and the New World. It also limited the range of acceptable political thought in the United States, which threatened to stifle the robust public debates that an economy based on innovation and initiative needed.

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The comfortable understanding among big business, big labor, and big government was coming apart. The unwelcome appearance of stagflation also signaled that national policy makers could no longer depend upon the economic prescriptions of John Maynard Keynes. He had given a central role to government to spend when private investments could no longer achieve full or near-full employment, as in the Great Depression. Most countries in the postwar West followed Keynesian policies to ward off recessions. Alas, few had had the courage to cut off popular spending programs when they no longer were needed to boost the economy. This negligence contributed to inflation, exacerbated by the 1973 spike in oil prices.

Big Blues: The Unmaking of IBM
by Paul Carroll
Published 19 Sep 1994

Those salesmen, taught that things always have to be super, eventually dis­ couraged even the typically blunt developers from acknowledging any problems. Although IBM has some exceptionally sharp developers, it also has more than its share of clunkers. The problem stems from IBM ’s long-cherished full-employment policy. While programmers at most personal-com puter software companies in the mid-1980s were young­ sters trained in new languages such as C, most of IBM ’s good program ­ mers were longtime employees who had initially specialized in older languages, such as Cobol. T hat’s like telling someone who is proficient at languages to switch from translating English into French to translat­ ing English into German.

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While he never did, he often told people that IBM could maintain its no-layoff tradition only as long as the business w ent well, and he kept a tight lid on em ploym ent— IBM ’s head count was about the same at the end of the 1970s as it is now, after more than 100,000 people were hired in the 1980s and then shown the door. But all those caveats about w hether full employment could last were swept aside with the euphoria of the early 1980s. A tem porary worker express­ ing surprise at the lack of typing work and wondering w hether she shouldn’t be moved to a different em ployer would be told just to bring a book to work and read during her shift the way everyone else did.

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It still made decisions on internal disputes, and that still allowed the old-line businesses to undercut whatever their younger brethren tried to do, even though Akers had decreed that would no longer happen. Akers couldn’t bring him self to break from the company’s paternal­ istic past, either. H e tried to stick with the full-employment policy, which told employees, in essence, “If you do your job, there will always be a job for you.’’ Guaranteeing jobs worked splendidly when IBM was expanding so fast over the decades, because the growth gave IBM the chance to hire all the new people it needed. But by late 1991, IBM was shrinking, not growing.

Why It's Still Kicking Off Everywhere: The New Global Revolutions
by Paul Mason
Published 30 Sep 2013

There are at least fifteen motels like this in Albuquerque, he says, and, of course, ‘It’s like this at the edge of every American city.’ This is what the automobile stupor and the bluegrass music and the Glenn Beck monologues numb you to as you speed along America’s highways. Those vintage motel signs, which summon up the era of Elvis and full employment, are in reality flagstaffs for the hidden homeless. They are right next to you, on every highway in America. And, just like in the 1930s, there is a president in the White House elected on a platform of hope, radicalism and concern for the working poor. And like in the 1930s, Congress is determined to stop him—insofar as he has not stopped himself.

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Though he faced resistance from the cheap-labour bosses and the police, by the time he wrote the novel Steinbeck was cutting with the grain in terms of Federal policy. For the book is not just about a journey: it is about the search for a new economic model based on state intervention to guarantee full employment, and about a new social model based on solidarity and tolerance. This was Roosevelt’s New Deal, which would, between 1933 and 1937, create twelve million jobs, power America out of double-dip recession and—in the teeth of opposition from corporations—redistribute wealth. Roosevelt would, within days of taking office, abolish speculation in the finance system.

The Atlantic and Its Enemies: A History of the Cold War
by Norman Stone
Published 15 Feb 2010

Now, economists were associated, on the whole, with easy answers. How widespread their effect was can be seen from an aside by the English historian A. J. P. Taylor, in his book about the origins of the Second World War. Hitler’s economy had produced mild inflation, he said, and had thereby produced full employment in a country that, in 1933, had had 8 million men out of work; Taylor added that everyone now knew that mild inflation was a cause for prosperity. A dozen years after writing this, when, nearing old age, he saw his savings consumed by inflation, and the streets outside scattered with litter, he told a different story.

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Print-outs sprawled their way across dirty factory floors, and the managers just got on with managing in the old ways, but such problems were not unknown in the West. In any case, and it is one of the extraordinary features of this period, Western economists of considerable reputation took the Soviet economy very seriously. John Kenneth Galbraith, for instance, thought that the full employment that the Soviet system ensured was admirable, and whole institutes were set up in Vienna and points west to examine the workings of the Soviet economy. In England, hardly an advertisement for capitalism, there was an institute at Birmingham University to study the workings of the Polish economy, directed by an Italian Keynesian, Mario Nuti; a great cemetery of information was installed, R.

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They were resisted, partly because they seemed to be offering a return to the dismal verities of the Gold Standard age. In the USA economics was much less dominated by the Keynesian orthodoxies. There the unions were markedly less strong, and there was not quite such a concentration on the virtues of full employment. The most basic assumption in England had to do with the thirties, when so many young and educated people had looked guiltily at the mass unemployment of the traditional industries, mainly in the north, and had compared it with the prosperity of the south (and maybe also thought, inevitably, that their own job prospects should have been grander than the schoolteaching or other such low-paid work that many of them found themselves doing).

Stigum's Money Market, 4E
by Marcia Stigum and Anthony Crescenzi
Published 9 Feb 2007

As theorists now realize, expanding money and bank credit without limit during an upswing and permitting them to contract without limit during a downswing, far from encouraging stable growth, would amplify fluctuations in income and output. In particular, unlimited money creation during a boom would fuel any inflationary fires and other excesses that developed. Today, the Fed sees its major policy job as pursuing a countercyclical monetary policy. Specifically, it attempts to promote full employment and price stability by limiting the growth of bank intermediation when the economy expands too vigorously and by encouraging it when the economy slips into recession. To achieve these objectives, a stable predictive relationship between inflation and economic growth, often referred to as a Phillips curve, is necessary, according to many models.2 Controlling the Level of Bank Intermediation The Fed has the ability to control the level of bank intermediation—the amount of bank lending and money creating—through several tools, although its main tool is its open market operations.

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Over time, new legislation has molded the Fed’s role into the institution we know today. There were two particular additional acts of Congress that refined and supplemented the objectives of the Fed, as originally stated in the Federal Reserve Act of 1913. The acts were the Employment Act of 1946 and the Full Employment and Balanced Growth Act of 1978 (sometimes referred to as the Humphrey-Hawkins Act after its original sponsors). These two acts restated the Fed’s objectives to include economic growth in line with the economy’s growth potential, a high level of employment, stable prices (in terms of the purchasing power of the dollar), and moderate long-term interest rates.

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These two acts restated the Fed’s objectives to include economic growth in line with the economy’s growth potential, a high level of employment, stable prices (in terms of the purchasing power of the dollar), and moderate long-term interest rates. From the Fed’s vantage point, its duties are now seen falling into four general areas: • Conducting the nation’s monetary policies by influencing the money and credit conditions in the economy in pursuit of full employment and stable prices. • Supervising and regulating banking institutions to ensure the safety and soundness of the nation’s banking and financial system and to protect the credit rights of consumers. • Maintaining the stability of the financial system and containing systemic risk that may arise in financial markets

Poland - Culture Smart!
by Allen, Gregory;Lipska, Magdalena;Culture Smart!;
Published 15 Jun 2023

Several companies now offer app-based deliveries, which have become very popular throughout the country (see Useful Apps, page 198, for more). WORK Most middle-aged Poles, who went through the transition from state socialism to a free-market economy, have experienced huge changes in their lives. To begin with, under the socialist system there was full employment, which resulted in overemployment, that is, too many people to do too little work. This situation, coupled with the increasingly negative attitude toward the state in the 1980s, resulted in an abysmal work ethic. The upside of this state of affairs was that working days were short, typically 8:00 a.m. to 3:00 p.m., and families spent a great deal of time together.

The Cold War: A New History
by John Lewis Gaddis
Published 1 Jan 2005

The stark fact that the Americans and the British could not have defeated Hitler without Stalin’s help meant that World War II was a victory over fascism only—not over authoritarianism and its prospects for the future. Meanwhile, the Soviet Union had significant assets, despite the immense losses it had suffered. Because it was part of Europe, its military forces would not be withdrawing from Europe. Its command economy had shown itself capable of sustaining full employment when the capitalist democracies had failed, during the prewar years, to do so. Its ideology enjoyed widespread respect in Europe because communists there had largely led the resistance against the Germans. Finally, the disproportionate burden the Red Army had borne in defeating Hitler gave the U.S.S.R. a moral claim to substantial, perhaps even preponderant, influence in shaping the postwar settlement.

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Stalin, his successor, had carried out a revolution from above in the Soviet Union, first by collectivizing agriculture, then by launching a program of rapid industrialization, and finally by ruthlessly purging potential rivals, real and imagined. The international proletarian revolution Lenin expected had not come, but the U.S.S.R. was nonetheless, by the end of the 1930s, the world’s most powerful proletarian state. And unlike its capitalist counterparts, it had maintained full production and therefore full employment throughout the Great Depression. The rise of Nazi Germany posed a serious challenge, to be sure, but Stalin’s pact with Hitler had bought time and territory, so that when the invasion came in 1941 the Soviet Union not only survived but eventually hurled it back. As the end of the fighting approached, the U.S.S.R. was poised, physically and politically, to dominate half of Europe.

The Boy Who Could Change the World: The Writings of Aaron Swartz
by Aaron Swartz and Lawrence Lessig
Published 5 Jan 2016

Though Aaron eschewed labels, his ideals seemed essentially libertarian socialist: he sought to minimize coercion (governmental, corporate, and economic) and maximize utility, while understanding the importance of equity and solidarity in achieving these ends. But he was willing to engage within the system to get there. During the time I knew him well, he thought a lot about monetary policy, believing that in order to resolve the immediate economic downturn, and eventually achieve full employment by mobilizing people and capital in ways that improve lives, “the Fed should be printing money that we then give to poor people (or everyone if that’s easier).” His final tweet, composed when yet another contentious fight over the debt limit loomed, urged the minting of a trillion-dollar coin to fund government operations.

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Then they talked about a recession the size of which hadn’t been seen since the 1930s. Once again, Keynes provides us with the instructions on how to get out of this mess. The question is whether we’ll follow them. Toward a Larger Left http://crookedtimber.org/2009/08/04/toward-a-larger-left/ August 4, 2009 Age 22 Stanford, like many universities, maintains full employment for humanities professors by requiring new students to take their seminars. My heart burning with the pain of societal injustice, I chose the one on “Freedom, Equality, Difference.” Most of the other students had no particular interest in the topic—they were just meeting the requirement. But a significant minority did: like me, they cared passionately about it.

Paper Promises
by Philip Coggan
Published 1 Dec 2011

So the fact that it was based on the dollar and committed to exchange rate stability was hardly surprising. However, one of the reasons the system weakened over time was that capital found ways of evading the controls. And the ability of countries to run independent monetary policy, often with the aim of ensuring full employment, stored up long-term trouble for the fixed exchange-rate system. The agreement was far from popular at the time, being attacked from both sides of the Atlantic. In Britain, Lord Beaverbrook, a close friend of Churchill, declared that ‘This is the gold standard all over again. And at a moment when the United States has all the gold and Britain has none of it.’

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Sure enough, within four days President Nixon had suspended the convertibility of gold, accompanying the move with a 10 per cent surcharge on imports – a blatant attempt to force other countries to revalue their currencies. The Bretton Woods system was over. It could be argued that Bretton Woods was doomed by the attempt to combine fixed exchange rates with a full employment policy. Arguably these two aims were not compatible for all countries all the time. The switch to floating exchange rates in the 1970s was followed by much higher rates of unemployment than had occurred under Bretton Woods, and the monetarists were accused of being callous about the plight of the unemployed because of their obsession with inflation.

Rise of the Robots: Technology and the Threat of a Jobless Future
by Martin Ford
Published 4 May 2015

In mid-2013, Chinese authorities acknowledged that only about half of the country’s current crop of college graduates had been able to find jobs, while more than 20 percent of the previous year’s graduates remained unemployed—and those figures are inflated when temporary and freelance work, as well as enrollment in graduate school and government-mandated “make work” positions, are regarded as full employment.52 Thus far, a lack of proficiency in English and other European languages has largely prevented skilled workers in China from competing aggressively in the offshoring industry. Once again, however, technology seems likely to eventually demolish this barrier. Technologies like deep learning neural networks are poised to transport instantaneous machine voice translation from the realm of science fiction into the real world—and this could happen within the next few years.

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(This, as we will see shortly, relates to what’s called the “permanent income hypothesis.”) As a result, Krugman says, looking at the data at any moment in time “tells you nothing at all about what will happen.” Krugman points out that “economics is not a morality play,” and goes so far as to suggest that we can have “full employment based on purchases of yachts, luxury cars, and the services of personal trainers and celebrity chefs.” I am skeptical of this (but see the section on “techno-feudalism” later in this chapter). As I pointed out previously, nearly all the major industries that constitute the modern economy produce mass-market products and services.

The Nanny State Made Me: A Story of Britain and How to Save It
by Stuart Maconie
Published 5 Mar 2020

But it went as far in the right direction as any British government has ever gone before or since, or seems likely to. In her history of the British working class, The People, Selina Todd states ‘between 1945 and 1951 the lives of working-class people greatly improved. Labour took power committed to maintaining full employment and collective bargaining and to introducing cradle to grave welfare provision’. There were caveats, of course: ‘For those who were used to a comfortable way of life, the late 1940s were an uncomfortable period of privation. But for those who had grown up in the depression and survived the blitz, the immediate post-war years heralded the start of a new life.’

…

As Nicholas Spice put it in his review of Kynaston’s Austerity Britain, ‘if the people put up with the inequity of post-war Britain and soldiered on through years of discomfort and privation, they did so not out of a supererogatory deference to the existing order, but because Butler and Beveridge and the Attlee administration brought about a quiet but enduring revolution’. Kynaston detailed these as ‘free grammar school education, universal healthcare, a comprehensive system of national insurance, family allowances, food and housing subsidies’. He also noted that large-scale nationalisation and full employment had ‘shifted power significantly towards the workers’. Selina Todd though, like many on the modern Left, is critical that Attlee and the Labour Party of the time did not go far enough. They accepted Beveridge’s idea that the new welfare state be paid for via a National Insurance system rather than redistributive tax hikes on the rich.

Licence to be Bad
by Jonathan Aldred
Published 5 Jun 2019

The growing interference of government in the economy, Hayek believed, constituted a direct threat to individual freedoms, freedoms which could be restored only through the long, slow, patient rolling back of government intervention and the eventual return to a true free-market economy. Hayek was clear about the scale of the challenge. Hayek saw that Keynesian economics was much more than just a set of policy recommendations for controlling unemployment. There was a rapidly emerging consensus in which a primary duty of government is to maintain full employment. (Even the bankers seemed to agree: in a government memo, Keynes noted that international financiers would disapprove of significant unemployment in Britain.)2 More than that, Keynes insisted that governments have a duty to regulate and supplement market forces for the sake of wider social benefits.

…

objection, 107, 119–20 Friedman, Milton, 4–5, 56, 69, 84, 88, 126, 189 awarded Nobel Prize, 132 and business responsibility, 2, 152 debate with Coase at Director’s house, 50, 132 as dominant Chicago thinker, 50, 132 on fairness and justice, 60 flawed arguments of, 132–3 influence on modern economics, 131–2 and monetarism, 87, 132, 232 at Mont Pèlerin, 5, 132 rejects need for realistic assumptions, 132–3 Sheraton Hall address (December 1967), 132 ‘The Methodology of Positive Economics’ (essay, 1953), 132–3 ‘The Social Responsibility of Business is to Increase Its Profits’ (article, 1970), 2, 152 Frost, Gerald, Antony Fisher: Champion of Liberty (2002), 7* Galbraith, John Kenneth, 242–3 game theory assumptions of ‘rational behaviour’, 18, 28, 29–32, 35–8, 41–3, 70, 124 Axelrod’s law of the instrument, 41 backward induction procedure, 36–7, 38 and Cold War nuclear strategy, 18, 20, 21–2, 24, 27, 33–4, 35, 70, 73, 198 focus on consequences alone, 43 as form of zombie science, 41 and human awareness, 21–3, 24–32 and interdependence, 23 limitations of, 32, 33–4, 37–40, 41–3 minimax solution, 22 multiplicity problem, 33–4, 35–7, 38 Nash equilibrium, 22–3, 24, 25, 27–8, 33–4, 41–2 the Nash program, 25 and nature of trust, 28–31, 41 the Prisoner’s Dilemma, 26–8, 29–32, 42–3 real world as problem for, 21–2, 24–5, 29, 31–2, 37–8, 39–40, 41–3 rise of in economics, 40–41 and Russell’s Chicken, 33–4 and Schelling, 138–9 and spectrum auctions, 39–40 theory of repeated games, 29–30, 35 tit-for-tat, 30–31 and trust, 29, 30–31, 32, 41 uses of, 23–4, 34, 38–9 view of humanity as non-cooperative/distrustful, 18, 21–2, 25–32, 36–8, 41–3 Von Neumann as father of, 18, 19, 20–22, 25, 26, 28, 30, 34, 41 zero-sum games, 21–2 Gates, Bill, 221–2 Geithner, Tim, 105 gender, 127–8, 130–31, 133, 156 General Electric, 159 General Motors (GM), 215–16 George, Prince of Cambridge, 98 Glass–Steagall Act, repeal of, 194 globalization, 215, 220 Goldman Sachs, 182, 184, 192 Google, 105 Gore, Al, 39 Great Reform Act (1832), 120 greed, 1–2, 196, 197, 204, 229, 238 Greenspan, Alan, 57, 203 Gruber, Jonathan, 245 Haifa, Israel, 158, 161 Harper, ‘Baldy’, 7 Harsanyi, John, 34–5, 40 Harvard Business Review, 153 Hayek, Friedrich and Arrow’s framework, 78–9 economics as all of life, 8 and Antony Fisher, 6–7 influence on Thatcher, 6, 7 and Keynesian economics, 5–6 and legal frameworks, 7* at LSE, 4 at Mont Pèlerin, 4, 5, 6, 15 and Olson’s analysis, 104 and public choice theory, 89 rejection of incentive schemes, 156 ‘spontaneous order’ idea, 30 The Road to Serfdom (1944), 4, 5, 6, 78–9, 94 healthcare, 91–2, 93, 178, 230, 236 hedge funds, 201, 219, 243–4 Heilbroner, Robert, The Worldly Philosophers, 252 Heller, Joseph, Catch-22, 98, 107, 243–4 Helmsley, Leona, 105 hero myths, 221–3, 224 Hewlett-Packard, 159 hippie countercultural, 100 Hoffman, Abbie, Steal This Book, 100 Holmström, Bengt, 229–30 homo economicus, 9, 10, 12, 140, 156–7 and Gary Becker, 126, 129, 133, 136 and behaviour of real people, 15, 136, 144–5, 171, 172, 173, 250–51 and behavioural economics, 170, 171, 172, 255 long shadow cast by, 248 and Nudge economists, 13, 172, 173, 174–5, 177 Hooke, Robert, 223 housing market, 128–9, 196, 240–41 separate doors for poor people, 243 Hume, David, 111 Huxley, Thomas, 114 IBM, 181, 222 identity, 32, 165–6, 168, 180 Illinois, state of, 46–7 immigration, 125, 146 Impossibility Theorem, 72, 73–4, 75, 89, 97 Arrow’s assumptions, 80, 81, 82 and Duncan Black, 77–8 and free marketeers, 78–9, 82 as misunderstood and misrepresented, 76–7, 79–82 ‘paradox of voting’, 75–7 as readily solved, 76–7, 79–80 Sen’s mathematical framework, 80–81 incentives adverse effect on autonomy, 164, 165–6, 168, 169–70, 180 authority figure–autonomy contradiction, 180 and behavioural economics, 171, 175, 176–7 cash and non-cash gifts, 161–2 context and culture, 175–6 contrast with rewards and punishments, 176–7 ‘crowding in’, 176 crowding out of prior motives, 160–61, 162–3, 164, 165–6, 171, 176 impact of economists’ ideas, 156–7, 178–80 and intrinsic motivations, 158–60, 161–3, 164, 165–6, 176 and moral disengagement, 162, 163, 164, 166 morally wrong/corrupting, 168–9 origins in behaviourism, 154 and orthodox theory of motivation, 157–8, 164, 166–7, 168–70, 178–9 payments to blood donors, 162–3, 164, 169, 176 as pervasive in modern era, 155–6 respectful use of, 175, 177–8 successful, 159–60 as tools of control/power, 155–7, 158–60, 161, 164, 167, 178 Indecent Proposal (film, 1993), 168 India, 123, 175 individualism, 82, 117 and Becker, 134, 135–8 see also freedom, individual Industrial Revolution, 223 inequality and access to lifeboats, 150–51 and climate change, 207–9 correlation with low social mobility, 227–8, 243 and demand for positional goods, 239–41 and economic imperialism, 145–7, 148, 151, 207 and efficiency wages, 237–8 entrenched self-deluding justifications for, 242–3 and executive pay, 215–16, 219, 224, 228–30, 234, 238 as falling in 1940–80 period, 215, 216 Great Gatsby Curve, 227–8, 243 hero myths, 221–3, 224 increases in as self-perpetuating, 227–8, 230–31, 243 as increasing since 1970s, 2–3, 215–16, 220–21 and lower growth levels, 239 mainstream political consensus on, 216, 217, 218, 219–21 marginal productivity theory, 223–4, 228 new doctrine on taxation since 1970s, 232–5 and Pareto, 217, 218–19, 220 poverty as waste of productive capacity, 238–9 public attitudes to, 221, 226–8 rises in as not inevitable, 220, 221, 242 role of luck downplayed, 222, 224–6, 243 scale-invariant nature of, 219, 220 ‘socialism for the rich’, 230 Thatcher’s praise of, 216 and top-rate tax cuts, 231, 233–5, 239 trickle-down economics, 232–3 US and European attitudes to, 226–7 ‘you deserve what you get’ belief, 223–6, 227–8, 236, 243 innovation, 222–3, 242 Inside Job (documentary, 2010), 88 Institute of Economic Affairs, 7–8, 15, 162–3 intellectual property law, 57, 68, 236 Ishiguro, Kazuo, Never Let Me Go, 148 Jensen, Michael, 229 Journal of Law and Economics, 49 justice, 1, 55, 57–62, 125, 137 Kahn, Herman, 18, 33 Kahneman, Daniel, 170–72, 173, 179, 202–3, 212, 226 Kennedy, President John, 139–40 Keynes, John Maynard, 11, 21, 162, 186, 204 and Buchanan’s ideology, 87 dentistry comparison, 258–9, 261 on economics as moral science, 252–3 Friedman’s challenge to orthodoxy of, 132 Hayek’s view of, 5–6 massive influence of, 3–4, 5–6 on power of economic ideas, 15 and probability, 185, 186–7, 188–9, 190, 210 vision of the ideal economist, 20 General Theory (1936), 15, 188–9 Khomeini, Ayatollah, 128 Khrushchev, Nikita, 139–40, 181 Kilburn Grammar School, 48 Kildall, Gary, 222 Kissinger, Henry, 184 Knight, Frank, 185–6, 212 Krugman, Paul, 248 Kubrick, Stanley, 35*, 139 labour child labour, 124, 146 and efficiency wages, 237–8 labour-intensive services, 90, 92–3 lumpenproletariat, 237 Olson’s hostility to unions, 104 Adam Smith’s ‘division of labour’ concept, 128 Laffer, Arthur, 232–3, 234 Lancet (medical journal), 257 Larkin, Philip, 67 law and economics movement, 40, 55, 56–63, 64–7 Lazear, Edward, ‘Economic Imperialism’, 246 legal system, 7* and blame for accidents, 55, 60–61 and Chicago School, 49, 50–52, 55 and Coase Theorem, 47, 49, 50–55, 63–6 criminal responsibility, 111, 137, 152 economic imperialist view of, 137 law and economics movement, 40, 55, 56–63, 64–7 ‘mimic the market’ approach, 61–3, 65 Posner’s wealth-maximization principle, 57–63, 64–7, 137 precautionary principle, 211–12, 214 transaction costs, 51–3, 54–5, 61, 62, 63–4, 68 Lehmann Brothers, 194 Lexecon, 58, 68 Linda Problem, 202–3 LineStanding.com, 123 Little Zheng, 123, 124 Lloyd Webber, Andrew, 234–5, 236 lobbying, 7, 8, 88, 115, 123, 125, 146, 230, 231, 238 loft-insulation schemes, 172–3 logic, mathematical, 74–5 The Logic of Life (Tim Harford, 2008), 130 London School of Economics (LSE), 4, 48 Long-Term Capital Management (LTCM), 201, 257 Machiavelli, Niccoló, 89, 94 Mafia, 30 malaria treatments, 125, 149 management science, 153–4, 155 Mandelbrot, Benoît, 195, 196, 201 Mankiw, Greg, 11 marginal productivity theory, 223–4 Markowitz, Harry, 196–7, 201, 213 Marx, Karl, 11, 101, 102, 104, 111, 223 lumpenproletariat, 237 mathematics, 9–10, 17–18, 19, 21–4, 26, 247, 248, 255, 259 of 2007 financial crash, 194, 195–6 and Ken Arrow, 71, 72, 73–5, 76–7, 82–3, 97 axioms (abstract assumptions), 198 fractals (scale-invariance), 194, 195–6, 201, 219 and orthodox decision theory, 190–91, 214 Ramsey Rule on discounting, 208–9, 212 and Savage, 189–90, 193, 197, 198, 199, 205 and Schelling, 139 Sen’s framework on voting systems, 80–81 standard deviation, 182, 192, 194 and stock market statistics, 190–91, 195–6 use of for military ends, 71–2 maximizing behaviour and Becker, 129–31, 133–4, 147 and catastrophe, 211 and Coase, 47, 55, 59, 61, 63–9 economic imperialism, 124–5, 129–31, 133–4, 147, 148–9 Posner’s wealth-maximization principle, 57–63, 64–7, 137 profit-maximizing firms, 228 see also wealth-maximization principle; welfare maximization McCluskey, Kirsty, 194 McNamara, Robert, 138 median voter theorem, 77, 95–6 Merton, Robert, 201 Meucci, Antonio, 222 microeconomics, 9, 232, 259 Microsoft, 222 Miles, David, 258 Mill, John Stuart, 102, 111, 243 minimum wage, national, 96 mobility, economic and social correlation with inequality, 226–8, 243 as low in UK, 227 as low in USA, 226–7 US–Europe comparisons, 226–7 Modern Times (Chaplin film, 1936), 154 modernism, 67 Moivre, Abraham de, 193 monetarism, 87, 89, 132, 232 monopolies and cartels, 101, 102, 103–4 public sector, 48–9, 50–51, 93–4 Mont Pèlerin Society, 3–9, 13, 15, 132 Morgenstern, Oskar, 20–22, 24–5, 28, 35, 124, 129, 189, 190 Mozart, Wolfgang Amadeus, 91, 92–3 Murphy, Kevin, 229 Mussolini, Benito, 216, 219 Nash equilibrium, 22–3, 24, 25, 27–8, 33–4, 41–2 Nash, John, 17–18, 22–3, 24, 25–6, 27–8, 33–4, 41–2 awarded Nobel Prize, 34–5, 38, 39, 40 mental health problems, 25, 26, 34 National Health Service, 106, 162 ‘neoliberalism’, avoidance of term, 3* Neumann, John von ambition to make economics a science, 20–21, 24–5, 26, 35, 125, 151, 189 as Cold War warrior, 20, 26, 138 and expansion of scope of economics, 124–5 as father of game theory, 18, 19, 20–22, 25, 26, 28, 30, 34, 41 final illness and death of, 19, 34, 35, 43–4 genius of, 19–20 as inspiration for Dr Strangelove, 19 and Nash’s equilibrium, 22–3, 25, 38* simplistic view of humanity, 28 theory of decision-making, 189, 190, 203 neuroscience, 14 New Deal, US, 4, 194, 231 Newton, Isaac, 223 Newtonian mechanics, 21, 24–5 Nixon, Richard, 56, 184, 200 NORAD, Colorado Springs, 181 nuclear weapons, 18–19, 20, 22, 27, 181 and Ellsberg, 200 and game theory, 18, 20, 21–2, 24, 27, 33–4, 35, 70, 73, 198 MAD (Mutually Assured Destruction), 35, 138 and Russell’s Chicken, 33–4 and Schelling, 138, 139 Nudge economists, 13, 171–5, 177–8, 179, 180, 251 Oaten, Mark, 121 Obama, Barack, 110, 121, 157, 172, 180 Olson, Mancur, 103, 108, 109, 119–20, 122 The Logic of Collective Action (1965), 103–4 On the Waterfront (Kazan film, 1954), 165 online invisibility, 100* organs, human, trade in, 65, 123, 124, 145, 147–8 Orwell, George, Nineteen Eighty-Four, 42–3 Osborne, George, 233–4 Packard, David, 159 Paine, Tom, 243 Pareto, Vilfredo 80/20 rule’ 218 and inequality, 217, 218–19, 220 life and background of, 216–17 Pareto efficiency, 217–18, 256* Paul the octopus (World Cup predictor, 2010), 133 pensions, workplace, 172, 174 physics envy, 9, 20–21, 41, 116, 175–6, 212, 247 Piketty, Thomas, 234, 235 plastic shopping bag tax, 159–60 Plato’s Republic, 100–101, 122 political scientists and Duncan Black, 78, 95–6 Black’s median voter theorem, 95–6 Buchanan’s ideology, 84–5 crises of the 1970s, 85–6 influence of Arrow, 72, 81–2, 83 see also public choice theory; social choice theory Posner, Richard, 54, 56–63, 137 ‘mimic the market’ approach, 61–3, 65 ‘The Economics of the Baby Shortage’ (1978), 61 precautionary principle, 211–12, 214 price-fixing, 101, 102, 103–4 Princeton University, 17, 19–20 Prisoner’s Dilemma, 26–8, 29–32, 42–3 prisons, cell upgrades in, 123 privatization, 50, 54, 88, 93–4 probability, 182–4 and Keynes, 185, 186–7, 188–9, 210 Linda Problem, 202–3 modern ideas of, 184–5 Ramsey’s personal probabilities (beliefs as probabilities), 187–8, 190, 197, 198, 199, 204–5 and Savage, 190, 193, 197, 198, 199, 203, 205 ‘Truth and Probability’ (Ramsey paper), 186–8, 189, 190 see also risk and uncertainty Proceedings of the National Academy of Sciences, 22 productivity Baumol’s cost disease, 90–92, 93, 94 and efficiency wages, 237–8 improvement in labour-intensive services, 92–3 labour input, 92 protectionism, 246, 255 psychology availability heuristic, 226 behaviourism, 154–8, 237 and behavioural economics, 12, 170–71 cognitive dissonance, 113–14 and financial incentives, 156–7, 158–60, 163–4, 171 framing effects, 170–71, 259 of free-riding, 113–14, 115 intrinsic motivations, 158–60, 161–3, 164, 165–6, 176 irrational behaviour, 12, 15, 171 learning of social behaviour, 163–4 moral disengagement, 162, 163, 164, 166 motivated beliefs, 227 ‘self-command’ strategies, 140 view of in game theory, 26–31 view of in public choice theory, 85–6 and welfare maximization, 149 ‘you deserve what you get’ belief, 223–6, 227–8, 236, 243 public choice theory as consensus view, 84–5 and crises of the 1970s, 85–6 foolish voter assumption, 86–8 ‘paradox of voter turnout’, 88–9, 95–6, 115–16 partial/self-contradictory application of, 86, 87–9 ‘political overload’ argument, 85, 86–7 ‘public bad, private good’ mantra, 93–4, 97 and resistance to tax rises, 94, 241 self-fulfilling prophecies, 95–7 and selfishness, 85–6, 87–8, 89, 94, 95–7 as time-bomb waiting to explode, 85 public expenditure in 1970s and ’80s, 89 Baumol’s cost disease, 90–92, 93, 94 and Keynesian economics, 4 and public choice theory, 85–8, 89, 241 and tax rises, 241–2 public-sector monopolies, 48–9, 50–51, 93–4 Puzzle of the Harmless Torturers, 118–19 queue-jumping, 123, 124 QWERTY layout, 42 racial discrimination, 126–7, 133, 136, 140 Ramsey, Frank, 186–8, 189, 190, 205, 208 Ramsey Rule, 208–9, 212 RAND Corporation, 17, 41, 103, 138, 139 and Ken Arrow, 70–71, 72–3, 74, 75–6, 77, 78 and behaviourism, 154 and Cold War military strategy, 18, 20, 21–2, 24, 27, 33–4, 70, 73, 75–6, 141, 200, 213 and Ellsberg, 182–4, 187, 197–8, 200 and Russell’s Chicken, 33 Santa Monica offices of, 18 self-image as defender of freedom, 78 rational behaviour assumptions in game theory, 18, 28, 29–32, 35–8, 41–3, 70, 124 axioms (abstract mathematical assumptions), 198 Becker’s version of, 128–9, 135, 140, 151 behavioural economics/Nudge view of, 173, 174–5 distinction between values and tastes, 136–8 economic imperialist view of, 135, 136–8, 140, 151 and free-riding theory, 100–101, 102, 103–4, 107–8, 109–10, 115–16 and orthodox decision theory, 198, 199 public choice theory relates selfishness to, 86 term as scientific-sounding cover, 12 see also homo economicus Reader’s Digest, 5, 6 Reagan, Ronald, 2, 87–8, 89, 104, 132 election of as turning point, 6, 216, 220–21 and top-rate tax cuts, 231, 233 regulators, 1–2 Chicago view of, 40 Reinhart, Carmen, 258 religion, decline of in modern societies, 15, 185 renewable energy, 116 rent-seeking, 230, 238 ‘right to recline’, 63–4 risk and uncertainty bell curve distribution, 191–4, 195, 196–7, 201, 203–4, 257 catastrophes, 181–2, 191, 192, 201, 203–4, 211–12 delusions of quantitative ‘risk management’, 196, 213 Ellsberg’s experiment (1961), 182–4, 187, 197, 198–200 errors in conventional thinking about, 191–2, 193–4, 195–7, 204–5, 213 financial orthodoxy on risk, 196–7, 201–2 and First World War, 185 and fractals (scale-invariance), 194, 195–6, 201 hasard and fortuit, 185* ‘making sense’ of through stories, 202–3 ‘measurable’ and ‘unmeasurable’ distinction, 185–6, 187–9, 190, 210–11, 212–13 measurement in numerical terms, 181–4, 187, 189, 190–94, 196–7, 201–2, 203–5, 212–13 orthodox decision theory, 183–4, 185–6, 189–91, 193–4, 201–2, 203–5, 211, 212–14 our contemporary orthodoxy, 189–91 personal probabilities (beliefs as probabilities), 187–8, 190, 197, 198, 199, 204–5 precautionary principle, 211–12, 214 pure uncertainty, 182–3, 185–6, 187–9, 190, 197, 198–9, 210, 211, 212, 214, 251 redefined as ‘volatility’, 197, 213 the Savage orthodoxy, 190–91, 197, 198–200, 203, 205 scenario planning as crucial, 251 Taleb’s black swans, 192, 194, 201, 203–4 ‘Truth and Probability’ (Ramsey paper), 186–8, 189, 190 urge to actuarial alchemy, 190–91, 197, 201 value of human life (‘statistical lives’), 141–5, 207 see also probability Robertson, Dennis, 13–14 Robinson, Joan, 260 Rodrik, Dani, 255, 260–61 Rogoff, Ken, 258 Rothko, Mark, 4–5 Rumsfeld, Donald, 232–3 Russell, Bertrand, 33–4, 74, 97, 186, 188 Ryanair, 106 Sachs, Jeffrey, 257 Santa Monica, California, 18 Sargent, Tom, 257–8 Savage, Leonard ‘Jimmie’, 189–90, 193, 203, 205scale-invariance, 194, 195–6, 201, 219 Scandinavian countries, 103, 149 Schelling, Thomas, 35* on access to lifeboats, 150–51 awarded Nobel Prize, 138–9 and Cold War nuclear strategy, 138, 139–40 and economic imperialism, 141–5 and game theory, 138–9 and Washington–Moscow hotline, 139–40 work on value of human life, 141–5, 207 ‘The Intimate Contest for Self-command’ (essay, 1980), 140, 145 ‘The Life You Save May be Your Own’ (essay, 1968), 142–5, 207 Schiphol Airport, Amsterdam, 172 Schmidt, Eric, 105 Scholes, Myron, 201 Schwarzman, Stephen, 235 Second World War, 3, 189, 210 selfishness, 41–3, 178–9 and Becker, 129–30 and defence of inequality, 242–3 as free marketeers’ starting point, 10–12, 13–14, 41, 86, 178–9 and game theory, 18 and public choice theory, 85–6, 87–8, 89, 94, 95–7 Selten, Reinhard, 34–5, 36, 38, 40 Sen, Amartya, 29, 80–81 service sector, 90–93, 94 Shakespeare, William, Measure for Measure, 169 Shaw, George Bernard, 101 Shiller, Robert, 247 Simon, Herbert, 223 Skinner, Burrhus, 154–5, 158 Smith, Adam, 101, 111, 122 The Wealth of Nations (1776), 10–11, 188–9 snowflakes, 195 social choice theory, 72 and Ken Arrow, 71–83, 89, 95, 97, 124–5, 129 and Duncan Black, 78, 95 and free marketeers, 79, 82 Sen’s mathematical framework, 80–81 social media, 100* solar panels, 116 Solow, Bob, 163, 223 Sorites paradox, 117–18, 119 sovereign fantasy, 116–17 Soviet Union, 20, 22, 70, 73, 82, 101, 104, 167, 237 spectrum auctions, 39–40, 47, 49 Stalin, Joseph, 70, 73, 101 the state anti-government attitudes in USA, 83–5 antitrust regulation, 56–8 dismissal of almost any role for, 94, 135, 235–6, 241 duty over full employment, 5 economic imperialist arguments for ‘small government’, 135 increased economic role from 1940s, 3–4, 5 interventions over ‘inefficient’ outcomes, 53 and monetarism, 87, 89 and Mont Pèlerin Society, 3, 4, 5 and privatization, 50, 54, 88, 93–4 public-sector monopolies, 48–50, 93–4 replacing of with markets, 79 vital role of, 236 statistical lives, 141–5, 207 Stern, Nick, 206, 209–10 Stigler, George, 50, 51, 56, 69, 88 De Gustibus Non Est Disputandum (with Becker, 1977), 135–6 Stiglitz, Joseph, 237 stock markets ‘Black Monday’ (1987), 192 and fractals (scale-invariance), 194, 195–6, 201 orthodox decision theory, 190–91, 193–4, 201 Strittmatter, Father, 43–4 Summers, Larry, 10, 14 Sunstein, Cass, 173 Nudge (with Richard Thaler, 2008), 171–2, 175 Taleb, Nassim, 192 Tarski, Alfred, 74–5 taxation and Baumol’s cost disease, 94 and demand for positional goods, 239–41 as good thing, 231, 241–2, 243 Laffer curve, 232–3, 234 new doctrine of since 1970s, 232–4 property rights as interdependent with, 235–6 public resistance to tax rises, 94, 239, 241–2 and public spending, 241–2 revenue-maximizing top tax rate, 233–4, 235 tax avoidance and evasion, 99, 105–6, 112–13, 175, 215 ‘tax revolt’ campaigns (1970s USA), 87 ‘tax as theft’ culture, 235–6 top-rate cuts and inequality, 231, 233–5, 239 whines from the super-rich, 234–5, 243 Taylor, Frederick Winslow, 153–4, 155, 167, 178, 237 Thaler, Richard, 13 Nudge (with Cass Sunstein, 2008), 171–2, 175 Thatcher, Margaret, 2, 88, 89, 104, 132 election of as turning point, 6, 216, 220–21 and Hayek, 6, 7 and inequality, 216, 227 privatization programme, 93–4 and top-rate tax cuts, 231 Theory of Games and Economic Behavior (Von Neumann and Morgenstern, 1944), 20, 21, 25, 189 Titanic, sinking of (1912), 150 Titmuss, Richard, The Gift Relationship, 162–3 tobacco-industry lobbyists, 8 totalitarian regimes, 4, 82, 167–8, 216, 219 see also Soviet Union trade union movement, 104 Tragedy of the Commons, 27 Truman, Harry, 20, 237 Trump, Donald, 233 Tucker, Albert, 26–7 Tversky, Amos, 170–72, 173, 202–3, 212, 226 Twitter, 100* Uber, 257 uncertainty see risk and uncertainty The Undercover Economist (Tim Harford, 2005), 130 unemployment and Coase Theorem, 45–7, 64 during Great Depression, 3–4 and Keynesian economics, 4, 5 United Nations, 96 universities auctioning of places, 124, 149–50 incentivization as pervasive, 156 Vietnam War, 56, 198, 200, 249 Villari, Pasquale, 30 Vinci, Leonardo da, 186 Viniar, David, 182, 192 Volkswagen scandal (2016), 2, 151–2 Vonnegut, Kurt, 243–4 voting systems, 72–4, 77, 80, 97 Arrow’s ‘Independence of Irrelevant Alternatives’, 81, 82 Arrow’s ‘Universal Domain’, 81, 82 and free marketeers, 79 ‘hanging chads’ in Florida (2000), 121 recount process in UK, 121 Sen’s mathematical framework, 80–81 Waldfogel, Joel, 161* Wanniski, Jude, 232 Watertown Arsenal, Massachusetts, 153–4 Watson Jr, Thomas J., 181 wealth-maximization principle, 57–63 and Coase, 47, 55, 59, 63–9 as core principle of current economics, 253 created markets, 65–7 extension of scope of, 124–5 and justice, 55, 57–62, 137 and knee space on planes, 63–4 practical problems with negotiations, 62–3 and values more important than efficiency, 64–5, 66–7 welfare maximization, 124–5, 129–31, 133–4, 148–9, 176 behavioural economics/Nudge view of, 173 and vulnerable/powerless people, 146–7, 150 welfare state, 4, 162 Wilson, Charlie, 215 Wittgenstein, Ludwig, 186, 188 Wolfenschiessen (Swiss village), 158, 166–7 Woolf, Virginia, 67 World Bank, 96 World Cup football tournament (2010), 133 World Health Organization, 207 Yale Saturday Evening Pest, 4–5 Yellen, Janet, 237 THE BEGINNING Let the conversation begin … Follow the Penguin twitter.com/penguinukbooks Keep up-to-date with all our stories youtube.com/penguinbooks Pin ‘Penguin Books’ to your pinterest.com/penguinukbooks Like ‘Penguin Books’ on facebook.com/penguinbooks Listen to Penguin at soundcloud.com/penguin-books Find out more about the author and discover more stories like this at penguin.co.uk ALLEN LANE UK | USA | Canada | Ireland | Australia India | New Zealand | South Africa Allen Lane is part of the Penguin Random House group of companies whose addresses can be found at global.penguinrandomhouse.com First published 2019 Copyright © Jonathan Aldred, 2019 The moral right of the author has been asserted Jacket photograph © Getty Images ISBN: 978-0-241-32544-5 This ebook is copyright 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Trillion Dollar Triage: How Jay Powell and the Fed Battled a President and a Pandemic---And Prevented Economic Disaster
by Nick Timiraos
Published 1 Mar 2022

This goal represented half of the Fed’s dual mandate but given the importance of the Phillips curve in guiding policy decisions, it often looked like officials treated it as the lesser of the two goals, subservient to the importance of low inflation. An hour-long panel of noneconomists stole the show during two days of academic presentations at the main research conference Clarida organized in Chicago in June 2019. “When I hear we’re at full employment, that’s not my reality. That’s not my community’s reality,” said Juan Salgado, the chancellor of City Colleges of Chicago, which enrolled 80,000 mostly minority students. Powell, who took notes and asked questions, seemed to genuinely enjoy the sessions. As 2019 drew to a close, the policy review seemed likely to deliver some important changes.

…

The vaccination program was already unleashing pent-up demand for travel, vacations, concerts, and dining out. On top of this was fiscal stimulus unlike any since World War II, at a time when the Fed was running maximally accommodative monetary policy. Yellen predicted the package would return the economy to full employment by 2022. In April, economists at the IMF projected the US would be the only large economy to surpass the level of GDP in 2022 that had been forecast before the pandemic hit. US allies breathed relief at the end of Trump’s impulsive diplomacy. During a closed-door session at the G-7 meeting in London, Canadian Finance Minister Chrystia Freeland exclaimed, “Janet Yellen is making America great again.”

Imagining India
by Nandan Nilekani
Published 25 Nov 2008

The threats for the Indian economy lie here, in these unswept corners of policy that we now avoid and step around, because they will determine the country India is set to become. We are now speeding toward a situation no one really wants. For instance, while we are, as Dr. C. Rangarajan notes, “approaching full employment,” the majority of our labor force is reaching this goal along a path based on low-income, insecure work. As our cities crumble, people are cordoning themselves off in gated housing communities with private supplies of electricity, water and security. And our higher education systems are creating thousands of graduates every year who cannot string a coherent paragraph together—“educated illiterates” whose degrees literally are not worth the paper they were printed on.

…

He expects “India’s workforce to equal the labor force” by 2010, which means that for the first time in India’s economic history everyone eligible for a job will have one. Indian governments have long searched for that evasive Holy Grail, and it has come by quietly. Of course, we are nowhere close to the real ideal of full employment. Too many Indian workers are in the unorganized sector, which mostly offers seasonal, insecure work. And a large number of Indians have turned to entrepreneurship as a distress choice. For lack of other career options, people set up pavement displays, tea stalls, phone booths, kirana stores and small shops in a variety of markets.

…

Over the last few years, however, it has become clear that the economy has created millions of jobs, accommodating the many job seekers coming into the city from smaller towns and villages. Job creation has in fact reached the point that it allows economists such as Dr. C. Rangarajan to postulate that “we’ll reach full employment by the end of this decade.” This for India would be a landmark never seen before—although in the light of the number of India’s self-employed, it is also a muted success. Most recently, the charge of the antireformers has been that with economic growth we are now facing rising inequality. This argument does give me pause.

Radical Chic & Mau-Mauing the Flak Catchers
by Tom Wolfe
Published 1 Jan 1970

“Let me answer the question—” “You dun‟t eefen listen to de kvestion,” says Preminger. “How can you answer de kvestion?” “Let me answer the question,” Cox says, and he says to Lenny: “We believe that the government is obligated to give every man employment or a guaranteed income . . . see . . . but if the white businessman will not give full employment, then the means of production should be taken from the businessman and placed in the community, with the people.” Lenny says: “How? I dig it! But how?” “Right on!” Someone in the back digs it, too. “Right on!” Julie Belafonte pipes up: “That‟s a very difficult question!” “You can‟t blueprint the future,” says Cox.

Beyond Outrage: Expanded Edition: What Has Gone Wrong With Our Economy and Our Democracy, and How to Fix It
by Robert B. Reich
Published 3 Sep 2012

A few years ago the Republican congresswoman Michele Bachmann remarked that if the minimum wage were repealed, “we could potentially virtually wipe out unemployment completely because we would be able to offer jobs at whatever level.” If you accept her logic, why stop there? After all, slavery was a full-employment system. Conservative economists have it wrong. The underlying problem isn’t that most Americans have priced themselves out of the global/high-tech labor market. It’s that most Americans are receiving a smaller share of the American pie. This not only is bad for the majority but also hobbles the economy.

With Liberty and Dividends for All: How to Save Our Middle Class When Jobs Don't Pay Enough
by Peter Barnes
Published 31 Jul 2014

With millions of soldiers returning and armament factories closing, a vast number of civilian jobs would be needed to keep everyone employed. What every American wanted to know was, where would all those new jobs come from? My father offered a solution. In an article titled “The Economic Equivalent of War,” he urged the creation of a peacetime government agency that would guarantee full employment by pledging, in advance, to buy up all the durable goods—cars, washing machines, and so on—that American factories produced but couldn’t sell. As during the war, companies would be given production quotas by boards representing industry, labor, and the public; this would keep surpluses from getting out of hand.

Four Futures: Life After Capitalism
by Peter Frase
Published 10 Mar 2015

Left critics, like Henwood and Dean Baker of the Center for Economic and Policy Research, locate our problems not in technology, but in policy. For them, blaming the weak economic recovery after the 2008 recession on automation is a distraction from the real issue, which is that government policy has not been sufficiently focused on fiscal stimulus and job creation, thus preventing the economy from reaching full employment. Worries about robots are, from this point of view, both counter-factual (because productivity growth is low) and politically reactionary. But others, including Brynjolfsson and McAfee, argue that even if no great fundamental breakthroughs are on the horizon, there is much to be gained from refining and recombining the breakthroughs we have already seen.

What's Next?: Unconventional Wisdom on the Future of the World Economy
by David Hale and Lyric Hughes Hale
Published 23 May 2011

For smaller countries facing comparable challenges—Switzerland and Singapore, for example, at different points in time—the solution was lending the surfeit capital abroad and a corresponding expansion in the current account surplus to above a tenth of GDP. In effect, these countries used overseas demand to supplement their insufficient domestic demand. But Japan comprised too big a proportion of world GDP to pursue such a strategy: A current account surplus sizable enough to maintain full employment of the country’s capital stock would have imposed enormous costs on the rest of the world. Indeed, other countries objected strenuously when the surplus expanded to just about half of the requisite size. Thus prevented by both diplomatic and economic factors from importing the foreign demand it needed, Japan was in danger of falling into a depression.

…

Equally important is the fact that the LDP created the political coalition that not only engineered the economic miracle of the 1950s and 1960s but ensured that most Japanese citizens enjoyed its benefits. It is no wonder voters kept rewarding it with a return to power. For decades, the LDP successfully ruled as a “catch-all coalition” that combined a strategy for rapid development with full employment, equal distribution of income, and a system for compensating those sectors of the population, such as workers in obsolescent industries, who were hurt by rapid development. On the strategy side, the “industrial policy” of the LDP and allied bureaucracies amounted to an extraordinarily successful “infant industry” policy that used a combination of promotion and protection to nurture future “winners,” such as autos, electronics, and steel, until they were ready to compete on the world stage on their own.

The American Way of Poverty: How the Other Half Still Lives
by Sasha Abramsky
Published 15 Mar 2013

In the late 1940s and 1950s, when Western European nations were distributing a range of social benefits to their populaces, America’s progressives fell victim to a McCarthyite political culture that denounced comprehensive federal safety net systems as being somehow “Communist.” McCarthyism ended in the mid-1950s, but it left a toxic rhetoric in its wake, one that was particularly hostile to big-picture safety net reforms. From debates around full employment policies during the Truman years to debates over universal healthcare in the Obama years, large-scale attempts to smooth out the market’s rough edges have routinely been denounced as somehow anti-American. Hence the kluge-like, makeshift nature of the American safety net. It existed, but it was neither uniform nor elegant.

…

But the numbers have never kept up with the need, and too often the programs simply remain hidden, underutilized and lacking clout. And that, said Connie Evans, president of the D.C.-based Association for Enterprise Opportunity, the trade association for American micro-lenders, was a shame. If one out of three Main Street businesses each added one employee, she argued, America would rapidly reach full employment again. Many of those businesses, she believed, could use micro-loans to expand; yet the programs that could help them do so were too few and far between. The Aspen Institute’s FIELD program estimated that nationwide in the years leading up to 2012 only around 117,000 such loans were disbursed annually.7 Given that there were more than 20 million micro-businesses in the country, and given the fact that small businesses in the post-2008 environment too often were denied credit by banks, that wasn’t nearly enough.

Fed Up: An Insider's Take on Why the Federal Reserve Is Bad for America
by Danielle Dimartino Booth
Published 14 Feb 2017

In the summer of 2005, Ben Bernanke, then a member of the Fed Board of Governors, tried to douse concerns about the housing market. “We’ve never had a decline in house prices on a nationwide basis,” said Bernanke. “So, what I think is more likely is that house prices will slow, maybe stabilize, might slow consumption spending a bit. I don’t think it’s going to drive the economy too far from its full employment path, though.” Greenspan told Congress in July 2005 that if housing prices fell, “they likely would be accompanied by some economic stress, though the macroeconomic implications need not be substantial.” To which I wrote a column headlined: “Reality, Fed Are at Odds.” Two of the top economists at the New York Fed released a paper in October 2005 saying, “We still find little evidence to support the existence of a national home price bubble.”

…

Bernanke and crew didn’t have even a moment to catch their breath when Lehman’s collapse ricocheted and blindsided them again. CHAPTER 13 Breaking the Buck FED STATEMENT WORD COUNT: 420 EFFECTIVE FED FUNDS RATE: 0.08% 10-YR TREASURY RATE: 1.97% FED BANKS TOTAL ASSETS: $2,919.55B DATE: 1/1/2012 Will capitalist economies operate at full employment in the absence of routine intervention? Certainly not. Do policymakers have the knowledge and ability to improve macroeconomic outcomes rather than make matters worse? Yes. —JANET YELLEN, APRIL 1999 When Bruce R. Bent Sr. and his wife landed in Rome on September 15, they were looking forward to a lovely holiday to celebrate their fiftieth wedding anniversary.

Toward Rational Exuberance: The Evolution of the Modern Stock Market
by B. Mark Smith
Published 1 Jan 2001

An editorial in Barron’s in the fall of 1949 stated this view succinctly: “The state is growing omnipotent, and it is doing so through use of the money power. The policies of the welfare state create inflation, feed on inflation, and necessitate inflation.” Later that fall, the president of the Federal Reserve Bank of Philadelphia predicted that the United States faced a prolonged period of inflation, caused by the government’s emphasis on full employment and constantly rising wage rates. Inflation of this magnitude had been unknown since the World War I years. But there was an important difference between the two periods, at least as far as the stock market was concerned. After the Second World War, a theory of investing existed (enunciated by T.

…

The reasoning behind the move was explained by William Greenburgh, a consultant for TIAA, who wrote, “An effort should be made to provide more income when [consumer] prices are high, even though this means taking risk that income will be less when prices are low.” Greenburgh observed that many economists believed the economy had a “built-in inflationary bias” due to heavy defense spending, a progressive tax structure, wage escalator clauses, budget deficits, easy money, an emphasis on full employment, and a disinclination to return to the gold standard. Thus it was unwise to commit retirement fund assets exclusively to traditional fixed-income investments.14 What would become one of the biggest bull markets in history began inconspicuously in June 1949. Like the market top of September 1929, the bottom in 1949 appeared unremarkable at the time.

Rummage: A History of the Things We Have Reused, Recycled and Refused To Let Go
by Emily Cockayne
Published 15 Aug 2020

The publishers George Allen & Unwin responded, explaining that ‘we (and doubtless others) are to a large extent using the reverse side of pre-war jackets of books of which the sheets were destroyed by enemy action’. Jackets protected the cloth covers. Had they been abolished, it was argued, ‘paper to prevent rubbing would have [had] to be slipped between separate books when they were dispatched in bulk’.56 A George Allen & Unwin edition of William Beveridge’s report on Full Employment in a Free Society (1944) re-employed a wrapper designed to clothe a book about El Greco published in 1938 (fig. 13).57 Oxford University Press opted for very simple wrappers, reutilising covers from their back catalogue. On the inside back flap of C. K. Allen’s Democracy and the Individual (1945) is the terse statement: ‘An Economy Jacket.

…

A collection of wartime recipes called Off the Beeton Track (1946) used as a dust jacket the reverse of a US Army map of part of Germany from 1944. The frugality of the recipes and the jacket jar oddly with the bright lithograph prints used to illustrate the book. Recipes include ‘Soup with left-over meat’, offal-based dishes and uses for dried eggs.59 13 (a and b). Both sides of the dust jacket for William Beveridge’s Full Employment in a Free Society. Author’s collection, photographed by Taryn Everdeen. Letters were also enveloped in reused matter, and most letters were sent by businesses. This envelope (fig. 14), used to contain a letter sent to a French Catholic church in London’s Soho in 1946, was made using a redundant map of part of France.

Battling Eight Giants: Basic Income Now
by Guy Standing
Published 19 Mar 2020

In considering the net cost of a basic income, this expected saving should be factored into the calculations. A basic income could also act as a suitable macro-economic stabilizer, with a core payment, adjusted according to changes in real per capita income, and a cyclical component, which would rise in times of recession and fall in times of ‘full employment’ or high aggregate demand.1 A basic income system would also tend to lessen regional inequality: it would represent a higher share of per capita income in low-income areas and encourage desirable interregional mobility. Sensible, modern business folk, including leading entrepreneurs and CEOs of mainstream corporations, also understand that basically secure people make more cooperative and productive workers, and even more rational consumers.

This Is Not a Drill: An Extinction Rebellion Handbook
by Extinction Rebellion
Published 12 Jun 2019

We must also abandon the fetish of ‘growth’ – a fetish first devised by neoliberal economists at the OECD and the Financial Times in the 1960s. They sought to encourage exponential economic growth to parallel the vast expansion of the globalized finance sector. Instead, our goal must be a decarbonized economy of full employment, based on renewables, recycling technologies, biodiversity, stock replenishment, sustainable and regenerative agricultural practices and other areas necessary for this transformation. This transformative programme will redefine what it is to be progressive. As the parliamentary debate on Heathrow’s expansion demonstrated, the twenty-first-century Left will split down into two camps.

Other People's Money: Masters of the Universe or Servants of the People?
by John Kay
Published 2 Sep 2015

The new emphasis on monetary policy that came with financialisation initially resulted in dramatic increases in interest rates intended to curb inflation. In 1980 short-term interest rates were at 17 per cent in Britain and at 19 per cent in the USA. These rates squeezed the budgets of home-buyers, bankrupted leveraged businesses and property developers, and depressed both asset prices and business confidence. The assumption of full employment which had been characteristic of the 1950s and 1960s had already gone: the measures of the early 1980s broke expectations of continuing and accelerating inflation. In the two decades that followed, interest rates and inflation steadily declined, and corporate profits and asset prices increased rapidly.

…

Gerald 242 Countrywide Financial 150, 152, 293 Craig, James 26 credit cards companies 27, 210 debt 54 origin of 185–6 profitability 113 credit default swaps 41, 60, 61, 64, 73, 100, 101, 119, 120, 121, 139, 152, 153, 223 credit expansion 54, 98 Crédit Lyonnais 33 credit ratings 21, 101, 248 credit risk 42, 75, 177, 192 Crédit Suisse First Boston 167, 292 credit-scoring 84, 87, 290, 291 Crosby, James 125 crowd-funding 81 D Dad’s Army (television series) 12 Dahinden, Vincent 124 Daschle, Tom 230 debit cards 186 debt reduction 241 debt securities 101, 107 debt-to-value ratio 149 democracy 4, 52, 308 deposit channel 25–6, 147–8, 173–94 activities of 188–94, 189, 192 directed by retail banks 291 household wealth 173–80, 175, 179 the payment system 181–8 ring-fencing 194, 287 simplification needed 213 deposit insurance 25, 121 deposit protection schemes 135 Derbyshire Building Society 90 deregulation 13, 28, 31, 149–50, 151, 246–7, 292 derivative contracts 191, 192, 323n11 derivatives market 2, 19, 35, 38, 110 portfolios 98 regulation 57, 234 securities 2, 15, 17, 41, 71, 131 Detroit, Michigan 254 Deutsche Bank 33, 104, 136–8, 166, 169, 191–2, 192, 193, 200, 219, 222, 266, 282, 286, 303, 323n11 Diamond, Bob 34, 35, 261, 267, 295, 300 Dickens, Charles: Martin Chuzzlewit 201 Dimon, Jamie 14–15, 35, 231 Dirks, Ray 228 Disney, Walt 70, 71 diversification 21, 27, 28, 29, 32, 33, 45, 95–9, 153 ‘alternative assets’ 98 building societies 151 buying all available stocks 99 coin-tossing game 96 correlation 96, 97–8 Exchange Traded Funds 99 hedge funds 98–9 passive funds 99 diversification divorce 74 DLJ 313n15 Dodd-Frank regulatory regime 236–7, 271 Doerr, John 167 dollar devaluation (1971) 14, 36 Donoghue, Mrs 283 dot.com boom 40 Draghi, Mario 42, 139 Dreamworks 21 Drexel Burnham Lambert 46 drug use 22 ‘Dutch book’ 68, 116 E eBay 187 economic policy 240–69 the British dilemma 262–9 consumer protection 259–62 financial markets and economic policy 248–52 Maestro 240–48 pensions and inter-generational equity 252–9 Economist, The 115 ‘Edge, the’ 114–18, 288 Edinburgh Britain’s second financial centre 11, 263 investment trusts in 26 Edison, Thomas 196 education 253, 259 efficient market hypothesis (EMH) 69–70, 99 Einstein, Albert 129 El Paso oil business 117–18, 232 electricity 245–6, 278 eligible counterparty 282–3 Elizabeth II, Queen 161 Emanuel, Rahm 301 embezzlement 127 emerging markets 39, 42 Emerson, Ralph Waldo: The Conduct of Life 181 emperor’s guard’s new clothes, the 309–10 empire, decline of 13 Enron 123, 124, 126, 127, 158, 176–7, 197, 246, 317n5 Equitas 107 Equity Funding 228 equity markets 23, 85, 168–9, 249, 288 Ericsson 108 Espirito Santo 271 Eurodollar market 13, 20, 120, 121 European Central Bank 42, 98, 138, 139, 183, 243, 244 European Commission 184, 289 European Monetary System 184 European Parliament 184, 328n6 European Union (EU) 194, 220, 226, 228, 273, 287 Eurostat 250 Eurozone 158, 183, 243, 250 creation of 129 crisis 41–2, 139, 301 indebtedness in 184 exchange rates fixed 18 flexible 18 forward 73 Exchange Traded Funds (ETFs) 99 synthetic 99 exchange-traded funds 280 Exchequer Partnerships 158, 159 extended family 78 Exxon Mobil 96, 101, 120, 134, 161, 163, 164, 189, 196 F Facebook 81, 162–3, 166, 167, 185, 196 ‘fair value’ 125–6, 191 fallacy of composition 89 Fama, Eugene 69 family support 79 Fannie Mae 75, 91, 135, 152, 230, 317–18n5 Farkas, Lee 152, 293 FBI 131 febezzle (‘functionally equivalent bezzle’) 127, 128, 132, 136, 176, 177, 190 Federal Deposit Insurance Corporation (FDIC) 25, 135, 247 Federal Reserve Bank of Kansas City symposium (Jackson Hole, Wyoming, 2005) 56–7, 58, 73, 79, 102, 181, 236, 256, 280 Federal Reserve Bank of New York 57, 183, 232, 242, 243 Federal Reserve Board 5, 41, 56, 57, 58, 134, 183, 231, 240, 243, 245, 247 Federal Reserve System 13, 40, 90, 98, 150, 183, 245 Federated Department Stores 204 fee structures 204 Ferguson, Charles 236 Feynman, Richard P. 276, 327n3 Fidelity 109, 199, 200, 213 finance sector a bias to action 203–8 control of risk 6, 7 economic significance 6 excess in the industry 6 export contribution 265 greedy individualism 24 growth of 1–2, 33 heavy criticism of 233 as just another business 5 labour force 263 lack of sanction application 7 lobbying 230, 302, 306 major role in politics 4 management of household financial affairs 6 matching of borrowers and lenders 6, 7 past and current attitudes in 23–4 payments system 6, 7, 25, 281 profitability 132–40, 134 qualitative assessment 265 recurrent crises 35, 307 regarded as having unique status 4–5 remuneration 54, 112 role of 143 search 144 sense of personal entitlement 24, 300 share in GDP 264–5 skills 15 stewardship 144 structural reform 7 taxation 266–7 work incentives 7 workers in finance 6–7, 125 finance theory 5 Finance Watch 328n6 financial advisers 197, 199, 291 Financial Conduct Authority 230, 237, 261 Financial Products Group 293 financial sector, regulation of see regulation Financial Services Authority 243, 247, 303 Financial Services Compensation Scheme 260 Financial Times 68, 115 financialisation 4–7, 36, 45, 72, 163, 165, 172, 259 and complexity 276, 278 conflation of roles of agent and trader 198 and the conglomeration 133 direct impact of 176 effect on corporate behaviour 78 and emergence of large asset management companies 200 emphasis on monetary policy 241 in Germany 169 and hedge funds 289 and housing 149 national and international 39 and risk 55 and secondary markets 170 and social security 255 Summers supports 57 transition from agency to trading 84 two main componenents of 16 Fink, Larry 200 First Boston 200 First Data Corporation 186 First World War 221 fiscal arbitrage 122, 123, 223 FISIM (financial services indirectly measured) 264 Fitch rating agency 313n6 Fitzgerald, Scott: The Great Gatsby 17, 297 FitzPatrick, Sean 156, 293–4 Five Star Movement 306 fixed commissions 29 fixed interest, currency and commodities (FICC) 22, 107, 110, 111, 118, 125, 160, 191, 194, 288 fixed-interest securities 190, 193 Flaubert, Gustave: Sentimental Education 80 Florida land boom (1920s) 201 Forbes magazine 204, 231 Ford, Henry 45, 70, 71 foreign exchange transactions speculators in 18–19 value of 2 Fortune magazine 23 ‘four horsemen’ 167, 168 Fox, Justin 70 fractional reserve banking 88 France corporatism 303–4 defeat of Sarkozy 248, 249 downgraded bonds 248, 249, 250 housing 149, 174 ‘trente glorieuses’ 36 Frankfurt financial centre 26 Freddie Mac 75, 135 free market 18, 59, 238, 247, 302 Frick, Henry Clay 44 Friedman, Milton 60, 63 Free to Choose 56 front running 28 FrontNational 306 Frost, Robert: ‘Provide, Provide’ 252 FT Alphaville 16 Fuld, Dick 24, 32, 72–3, 75, 231, 293 full employment 241 fund managers 66, 86, 108, 115, 206, 209, 212 future of finance 297–308 futures 19 G G8 and G20 economic summits 220 Galbraith, J.K. 127, 201 Galton, Francis xi gambling 130–31, 289 close regulation of 71, 72 Lloyd’s coffee house 71–2 lottery 65, 66, 68, 72 Gates, Bill 174, 268 Gaussian copula 22 GEC 48, 51 GEICO 107 Geithner, Timothy 57–8, 73, 75–6, 92, 104, 183, 230, 232, 239, 276, 306, 307 Geithner doctrine 271 Gemeinschaft 17, 61, 255 General Electric 46, 196 General Motors 45, 49 general share price indexes 98 Generali 27 Generally Accepted Accounting Principles (GAAP) 193 Gensler, Gary 288 Germany corporatism 303, 304 ‘economic miracle’ 36 housing 149, 174 indebtedness to 183–4 Landesbanken 169 Mittelstand 52, 168, 169, 170, 171, 172 role of Bundesbank 243 social market economy 219 state pensions 253 Gesellschaft 17, 61, 255 Gingrich, Newt 230 Glass-Steagall Act (1933) 25, 28, 33 Glaxo 96 global financial crisis (2007–9) and bank assets 91 bankers’ cognitive dissonance 102 begins in the USA 41 causes of 194, 220, 271 collapse of asset-backed securities market 21 collapse of sub-prime mortgages 109 costs of 285 and derivative contracts 192 and diversification 32 emergency measures 285–6 Gaussian copula 22 and liquidity 188, 278, 286 misallocation of housing finance 148 most culpable figures 293 unprecedented public intervention 41 the worst financial crisis since the Great Depression 15 globalisation 13 of capital flows 176, 180 of financial markets 17 and income inequality 53–4 pressure on regulatory structures 14 ‘gnomes of Zurich’ 18 gold standard 13, 18, 36, 181, 241 Golden Dawn 306 Goldman Sachs 1, 14, 31, 55, 57, 59, 63, 104–5, 114, 115, 117, 118, 120, 135, 143, 158, 160, 164, 232, 233, 250, 258, 266, 282, 283, 284, 288, 294, 300, 306 Code of Business and Ethics 118 Goldsmith, Oliver: The Deserted Village 49 goodwill 31, 258–9 Goodwin, Fred 14, 34, 149, 156, 169, 231, 293 Google 80, 83, 162, 167, 196 Gould, Jay 44 government assets and liabilities 000 government bonds 17, 42, 86, 155, 178, 208, 222, 290 government debt 128, 178, 190, 203, 245, 250, 251 government spending 253 Graham, Ben 176 Grasso, Dick 49 Great Depression 12, 15, 25, 36, 57, 218, 221, 225, 258, 308 ‘Great Moderation, the’ 40, 57, 104 Greece accounting manipulation 158, 250 adoption of a common currency 41 government debt 42, 128 refinancing of Greek credit 42 Greenspan, Alan 57, 63, 104, 119, 181, 245, 276 and Ayn Rand 79, 240 and ‘Black Monday’ 242 chairman of the Federal Reserve Board 56, 58, 181, 240–41, 242 and Fed priorities 247–8 and the Markowitz model 68–9 and mortgage defaults 97 and risk 73 testimony to Congress 67–8, 240 ‘Greenspan doctrine’ 56, 60, 67, 68, 71, 87, 101, 249 ‘Greenspan put, the’ 242, 249 Grillo, Bepep 306 Grimaldis of Monaco 123 gross domestic product (GDP) 251, 256, 264–5, 265, 266 gross national income (GNI) 265–6 gross value added (GVA) 265 group insurance 76–7 Grubman, Jack 293 H Haldane, Andrew 139, 264 Halifax Building Society 31, 32, 140, 164, 258–9 becomes a public company 124 competition for the ‘talent’ 193–4 ‘the Edge’ established in wholesale financial markets 114 and fixed-interest securities 190, 193 Group Treasury 106, 107, 111, 129 origins 106 rescued by the British government 124 response to changing times (1990s) 129 takes over the Bank of Scotland 124, 125 the world’s largest mortgage lender 106 worthless windfall shares 127–8 Hamamatsu Photonics 168 Hambrecht & Quist 167 Hambros Bank 158 Hanson 45, 46–7 ‘hard’ commodities 17 Harding, David 111–12, 124 Hartlepool nuclear power station, northeast England 158 Harvard University 5, 14–15 Harvey-Jones, Sir John 51 Hawkins, Sir Henry 61, 64, 116 Hayek, Friedrich 225 HBoS 32, 91, 124, 125, 135 healthcare 77, 78, 79, 253, 257–8 hedge fund managers 23, 99, 109, 282 Hedge Fund Research 323n9 hedge funds 27, 98–9, 110, 191, 194, 284, 289, 323n9 hedge fund centre, Mayfair, London 263 Helyar, John 46, 164 Henderson, David 58 ‘hidden champions’ 168 high-frequency trading 2, 111, 280, 305 Hill, Lord 322n14 Hope, Bob 160 Hornby, Andy 14 horse-racing 72, 116 House of Commons library 115 House of Lords 283 House of Morgan 25, 35 Household International 34–5 housing 148–54, 290 causes of crisis in housing finance 153 collapse of thrifts 150 equity release 54 house prices (US) 41, 43, 174, 259 houses as physical assets 146–7 low-cost 79 mortgage defaults 97 owner-occupied housing stock 53, 149, 151 specialist lenders 150 HSBC 1, 24, 34–5, 286, 328n22 Hubler, ‘Howie’ 130 Hurricane Katrina (2005) 79, 256 I Ibsen, Henrik: An Enemy of the People 285 Iceland: bank and compensation scheme collapse 260 ICI 45, 46–8, 51, 78 Iksil, Bruno 35, 130 ‘I’ll be gone, you’ll be gone’ culture 125, 128, 129, 131, 133, 152, 156, 204, 273 imperialism 13, 218 income distribution 52–4, 53 Independent Commission on Banking 139, 287 India, economic growth in 53 inflation 36, 54, 178, 241–2, 258 information asymmetry 60, 74, 76, 251, 317n2 information technology 18, 19–20, 31, 168, 185 infrastructure, property and 154–60 initial public offering (IPO) 113 Inside Job (film) 236 insurance companies 16, 27, 29, 120, 197, 199, 208, 213, 264 Intel 29, 167 interest rates and inflation 241, 242 long-term 251 intergenerational accounting 258 intermediation 80–105 bad intermediaries 81–2 competition 271 direct/indirect 82, 83 and diversification 96 facilitating 7 and the internet 81 leverage 100–105 managed 83, 201, 212–13 the role of the middleman 80–99 total costs of 207 transparent 83, 84, 201–2, 203 International Financial Reporting Standards (IFRS) 193 International Labour Organization (ILO) 263 International Monetary Fund (IMF) 13–14, 38, 39, 56, 58, 139, 220, 302 international reply coupons 131 International Swaps and Derivatives Association (ISDA) 61, 119, 193 internet 182, 183, 185 connectedness 81, 83 and intermediation 81 Interstate Commerce Commission 233, 237 investment banking FICC trading 107 global expansion of American banks 33 investment trusts 26, 27 relationships 16 within commercial banks 22 investment banks boutique 205 ‘dark pools’ 29 economists in 248–9 legal partnerships 30 modern objectives 197 and rating agencies 249 and search 197 investment channel 26, 148, 174, 175, 195–213 a bias to action 203–8 fails to meet the needs of businesses and households 213 investable assets 202–3, 203 the role of the asset manager 208–13 simplification needed 213 and sovereign wealth funds 253 stewardship 195–203, 203 investment companies 26, 27, 96, 177, 197, 199, 200, 201, 202 investment funds closed-end (managed) 212 open-ended (transparent) 212 Investor B 108 investors allocation of risk 57, 60, 73 and credit ratings 21 foreign 39 institutional 23, 28, 46 large 98 and leverage 101 long-term 94 losses of 43 private 28 property 99 retail 66 small 30, 99 sophisticated 23 Ireland bank workers’ strike (1970) 182 collapse of banking system (2008) 42, 138, 182 Isaacson, Walter 71 Ishmael, Stacy-Marie 16 Israel defence forces 171 high-technology start-up sector 117 It’s a Wonderful Life (film) 12–13 ITT 45 J Japan credit expansion 98 economic growth 36, 39 imagined competitive threat from 221 and quantitative easing 245 speculative bubble (late 1980s) 38–9, 280 jobbers 25, 28, 29–30 Jobs, Steve 70, 71, 162, 196 Johnson, Simon 302 Jordan Marsh department store 46, 90 J.P.

The Establishment: And How They Get Away With It
by Owen Jones
Published 3 Sep 2014

Trade unions have been crippled for a variety of reasons. The introduction of anti-union laws which, as Tony Blair himself once boasted, were ‘the most restrictive on trade unions in the Western world’, have left them often unable to stand their ground on behalf of their workforces. The end of full employment is another key reason: in times of job insecurity, the position of organized labour is weakened because there are so many workers willing to stomach attacks on wages and conditions as long as their own jobs are preserved. The defeats suffered by major trade unions, not least the miners – once seen as near-invincible – in the mid-1980s, made it seem as though industrial struggle was a futile exercise.

…

If it is good enough for German workers, it is surely good enough for British workers, and would give them a voice in their supermarkets, call centres, offices and other places of work, instead of treating them as chattels to be exploited. It would need to be complemented by other policies to stop workers being reduced to hire-and-fire fodder to be disposed of at will by employers, such as scrapping zero-hour contracts. An official policy of building full employment is also critical, which has the advantage of best guaranteeing the negotiating power of labour. Bosses would no longer be economic despots in Britain’s workplaces. Privatization has become a form of corporate welfare, with the likes of rail companies being subsidized by taxpayers’ money. Each rail franchise could be brought back into public ownership easily and at no cost, as the contract of each privately run service comes up for renewal.

Panderer to Power
by Frederick Sheehan
Published 21 Oct 2009

At the close of trading on April 14, the Nasdaq Composite closed at 3,321, a fall of 35 percent from March 10. Massive buying interests did what they could to restore the market, but it was exhausted, particularly the technology companies. 40 House Committee on Banking and Financial Services, Conduct of Monetary Policy: Report of the Federal Reserve Board Pursuant to the Full Employment and Balanced Growth Act of 1978 P.L. 95–523 and The State of the Economy, February 17, 2000, p. 30. There was no doubt that, after inflating for the past decade, the stock market was now deflating. Since the stock market ran the economy, there was a good chance that the GDP would follow. This was an odd time for the Federal Reserve to raise the funds rate.

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According to the New York Times: “Alan Greenspan has been everywhere in guiding economic policy in the wake of the terrorist attacks, slashing interest rates, helping to get Wall Street running again, shaping the tax cuts being developed by Congress and evaluating which airlines should receive government loan guarantees.”33 The description was apt but possibly embellished. Evidence of Greenspan’s airline intervention is lacking, but that was emblematic of the man’s grip on America’s pulse. 31 Senate Committee on Banking, Housing, and Urban Affairs, “First Session on Oversight of the Monetary Policy Report to Congress Pursuant to the Full Employment and Balanced Growth Act of 1978,” July 24, 2001, p. 16. This was not the only memorable tête-à-tête with Senator Gramm. Gramm called Alan Greenspan a “national phenomenon” and an oracle (Richard W. Stevenson, “Suddenly, Critics Are Taking Aim at Greenspan,” New York Times, April 2, 2001). Gramm would call Greenspan “the greatest central banker of the century,” presumably the twentieth century (Ian A.

The Economics Anti-Textbook: A Critical Thinker's Guide to Microeconomics
by Rod Hill and Anthony Myatt
Published 15 Mar 2010

2 the anti-text ends, but rather as places where funds required for investment and expansion are realized. Question for your professor: Would there be an opportunity cost to putting people back to work (and producing more goods) even in a deep recession? If not, then does scarcity depend on full employment? Post-Keynesians aren’t the only ones who reject scarcity as a basic economic condition. For example, Emily Northrop (2000) questions whether the fundamental cause of scarcity – unlimited wants – is really innate, and argues that it may be merely constructed. She notes that some people manage to resist consumerism and choose different lifestyles embodying simplicity, balance or connection (to the earth and to others).

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Galbraith’s 1973 book, Economics and the Public Purpose. 2 The stand-up economist, Yoram Bauman, quips that a microeconomist is someone who is wrong about specific things, whereas a macroeconomist is someone who is wrong about things in general (see his website: www.­ standupeconomist.com/). 3 For example, Lavoie (2006: 10) says: ‘… since full employment of resources is not assumed, the discussion of their efficient allocation is not a major issue. Rather, what is emphasized among postKeynesian economists is the degree to which these resources are utilized.’ 4 While it is true that economists recognize problems with markets, the solution to these problems is always more and better markets. 5 In the next chapter we discuss the difficulties of coming to a definitive conclusion through empirical testing.

Hedgehogging
by Barton Biggs
Published 3 Jan 2005

It abounds in mares’ nests and confusions. . . . Flashes of insight and intuition intersperse tedious algebra. When it is finally mastered, we find its analysis to be obvious and at the same time new. In short, it is a work of genius.” The book made a compelling case for reflation by deficit finance. Keynes argued full employment in mature capitalist economies could be maintained only with the help of government spending. In downturns, governments should consciously practice deficit spending to fulfill the role of private demand. The government’s budget should not just be for the purpose of sound financial planning for expenditures and revenues, but as a major instrument in the stabilization of the national economy.

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The General Theory founded modern macroeconomics, and virtually all of the subsequent work in that field emerges from it.The Roosevelt Brain Trust instinctively understood its concept of deficit spending stimulating demand and employment. New Deal disciples maintain that Keynesian economics was the backbone of the New Deal, and that it was what brought the U.S. economy back from the Depression to full employment.The United States in turn resuscitated the world.The skeptics argue that it was another event called World War II, not Keynesian economics, that revived the world. Keynes believed that in rich societies capital investment would be inadequate to sustain growth because of the high propensity of people to save.

Profit Over People: Neoliberalism and Global Order
by Noam Chomsky
Published 6 Sep 2011

One reason was the (rather plausible) expectation that liberalization of finance would impede freedom of trade. Another was the recognition that it would serve as a powerful weapon against democracy and the welfare state, which had enormous public support. Regulation of capital would allow governments to carry out monetary and tax policies and to sustain full employment and social programs without fear of capital flight, US negotiator Harry Dexter White pointed out, with the agreement of his British counterpart, John Maynard Keynes. Free flow of capital, in contrast, would create what some international economists call a “virtual senate,” in which highly concentrated financial capital imposes its own social policies on reluctant populations, punishing governments that deviate by capital flight.19 The Bretton Woods assumptions largely prevailed during the “Golden Age” of high levels of growth of the economy and productivity, and extension of the social contract, through the 1950s and 1960s.

The Future of the Professions: How Technology Will Transform the Work of Human Experts
by Richard Susskind and Daniel Susskind
Published 24 Aug 2015

In this and the following section we explain why there is uncertainty here, and we provide a new framework for thinking in a systematic way about technological unemployment in the professions. By way of preface, we need to be careful with the term ‘employment’. Our interest is not simply in whether technology might put professionals out of work, but also how well paid any work is. A future where there is full employment but with wages below subsistence level would be a worry. Our focus, then, is on the future of what we call ‘reasonably-paid’ employment. Hotdogs To tackle the question of technological unemployment, we find it helpful to work with a simplified story, one that we base on a discussion of ‘hotdogs’ by Paul Krugman, a Nobel Laureate in economics.25 Imagine a company that hires people to make hotdogs, and that this involves just three tasks—preparing the sausage, baking the bun, and putting the hotdog together.

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Our expectation is that, over time—by which we mean decades, rather than overnight—there will be technological unemployment in the professions. In other words, there will not be sufficient growth in the types of professional task in which people, not machines, have the advantage to keep most professionals in full employment. Because we cannot provide exact answers to the three questions, the scale of the job-loss is uncertain. Yet, when we take the findings of this book into account, there are three main reasons to think that job-loss will indeed be the general direction of travel. First, as machines continue to become increasingly capable, they will go on eroding any advantage that people have today in performing certain types of task.

Slowdown: The End of the Great Acceleration―and Why It’s Good for the Planet, the Economy, and Our Lives
by Danny Dorling and Kirsten McClure
Published 18 May 2020

Members of Generation X, who typically had very young Generation W parents, and their Generation V grandparents were also quite young (since that time, the average age at which people have their first child has got older). In Britain, as their grandparents were trying to come to terms with imperial demotion and their parents were mostly enjoying full employment (for men) and very rapidly improving attitudes about women, Generation X itself was watching the cathode ray tube TV. Their children would watch flat screens, their grandchildren may well use Google glasses or an electronic contact lens, but after that, the room for further technical advancement will start to diminish.

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The children of that Socialist Sunday School in Bradford did not yet know that there were two world wars, the crash of 1929, and a Great Depression to come. Those who survived would also live to see, in their middle age, the arrival of the new dawn that they had been promised, a welfare state, free health service, full employment, high and still growing equality, and rapidly rising living standards. That is why this banner has survived: they won, despite all the adversity of their times. We need to plan to win again. Exactly a century after that banner was made, a research fellow at the Future of Humanity Institute at the University of Oxford published an article in which he detailed what he believed remain the five biggest threats to human existence: nuclear war, a bioengineered pandemic, superintelligence, nanotechnology, and unknown unknowns.

The Streets Were Paved With Gold
by Ken Auletta
Published 14 Jul 1980

He took care, in a May 25, 1976, letter to Mayor Beame promising the federal assumption of local welfare costs, to strike the promise of a “prompt” takeover from a draft and substitute the phrase “as soon as possible.” Mindful that promises cost money, he toned down a staff-drafted speech on national health insurance, as well as language committing his Presidency to a sweeping Humphrey-Hawkins full employment bill. He seemed to understand that declaring health care or a job a right was different from telling people how to pay for that right, or how to set up a system to deliver that right. Many ADA liberals took this as a clue that Carter was not one of them. As a reporter covering Carter, I took it as a clue that he had a realistic sense of limits, an engineer’s concern with how things worked, not just how they sounded.

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“I think it’s fair to say,” economist John Kenneth Galbraith told a New York Times symposium in July 1975, “that no problem associated with New York City could not be solved by providing more money.” He said it was “remarkable” and “outrageous” that “so many people of wealth had left.” The “fiscal crisis would be over,” declared author Michael Harrington, if Washington passed “three laws”—federalized welfare costs, national health insurance, and the Humphrey-Hawkins full-employment bill. These views were echoed by others on the left, including economists like Robert Lekachman. As General Westmoreland would say, if only we had a few more troops … This preoccupation with money leads, as the social scientists would put it, to a preoccupation with “inputs” rather than “outputs.”

Visions of Inequality: From the French Revolution to the End of the Cold War
by Branko Milanovic
Published 9 Oct 2023

It is even more plausible to argue that the recent narrowing in income inequality observed in the developed countries was due to a combination of the narrowing inter-sectoral inequalities in product per worker [between agriculture and manufacturing], the decline in the share of property incomes in total incomes of households, and the institutional changes that reflect decisions concerning social security and full employment. 15 The idea was simple, but nobody had expressed it before. Kuznets started from the position that incomes in preindustrial societies were relatively equal. That proposition might not be true, and certainly was not true for societies with large inequality in landholdings, but we can assume (although it is never made explicit in Kuznets’s writings) that he had in mind an agricultural society approximating New England, composed of landowning peasantry. 16 That Kuznets had the United States primarily in mind can be guessed from two statements he makes in quick succession.

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Alexis de Tocqueville, Souvenirs, preface by Fernand Braudel, postface by J. P. Meyer (Paris: Gallimard, 1978), 130. My translation. 49 . The first quotation is from Marx, Class Struggles in France, 71. The second quotation is from Marx, Capital, vol. III, ch. 47, 949. 50 . Marx, The Eighteenth Brumaire, 78. 51 . Micha ł Kalecki, “Political Aspects of Full Employment,” Political Quarterly 14, no. 4 (1943): 322–330. Axel Leijonhufvud, “Capitalism and the Factory System,” in Economic as a Process: Essays in the New Institutional Economics, ed. R. N. Langlois, 203–223 (New York: Cambridge University Press, 1986). 52 . Marx, Class Struggles in France, 50. 53 .

The Rich and the Rest of Us
by Tavis Smiley
Published 15 Feb 2012

Their predictions are based largely on the rising cost of labor in China and the exorbitant costs of shipping products back to the United States. Also, ironically, it’s becoming cheaper to manufacture goods in the United States, thanks to the recalibration of labor union benefits that have allowed companies to shrink wages and benefits in exchange for full employment for American workers. We’re not economists, but we believe that such lofty predictions are based on 20th-century thinking. First, our history of bouncing back is no indication that we will come back more vibrant after this unprecedented Great Recession. Second, relying on our military muscle to change the economic equation will fatten the purses only of the military industrial complex, waste more resources and lives, and wind up costing the American taxpayer more.

The Taste of War: World War Two and the Battle for Food
by Lizzie Collingham
Published 1 Jan 2011

The real income of a man in industry rose by 46 per cent during the war.49 It was this rise in purchasing power, combined with price controls and the guarantee of the ration, which gave the working classes access to adequate quantities of meat, eggs (albeit dried), butter and milk products. More than any action by nutritionists or government-directed policy it was full employment and the fairer distribution of food brought about by the need for food rationing which had a revolutionary impact on the nation’s health and gave the poorest third of society access to animal protein, vitamins and calcium. The huge gap that had previously existed between the nutritional value of the diet of the wealthy and the poor was substantially narrowed during the war.

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In 1941, William Beveridge was asked to chair a minor government committee on insurance benefits, but the report that he published in December 1942 was more far-reaching and called for a comprehensive system of social security based on subsistence-rate benefits, a new health service, and measures to ensure full employment. The cabinet response to the report was divided. The Labour Ministers – Ernest Bevin, Herbert Morrison, Hugh Dalton – were all in favour of reform, although not necessarily in the shape that Beveridge had suggested. But they were not in a position within the coalition government to direct social policy.

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Eventually, special areas known as Wimpy bars were set up in the Corner Houses. After the war these bars were emulated by a string of fast-food chains.81 The post-war agricultural revolution, and the revolution in food processing which accompanied it, both made a greater variety of foodstuffs widely available. Economic recovery, which saw the whole of Europe achieve full employment by the 1960s, meant that disposable incomes rose. An indicator of how affordable food had become is the falling proportion of household income which was spent on food. This was most dramatic in the United States where the proportion of the total household budget allocated for food dropped from 33 per cent in the 1930s to 13 per cent in the 1980s.

The Rise and Fall of the British Nation: A Twentieth-Century History
by David Edgerton
Published 27 Jun 2018

Only a minority of workers were union members, and membership was weighted towards male, skilled workers. The history of trade unionism reveals a key divide, much changed over time, between the craft unions and the labourer or general unions, and the divisions too between skills, with many unions representing workers in each workplace. Full employment and rising prices stimulated membership, unemployment and falling prices made it less attractive. Membership doubled between 1900 and 1914 (starting at 2 million) and doubled again over the Great War, peaking in 1920. It then fell rapidly and then steadily got back to just over 1913 levels in 1931.

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It was down to fifty-two seats in a 31 per cent vote in 1931; but then rose to 154 seats on a 38 per cent vote (as good as it had ever got before 1945) in 1935. It was at this low parliamentary strength that it sat in parliament through the Second World War. LABOUR AND THE SECOND WORLD WAR The demands of the Second World War quickly ensured full employment, which raised wages in many cases and strengthened trade unions. Although strikes were made illegal, trade union membership nearly doubled, and employers were forced to recognize unions in firms and industries previously resistant. In 1938–9 only 1 million manual workers paid income tax, and they paid barely £3 per annum each; by 1944 the number had increased to 7 million, paying on average just under £30 each.37 The Second World War saw a newly assertive British working class, and film producers, and the state, sometimes, let through what was unthinkable before the war.

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The Communist Party was also opposed. It noted that wages were higher in the United Kingdom, worker contributions to social services were lower and there was a danger of harmonization of social services on the contributory (that is Beveridgean) model on joining. There was no Common Market commitment to full employment; the Common Market meant discrimination against the Commonwealth in trade, and higher food prices.43 There were those on the Labour left who disguised their own nationalism by claiming that the Common Market represented continental protection and that the United Kingdom should look outwards, to remain truly internationalist, committed to the Commonwealth and the United Nations.44 Harold Wilson rather niftily endorsed this line of thinking.

Dream Hoarders: How the American Upper Middle Class Is Leaving Everyone Else in the Dust, Why That Is a Problem, and What to Do About It
by Richard V. Reeves
Published 22 May 2017

While real wage rises have been sickly for those outside the top quintile, the average salary at the top has grown by 58 percent since 1979.20 Even excluding the top 1 percent, whose golden parachutes and excessive compensation packages drew so much attention in the wake of the 2008 financial crisis, average wage and salary income in the top quintile has grown by a robust 44 percent. There are many competing explanations for these growing wage disparities: the decline of trade unions, a shift away from full employment, increased competition as a result of globalization, downward pressure on wages from immigration, and what has been sexily labeled “skill-biased technological change.” Debates continue to rage in academia over the relative importance of these different factors, at different points in time and for different groups.

The Scandal of Money
by George Gilder
Published 23 Feb 2016

You can maintain nominal or measured GDP (without adjusting for inflation) at any desired rate of growth. Hence Friedman’s advice to the Chinese leaders, “Get control of your money supply.” Friedman’s monetarist theory explains why the Federal Reserve Board has a mandate from Congress not just to serve as a “lender of last resort” in crises but also to combat inflation and promote full employment. These goals imply that the Fed controls the effective money supply. By manipulating this lever, the theory goes, central bankers both determine the level of prices (inflation) and influence the level of employment and at least nominal growth. That is the creed of monetarism, suggesting that even in a fully free-market economy the central bank is the one institution that must maintain top-down control.

The Second Intelligent Species: How Humans Will Become as Irrelevant as Cockroaches
by Marshall Brain
Published 6 Apr 2015

Should the society let these people die immediately, or accommodate them in some way? Now think about the economy. Let's assume that, in this hypothetical society, the average take-home pay is $X per person. That means that consumers in this society have $X * 1,000,000 in spending power if there is full employment. This aggregate number is an important driver for the society's economy. What happens if there is a big economic downturn for some reason and 200,000 jobs evaporate? 200,000 people will necessarily become homeless. Now the consumers only have $X * 800,000 in total spending power, which is definitely not good for the society's economy because of the retraction.

Team Human
by Douglas Rushkoff
Published 22 Jan 2019

Humans became resources. The employment model has become so prevalent that our best organizers, representatives, and activists still tend to think of prosperity in terms of getting everyone “jobs,” as if what everyone really wants is the opportunity to commodify their living hours. It’s not that we need full employment in order to get everything done, grow enough food, or make enough stuff for everyone. In the United States, we already have surplus food and housing. The Department of Agriculture regularly burns crops in order to keep market prices high. Banks tear down houses that are in foreclosure lest they negatively impact the valuation of other houses and the mortgages they’re supporting.

Eurowhiteness: Culture, Empire and Race in the European Project
by Hans Kundnani
Published 16 Aug 2023

: Harvard University Press, 2018), p. 194. 47.Article 3.3 of the treaty stated: “The Union shall establish an internal market. It shall work for the sustainable development of Europe based on balanced economic growth and price stability, a highly competitive social market economy, aiming at full employment and social progress, and a high level of protection and improvement of the quality of the environment. It shall promote scientific and technological advance.” 48.On the emergence of the welfare state in Europe, see Judt, Postwar, pp. 72–77. 49.Gøsta Esping-Andersen, The Three Worlds of Welfare Capitalism (Princeton: Princeton University Press, 1990). 50.Jan-Werner Müller, Contesting Democracy.

The End of Indexing: Six Structural Mega-Trends That Threaten Passive Investing
by Niels Jensen
Published 25 Mar 2018

Rapid ageing of the German populace will indeed have a significant (and negative) impact on economic growth in that country but, as we just saw, the introduction of advanced robotics could potentially be the solution to Germany’s ageing problem, as it will allow German industry to continue as if nothing has happened. Meanwhile, in the US, a growing workforce will force those in power to choose between full employment and being able to compete internationally. One can therefore not assume that financial markets across the world will react uniformly to a rising degree of automation. Significant interest rate gaps could open up, and equity market returns could vary quite dramatically, but more on that in chapter 12

Civilization: The West and the Rest
by Niall Ferguson
Published 28 Feb 2011

In 1938 the output of the American economy was still more than 6 per cent below the pre-crisis peak of 1929; German output was 23 per cent higher, and Soviet output even higher, if the official statistics for ‘net material product’ are to be believed. As early as April 1937 unemployment in Germany fell below the million mark, compared with 6 million just over four years before. By April 1939 fewer than 100,000 Germans were out of work; as good as full employment. The United States lagged far behind, even if one adjusts the official unemployment figures to count those on federal emergency relief work as employed. By a modern definition the unemployment rate was still 12.5 per cent in 1938. The problem was that totalitarian growth did not translate into significantly higher living standards.

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Hitler’s economic model, as he made clear in the document we know as the Hossbach Memorandum, necessarily entailed the acquisition of ‘living space’ – the annexation of adjoining territory – as a way of acquiring the raw materials Germany could no longer afford to import. The forced march to full employment via rearmament thus made war ever more likely. And war in its late 1930s variant, given the state of military technology, was a spectacularly destructive affair. As early as 1937 it was revealed what havoc aerial bombardment could wreak, not only in Guernica, where German and Italian planes dive-bombed Spanish Republican positions, but also in Shanghai, which was severely damaged by Japanese air raids.

An Empire of Wealth: Rise of American Economy Power 1607-2000
by John Steele Gordon
Published 12 Oct 2009

Walter Heller, a professor of economics at the University of Minnesota before becoming Kennedy’s chairman of the Council of Economic Advisors, talked about being able to “fine tune” the national economy. In other words, he wanted government to be the “engineer” driving Alfred Marshall’s economic machine. He proposed budgeting based on what he called a “full-employment budget.” In other words, the budget should spend what revenues the government would be receiving if the economy was operating at an optimum level. If the economy was at that level, the budget would be in balance; if below it, the budget deficit would automatically stimulate the economy, driving it toward the optimum.

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Meanwhile, the Vietnam War escalated quickly. In 1965 the defense budget had been $50 billion. In 1968 it was $82 billion. Had the economy been underperforming, as it had been in the 1930s, the result of all this new spending would have been stimulating. But the economy in the mid-1960s was near full employment, so the inevitable result was that inflation began to increase. A vicious circle quickly developed. Increased inflation caused interest rates to rise as lenders wanted protection from the inflation. But the Federal Reserve, operating on a Keynesian model, was afraid that increased interest rates would cause economic growth to end, and so it expanded the money supply to keep interest rates low.

Sixty Days and Counting
by Kim Stanley Robinson
Published 27 Feb 2007

Admitting that and moving on would remove one of the greatest fears of all. Another thing we could do would be to institute full employment. Government of the people, by the people, and for the people could offer jobs to everyone who wants one. It would be like the Works Progress Administration during the Depression, only more wide-ranging. Because there’s an awful lot of work that needs doing, and we’ve got the resources to get things started. We could do it. One of the more interesting aspects of full employment as an idea is how quickly it reveals the fear that lies at the heart of our current system. You’ll notice that anytime unemployment drops below 5 percent the stock market begins to flag, because capital has begun to worry that lower unemployment will mean “wage pressure,” meaning management faces a shortage in supply of labor and has to demand it, has to bid for it, pay more in competition, and wages therefore go up—and profits down.

European Spring: Why Our Economies and Politics Are in a Mess - and How to Put Them Right
by Philippe Legrain
Published 22 Apr 2014

Britain had created its now-revered National Health Service. Governments played a much bigger role in the economy generally: industries had been nationalised, taxes and spending had risen and planning was all the rage. Determined to avoid a repeat of the Great Depression, governments’ priority was maintaining full employment. While the school leaving age in Britain had risen to fifteen, university was still the preserve of a privileged few. Life expectancy at birth had reached seventy-three years in Norway and Iceland, seventy in Britain and sixty-eight in West Germany, but was still only fifty-six in Albania. Income per person in Switzerland, the richest country in Europe, was the same as Argentina’s today; Britain was poorer than Romania and Venezuela are now.522 Television was generally a single channel in black and white.

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In post-war Europe, where growth came mainly from rebuilding what had been destroyed and emulating what America did better, the importance of creative destruction was forgotten. So too was the financial cycle, because the financial sector was caged and overwhelmingly national. This deceptively stable environment tricked policymakers into thinking they could plan economic development while fine-tuning demand to maintain full employment. But the system broke down in the early 1970s as the post-war economic boom ran out of steam, efforts to boost employment resulted in ever higher inflation, the Bretton Woods system of currencies pegged to the US dollar collapsed and the oil shocks of 1973–74 resulted in the previously unthinkable combination of stagnation and inflation: stagflation.

Fifty Degrees Below
by Kim Stanley Robinson
Published 25 Oct 2005

Given some version of these foundational axioms, the scientific community suggests these platform particulars for government: (preliminary partial list, please add to as you see fit) “Contract with Our Children” 1. protection of the biosphere: sustainable uses; clean technologies; carbon balance; climate homeostasis. 2. protection of human welfare: universal housing, clothing, shelter, clean water, health care, education, reproductive rights. 3. full employment: Current economy defines 5.4% unemployment as optimum for desired “wage-pressure balance,” treating labor (people) as a commodity and using a supply/demand pricing model. Five percent in U.S.A. = approx. fifteen million people. At the same time there is important work not being done. If government-insured full employment reduced “wage pressure,” forcing a rise in minimum wages from the private sector, this would help pull millions out of poverty, decrease their government dependence and social service costs, and inject and cycle their larger incomes back into the economy. 4.

Endless Money: The Moral Hazards of Socialism
by William Baker and Addison Wiggin
Published 2 Nov 2009

Officially reported inflation has largely been under control ever since the early 1980s, and even in the case of Lehman Brothers, it stepped in to arrest the ill effects upon collaterally damaged institutions. Moreover, its august management, largely bankers and economists, is regarded as pro-business and supportive of capitalism. However, it also has a broader mandate, which was established by the Humphrey-Hawkins Full Employment and Balanced Growth Act of 1978, brought into law under President Carter during a time of high inflation and unemployment that was occurring despite expansion. With jobs being lost rapidly in the wake of the financial meltdown of 2008-2009, members of Congress are apt to pressure the Fed to be ever more expansionary, so long as economic recovery remains elusive.

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J., 247 Hayek, Friedrich A., 6, 70, 241, 287–288, 298 Heather, Peter, 260–261 Higgs, Robert, 91 The History of Bimetallism in the United States (Laughlin), 80 Hoffman, Paul, 177 Home Mortgage Disclosure Act, 213 Homer, Sidney, 96 Hoover, Herbert, 340 Hopkins, Keith, 242, 246, 266 Housing Crisis: and government intervention, 219–220 and increase in homeownership, 216–219 OFHEO’s findings, 214–216 overview, 209–211 warnings of, 211–214 See also Credit Crisis of 2008–2009 413 Howard, Tim, 214 Hoye, Bob, 72 Humphrey–Hawkins Full Employment and Balanced Growth Act of 1978, 133 Huntington, Francis C., 5 Hutchins, Robert, 177 Ingraham, Laura, 233 Inopia nummorum, 245–246 “I.O.U.S.A.” See Fiat currency, and “I.O.U.S.A.”; Socialism, and “I.O.U.S.A.” Jackson, Andrew, 49, 135 Jackson, Jesse, 180 Jay Cooke & Company, 51–52 Jefferson Airplane, 309 Jefferson Starship, 309 Jefferson, Thomas, 232 Jessamy, Patricia, 295–296 Jobs, Steve, 171 Johnson, James, 186 Johnson, Jamie, 174 Johnson, Jim, 214 Jones-Kelley, Helen, 317 JP Morgan Chase, 57, 168, 212 Justinus, Marcus Junianus, 205 Kelly, Walt, 145 Kemmerer, Edwin, 62, 280 Kennicott, Philip, 335 Kent, Phil, 175–176, 181 Kessler, Andy, 157, 158 Keynes, John Maynard, 15, 273, 298, 336 Keynes, Lord, 105, 108, 113 Kinsey, Alfred C., 178 Knickerbocker Trust, 56 Kochin, Levis, 94–95, 96, 98, 99 414 Krugman, Paul, 146 Kulongoski, Ted, 317 LaHood, Ray, 316–317 Lamont, Corliss, 181 Lamont, Ned, 181 Laski, Howard, 178 Laughlin, Laurence, 52, 80 Lehman Brothers, 122, 152, 155, 210 Lemieux, Pierre, 321 Levin, Mark, 159 Lewis, Arthur, 99, 314 Lewis, C.

More: The 10,000-Year Rise of the World Economy
by Philip Coggan
Published 6 Feb 2020

And concerns have shifted to the way that bioengineering may alter plants and animals and inadvertently destroy the ecosystem on which we depend. What about the concern that technology will destroy jobs? In the 1960s, President John F. Kennedy declared that the major domestic challenge was to “maintain full employment at a time when automation … is replacing men”. It is worth remembering that many traditional jobs have disappeared altogether, but overall employment has continued to rise. The 1841 British census, for example, records more than 97,000 blacksmiths, 212,000 boot and shoe makers, 5,000 chimney sweeps, 18,000 coopers (barrel-makers), and over 1.1 million domestic servants.36 Such jobs are scarce now.

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He revived a phrase first used by Alvin Hansen in 1938: secular stagnation.40 Mr Summers claimed that the shock caused by the financial crisis seemed to have caused a permanent shift in the trend growth rate of output. The fear was that no level of interest rates would “permit the balance of savings and investment at full employment”. This shift was driven by a number of factors. As the population aged, economic growth slowed, and there was thus less need for businesses to invest in new plant and equipment. Furthermore, a larger proportion of capital investment was devoted to technological equipment, which needed regular updating and was declining steadily in price.

The Finance Curse: How Global Finance Is Making Us All Poorer
by Nicholas Shaxson
Published 10 Oct 2018

Keynes knew that finance had its uses, but he knew that it could also be dangerous, especially when it was allowed to slosh around the world at will, unchecked by democratic controls. If your economy is open to tides of global hot money – rootless money not tied to any particular real project or nation, that is – then it is harder to pursue desirable policies like full employment. This is because if you try, for instance, to boost industry by lowering interest rates in a country that is open to flows of financial capital, then money will simply sluice out, looking for better returns elsewhere. Capital will become scarcer; the value of the currency will tend to fall; and interest rates will be forced up again.

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One is that they fail to see how the pro-finance changes that have happened with globalisation have generally required active intervention, or deliberate non-intervention, by governments. Central banks have been actively freed from direct democratic controls, and their objectives have been purposefully changed from goals such as promoting full employment to targeting inflation. Financial deregulation has involved actively de-fanging laws to protect societies. Trade and investment treaties, consciously negotiated and signed, tie the hands of governments and prevent them from intervening to protect domestic industries. Governments have knowingly privatised huge swathes of public assets, and carefully fed them into competitive, financialised frameworks.

How Money Became Dangerous
by Christopher Varelas
Published 15 Oct 2019

To the contrary, there seem to be growing voices arguing for the expansion of borrowing and government spending to achieve various policy objectives. Nobel Prize winners and politicians alike have put forth theories including the revival of a century-old idea called Modern Monetary Theory (MMT), which argues that government’s monopoly control over money allows, if not requires, that any and all fiscal policies be undertaken to ensure full employment—for example, printing as much currency as desired, without cause for worry that such an action would lead to inflation or possibly the loss of systemic financial integrity. Regardless of its potential for success—and it should be noted that it has not yet been executed successfully—support for MMT does seem to provide evidence of the limited concern for our growing debt burden.

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: “In addition to the absence of coordination and sufficiency, the programs of the past all have another common failing—they are indirect. Each seeks to solve poverty by first solving something else. I’m now convinced that the simplest approach will prove to be the most effective—the solution to poverty is to abolish it directly by a now widely discussed measure: the guaranteed income. . . . We must create full employment or we must create incomes. People must be made consumers by one method or the other.” Half a century later, Mayor Tubbs committed to testing UBI on his struggling community, launching a small trial—130 families were selected to receive $500 per month for eighteen months, beginning in early 2019.

The Asian Financial Crisis 1995–98: Birth of the Age of Debt
by Russell Napier
Published 19 Jul 2021

Kentaro Aikawa, chairman of MHI, 14 January 1998 Those investors who are wearied by the quality of Asian management and their inability to secure decent returns on capital may be cheered to know that things are worse in Japan. MHI is a US$13bn market cap company with US$8.6bn in shareholders’ equity. According to the chairman the aim of this enterprise is full employment and full utilisation of facilities. Everything else is secondary. The world is flush with capital. There is looming overcapacity in almost all global businesses. The Ford Motor Company itself estimates that there is 40% overcapacity in the global system for motor cars. The price of commodities is headed lower and the collapse in demand in Asia is already impacting capacity utilisation rates from the dairy sheds of New Zealand to the paper mills of Alabama.

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With the flood of forced central bank buying the yields on government debt, yields were kept lower than they would otherwise have been in relation to domestic growth and inflation. The flow of cheap goods to the developed world from Asia – a product of their artificially depressed exchange rates – also depressed inflation, adding to the downward pressure on interest rates. The social capital system of north Asia continued to target full capacity and full employment above profits also acting to cap global inflation. Developed world interest rates trended lower, reacting to the decline in global inflation. In the developed world, there were fortunes to be made by availing oneself of the ever cheaper debt to finance purchases of assets, whether property, equities or bonds, that rose ever higher fuelled by the combination of low interest rates and high economic growth.

Basic Economics
by Thomas Sowell
Published 1 Jan 2000

Keynesian economics offered not only an economic explanation of changes in aggregate output and employment, but also a rationale for government intervention to restore an economy mired in depression. Rather than wait for the market to adjust and restore full employment on its own, Keynesians argued that government spending could produce the same result faster and with fewer painful side-effects. While Keynes and his followers recognized that government spending entailed the risk of inflation, especially when “full employment” became an official policy, it was a risk they found acceptable and manageable, given the alternative of unemployment on the scale seen during the Great Depression.

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Milton Friedman{558} Money is of interest to most people but why should banking be of interest to anyone who is not a banker? Both money and banking play crucial roles in promoting the production of goods and services, on which everyone’s standard of living depends, and they are crucial factors in the ability of the economy as a whole to maintain full employment of its people and resources. While money is not wealth—otherwise the government could make us all twice as rich by simply printing twice as much money—a well-designed and well-maintained monetary system facilitates the production and distribution of wealth. The banking system plays a vital role in that process because of the vast amounts of real resources—raw materials, machines, labor—which are transferred by the use of money, and whose allocation is affected by the huge sums of money—trillions of dollars—that pass through the banking system.

Trend Commandments: Trading for Exceptional Returns
by Michael W. Covel
Published 14 Jun 2011

Bernanke: “One hundred percent.”3 That confidence seems misplaced when you consider Bernanke’s words but a few years before: In 2005, Bernanke said: “We’ve never had a decline in house prices on a nationwide basis. So, what I think is more likely is that house prices will slow, maybe stabilize, might slow consumption spending a bit. I don’t think it’s going to drive the economy too far from its full employment path, though.”4 In 2006, Bernanke said: “Housing markets are cooling a bit. Our expectation is that the decline in activity or the slowing in activity will be moderate, that house prices will probably continue to rise.”5 In 2007, Bernanke stated: “At this juncture…the impact on the broader economy and financial markets of the problems in the subprime markets seems likely to be contained.”6 Worse yet?

Private Government: How Employers Rule Our Lives (And Why We Don't Talk About It)
by Elizabeth S. Anderson
Published 22 May 2017

This is a striking concession, given that the U.S. economy has had a chronic tendency to unemployment or underemployment. There is no greater waste, from an efficiency point of view, than unemployment. Moreover, the neat efficiency claims about market allocations in any given market apply only in the context of full employment. Finally, it is worth noting that the powers employers routinely exercise vastly exceed any authority that could be justified on efficiency or any other grounds. None of the sexual harassment suffered by workers improves productivity. It’s a sheer abuse of power, and a massive deadweight loss of utility, even if we view matters solely in terms of efficiency.

The Lights in the Tunnel
by Martin Ford
Published 28 May 2011

I think we can certainly expect to see worker shortages in some areas, but this may very possibly be combined with an overall unemployment problem. The danger is that increasing structural unemployment will unfold in parallel with the demographic problem. I suspect that most of the projections regarding the impact of aging populations assume reasonably full employment among younger workers. If this does not turn out to be the case, the situation will obviously be much worse. As I pointed out in Chapter 3, a payroll tax-based system for supporting retirement programs might become completely unsustainable. Businesses will never fully automate because of the high initial capital investment and the lack of flexibility this implies There are some valid points here, and I think that these factors may, in many cases, serve to retard the process of automation—but in the long run they will not prevent it.

The Crowded Universe: The Search for Living Planets
by Alan Boss
Published 3 Feb 2009

Given that the jobs of the hundreds of astronomers at the Institute depended on the existence of Hubble, and that the telescope was scheduled to cease operations in 2005, the Institute astronomers were already looking around for a replacement space telescope to provide their daily bread. Ever since its founding in 1981, the Institute had embodied the “Full Employment Act” for astronomy, not only for those willing to work there but also for astronomers around the country, whose grants of valuable Hubble observing time were allocated in “orbits” (the usable portion of the roughly 96 minutes that it takes Hubble to circle Earth in an orbit low enough to be reached and serviced by the Space Shuttle).

Making the Future: The Unipolar Imperial Moment
by Noam Chomsky
Published 15 Mar 2010

By that time, even in Europe there was mounting concern about what labor historian Ronaldo Munck, citing Ulrich Beck, calls the “Brazilianization of the West . . . the spread of temporary and insecure employment, discontinuity and loose informality into Western societies that have hitherto been the bastions of full employment.” By now, an insult to Brazil, which is seeking to address such problems, not exacerbate them. The state-corporate war against unions has recently extended to the public sector, with legislation to ban collective bargaining and other elementary rights. Even in pro-labor Massachusetts, the House of Representatives voted right before May Day to sharply restrict the rights of police officers, teachers and other municipal employees to bargain over health care—essential matters in the United States, with its dysfunctional and highly inefficient privatized health care system.

Circus Maximus: The Economic Gamble Behind Hosting the Olympics and the World Cup
by Andrew Zimbalist
Published 13 Jan 2015

The third method (assuming away the rational expectations and complete crowding-out positions) will have a positive short-run effect on output, but it will require debt service going forward, and this debt service (other things being equal) will entail either future reductions in public services or increases in taxes, or both. If increases in public construction spending did not have to be funded eventually, maintaining full employment would be trivial. Each city could simply hire a thousand workers to dig a big hole every week, and then hire another thousand to fill it up. Too bad economics is not so simple. If the object being built has no or little value, then it is a bad investment for the city. A good investment would return enough value not only to retire the relevant debt service but also to cover the return on the next best available public investment at the time (the opportunity cost).

The Simple Path to Wealth: Your Road Map to Financial Independence and a Rich, Free Life
by J L Collins
Published 17 Jun 2016

Increasingly in the U.S. there is talk of establishing a national sales tax or added value tax. While both may have merit—especially as a substitute for the income tax—these would effectively tax any Roth money as it was spent. With all this in mind, here is my basic hierarchy for deploying investment money: Fund 401(k)-type plans to the full employer match, if any. Fully fund a Roth if your income is low enough that you are paying little or no income tax. Once your income tax rate rises, fully fund a deductible IRA rather than the Roth. Keep the Roth you started and just let it grow. Finish funding the 401(k)-type plan to the max.

Boomerang: Travels in the New Third World
by Michael Lewis
Published 2 Oct 2011

It kept falling right through the next month. It fell so far, and her prediction received so much attention, that money managers who had put clients into municipal bonds felt compelled to hire more people to analyze states and cities, to prove her wrong. (One of them called it “The Meredith Whitney Municipal Bond Analyst Full Employment Act.”) Inside the financial world a new literature was born, devoted to persuading readers that Meredith Whitney didn’t know what she was talking about. She was vulnerable to the charge: up until the moment she appeared on 60 Minutes she had, so far as anyone knew, no experience at all of U.S. municipal finance.

Heroic Failure: Brexit and the Politics of Pain
by Fintan O'Toole
Published 22 Jan 2018

The EU lost its moral compass when the Berlin Wall fell. Before that, it was in a competition against communism. The generation of Western European leaders that had experienced the chaos of the continent in the 1930s and 1940s were anxious to prove that a market system could be governed in such a way as to create full employment, fair opportunities, decent public services and steady progress towards economic equality. But when the need to compete with alternative ideologies went away after the collapse of the Soviet Union, the EU gradually abandoned its social democratic and Christian Democratic roots. It also moved away from evidence-based economics – the German-led austerity drive after 2008 was impervious to the realities of its own failure.

The Great Crash 1929
by John Kenneth Galbraith
Published 15 Dec 2009

Most of them were small men who had taken a flier in the market and then become more deeply involved. Later they had more impressive companions. It was the crash, and the subsequent ruthless contraction of values which, in the end, exposed the speculation by Kreuger, Hopson, and Insull with the money of other people. Should the American economy ever achieve permanent full employment and prosperity, firms should look well to their auditors. One of the uses of depression is the exposure of what auditors fail to find. Bagehot once observed: "Every great crisis reveals the excessive speculations of many houses which no one before suspected."4 III In mid-November 1929, at long, long last, the market stopped falling—at least, for a while.

"They Take Our Jobs!": And 20 Other Myths About Immigration
by Aviva Chomsky
Published 23 Apr 2018

Working for national health care and universal preschool might be a place to start. Or restructuring the tax system so that corporations and the super-rich pay their fair share. Or enforcing corporate accountability toward workers and communities. We could work toward a thirty-hour work week and full employment. Globally, we could forgive Third World debt and create a system of democratic oversight for U.S. corporations operating abroad. We could respect the sovereignty of governments like Cuba’s, Venezuela’s, and Bolivia’s, which are experimenting with different economic models. We could eliminate military “aid” that is used primarily, in Latin America, to repress domestic movements for social change.

Impact: Reshaping Capitalism to Drive Real Change
by Ronald Cohen
Published 1 Jul 2020

The new ideas brought by The Wealth of Nations helped shift our economic system from mercantilism (which held that countries should use trade and the accumulation of gold to make themselves more powerful), to laissez-faire (the idea that state intervention in economic activity is ill-advised), which prevailed until the 1930s. After the Great Depression, this gave way to John Maynard Keynes’s new thinking about a ‘managed economy’, where the state assumes responsibility for altering public expenditure, interest rates and taxation to maintain full employment. Then, we had a throwback to laissez-faire with the arrival of Milton Friedman’s neoliberalism in the 1980s, and its obsessive focus on governments not interfering with business. Neoliberalist thinking has prevailed from the 1980s through to the 2008 financial crisis, after which we have seen the emergence of new thinking, this time about impact and the need for businesses to recognize their wider obligation to all stakeholders, rather than an exclusive obligation to their shareholders.

Damsel in Distressed: My Life in the Golden Age of Hedge Funds
by Dominique Mielle
Published 6 Sep 2021

The federal funds rate, the interest rate at which depository institutions like banks and credit unions lend to each other, hovered around 1.5 percent until mid-2004, a level also unseen in the preceding forty years. This short-term interest rate is controlled and adjusted by the Fed in its meetings, eight times a year, to fulfill the dual mandate of full employment and stable prices. From the longest maturity to the shortest, all U.S. rates fell dramatically. I say “by historical standards” because to a young investor starting today in the business, these yields would seem high. We have been living in a period of exceptionally low and tightly controlled interest rate for the last ten years, and it would only show that said newbie lacks context and experience in anything but Facebook and Instagram.

The Passenger: Berlin
by The Passenger
Published 8 Jun 2021

The Saxon state minister for integration, Petra Köpping, has worked some of these stories into her book Integriert doch erst mal uns! (‘Integrate Us First!’), and the house is packed at every reading she gives in eastern Germany these days. A lot of it is about lost jobs and, yes, this sounds nice and technical, like an easy problem to solve. But in this Prussian nation of full employment called the German Democratic Republic, where work was the meaning of life and the jobless few were called Assis (‘antisocial elements’), it could also mean: co-workers, brothers, husbands who hanged themselves, siblings and cousins who slowly drank themselves to death, families that now suddenly seethed because some now had more than others.

Trust: The Social Virtue and the Creation of Prosperity
by Francis Fukuyama
Published 1 Jan 1995

The Keynesians, by contrast, accepted the need for a strong private sector but argued for massive government intervention through public spending in order to maintain full employment and other social welfare goals. The neomercantilist wave focuses on more modest objectives like the promotion of high-technology industries in a highly competitive and interdependent global market. The neomercantilists would concede that global competition produces beneficial economic efficiencies and that economies should be export oriented and outward looking, and for the most part they believe that welfare goals like full employment or equitable income distribution can be achieved only indirectly. They would argue the more modest point that the market alone is insufficient to produce technological leadership and hence rapid long-term growth. 3James Fallows, Looking at the Sun: The Rise of the New East Asian Economic and Political System (New York: Pantheon Books, 1994). 4For examples of this genre, see Chalmers Johnson, MITI and the Japanese Miracle (Stanford: Stanford University Press, 1982); James Fallows, “Containing Japan,” Atlantic Monthly 263, no. 5 (1989): 40-54; “Looking at the Sun,” Atlantic Monthly 272, no. 5 (1993): 69-100; “How the World Works,” Atlantic Monthly 272, no. 6 (1993): 61-87; Chalmers Johnson, Laura D’Andrea Tyson, and John Zysman, The Politics of Productivity (Cambridge, Mass.: Ballinger Books, 1989); Laura D’Andrea Tyson, Who’s Bashing Whom?

Who Stole the American Dream?
by Hedrick Smith
Published 10 Sep 2012

Tens of millions of families had steady income, and they spent it, generating high consumer demand. Robust consumer demand is the main driving force of the U.S. economy. It propels businesses to invest in new technology, new plants and equipment, and more employees. Corporate expansion contributes to full employment, fueling “the virtuous circle of growth” to another round of expansion and higher living standards. But in our New Economy, the dynamic thrust of “the virtuous circle” has been disrupted by job losses and the lid on average pay scales. Flat pay is bad not only for individuals, but for the whole economy.

…

In a bible for corporate managers in the early 1980s, In Search of Excellence, Thomas Peters and Robert Waterman, Jr., preached the virtues of keeping employees on the payroll, even during recessions, a far cry from the mass layoffs and hiring freezes of the 2008 recession and recovery. “Only when we look at excellent companies do we see … full employment policies in time of recession,” they wrote. “Caring runs in the veins of the managers of these institutions.” The Labor Movement: Shared Power/Shared Prosperity But the anchor of middle-class power during the long postwar period and its most consistent and effective advocate was the American labor movement.

The Option of Urbanism: Investing in a New American Dream
by Christopher B. Leinberger
Published 15 Nov 2008

In the 1990s and the 2000s as jobs moved out to even more distant edge cities of the favored quarter, twelve to thirty miles and more from the center city, with poor or no transit connections, these jobs were not commutable for most low-income residents, and even moderate-income housing was often not available nearby. This resulted in a severe housing/jobs imbalance in which the unemployment rate on the fringe of the favored quarter was at or below theoretical full employment (less than four percent) while it was twice that amount on the other side of the metropolitan area. The jobs that went begging were virtually impossible to commute to even with a readily available and affordable car. E X C L U S I O N O F N O N D R I V E R S F R O M S O C I E T Y. One minority class has been excluded from “normal” participation in society.

Utopia for Realists: The Case for a Universal Basic Income, Open Borders, and a 15-Hour Workweek
by Rutger Bregman
Published 13 Sep 2014

.” – Karl Widerquist, Associate Professor at SFS-Qatar, Georgetown University, and co-chair of the Basic Income Earth Network “Utopia for Realists is an important book, a wonderfully readable breath of fresh air, a window thrown open to a better future. As politicians and economists are asking how to increase productivity, ensure full employment, and downsize government, Bregman asks: What actually makes life worth living and how can we get there? The answers, it turns out, are already there, and Bregman combines deep research with wit, challenging us to think anew about how we want to live and who we want to be. Required reading.” – Philipp Blom, historian and author of The Vertigo Years.

How We Got Here: A Slightly Irreverent History of Technology and Markets
by Andy Kessler
Published 13 Jun 2005

But he figured that if the cylinder was 2 feet in diameter and the piston 4 feet long, it could lift 8000 pounds, 4 feet, once a minute, which was the power of one horse. Now we’re getting somewhere. *** Papin never built the bigger model, and when he started telling people about his new invention, the steamboat, local boatmen heard about it and broke into his shop and destroyed it. They (correctly, but early) figured it would threaten their full employment. This destruction will be a recurring theme. Thomas Savery of Modbury was a mathematician and a mechanic who was familiar with the works of both Somerset and CANNONS TO STEAM 19 Papin. He took the Marquis’s two-vessel design, and added a useful cock valve to control the flow of steam between the two, and then three, vessels.

Double Entry: How the Merchants of Venice Shaped the Modern World - and How Their Invention Could Make or Break the Planet
by Jane Gleeson-White
Published 14 May 2011

When considering the Depression, Keynes theorised that if it were possible to measure in money what the community was buying and how much extra the unemployed would produce if they were working, then it would be possible to calculate how much extra ‘demand’ (or spending) would need to be injected into the economy to close this ‘output gap’ (created by the unemployed). In other words, it would be possible to determine how much the government itself would have to spend in order for the economy to reach full employment. Keynes’s framework introduced key macroeconomic variables such as consumption, investment and savings, as well as the idea of economic ‘sectors’—households, businesses, governments and foreign economies—which affect an economy through their consumption, saving or investment of income, all of which are now important components of national accounting.

The Rise of the Quants: Marschak, Sharpe, Black, Scholes and Merton
by Colin Read
Published 16 Jul 2012

Intertemporal CAPM – an extension of the CAPM beyond the simple consideration of variances to also include additional consumption and investment opportunities over time. Keynesian model – a model developed by John Maynard Keynes that demonstrates savings may not necessarily be balanced with new investment and the gross domestic product may differ from that which would result in full employment. Kurtosis – a statistical measure of the distribution of observations about the expected mean as a deviation from that predicted by the normal distribution. Life cycle – the characterization of a process from its birth to death. Life Cycle Model – a model of household consumption behavior from the beginning of its earning capacity to the end of the household.

The Politics of Pain
by Fintan O'Toole
Published 2 Oct 2019

The EU lost its moral compass when the Berlin Wall fell. Before that, it was in a competition against communism. The generation of Western European leaders that had experienced the chaos of the continent in the 1930s and 1940s were anxious to prove that a market system could be governed in such a way as to create full employment, fair opportunities, decent public services and steady progress towards economic equality. But when the need to compete with alternative ideologies went away after the collapse of the Soviet Union, the EU gradually abandoned its social democratic and Christian Democratic roots. It also moved away from evidence-based economics – the German-led austerity drive after 2008 was impervious to the realities of its own failure.

Silicon City: San Francisco in the Long Shadow of the Valley
by Cary McClelland
Published 8 Oct 2018

He got Salesforce to donate $30 million—they adopted the schools—and now the program has expanded to Oakland. Ed Lee always said, “This is my legacy.” He was frustrated by the criticism, but every year the unemployment rate went down, tax revenue went way up, and he was able to put together the city programs that he always dreamed about. And he had the money to do it, because he had full employment. And the progressives who don’t get that, they are never going to get it. But yes, that was a constant frustration. Ed Lee’s whole mantra was, I’m just going to go do my job. I’m going to build more affordable housing. I’m going to go do what I know is right. Let them say what they want. And you know, actions speak louder than words.

Retirementology: Rethinking the American Dream in a New Economy
by Gregory Brandon Salsbury
Published 15 Mar 2010

What we do have now, however, that we didn’t have then is a recent memory of the greatest economic expansion in the history of mankind. Starting in the early 1980s, the American economy experienced almost monthly growth, new businesses and industries were born, and job creation became so robust that we experienced long spells of “full employment.” Things weren’t always rosy, but it was a long enough stretch that there are people in the workforce right now who are experiencing their first recession in a lifetime, presuming that an ever-expanding economy was their birthright. A big reason for that is because many currently affected by today’s meltdown weren’t alive in 1944–45 when workers who earned more than $200,000 were taxed at an amazing 94% or in 1951–63 when top earners making more than $400,000 were taxed at 91%.60 Though the 1950s were a time of economic expansion in the United States, there were so few people affected by the 91% tax rates (and there were so many tax shelters available in the pages of the IRS tax code) that no one allowed his cash income to come anywhere close to the highest rate.

The Decline and Fall of IBM: End of an American Icon?
by Robert X. Cringely
Published 1 Jun 2014

I have seen the decline of self-serving upper management, which continues to take from its employees and line its own pockets to the extent that I've grown ashamed to be known as an IBM employee and manager. Again it saddens me to see such a great company which had tremendous values (Best Customer Service, Respect for the Individual, and Full Employment) being destroyed to the extent that life long IBM employees will now find themselves on Medicare/Medicaid if, if they complete 30 years with the company, while at the same time executive level managers retire with multi-million dollar a year pension plans. Sad! Bill Moore | May 08, 2007 | 9:16AM Cut the waste--from the top What I find fascinating is how IBM equates Lean with job cuts.

The Rare Metals War
by Guillaume Pitron
Published 15 Feb 2020

Relocate your low-value rare-earth applications, and we’ll take care of your low-tech!”’ an Australian consultant told me.8 The Japanese may have had the technology, but the Chinese had the allure of cheaper production that would allow Japanese businesses to expand their profit margins. The Japanese didn’t hesitate for long. Boasting full employment and a strong currency at the time, the island nation considered it a sound decision. The history books will look back at this and say that Japan, the second-strongest global power at the time, knowingly exported to its competitor the technologies it lacked. As related in Chapter Three, French chemical company Rhône-Poulenc was enticed by the prospect of low-cost rare-earths transformation, and also moved part of its refining operations to China.

Money: The True Story of a Made-Up Thing
by Jacob Goldstein
Published 14 Aug 2020

What if there were a lot of people who wanted a job but couldn’t find one, and idle offices and factories? In that case, as the government put more money into the economy and started buying stuff, it would drive businesses to hire more workers. Prices wouldn’t start rising, Mosler argued, until the economy got to full employment. Unlike most foreign investors, Mosler wasn’t trying to convince the finance minister to cut spending. He wanted to convince the minister that Italy could just print money. The minister agreed. Mosler borrowed the lira from Italian banks, then turned around and loaned it to the Italian government.

Still Broke: Walmart's Remarkable Transformation and the Limits of Socially Conscious Capitalism
by Rick Wartzman
Published 15 Nov 2022

There is no mystery as to the policies we need to help workers regain their rightful share of the nation’s prosperity. I’d start with these: rewriting labor law to expand collective bargaining, as well as to foster new avenues for employees’ voices to be heard, including seats on corporate boards; making “full employment”—the point at which most everyone who wants a job can find one and a catalyst for rising wages—a primary goal of government; restoring overtime pay so that the majority of salaried workers qualify as they did in the 1970s, not just the 15 percent who do now; buttressing worker protections so that it’s harder to pilfer people’s wages or misclassify employees as contractors; and devising a health system that gives every American affordable access to good medical care, untethered to the workplace.

Persian Gulf Command: A History of the Second World War in Iran and Iraq
by Ashley Jackson
Published 15 May 2018

The field fortifications covered a vast area both in width and depth, and in all resulted in over a million pounds finding their way into the pockets of these deserving people. As far as the army was concerned it was excellent value for money while at the same time freeing the troops for the more important work of training. It was the first chance the Kurds had of full employment at a time when the cost of living was rising fast. It was also sound propaganda for the Allied cause.122 Other British observers noted the enormous scale of defensive works being undertaken, and the local labour that it depended upon. Ann Lambton visited American installations at the port of Khorramshahr in Iran, including the truck assembly factory and the jetties: It is an impressive sight.

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Defences in the Mosul area were extensive – in one sector alone 24 miles of anti-tank ditches were cut through solid rock: The field fortifications covered a vast area both in width and depth, and in all resulted in over a million pounds finding their way into the pockets of these deserving people. As far as the army was concerned it was excellent value for money while at the same time freeing the troops for the more important work of training. It was the first chance the Kurds had of full employment at a time when the cost of living was rising fast. It was also sound propaganda for the Allied cause . . . But all of this intense activity came to a stop when the strategic situation changed. The Germans weren’t coming through the Caucasus after all. They had been halted and resoundingly beaten by the Red Army, at Stalingrad and elsewhere.108 What followed in northern Iraq was a drawdown of forces as troops were moved to other, more active theatres of operations.

The Brussels Effect: How the European Union Rules the World
by Anu Bradford
Published 14 Sep 2020

It shall work for the sustainable development of Europe based on balanced economic growth and price stability, a highly competitive social market economy, aiming at full employment and social progress, and a high level of protection and improvement of the quality of the environment. It shall promote scientific and technological advance. The references to “sustainable development,” “balanced economic growth,” “social market economy,” “full employment and social progress,” together with a “high level of protection and improvement of the quality of the environment” are illustrative of European values, which envision a prominent role for the government as a steward of regulated market outcomes.

The Numerati
by Stephen Baker
Published 11 Aug 2008

Imagine, says Aleksandra Mojsilovic, one of Takriti's modelers, that the company has a superior worker named Joe Smith. Management could use two or three others just like him, or even a dozen. Once the company has built rich mathematical profiles of their employees, it shouldn't be too hard to sift through them to identify the experiences or routines that make Joe Smith so good. "If you had the full employment history, you could even compute the steps to become a Joe Smith," she says. Most of this, of course, would involve training programs, not genetic manipulation. And the real Joe Smith may have intuitive smarts or a knack for design that just cannot be replicated. "I'm not saying you can re-create a scientist, or a painter, or a musician," Mojsilovic says.

Third World America: How Our Politicians Are Abandoning the Middle Class and Betraying the American Dream
by Arianna Huffington
Published 7 Sep 2010

The rate for those in the middle income range was 9 percent—not far off the national average. The rate for those in the bottom 10 percent of income was a staggering 31 percent. These numbers, according to the Wall Street Journal’s Robert Frank, “raise questions about the theory behind what is informally known as ‘trickle down’ economics, since full employment at the top doesn’t seem to be translating into more jobs below.”18 In fact, these numbers do more than raise questions—they also supply the answers. Does anyone believe that the sense of urgency coming out of Washington wouldn’t be wildly different if the unemployment rate for the top 10 percent of income earners was 31 percent?

The Only Game in Town: Central Banks, Instability, and Avoiding the Next Collapse
by Mohamed A. El-Erian
Published 26 Jan 2016

As a result, central bank actions indeed ended up being a lot more helpful to Wall Street than to Main Street. The Economist put it well in May 2014, when it stated that “low interest rates and low volatility have a bigger impact on asset prices than on real investment, and risk creating financial bubbles long before economies reach full employment.”2 The Bank for International Settlements (BIS) went further when it warned advanced economies about “financial booms [that] sprinkle the fairy dust of illusionary riches.”3 Then there was a Wall Street Journal article looking at the “Investor’s Dilemma” and noting that “investing these days is like shopping at Neiman Marcus: Almost everything is expensive.”4 Both the BIS and the Journal were reflecting a concern shared by many others.

The Global Auction: The Broken Promises of Education, Jobs, and Incomes
by Phillip Brown , Hugh Lauder and David Ashton
Published 3 Nov 2010

John Maynard Keynes’s classic work on The General Theory of Employment, Interest and Money, published in 1936, shaped economic thinking at the time by rejecting the neoliberal view that capitalist economies were self-correcting and required little government intervention. Hence, economies which had fallen into recession would automatically bounce back to a period of boom and full employment. Keynes rejected this idea and argued that governments could intervene effectively in market economies to solve the problem of recession, or what one of his contemporaries called the “gales of creative destruction.”3 Thus, when demand for goods slackened and workers were threatened with unemployment, governments could act to keep the wheels of industry turning.

With Liberty and Justice for Some: How the Law Is Used to Destroy Equality and Protect the Powerful
by Glenn Greenwald
Published 11 Nov 2011

Pervasive joblessness afflicted the middle classes less severely than the poor, while at the two richest levels only 3.2 percent and 4 percent of job seekers, respectively, were without work. As the Center for Labor Market Studies explained in its report, “A true labor market depression faced those in the bottom two deciles of the income distribution; a deep labor market recession prevailed among those in the middle of the distribution, and close to a full employment environment prevailed at the top.” Beyond the miseries of long-term unemployment, the impact of the financial crisis was visible in many other ways. In 2009, 2.8 million American homes had foreclosure proceedings filed against them. As Reuters put it at the beginning of 2010: “U.S. foreclosure actions shattered all records in 2009 and will do so again this year.”

The New Elite: Inside the Minds of the Truly Wealthy
by Dr. Jim Taylor
Published 9 Sep 2008

Many of Franklin Roosevelt’s wealth-equalizing New Deal economic policies continued, with the top tax rate peaking at 91 percent throughout the 1950s, and remaining at 70 percent throughout most of the 1970s. In the meantime, The Wealth of the Nation 31 lower- and middle-class workers benefited from a variety of economic changes. With World War II came full employment, abundant overtime, and, at least temporarily, a growing number of women in the workforce. Union membership surged, wages went up, and bluecollar prosperity took hold, but wartime rationing meant that there was relatively little to buy, so savings rates reached historical highs. The middle class swelled while the gap between the rich and poor narrowed, a pattern that economists Claudia Golden and Robert Margo called ‘‘the great compression.’’5 Ironically, it was the growing middle class that laid the groundwork for the new wave of wealth.

Social Democratic America
by Lane Kenworthy
Published 3 Jan 2014

“A Swedish-Style Welfare State or Basic Income: Which Should Have Priority?” Pp. 130–142 in Redesigning Redistribution. Edited by Erik Olin Wright. London: Verso. Berman, Sheri. 2006. The Primacy of Politics. Cambridge, UK: Cambridge University Press. Bernstein, Jared and Dean Baker. 2003. The Benefits of Full Employment. Washington, DC: Economic Policy Institute. Blair, Tony. 2010. A Journey: My Political Life. New York: Knopf. Blanchard, Olivier. 2004. “The Economic Future of Europe.” Journal of Economic Perspectives 18(4): 3–26. Blank, Rebecca M. 1997. It Takes a Nation: A New Agenda for Fighting Poverty.

The Economic Singularity: Artificial Intelligence and the Death of Capitalism
by Calum Chace
Published 17 Jul 2016

He acknowledges that it is hard to disentangle the impact of automation from that of globalisation and off-shoring, but he remains convinced that AI-led automation is already harming the prospects of the majority of working Americans. In fact, since Ford’s book was published the US employment figures have improved considerably, and the unemployment rate hovers around 5%, which is considered close to full employment. However, many middle-class Americans do feel squeezed, having been obliged to accept part-time work, or having missed out on wage rises. This suggests that technological unemployment has not yet begun to really bite, but we might be seeing the early warning signs.[xxxii] Ford pauses to review the prospects for disruption of two sectors of the economy which have so far been relatively unscathed by the digital revolution – education and healthcare.

The War on Normal People: The Truth About America's Disappearing Jobs and Why Universal Basic Income Is Our Future
by Andrew Yang
Published 2 Apr 2018

Not necessarily, because the unemployment rate doesn’t measure what you likely think it measures. As of September 2017, the unemployment rate is only 4.2 percent, close to the lowest rate since the 2008 economic crisis. That sounds great, and economists are talking about the very optimistic case of “full employment,” which is when an economy has as many jobs for people in the workforce as want them. The problem is that the unemployment rate is defined as how many people in the labor force are looking for a job but cannot find one. It does not consider people who drop out of the workforce for any reason, including disability or simply giving up trying to find a job.

Worth Dying For: The Power and Politics of Flags
by Tim Marshall
Published 21 Sep 2016

Mental gymnastics are required to overlook the gulag and the terror and say that ‘on balance’ Communism was a good thing but even now, with the archives opened, there are still many who cannot accept that a faith they have held for a lifetime may have contributed to mass murder. Few people would argue that ‘on balance’ the Nazis, with their full employment and autobahns, were good for Germany, but when it comes to the hammer and sickle, that’s when the mental gymnastics take over. The ideas behind the flags may be part of the explanation. The Nazis were quite open about the symbolism of their flag: it represented what they believed about superior races, strength, weakness and purity, views which were crushed amid the wreckage of Europe.

How to Do Nothing
by Jenny Odell
Published 8 Apr 2019

Refusal requires a degree of latitude—a margin—enjoyed at the level of the individual (being able to personally afford the consequences) and at the level of society (whose legal attitude toward noncompliance may vary). For her part, Parks and her family were nearly ruined by her arrest. She was unable to find full employment for ten years after the boycott, lost weight and had to be hospitalized for ulcers, and experienced “acute financial hardships” that went unaddressed until the militant trade unionists of a small branch of the NAACP forced the national organization to help her out.41 Even Diogenes, who would seem to have nothing to lose, existed in a kind of margin.

Work Optional: Retire Early the Non-Penny-Pinching Way
by Tanja Hester
Published 12 Feb 2019

INVESTMENT CHECKLIST Investigate what investment options you have through your and/or a spouse’s employer(s), such as 401(k), 403(b), 457(b), TSP, and employee stock purchase plan. Ensure that you’re saving as much in your employer plan as you can comfortably afford, preferably enough to get the full employer match if you have that benefit. Assign employer plan contributions to the stock and bond fund options with the lowest fees. Determine which investment vehicles you’d like to focus on outside of your employer plan, whether that’s low-fee index funds, actively managed mutual funds, individual stocks and bonds, dividend stocks, rental real estate, passive business ventures, or some combination.

How Democracy Ends
by David Runciman
Published 9 May 2018

The First World War finally brought about the mass political enfranchisement of women as well as men in Britain and the US. The Second World War delivered it in France, and in other new democracies around the world, including India. The modern welfare state in Britain was a product of the experience of war. Healthy citizens and full employment were necessary to prosecute conflicts that depended on the mobilisation of the national workforce. In the US the Great Depression triggered a national experiment with political and economic reforms under the terms of the New Deal; but it was the war with fascism that sealed the deal and cemented the power of the federal government to provide for the nation’s welfare.

Dreams of Leaving and Remaining
by James Meek
Published 5 Mar 2019

when all’s going well. You can see her point. Andrzej Buła, the marshal of Opole and Civic Platform leader in the province, told me that the EU was funding 40 per cent of the provincial budget, while unemployment had dropped from 14 to 8 per cent. In some counties it’s as low as 5 per cent – essentially full employment. Without the Ukrainians, he said, they’d be short-handed. Yet in the 2015 parliamentary elections Civic Platform lost Opole on a swing of 40 per cent to Law and Justice. There’s a word for the work of those who navigate the single field that unites culture and the economy in people’s minds: politics.

Genentech: The Beginnings of Biotech
by Sally Smith Hughes

Its five overtaxed scientists were clearly insufficient to meet Lilly’s benchmarks and also take on the new research projects the firm had planned. Boyer and Swanson, intent as ever on acquiring complementary DNA expertise, had continued to pressure Ullrich, Seeburg, and Shine to accept offers of full employment. The founders now had the insulin research as incontrovertible evidence that Genentech could successfully perform breakthrough science with results as good or better than anything academia offered. The three postdocs indeed took note of the start-up’s achievements. Overcoming their initial resistance to working for a company, they began to look upon the job offers with more favor.

The Cult of Smart: How Our Broken Education System Perpetuates Social Injustice
by Fredrik Deboer
Published 3 Aug 2020

,” Washington Post, April 25, 2018, https://www.washingtonpost.com/opinions/america-is-obsessed-with-the-virtue-of-work-what-about-the-virtue-of-rest/2018/04/25/f829f406-48bf-11e8-8b5a-3b1697adcc2a_story.html, accessed February 18, 2019. 18. Matt Bruenig, “Just What Is a Job Guarantee?,” Jacobin, May 5, 2018, https://www.jacobinmag.com/2018/05/full-employment-job-guarantee-bernie-bruenig, accessed February 14, 2019. 19. Frederick Kirschenmann, “How Many Farmers Will We ‘Need’?,” Leopold Letter, winter 2000, https://www.extension.iastate.edu/agdm/articles/others/KirJan01.html, accessed October 10, 2018. 20. Tom Vilsack, “Testimony of Thomas J.

Lords of Finance: The Bankers Who Broke the World
by Liaquat Ahamed
Published 22 Jan 2009

They therefore occupied a strange hybrid zone, accountable primarily to their directors, who were mainly bankers, paying dividends to their shareholders, but given extraordinary powers for entirely nonprofit purposes. Unlike today, however, when central banks are required by law to promote price stability and full employment, in 1914 the single most important, indeed overriding, objective of these institutions was to preserve the value of the currency. At the time, all major currencies were on the gold standard, which tied a currency in value to a very specific quantity of gold. The pound sterling, for example, was defined as equivalent to 113 grains of pure gold, a grain being a unit of weight notionally equal to that of a typical grain taken from the middle of an ear of wheat.

…

Graph hounds, chart wavers and statistic quoters may shout their pens hoarse with contrary sentiment—financial Jeremiahs may rave of days of doom, but these minority reports are drowned by the hurrahing ticker tape and the swish of skyrocketing securities. We’re gambling on continued prosperity, full employment, and undiminished spending capacity—on freight loadings, automobile output, radio expansion—on aviation development, crop yields, beef prices—on mail order sales and sound retailing. It was from Washington that the bull market faced its greatest hostility. Every senior financial official in the government thought that stocks were now in a speculative bubble—everyone, that is, except the president, Calvin Coolidge.

Piracy : The Intellectual Property Wars from Gutenberg to Gates
by Adrian Johns
Published 5 Jan 2010

This in turn gave way to The Autonomy of Science, which advanced a sweeping threestage view of the history of science extending back centuries. Elements of this then reappeared in what might seem a radically different text, on Economic Planning. Finally, Polanyi turned the book on planning into a volume named Full Employment in Theory and Practice. And this last did appear in print, as Full Employment and Free Trade, in 1945 – constituting the third part of a triptych with Hayek’s Road to Serfdom and Popper’s Open Society. Only much later would fragments of the other projects resurface, most notably in Personal Knowledge. Throughout these pivotal years arguments about patents formed one of the few common threads, linking each new project to the last.

The Great Leveler: Violence and the History of Inequality From the Stone Age to the Twenty-First Century
by Walter Scheidel
Published 17 Jan 2017

Mansfield and Snyder 2010’s finding that war has no more than scattered effects on democratization stems in no small part from their failure to distinguish between mass mobilization warfare and other types of conflict. 52 Ticchi and Vindigni 2008: 30, with references, especially concerning Latin America. 53 This connection has been attributed to a variety of factors, from war-related social solidarity, ideals of equality, and political consensus building to the assertiveness of the working class due to full employment and unionization, the huge increase in state expenditure and capabilities, and the morale-building function of promises of postwar reform. Titmuss 1958 is a classic statement (for a brief survey of the debate on his position, see Laybourn 1995: 209–210). Among recent studies, Klausen 1998 provides the most forceful argument in support of the critical importance of World War II in postwar welfare state creation in different countries, whereas Fraser 2009: 246–248 makes a strong case specifically for the United Kingdom, as does Kasza 2002: 422–428 for Japan; the latter also concisely theorizes the relationship between mass war and welfare, emphasizing the demand for healthy soldiers and workers, the effects of the absence of male breadwinners, calls for social justice and equality of sacrifice even for elites, and war-induced urgency that induced rapid change (429–431).

…

Globalization of trade and finance, a powerful driver of rising inequality, is predicated on a relatively peaceful and stable international order of the kind that the British Empire had come to ensure when worldwide economic integration first took off in the nineteenth century, was subsequently reestablished under the effective hegemony of the United States, and then was further reinforced by the end of the Cold War. Key mechanisms of equalization such as unionization, public intervention in private-sector wage setting, and highly progressive taxation of income and wealth all first rose to prominence in the context of global war, as did full employment during and after World War II. In the United States, the disequalizing phenomenon of political polarization rapidly abated in the wake of the Great Depression and during World War II. And although ongoing technological change is a given, the counterbalancing provision of education is very much a matter of public policy.

Poorly Made in China: An Insider's Account of the Tactics Behind China's Production Game
by Paul Midler
Published 18 Mar 2009

Chinese manufacturers had other reasons for being in business, and they operated in a world where economic principles differed. One aspect that made manufacturing different in China was the symbiotic relationship formed between the export manufacturing sector and government. Throughout the 1980s and into the 1990s, when the planned economy failed to create enough jobs to attain full employment, the Communist Party looked to private industry to put people to work. Entrepreneurs who could offer jobs garnered a degree of political clout with government officials. In the 2000s, manufacturers were encouraged with a different political emphasis—bringing in foreign currency. Chinese companies that were not able to earn much of a profit were still able to earn political influence, and it was with these motivations in mind that manufacturers found themselves entering into deals.

The Spirit Level: Why Greater Equality Makes Societies Stronger
by Richard Wilkinson and Kate Pickett
Published 1 Jan 2009

In the decades which contain the world wars, life expectancy increased between 6 and 7 years for men and women, whereas in the decades before, between and after, life expectancy increased by between 1 and 4 years. Although the nation’s nutritional status improved with rationing in the Second World War, this was not true for the First World War, and material living standards declined during both wars. However, both wartimes were characterized by full employment and considerably narrower income differences – the result of deliberate government policies to promote co-operation with the war effort. During the Second World War, for example, working-class incomes rose by 9 per cent, while incomes of the middle class fell by 7 per cent; rates of relative poverty were halved.

Nomadland: Surviving America in the Twenty-First Century
by Jessica Bruder
Published 18 Sep 2017

More than half of the country’s sugar beet fields—some 680,000 planted acres—lie in the Red River Valley, which spans western Minnesota and eastern North Dakota. That region is home to American Crystal Sugar, the nation’s biggest beet sugar company. This region is a national anomaly, boasting nearly full employment, which makes hiring workers very difficult. (The challenge had been even greater when the Bakken oil fields were booming.) For this reason, American Crystal seeks itinerant workers who can come—bringing their own homes—from far away to work the autumn harvest. Equipped with that information and two pairs of heavy-duty work gloves, I arrived during the last week of September at Drayton Yard, a massive sugar beet storage and processing facility in North Dakota near the Canadian border.

The Global Minotaur
by Yanis Varoufakis and Paul Mason
Published 4 Jul 2015

When chief executive officers (CEOs) ponder a large-scale investment in some new plant or product line, they spend sleepless nights trying desperately to peer into the future. To see what? To see whether there will be sufficient demand for their final product. And what does that ultimately depend on? It depends – and the CEOs know this – on whether other CEOs like them invest now en masse. For if many of them invest, then order books will be full, employment will rise, people will have money to spend, and the economy will be buoyant when they bring their gleaming new product to market. But if not enough of them invest, then orders will be few, employment sluggish and final demand low. Thus CEOs are caught in the prophecy paradox: if each foretells good times, then good times will come and their optimistic forecasts will be confirmed.

Getting By: Estates, Class and Culture in Austerity Britain
by Lisa McKenzie
Published 14 Jan 2015

In 1968 two young researchers from the University of Nottingham, Ken Coates and Bill Silburn, boldly announced that ‘poverty is back among us’, even though Alan Sillitoe had written about poverty in Nottingham a decade earlier. They argued that during the 1950s there had been a myth that widespread material poverty had ‘been finally and triumphantly overcome’ (p 30). Rowntree and Lavers’ report in 1951 concluded that poverty in most places had been reduced, and eradicated in the South East and Midlands due to full employment and plenty of overtime for men. However, there was a small group of persistent people at the time that constantly maintained that there was still a serious problem of material poverty, Peter Townsend being one of the most consistent and vocal. Coates and Silburn (2007) decided to conduct their own study in Nottingham to discover whether Townsend was right.

Average Is Over: Powering America Beyond the Age of the Great Stagnation
by Tyler Cowen
Published 11 Sep 2013

Many people with part-time jobs would like to have full-time jobs, and many people are stuck in jobs that give them few chances for advancement. A considerable portion of our labor force is underemployed. Economists consider this very poor labor-market performance, and generally don’t expect to see full employment returning anytime soon. The crisis of 2008 and the ensuing recession are over, but the deeper structural problems are now showing through. There were short-run job market problems from the fallout from the financial crisis, but it’s not just a short-run problem. Our population is growing, but the number of people working continues to fall.

The End of Growth
by Jeff Rubin
Published 2 Sep 2013

Regardless of political stripe, everyone understands that a sustained period of rising joblessness can cause a country to crumble. Tax revenues go down, public services are cut, infrastructure falls apart, crime rates increase, and so does homelessness. It’s a downward spiral. If we’re to manage the slowdown in growth and avoid its worst consequences, the notion of what constitutes full employment needs to be recalibrated to account for the new economic reality. Just as oil trading at $20 a barrel is a thing of the past, so too are jobless rates in the low single digits. Although jobs may become scarcer, at the same time we may also see fewer people looking for work. CLOSING BORDERS History suggests that rising unemployment in any country results in tighter border restrictions.

Twilight of the Elites: America After Meritocracy
by Chris Hayes
Published 11 Jun 2012

Despite anemic growth in the post-crisis years, stocks are performing at historically high levels and inflation-adjusted corporate profits are at near record highs; the stock market has regained its losses from the crashes and the Dow is back above 13,000. Unemployment for the 30 percent of the adult population with a four-year college degree is a bit above 4.5 percent, which is back to its pre-crisis levels and constitutes full employment for that portion of the society. Large corporate law firms that dramatically cut their signing bonuses for well-credentialed new associates in the wake of the crisis have reinstituted them at levels even higher than before the crisis. Bonuses on Wall Street are once again breaking records. Meanwhile the “real economy,” or “Main Street” as politicians call it, is mired in its worst extended contraction in eighty years.

The Vanishing Middle Class: Prejudice and Power in a Dual Economy
by Peter Temin
Published 17 Mar 2017

Among the recommendations in common with the Washington Consensus are the desire for fiscal discipline in place of Keynesian polices, low marginal tax rates, low tariffs, privatization of state enterprises, and deregulation of private markets. Neoliberals added freedom of contracts, by which they typically mean opposition to labor unions, and they abandoned the postwar mandate to maintain full employment.18 Modern conservatives fear the power of the federal government that grew in the world wars and Great Depression, and they oppose the redistribution in a welfare state. They oppose the New Deal and unions as an “excess of democracy,” whatever that phrase means. They believe that the free market is equivalent to freedom itself and that regulating markets means surrendering political liberty.

Green Economics: An Introduction to Theory, Policy and Practice
by Molly Scott Cato
Published 16 Dec 2008

As I have written elsewhere: We should not see work as an end in itself, and should do our best to minimize the work needed, rather than creating work. 56 GREEN ECONOMICS Only somebody who was set to benefit from the work of others would want to do something that would seem so insane to the members of a society we might label primitive.1 Since one of the key demands of a green economist is an end to economic growth there has been much discussion about how this is compatible with full employment, and whether there is a dichotomy between jobs and protecting the environment. This debate is the subject of the first section in this chapter. The following section begins to ask deeper questions about what work is and how it forms both the individual and our society. Then we move on to consider recent tangible developments in the world of work, especially the impact of globalization on the way work is shared between different countries with different levels of wealth – the so-called ‘international division of labour hypothesis’.

Empty Planet: The Shock of Global Population Decline
by Darrell Bricker and John Ibbitson
Published 5 Feb 2019

If you take a sip of the green tea provided to each of those seated, one of them instantly pours a refill. If you use the warm hand towel placed thoughtfully beside the notebook, with its perfectly sharpened pencil, the towel is instantly replaced. God only knows what might happen if you used the pencil. Afterward, a Chinese colleague explains. The government has a policy of full employment—or at least as full as they can make it. These women were recruited from the countryside and brought to Beijing to perform these tasks. Any work, even pointless work, is better than being idle. As the world’s most populous nation, China has a huge, cheap workforce at its disposal—so huge and so cheap that many Western companies have decided to move their plants and jobs there, leading to accusations that low-wage Chinese labor has undermined American manufacturing.

The Wisdom of Frugality: Why Less Is More - More or Less
by Emrys Westacott
Published 14 Apr 2016

At the present time it is admittedly hard to imagine anything approaching that sort of consensus for another great national project. But the point here is not that the solution to economic problems like unemployment is easy to put into effect; the point is that the problem does not lie in some intrinsic feature of modern economies or in some mathematical formula discovered by clever economists that blocks the path to full employment the way the law of gravity prevents us from jumping over our houses. There is no shortage of worthwhile work that needs doing. Infrastructure needs repairing; schools and hospitals need upgrading; public parks, large and small, need to be improved and adequately staffed; public transport in many places is woefully inadequate; there is a virtually unlimited amount of research to be undertaken in medicine, alternative energy, and other scientific fields.

How Did We Get Into This Mess?: Politics, Equality, Nature
by George Monbiot
Published 14 Apr 2016

See animalrightscambridge.files.wordpress.com. 9Mark Townsend and Nick Denning, 9 November 2008, ‘Police Warn of Growing Threat from Eco-Terrorists’, guardian.com. 10Stephen Pritchard, 23 November 2008, ‘Anonymous Sources and Claims of Eco-Terrorism’, guardian.com. 11NETCU, personal communication, 22 December 2008. 12Townsend and Denning, ‘Police Warn of Growing Threat from Eco-Terrorism.’ 13The site this is take from (netcu.org.uk) was accessed at the time of writing and is no longer available. 14Leading article, 12 March 2006, ‘Email Campaigns’, Observer, theguardian.com; Linda Harrison, 9 July 2001, ‘Anti-Abortion Activists Step up UK Net Campaign’, theregister.co.uk. 15Jeremy Laurance, 8 May 2006, ‘Anti-Abortionist Jailed for Photo Protest’, independent.co.uk. 47. Union with the Devil 1Larry Elliott, 26 June 2006, ‘Sir Digby Rides Off with All Guns Blazing’, theguardian.com. 2GMB, 11th July 2006, ‘AA Roadshow Tackles Damon Buffini: Maidstone and Dover’, labournet.net. 3Trade Union and Labour Party Liaison Organisation, 25 July 2004, ‘Full Employment and Working in Modern Britain’, The TULO Guide to the Warwick Agreement, National Policy Forum. 4House of Commons, 2 March 2007, Temporary and Agency Workers (Prevention of Less Favourable Treatment) Bill, Second Reading, Hansard, publications.parliament.uk. 5See amicustheunion.org, accessed 9 July 2007. 6Paul Kenny, 3 June 2007, speech to the GMB conference, gmb.org.uk/shared_asp_files/GFSR.asp?

Lab Rats: How Silicon Valley Made Work Miserable for the Rest of Us
by Dan Lyons
Published 22 Oct 2018

Twenty years ago, pundits believed the Internet was going to make the world better in all sorts of ways, from perfecting democracy to saving the planet. Best of all would be the financial impact. During the heady days of the first dotcom boom, when stocks were soaring and people were mooning over the magical powers of the web, Wired founding editor Kevin Kelly declared the Internet would usher in decades of “ultraprosperity,” with “full employment…and improving living standards.” We were entering “the roaring zeroes,” as he called it, while declaring, “The good news is, you’ll be a millionaire soon. The bad news is, so will everybody else.” Bill Gates would become a trillionaire, Kelly predicted, perhaps as soon as 2005. By 2020, average U.S. household income would be $150,000.

Exodus: How Migration Is Changing Our World
by Paul Collier
Published 30 Sep 2013

But, as I now elaborate, these alternatives to migration are all too slow to close the massive gap in income between the poorest societies and the rich within our own lifetimes. How the Income Gap Affects Migration The growth of rich countries during that Golden Thirty Years and the stagnation of the poor are fundamental to understanding the origins of modern migration. The unprecedented prosperity of that period created pressures to reopen the doors. Full employment made employers desperate for workers. It also removed the fear that had inhibited workers from collective action, and so unions expanded and became more militant. Governments were themselves the main employer in the country, and so directly faced a labor shortage, but they also suffered the backlash of strikes and wage inflation that accompanied union militancy.

The Lies That Bind: Rethinking Identity
by Kwame Anthony Appiah
Published 27 Aug 2018

The manifesto, Let Us Face the Future, announced that “its ultimate purpose at home” was “the establishment of the Socialist Commonwealth of Great Britain—free, democratic, efficient, progressive, public-spirited, its material resources organised in the service of the British people.”26 The party sought to raise the school-leaving age to sixteen, increase adult education, improve public housing, make public secondary school education free, create a national health service, provide social security for all, guarantee full employment, and take fuel and power, public transportation, and iron and steel into public ownership. The manifesto did not lack ambition, as you can see, and the party achieved more of its aims than many believed possible. As a result, the lives of the English working class were beginning to change radically for the better.

Smarter Investing
by Tim Hale
Published 2 Sep 2014

At first glance that appears an easy question to answer, perhaps picking your sixty-fifth birthday, the normal ‘retirement’ age in the UK, as the end of your accumulation phase (unless of course the Chancellor decides we all need to work longer). In reality, as organisations narrow rapidly near the top, and loyalty to long-serving employees fails, you should perhaps consider that being in gainful, full employment at sixty, let alone sixty-seven, is no longer going to be the norm. Perhaps you should consider having more in your pot at an earlier stage (say fifty-five perhaps), which means investing higher, regular contributions, to provide security and flexibility in your later working years; working if you choose, or when you can.

The Hidden Half: How the World Conceals Its Secrets
by Michael Blastland
Published 3 Apr 2019

Economists who remembered the 1930s, Sir Terry said, could think of nothing worse than mass unemployment. That was the blight of their age, that was their searing memory, and it informed their theoretical belief. Never again, they said. They became committed to the Keynesian economics of the management of aggregate demand in order to maintain full employment, and they put their trust in the power of state spending to that end. Initially, this seemed to work. But in the 1970s, so it’s often argued, the policy came to sudden grief, stimulating a demand that the economy somehow failed to supply. Times and expectations had changed. Rampant inflation took hold (reaching 27% annually in the UK, even as unemployment rose).

Affluence Without Abundance: The Disappearing World of the Bushmen
by James Suzman
Published 10 Jul 2017

In advanced economies, the airwaves are packed with the rhetoric of politicians and ordinary people alike invoking the virtues of “strivers” and “working families” and decrying the laziness of “shirkers” and “freeloaders.” And in most less-developed economies, consultants and experts of all kinds spend their energy developing policy briefs and grand plans to create jobs. Almost everywhere full employment remains an ideal for politicians of all shades, among whom fears of rising unemployment invoke the specter of electoral defeat. It is no wonder, then, that John Maynard Keynes believed that our desire to solve the “economic problem” was not only “expressly evolved by nature” but was the sum of “all our impulses and deepest instincts.”

The Mole People: Life in the Tunnels Beneath New York City
by Jennifer Toth
Published 14 Jun 1993

They also fear the people they encounter in the netherworld. Sullivan considers the presence of people living underground to be a significant change from 1940 when Granick wrote the first edition of Underneath New York. “Homeless people who now live underground by the thousands were more an oddity than an issue back then, as the city was close to full employment,” Sullivan said of the immediate pre— World War II period. Now, although some maintenance crews get to know squatters in certain tunnel areas and even bring extra sandwiches for them, most workers believe the underground homeless are dangerous—criminals on the run, insane people, drug addicts, alcoholics, AIDS cases, tuberculosis patients—all of whom represent threats of one kind or another.

A Hacker's Mind: How the Powerful Bend Society's Rules, and How to Bend Them Back
by Bruce Schneier
Published 7 Feb 2023

We can imagine feeding the world’s tax laws into an AI, because the tax code consists of formulas that determine the amount of tax owed. There is even a programming language, Catala, that is optimized to encode law. Even so, all law contains some ambiguity. That ambiguity is difficult to translate into code, so an AI will have trouble dealing with it. AI notwithstanding, there will be full employment for tax lawyers for the foreseeable future. Most human systems are even more ambiguous. It’s hard to imagine an AI coming up with a real-world sports hack like curving a hockey stick. An AI would have to understand not just the rules of the game but also human physiology, the aerodynamics of the stick and the puck, and so on.

The End of Medicine: How Silicon Valley (And Naked Mice) Will Reboot Your Doctor
by Andy Kessler
Published 12 Oct 2009

If you had the pattern of waves after they went through the cross section of an object, you do an inverse Fourier transform, and back into a pretty close approximation of what the object looks like, without doing all that much math. Bingo. The newly formed NASA found out about it and had to have it. President Kennedy had them putting a man on the moon by the end of the decade, a full employment act for physicists, but a big concern for manned space exploration was radiation from solar flares. These microwave bursts would be as dangerous for an astronaut as putting a sheep in a microwave oven—Johnny Carson’s Carnac the Magnificent’s question to a card that read Sis Boom Bah. With Bracewell’s Observatory cranking out maps quickly using Bracewell’s shortcut, NASA could warn astronauts of solar flares almost in real time and have them hide behind radiation shields on spaceships, abort space walks or quickly head inside the Lunar Module instead of hitting golf balls on the moon.

Vassal State
by Angus Hanton
Published 25 Mar 2024

Yet, if the UK were the fifty-first state, it would be, by some estimates, poorer than Mississippi and certainly among the poorest five or six US states.2 By contrast, incomes in the neighbouring state of Arkansas are significantly higher, partly because the city of Bentonville is home to Walmart, the biggest retailer in the US. The company has brought both prosperity and full employment to the city with its 14,000 staff and about the same number of employees in suppliers’ offices: it is a thriving place and one with a purpose. This demonstrates the ‘home-town advantage’ and applies to towns and cities hosting large and medium-sized companies all across America. In Bentonville, Alice Walton, daughter of Walmart founder Sam Walton, has spent hundreds of millions of dollars of her $64 billion fortune to create one of the best museums of American art.

The True and Only Heaven: Progress and Its Critics
by Christopher Lasch
Published 16 Sep 1991

Since the wealthy could spend only a small portion of their vast incomes, their disproportionate share of the national wealth meant that aggregate savings rose disproportionately as national income increased. A higher volume of savings did not generate a higher volume of investment. It led to a decline of aggregate demand, declining investment, and unemployment. A "somewhat comprehensive socialization of invest -72- ment," Keynes concluded, would "prove the only means of approximation to full employment." Government spending would put people to work, stimulate consumption, and forestall the need for a more radical attack on the problem of inequality. It would provide an alternative to a redistribution of income, in other words, even if many businessmen still found it difficult to distinguish "novel measures for safeguarding capitalism from what they call Bolshevism."

…

Their "irreverence" for "traditional wisdom or the restraints of custom" derived from an excessive confidence in reason. "It did not occur to us to respect the extraordinary accomplishment of our predecessors in the ordering of -76- life ... or the elaborate framework which they had devised to protect this order." Keynes's theory of "abundance through full employment," as Hession notes, gave "new life to the old ideology of progress and national economic growth." At the same time, his belated appreciation of tradition brought to the surface, if only as an afterthought, a persisting undercurrent of uneasiness in progressive ideology. It was as if the idea of progress required as a kind of counterpoint an exaggerated and slightly sentimental "reverence" for the "restraints of custom."

Stealth of Nations
by Robert Neuwirth
Published 18 Oct 2011

Another thirty years on—a hundred and sixty years after Adam Smith published The Wealth of Nations—John Maynard Keynes offered a frank diagnosis of the problems of the free-market system in the last chapter of his 1936 book The General Theory of Employment, Interest and Money: “The outstanding faults of the economic society in which we live,” he wrote, “are its failure to provide for full employment and its arbitrary and inequitable distribution of wealth and income.” Keynes believed that government could provide the leavening, leveling factor, investing in and stimulating production in order to create jobs and spur consumption, and in the process leveling the huge inequities in wages and wealth.

Unhealthy societies: the afflictions of inequality
by Richard G. Wilkinson
Published 19 Nov 1996

Medical services were also diverted from civilian use on a vast scale to meet the needs of wounded soldiers. Although food rationing improved the quality of the nation’s diet during the Second World War and is often given the credit for the health improvements, such an explanation ignores the fact that it does not apply to the First World War. Both wars however saw a return to full employment and a dramatic narrowing of income differences. Winter describes the attempt to ensure basic minimum standards for all, which he says led to a levelling up of health standards, with the most rapid improvements coming in the poorest areas (Winter 1985, 1988). Not only did unemployment virtually disappear, but differences in earnings amongst those in employment narrowed very substantially.

Throwing Rocks at the Google Bus: How Growth Became the Enemy of Prosperity
by Douglas Rushkoff
Published 1 Mar 2016

Learning code well enough to be a competent programmer is even harder. Although I certainly believe that any member of our highly digital society should be familiar with how these platforms work, universal code literacy won’t solve our employment crisis any more than the universal ability to read and write would result in a full-employment economy of book publishing. It’s actually worse. A single computer program written by perhaps a dozen developers can wipe out hundreds of jobs. Digital companies employ ten times fewer people per dollar earned than traditional companies.42 Every time a company decides to relegate its computing to the cloud, it is free to release a few more IT employees.

The Rise of the Outsiders: How Mainstream Politics Lost Its Way
by Steve Richards
Published 14 Jun 2017

What happens if banks or large global companies threaten to move elsewhere, if a government imposes taxes or a regulatory framework that they regard as punitive? What is the solution to genuine worries about the free movement of labour, when countries’ economies and public services are dependent on immigrants? How can a government pledge a commitment to full employment when technology wipes out jobs? How to address widening inequality in a global economy without undermining economies? Immigration was the policy area that united the populist phrases about ‘take back control’ and being ‘left behind’ – the anguished questions posed by globalization – into a deceptive whole.

Capitalism Without Capital: The Rise of the Intangible Economy
by Jonathan Haskel and Stian Westlake
Published 7 Nov 2017

Piketty’s now famous r > g inequality (explained in box 6.2) implies that if returns on capital (r) exceed the growth of the economy as a whole (g), then the slice of the economic pie owned by the rich will generally grow. Piketty argues that in the postwar period, political choices reduced r: in particular, high taxes on the rich and government policies that encouraged full employment and union rights. The reversal of those policies and the fall of economic growth have shifted economies to where r now exceeds g and will continue to do so. Box 6.2. An Outline of Piketty’s r > g Condition A sketch of Piketty’s argument, from a brilliant review by the economist Robert Solow (2014), is this.

Grave New World: The End of Globalization, the Return of History
by Stephen D. King
Published 22 May 2017

As Reagan put it – in a more memorable way than Hayek ever managed – ‘The nine most terrifying words in the English language are “I’m from the government and I’m here to help”.’5 Even then, the early years were touch and go: in 1981, Ronald Reagan sacked around 13,000 American air traffic controllers who went on strike in violation of the terms of their contracts, while even in her second term in office Margaret Thatcher was engaged in a ferocious battle with Britain’s coal miners. By the late 1980s, however, Reagan and Thatcher had won: the private sector had triumphed – at least philosophically – over the public sector, markets had succeeded where central planning had failed, macroeconomic policy was aimed at price stability, not full employment, and economic growth was to be achieved through ‘supply-side’ reform, not Keynesian-style demand management. Importantly, following Thatcher’s lead with her very early decision to abolish exchange controls, capital markets were to be subject to the discipline provided by international investors.

Food and Fuel: Solutions for the Future
by Andrew Heintzman , Evan Solomon and Eric Schlosser
Published 2 Feb 2009

At its basic level, a soft path approach, the most general term, is concerned with values. A soft path approach to energy policy focuses on reducing the risks of environmental and social harms that can result from energy sources and energy-using technologies, but it also accepts the importance of social and economic stability, full employment, and democratic institutions and norms. In the latter set of values the soft path approach does not differ markedly from most conventional energy planning in the Western world. (Energy planners of all stripes do tend to take economics and security seriously, even when their specific projections turn out to be dead wrong.)

The Precariat: The New Dangerous Class
by Guy Standing
Published 27 Feb 2011

For our purposes, the precariat consists of people who lack the seven forms of labour-related security, summarised in the Box, that social democrats, labour Forms of labour security under industrial citizenship Labour market security – Adequate income-earning opportunities; at the macro-level, this is epitomised by a government commitment to ‘full employment’. Employment security – Protection against arbitrary dismissal, regulations on hiring and firing, imposition of costs on employers for failing to adhere to rules and so on. Job security – Ability and opportunity to retain a niche in employment, plus barriers to skill dilution, and opportunities for ‘upward’ mobility in terms of status and income.

Capitalism: Money, Morals and Markets
by John Plender
Published 27 Jul 2015

Where previously tax had been regarded chiefly as a means of financing wars, it now provided the wherewithal for health care, education, pensions and infrastructure, as well as defence. This was a cornerstone of the post-war settlement between labour and capital, which included increased welfare and free collective bargaining for workers, together with a political guarantee of full employment underpinned by Keynesian demand management. The post-war social contract implicitly recognised that the utilitarian ethical basis of capitalism – that is, its ability to deliver the greatest good of the greatest number through the self-interested actions of individuals – involved potential conflicts with social justice.

The Enigma of Capital: And the Crises of Capitalism
by David Harvey
Published 1 Jan 2010

The astonishing growth performance of capitalism in China after 1980 depended, for example, on the radical reduction of infant mortality in the Mao years that later resulted in a massive young labour force clamouring for employment. In the absence of increasing productivity, accumulation leads to relatively full employment of local labour resources. Scarcity of labour means increasing wages. Either wages continue to rise in such a way as to not interfere with the increasing mass of accumulation (because more labourers are employed) or accumulation slows along with the demand for labour, thus pushing wages down.

The Entrepreneurial State: Debunking Public vs. Private Sector Myths
by Mariana Mazzucato
Published 1 Jan 2011

‘Small Business and Government: The Richard Report’. Submission to the Shadow Cabinet. Available online at http://www.bl.uk/bipc/pdfs/richardreport2008.pdf (accessed 6 June 2011). Robinson, J. 1953–54. ‘The Production Function and the Theory of Capital’. Review of Economic Studies 21, no. 2: 81–106. _____. 1978. ‘Obstacles to Full Employment’. In Contributions to Modern Economics. New York, San Francisco: Academic Press. Rodrik, D. 2004. ‘Industrial Policy for the 21st Century’. CEPR Discussion Paper 4767. Rogoff, K. and C. Reinhart. 2010. ‘Growth in a Time of Debt’. American Economic Review 100, no. 2: 573–8. Roland, A. and P.

The Age of Stagnation: Why Perpetual Growth Is Unattainable and the Global Economy Is in Peril
by Satyajit Das
Published 9 Feb 2016

On September 18, 2008, at the height of the crisis, Ben Bernanke, Alan Greenspan's successor at the Fed, made the case for a massive bank bailout to skeptical legislators: “If we don't do this, we may not have an economy on Monday.”7 Three years earlier, during an interview on financial news channel CNBC, Bernanke had stated: “We've never had a decline in house prices on a nationwide basis…. House prices will slow, maybe stabilize, might slow consumption spending a bit. I don't think it's gonna drive the economy too far from its full employment path, though.”8 He had repeatedly stated that housing prices reflected strong economic fundamentals. Back in 2001, IMF economist Prakash Loungani had concluded after a study that economists’ forecasts were generally grossly inaccurate. Following the GFC, Loungani and his colleague Hites Ahir found that no economist in 2008 had seen the recession coming—a remarkable outcome, given that the crisis had already commenced.

AI Superpowers: China, Silicon Valley, and the New World Order
by Kai-Fu Lee
Published 14 Sep 2018

This would constitute a devastating blow to working families. Worse still, this would not be a temporary shock, like the fleeting brush with 10 percent unemployment that the United States experienced following the 2008 financial crisis. Instead, if left unchecked, it could constitute the new normal: an age of full employment for intelligent machines and enduring stagnation for the average worker. U.S.-CHINA COMPARISON: MORAVEC’S REVENGE But what about China? How will its workers fare in this brave new economy? Few good studies have been conducted on the impacts of automation here, but the conventional wisdom holds that Chinese people will be hit much harder, with intelligent robots spelling the end of a golden era for workers in the “factory of the world.”

The New Gold Rush: The Riches of Space Beckon!
by Joseph N. Pelton
Published 5 Nov 2016

This means avoiding super density where there is loss of community spirit and involvement. Such super density also creates major problems of response to natural or human-made disasters or terrorist attack. (3) Finally re-focus on new approaches to urban planning devoted to research to achieve more effective use of artificial intelligence and automation so as to create full employment. This new thrust would be toward achieving universal education, health care and employment systems geared to a sustainable world and coping with the global strife associated with cultural, racial, linguistic or social conflicts. 6. Space and Ground-based Infrastructure for Education and Health Care.

Infonomics: How to Monetize, Manage, and Measure Information as an Asset for Competitive Advantage
by Douglas B. Laney
Published 4 Sep 2017

Data management and governance expert, and head of services delivery with First San Francisco Partners, John Ladley, acknowledges that the general failure to do just this has been a “foundational flaw in IT and data management for years.” He proclaimed to me, “As long as I see development teams cranking out hundreds of apps and services without considering the ancillary uses of data, I will have full employment!”15 Organizations that monetize their information assets outstrip their rivals by using it to reinvent, digitalize, or eliminate existing business processes and products. Yet 50 percent of 249 respondents in an online Gartner poll said their company is not monetizing information in any way. 31 percent said they are doing so indirectly by measuring the economic benefit of data through better decision making.

Global Inequality: A New Approach for the Age of Globalization
by Branko Milanovic
Published 10 Apr 2016

Kuznets stated, “It is even more plausible to argue that the recent narrowing in income inequality observed in the developed countries was due to a combination of the narrowing inter-sectoral inequalities in product per worker, the decline in the share of property incomes in total incomes of households, and the institutional changes that reflect decisions concerning social security and full employment” (1966, 217). 8. Malign and benign forces were brought together as explanations for the emergence of the modern welfare state by Max Beloff (1984) in an influential book entitled, not surprisingly, Wars and Welfare: Britain 1941–1945. 9. Our very use of the term “service” or “tertiary” sector is problematic precisely because it conceals under one name an incredible variety of jobs and skills, with vastly different pay scales.

Trade Wars Are Class Wars: How Rising Inequality Distorts the Global Economy and Threatens International Peace
by Matthew C. Klein
Published 18 May 2020

While the conference focused on reforming the monetary system and the regulations surrounding financial flows, delegates also supported a proposal for a new International Trade Organization (ITO) that would “reduce obstacles to international trade and in other ways promote mutually advantageous international commercial relations.” As U.S. Treasury secretary Henry Morgenthau put it in his closing remarks at the conference, the “revival of international trade is indispensable if full employment is to be achieved in a peaceful world and with standards of living which will permit the realization of men’s reasonable hopes.”17 But this revival of international trade was to occur in a very different context than today. Transportation costs were still high enough then that it made little sense to spread manufacturing processes across wide geographic areas.

The Chip: How Two Americans Invented the Microchip and Launched a Revolution
by T. R. Reid
Published 18 Dec 2007

The U.S. firms could not rebuild fast enough to meet the need. Their customers went shopping for an alternate source of RAM chips—and found it in Japan. Following standard Japanese industrial practice, the big Japanese electronics firms had maintained their work force and their production capacity during the recession. They absorbed the costs of full employment during slack times on the theory that the investment in keeping a trained, loyal work force on the job would pay off when things turned up. They were, accordingly, in the catbird seat when the market for 16K RAMs took off in the mid-1970s. Silicon Valley’s inability to meet demand gave Japan a golden opportunity to show the world what it could do, and Japanese firms leaped at the chance.

A History of the World in Seven Cheap Things: A Guide to Capitalism, Nature, and the Future of the Planet
by Raj Patel and Jason W. Moore
Published 16 Oct 2017

Liu, Yi-Ping, Gui-Sheng Wu, Yong-Gang Yao, Yong-Wang Miao, Gordon Luikart, Mumtaz Baig, Albano Beja-Pereira, Zhao-Li Ding, Malliya Gounder Palanichamy, and Ya-Ping Zhang. 2006. “Multiple Maternal Origins of Chickens: Out of the Asian Jungles.” Molecular Phylogenetics and Evolution 38, no. 1: 12–19. Livingston, James. 2016. No More Work: Why Full Employment Is a Bad Idea. Chapel Hill: University of North Carolina Press. Lo, Jung-Pang. 1955. “The Emergence of China as a Sea Power during the Late Sung and Early Yüan Periods.” Far Eastern Quarterly 14, no. 4: 489–503. Lobell, David, and Christopher B. Field. 2007. “Global Scale Climate-Crop Yield Relationships and the Impacts of Recent Warming.”

The Age of Turbulence: Adventures in a New World (Hardback) - Common
by Alan Greenspan
Published 14 Jun 2007

The eighteen committee members* were all seasoned central bankers and economists, and as we went around the table comparing assessments of the economy, it was apparent that they, too, were concerned. Gerry Corrigan, the gruff president of the New York Fed, said we ought to raise rates; Bob Parry, the Fed president from San Francisco, reported that his district was seeing good growth, high optimism, and full employment—all reasons to be leery of inflation; Si Keehn from Chicago agreed, reporting that the Midwest's factories were running near full capacity and that even the farm outlook had improved; Tom Melzer of the St. Louis Fed told of how even the shoe factories in that district were operating at 100 percent; Bob Forrestal from Atlanta described how his staff had been surprised at the strength of employment figures even in chronically depressed sections of the South.

…

I told them: "I want to raise a broad hypothesis about where the economy is going over the longer term, and what the underlying forces are." 166 More ebooks visit: http://www.ccebook.cn ccebook-orginal english ebooks This file was collected by ccebook.cn form the internet, the author keeps the copyright. IRRATIONAL EXUBERANCE My idea was that as the world absorbed information technology and learned to put it to work ; we had entered what would prove to be a protracted period of lower inflation, lower interest rates, increased productivity, and full employment. "I've been looking at business cycles since the late 1940s," I said. "There has been nothing like this." The depth and persistence of such technological changes, I noted, "appear only once every fifty or one hundred years." To suggest the global scale of the change, I alluded to a new phenomenon: inflation seemed to be ebbing all over the world.

Unelected Power: The Quest for Legitimacy in Central Banking and the Regulatory State
by Paul Tucker
Published 21 Apr 2018

Adopting a strong form of the third Design Precept, the agency would set out how it interprets and plans to apply the statutory mandate. Since it would be substituting for the legislature, it should encourage active public debate on its conception of the mission. For example, when in 2012 the Federal Reserve took the important and welcome step of publishing how it defined “price stability” and “full employment,” it would have been better to invite public discussion rather than simply making a declaration of policy. An order of magnitude worse is where an independent-agency policy regime is unable to meet the Delegation Criteria because society’s preferences are in flux, the goal intrinsically indeterminate, or big distributional choices unavoidable.

…

This is no less relevant to monetary policy, but here the analysis can be pushed a step further by reintroducing part I’s distinction between goals and instruments: Rule for Objective: “Monetary policy shall be set so as to achieve an annual rate of inflation (as defined) of Y percent.” Standard: “Monetary policy shall be set so as to maintain price stability and full employment over the medium-to-long term.” Rule for Instrument: “The policy interest rate (as defined) shall be set according to the formula F.” Hayek’s choice between rules and (vague) standards is clear enough:16 When we obey laws, in the sense of general abstract rules laid down irrespective of their application to us, we are not subject to another man’s will and are therefore free.

The Misbehavior of Markets: A Fractal View of Financial Turbulence
by Benoit Mandelbrot and Richard L. Hudson
Published 7 Mar 2006

Two centuries ago, when new telescopes and new math were opening the modern study of astronomy, the great French mathematician, the Marquis Pierre-Simon de Laplace, asserted that he could predict the future of the cosmos—if only he knew the present position and velocity of every particle in it. This view, carried over into markets, would be a full-employment act for the world’s financial analysts and economists. They could tell you whether inflation would rise, whether interest rates would fall, and which stocks to buy and sell—if only they had enough good data, if only they had good enough computers, if only there were enough of them earning good salaries.

The politics of London: governing an ungovernable city
by Tony Travers
Published 15 Dec 2004

Paradoxically, the more successful these strategies are, the more attractive such areas are for development, particularly to high tech companies and research organizations which are fairly free in their locational choice and hence strongly influenced by the locational preferences of their skilled employees (Hall et al., 1987). The western part of the region continues to be characterized by very high levels of development pressures and full or even over-full employment. At the beginning of the twenty-first century, local politicians were actively campaigning for policies of job diversion from the area, arguing that continuing influxes of higher paid employees were squeezing teachers, nurses and other public service workers out of local housing markets, creating problems for service delivery.

Nudge: Improving Decisions About Health, Wealth, and Happiness
by Richard H. Thaler and Cass R. Sunstein
Published 7 Apr 2008

Many people simply pick a “round number,” typically 5, 10, or 15 percent of income. Of course, there is no sensible reason why the correct percentage of your income to save would be an exact multiple of 5. Another common rule of thumb is to contribute to a retirement account the minimum amount necessary to get the full employer match. If the employer matches employees’ contributions up to 6 percent of pay, then many employees contribute 6 percent. If participants are behaving this way, then firms wanting to encourage employee savings might alter their matching formula to help workers. Changing the match formula from 50 percent on the first 6 percent of pay to 30 percent on the first 10 percent of pay would probably increase contribution rates.

Affluenza: The All-Consuming Epidemic
by John de Graaf , David Wann , Thomas H Naylor and David Horsey
Published 1 Jan 2001

The ads are all about “me,” chasing an illusion of personal grandeur. But political scientist Benjamin Barber is skeptical that those roads can take us where we want to go. In A Place for Us, Barber explains his gripe with an economy based solely on profit. “Markets are as likely to undermine as to sustain full employment, environmental safety, public health, social safety nets, education, cultural diversity, and real competition,” he writes.1 He believes these qualities need to be championed by us, the people—a slumbering yet historically potent third force in American society. He urges us to rise up from our couches and collectively reenergize the third place, between big government and big business, where “citizens breathe freely and behave democratically without regarding themselves as passive complainers, grasping consumers, or isolated victims.”2 This third place, treasured throughout American history, is where civic life thrives.

Four Arguments for the Elimination of Television
by Jerry Mander
Published 1 Jan 1977

During the war, American in- dustrial capacity, lying fallow only a few years before, had actually expanded to build the military machine. My father's own business was an example. Now there were no more uniforms to make, and no more tanks. The war had given men jobs as soldiers and women jobs as factory workers. Full employment had practically become a reality. Now Johnny was marching home again, jobless. If this was the talk among ordinary people, one can only imagine what was said in industrial boardrooms and at the Department of Commerce. With industrial capacity and capi- tal investment expanded as they were, the consequences of a drop in production could make the 1930s look like golden years.

The Power Surge: Energy, Opportunity, and the Battle for America's Future
by Michael Levi
Published 28 Apr 2013

I’m bored!” m m m Shale gas was shaking up the U.S. economy. It’s usually difficult to figure out how much credit to give any particular development for a big gain in jobs. Most economists would say that when the economy is working properly, it doesn’t even make much sense to try. They call this “full employment,” and it means that, most of the time, the unemployment rate in the country is basically fixed. The number is a consequence of basic factors including how many people are able and want to work, how flexible they are when it comes to switching jobs, and what the Federal Reserve in Washington does with interest rates; add a job in one industry, theory says, and you’ll ultimately find someone out of work in another.12 But when the economy is in the dumps, and the unemployment rate is abnormally high, the usual rules don’t apply: new jobs are much more of an unalloyed good, and jobs added in one part of the economy don’t clearly come at the expense of others.

The Price of Everything: And the Hidden Logic of Value
by Eduardo Porter
Published 4 Jan 2011

Raising interest rates would have taken the air out of the incipient housing bubble, but it would have also slowed the economy, lengthening the recession and boosting unemployment. Had housing growth stalled, lots of construction-sector jobs—which provided a livelihood for many workers—wouldn’t have existed. “Whenever in the future the US finds itself in a situation like 2003, should it try to keep the economy near full employment even at some risk of a developing bubble?” wondered the economic historian J. Bradford Delong. “I am genuinely unsure as to which side I come down on in this debate.” Beyond the immediate impact on aggregate employment, what would happen with innovation if every time investors swooped upon a new technology the emergent bubbles were preemptively pricked?

All About Asset Allocation, Second Edition
by Richard Ferri
Published 11 Jul 2010

FIGURE 11-8 S&P 500 Earnings Growth is Highly Correlated with Per Capita GDP Growth 100,000 1,000 10,000 100 1,000 10 1000 1 10 GDP per capita (left scale) S&P 500 earnings (right scale) 2009 2004 1999 1994 1989 1984 1979 1974 1969 1964 1959 1954 1949 1944 1939 1934 0 1929 1 Realistic Market Expectations 235 The long-term correlation between annual GDP per capita growth and S&P 500 earnings growth has been over ⫹0.9. The correlation is higher if earnings are smoothed over 10 years to reduce the effect of recessionary earnings lulls. THE FEDERAL RESERVE AND GDP GROWTH The Federal Reserve has two primary mandates: first, to foster full employment by promoting controlled GDP growth, and second, to keep inflation in check. Basically, the Federal Reserve targets the economy to grow at about 3 percent per year (after inflation). This encourages steady job creation and holds inflation at a reasonable level. If the economy grows faster than the target, it can cause a supply-and-demand mismatch, which can lead to higher inflation.

Five Billion Years of Solitude: The Search for Life Among the Stars
by Lee Billings
Published 2 Oct 2013

It would take maybe a few extra years, but that was all. In retrospect I’ve learned, to my horror, that the science isn’t everything. In fact, it’s probably the last thing. People don’t support what they think is best for all of science, they support what directly benefits them. These days, what the astronomy community pursues is full employment for astronomers.” As it became clear that building both TPFs would easily be multibillion-dollar endeavors, outspoken support for the project in the wider U.S. astronomical community became ever more muted. The choice for NASA became an easy one as it struggled to balance the budgetary burden of its human spaceflight efforts against the discordant demands of astronomers and astrophysicists.

Utopias: A Brief History From Ancient Writings to Virtual Communities
by Howard P. Segal
Published 20 May 2012

A professional journalist and accomplished fiction writer before Looking Backward appeared, Bellamy knew how to captivate an audience. His readers are transported along with Julian West, a wealthy young Bostonian who somehow sleeps for 113 years, from the poverty, disease, crowding, violence, and corruption of late-nineteenth-century industrial America to a nation of wellplanned cities and towns whose citizens enjoy full employment, material abundance, good health, and social harmony. In the process, they join Julian in his quest to understand how utopia emerged without bloodshed, much less revolution.35 At its heart, Bellamy’s novel is about cooperation, a modest form of socialism, the “Religion of Solidarity,” and material and administrative advances.

Zero-Sum Future: American Power in an Age of Anxiety
by Gideon Rachman
Published 1 Feb 2011

Once again Greenspan both epitomized and molded the emerging consensus. In 1995, as the tech boom surged, he suggested to his colleagues at the Fed that the IT revolution meant that the world had “entered what would prove to be a protracted period of lower inflation, lower interest rates, increased productivity and full employment.” It was, suggested the Fed chairman, the kind of technological revolution that only happened once or twice a century.3 The rise of the information technology industry in the United States made it much easier to make the case for globalization. If traditional manufacturing was still at the core of the American economy, then competition with low-cost workers in Mexico or China would look much more frightening.

The Ghosts of Berlin: Confronting German History in the Urban Landscape
by Brian Ladd
Published 1 Jan 1997

In fact, their apartments had been eagerly sought and well liked by skilled workers and professionals. However, there is considerable reason to worry about the future of these districts in a "free," capitalist society. Their smooth functioning depended on several conditions that quickly disappeared after 1990: full employment, a broad range of state-provided social services (especially child care and youth activities), and a society in which cooperation among neighbors was taken for granted. If these satellite cities continue to deteriorate into ghettos of unemployed adults and disaffected youth, plagued by crime and vandalism, Westerners will be all the more < previous page page_191 file:///Volumes/My%20Book/arg/ladd-Ghosts_Berlin/files/page_191.html [24/03/2011 13:50:21] next page > page_192 < previous page page_192 next page > Page 192 inclined to curse the GDR authorities who built them, but Easterners will see the problem differently.

Hustle and Gig: Struggling and Surviving in the Sharing Economy
by Alexandrea J. Ravenelle
Published 12 Mar 2019

According to the Economic Security Index, 20 percent of the American population saw their available household income decline by 25 percent or more and lacked an adequate financial safety net to replace this lost income.9 Even those who started the recession with savings soon found themselves tapping their reserves: 57 percent of Americans who had savings before 2008 used up some or all of their savings in the Great Recession and its aftermath, and 34 percent reported that they were somewhat worse off or much worse off financially than they had been five years earlier.10 Well after the recession ended, nearly half of Americans noted that they would have trouble finding four hundred dollars to pay for an emergency without selling a possession or borrowing money.11 In many ways, it’s almost as if the recession never really ended: in the height of the Wall Street crisis, in October 2008, 57 percent of adults said their incomes were falling behind the cost of living; in 2014, 56 percent of adults echoed the same concern.12 The interest in demeaning poop-scooping jobs also highlights another element of the gig economy: workers have such a great need for extra income they will literally pick up almost anything for the promise of extra money. As I write this, unemployment in the United States is below 4 percent. According to the Bureau of Labor Statistics, the unemployment rate has been 5 percent or less—commonly considered to be “full employment”—since September 2015. Worker incomes, too, have returned to prerecessionary levels, after accounting for inflation.13 Even so, research by the Federal Reserve Board points to an ever-increasing number of workers who are working multiple jobs, doing informal work for pay in addition to a main job, or both.

Lessons-Learned-in-Software-Testing-A-Context-Driven-Approach
by Anson-QA

In some companies, a nonprogramming tester will be treated as a second-class employee no matter how good he is. You have to hire programmers in these cases. Your challenge will be to hire programmers who have diverse backgrounds. In our experience, this is not easy, but it is achievable if you work in a good company, and the industry is not in one of its full-employment boom cycles. Another diversity issue bears mention. Occasional articles are published about racism and sexism and ageism in the computer industry, and we've seen our share of it. Hiring, training, pay, and promotion preferences that result in groups that are more dominated by white males than they need to be are particularly 188 counter-productive in testing.

Radical Markets: Uprooting Capitalism and Democracy for a Just Society
by Eric Posner and E. Weyl
Published 14 May 2018

Yet, the fact that international inequality began to fall just as globalization began to accelerate and decolonization was completed suggests that international inequality may be attributable to colonialism and closed international markets rather than to free markets. Stagnation The last significant shift in economic philosophy took place in the 1970s, when “stagflation” (simultaneously high inflation and unemployment) undermined the then-accepted Keynesian argument that inflation was a cost worth paying for full employment. The neoliberal and “supply-side” ideas that grew up in response promised that allowing greater play of capitalism (lower taxes, deregulation, privatization) would unleash economic growth. Even if capitalism might cause some inequality, wealth would eventually “trickle down” to ordinary workers.

Red Flags: Why Xi's China Is in Jeopardy
by George Magnus
Published 10 Sep 2018

Lurking in the wings is the strong likelihood that the external environment for China may well become less benign. The US dollar is likely to appreciate again if the Federal Reserve tightens US monetary conditions sufficiently, which well it might in view of Washington’s tax cuts and fiscal stimulus programme enacted in 2018 in a more or less full employment economy. Alternatively, investors may flee riskier assets when the global economy turns down again. Sino–US relations look set to remain tense, as the US administration steps up the pressure on trade and investment relations with China. For the most part, though, these factors should not test the Chinese foreign exchange regime to the core, unless there is a serious breakdown in political relations.

The Unusual Billionaires
by Saurabh Mukherjea
Published 16 Aug 2016

This was a tough choice among the multiple options available in the early noughties, which ranged from the use of Direct Sales Agents (or DSAs, employed by ICICI Bank and many foreign banks) to the use of a subsidiary (as followed by HDFC Bank), onwards to contractual employment. Among all the options, the full-employment model had the lowest risk, but came at the highest cost of customer acquisition. Kaul’s model of contractual employment thus had to have higher productivity per sales executive. Kaul would be vindicated in the years to come, when business procured via DSAs led to asset-quality challenges for ICICI Bank amongst others.

We're Not Broken: Changing the Autism Conversation
by Eric Garcia
Published 2 Aug 2021

I still regularly get e-mails and messages from parents of autistic kids who want advice or are just grateful that I offer an example of a different way to be autistic in this world. I’ll carry these messages with me forever. I hope that with this book, I’ve shown that there is no correct way to be autistic and that autistic people who have higher support needs or those who cannot speak or hold full employment deserve as much dignity and respect as I am afforded. And the story for Generation Z and beyond will be unique. To be certain, many of them may live with continued challenges, like the persistent misinformation about vaccines or incomplete portrayals of autistic people in pop culture. But they will have grown up with concepts like neurodiversity as part of the lexicon.

MegaThreats: Ten Dangerous Trends That Imperil Our Future, and How to Survive Them
by Nouriel Roubini
Published 17 Oct 2022

Andrew Mellon, Wikipedia entry, https://en.m.wikipedia.org/wiki/Andrew_Mellon#:~:text=In%20his%20memoirs%2C%20Hoover%20wrote,wrecks%20from%20less%20competent%20people.%22. 8. The employment target for public policy started with the Employment Act of 1946 and was formalized for the Fed with the Humphrey-Hawkins Full Employment Act of 1978. 9. Jerome Powell, “New Economic Challenges and the Fed’s Monetary Policy Review,” Federal Reserve, August 27, 2020, https://www.federalreserve.gov/newsevents/speech/powell20200827a.htm. 10. “What Is Forward Guidance and How Is It Used in the Federal Reserve’s Monetary Policy?” Federal Reserve. https://www.federalreserve.gov/faqs/what-is-forward-guidance-how-is-it-used-in-the-federal-reserve-monetary-policy.htm. 11.

British Rail
by Christian Wolmar
Published 9 Jun 2022

Following a two-year investigation, the report confirmed that railway workers had fallen behind their peers in other industries, and the government consequently allowed BR to offer increases of 8–10 per cent across the board in order to restore pay parity for the railworkers. The context is that this was a period of full employment and labour shortages which were being only partly alleviated through immigration, and therefore the government was ready to accede to demands for higher pay to prevent too many railway workers leaving the industry. Beeching, perhaps surprisingly, allowed for rather generous settlements, too, but only in return for a clear commitment to increased productivity and a cutback on staffing levels.

Sickening: How Big Pharma Broke American Health Care and How We Can Repair It
by John Abramson
Published 15 Dec 2022

AFTER WORLD WAR II: THE (ALMOST) GOLDEN ERA OF AMERICAN CAPITALISM The American economy grew rapidly in the first three and a half decades after World War II, and that growth was shared with working- and middle-class Americans. FDR’s New Deal brought Social Security, unemployment insurance, unions and collective bargaining, minimum-wage laws, and the Home Owners’ Loan Corporation (to prevent Depression-era home foreclosures). Industrialization for the war effort and public investment in infrastructure led to full employment and economic growth. Corporations addressed the needs of a broad range of stakeholders — consumers, employees, the community, and the nation in addition to shareholders. Corporate and Wall Street power was counterbalanced by labor unions, farm cooperatives, fair-trade laws allowing small retailers to compete with large chain stores, and government regulation of financial markets and banks to protect small investors.

The End of Growth: Adapting to Our New Economic Reality
by Richard Heinberg
Published 1 Jun 2011

The goal of a steady-state economy is now being actively promoted by the Center for the Advancement of a Steady State Economy (CASSE), headquartered in Arlington, VA, with chapters elsewhere in the country.42 The president of the organization, Brian Czech, is author of Shoveling Fuel for a Runaway Train (2000).43 In his 2007 book Managing Without Growth, Canadian economist Peter Victor presents a model of the Canadian economy that shows “it is possible to develop scenarios over a 30 year time horizon for Canada in which full employment prevails, poverty is essentially eliminated, people enjoy more leisure, greenhouse gas emissions are drastically reduced, and the level of government indebtedness declines, all in the context of low and ultimately no economic growth.”44 Some critics of the steady-state economy concept have assumed that keeping consumption constant would require harsh government controls.

Fault Lines: How Hidden Fractures Still Threaten the World Economy
by Raghuram Rajan
Published 24 May 2010

The prevailing orthodoxy suggested that Fed policy makers should worry only if inflation was getting out of hand. And it was not: inflation in the prices of goods (like cars and milk) and services (like haircuts and laundry) was quiescent, and indeed, if anything, the Fed feared deflation. So the Fed was free to focus on the second part of its mandate, full employment. Yet even while the Fed attempted to convince unwilling corporations to invest through ultralow interest rates, the prices of financial assets and housing were skyrocketing. But the orthodoxy suggested asset prices could be ignored. Rising Asset Prices Rapidly rising asset prices should have sounded alarm bells.

The Cheating Culture: Why More Americans Are Doing Wrong to Get Ahead
by David Callahan
Published 1 Jan 2004

Krueger, Myth and Measurement: The New Economics of the Minimum Wage (Princeton: Princeton University Press, 1995). On the impact and workings of the EITC, see Bruce D. Meyer and Douglas Holtz-Eakin, eds., Making Work Pay: The Earned Income Tax Credit and Its Impact on Working Families (New York: The Russell Sage Foundation, 2001.) [back] 3. Jared Bernstein and Dean Baker, The Benefits of Full Employment: When Markets Work for People (Washington, D.C.: Economic Policy Institute, 2003). For more on the link between growth and equity, see Barry Bluestone and Bennett Harrison, Growing Prosperity: The Battle for Growth with Equity in the 21st Century (Boston: Houghton Mifflin, 2000). [back] 4.

The Culture of Narcissism: American Life in an Age of Diminishing Expectations
by Christopher Lasch
Published 1 Jan 1978

They have become doubly objectionable and for reasons the force of which , even enemies of the establishment must acknowledge, in the wake of the Ocean Hill-Brownsville battle of the late sixties when community control degenerated into reverse racism and educa, " " tion into racial propaganda Yet the alternative to community control is more bureaucracy Instead of confronting the choice liberal reformers try to have things both ways. While advocating . . , Paternalism Without Father : 229 228 : The Culture of Narcissism an expansion of government services to the family, a federal guarantee of full employment, improved protection of children s legal rights, and a vastly expanded program of health care, they propose ' to strengthen parent participation in all these programs. They " " treat the ascendancy of experts as an unavoidable condition of industrial society, even when they seek to qualify this ascendancy by improving the position of consumers.

Good Times, Bad Times: The Welfare Myth of Them and Us
by John Hills
Published 6 Nov 2014

DH (Department of Health) (2013) Caring for our future: Consultation on reforming what and how people pay for their care and support, London: DH. Disney, R., Emmerson, C. and Tetlow, G. (2009) ‘What is a public sector pension worth?’, Economic Journal, vol 119, no 541, F517–F535. Dorling, D. (2014) All that is solid: The great housing disaster, London: Allen Lane. DWP (Department for Work and Pensions) (2007) Ready for work: Full employment in our generation, Cm 7290, London: The Stationery Office. DWP (2012) Annual abstract of statistics 2012, London: DWP. DWP (2013a) Benefit expenditure and caseload tables, 2013, London: DWP. DWP (2013b) Duration on working-age benefits, Great Britain, April 2013, London: DWP. DWP (2013c) The single tier pension: A simple foundation for saving, Cm 8528, London: The Stationery Office.

Hit Makers: The Science of Popularity in an Age of Distraction
by Derek Thompson
Published 7 Feb 2017

The postwar economic boom A serious commercial interest in teenagers didn’t begin in earnest until after World War II. To entice marketers, teenagers needed money, and that money would come from two principal sources: the labor force and parents. The 1950s saw one of the great periods of economic expansion in American history. With full employment came rising wages for unionized adults and older teenage workers. Meanwhile, parents gradually had fewer children and spent more per child, as befits any scarce and valuable investment. Birthrates declined across the advanced world in the second half of the twentieth century due to both the rise of female education and the legalization of the pill.

In FED We Trust: Ben Bernanke's War on the Great Panic
by David Wessel
Published 3 Aug 2009

Taylor believed that government economic policy worked best when the people who made policies publicly described the rules that governed their decision making. He was famous among central bankers around the world for “the Taylor rule,” a simple formula for setting interest rates that depended on where inflation was versus the Fed’s goal for it, how far from full employment the economy was, and what the short-term interest rate should be when the economy was perking along. Taylor had been among George H. W. Bush’s economic advisers, and nearly made it to the Fed board then until internal political squabbles thwarted him. In 2005, he had been among the unsuccessful contenders to succeed Greenspan, for whom he had once worked when Greenspan was a private consultant.

Phishing for Phools: The Economics of Manipulation and Deception
by George A. Akerlof , Robert J. Shiller and Stanley B Resor Professor Of Economics Robert J Shiller
Published 21 Sep 2015

Coupled with Medicare, and 80 percent homeownership by the age of 60,12 older Americans can afford an occasional present to the grandchildren. Nor does this relief of the problem of low savings come intrusively through the front door of telling people what to spend. Government has been a great help. (We remark, further, that other government commitments relieve more immediate problems of low saving. Macroeconomic policies of full employment mean that most of those spells of unemployment will be short; unemployment insurance makes it easier to be looking for a job; and disability insurance makes it easier for those who cannot take one.) Given the dependence of the vast majority of the population on Social Security, it is surprising that any politician would tamper with it.

Money: The Unauthorized Biography
by Felix Martin
Published 5 Jun 2013

John Maynard Keynes began the final chapter of the most important work of economics of the twentieth century with a realistic diagnosis of the situation seven years into the Great Depression. “The outstanding faults of the economic society in which we live,” he wrote, “are its failure to provide for full employment and its arbitrary and inequitable distribution of wealth and incomes.”32 Today, five years into another monumental economic calamity, it is the same outstanding faults of unemployment and an unjust distribution of economic risks that plague us. Money and banking, incorrectly understood, and so incorrectly configured, are what brought us here.

How to Run a Government: So That Citizens Benefit and Taxpayers Don't Go Crazy
by Michael Barber
Published 12 Mar 2015

As a successful former journalist, he wrote with clarity and punch. Most of Britain could see what he saw: the nationalized industries had not delivered what they had promised. They had been intended to improve industrial relations but by the 1970s and 80s were often strike-ridden. They were meant to contribute to full employment, but in practice had resulted in state-subsidized overstaffing. They were supposed to improve productivity, but on that measure Britain was falling behind other countries. With their failure to perform, the case for them had unravelled. The boards that oversaw them, and their chairmen, did not leap from this analysis to privatization.

Human Compatible: Artificial Intelligence and the Problem of Control
by Stuart Russell
Published 7 Oct 2019

He described the high unemployment afflicting Great Britain in 1930 as a “temporary phase of maladjustment” caused by an “increase of technical efficiency” that took place “faster than we can deal with the problem of labour absorption.” He did not, however, imagine that in the long run—after a century of further technological advances—there would be a return to full employment: Thus for the first time since his creation man will be faced with his real, his permanent problem—how to use his freedom from pressing economic cares, how to occupy the leisure, which science and compound interest will have won for him, to live wisely and agreeably and well. Such a future requires a radical change in our economic system, because, in many countries, those who do not work face poverty or destitution.

The Einstein of Money: The Life and Timeless Financial Wisdom of Benjamin Graham
by Joe Carlen
Published 14 Apr 2012

These are some of the reasons why it is somewhat surprising that, of the two economists, it was Hayek, of the less interventionist Austrian school, who gave Graham “strong support of the plan in its international application.”70 In fact, Hayek wrote a full-length article endorsing the plan titled “A Commodity Reserve Currency,”71 which was published in the June–September 1943 issue of the Economic Journal. As for Keynes, his support was more equivocal, as he considered rising prices to be more conducive to full employment than Graham's objective of price stabilization. Nonetheless, he did recognize the merit of other aspects of Graham's plans. As Keynes wrote in a personal letter to Graham, “On the use of buffer stocks as a means of stabilizing short-term commodity prices, you and I are ardent crusaders on the same side.”72 According to Kahn and Milne, “Ben exchanged a number of letters with John Maynard Keynes on this and other economic topics.”73 Whatever one's opinion of his plan may be, it is a testament to his extraordinary intellect and writing skills that Graham, with no formal economic training, could conceive, develop, and present his plan in such a way as to elicit considered (and, on balance, positive) responses from two of the greatest economists of the era (and, indeed, of modern history).

The Divide: A Brief Guide to Global Inequality and Its Solutions
by Jason Hickel
Published 3 May 2017

Massive government spending had what Keynes called a ‘multiplier effect’: by transforming government money into workers’ wages, workers gain consumer power that creates new opportunities for private businesses that spring up where the cash is plentiful, like trees around an oasis. When the Second World War gained pace it proved the point: government spending on factory production for the war effort had the same effect, boosting employment (the US reached full employment during the war), increasing wages and stimulating demand.6 Economic growth soared and – with higher wages for the poor and higher taxes on the rich – inequality was dramatically reduced. Those were heady days. The edifices of laissez-faire capitalism were collapsing all around, and Keynes and his followers were emboldened to argue for a whole new approach to economics.

Capitalism, Alone: The Future of the System That Rules the World
by Branko Milanovic
Published 23 Sep 2019

A more contemporary example of a tacit contract, currently in the danger of unraveling, is found in the Nordic countries, where wage compression was combined with a high share of capital in net income—but with an understanding that profits would be reinvested to maintain high aggregate demand and full employment (Moene 2016). 10. Harriet Sherwood, “ ‘Christianity as Default Is Gone’: The Rise of a Non-Christian Europe,” Guardian, March 21, 2018. 11. An exception may be the recent attempts by the Catholic Church under Pope Francis to reinforce ethical considerations in business life. See, for example, Hannah Brockhaus, “Pope Francis: The Church Cannot Be Silent about Economic Suffering,” April 12, 2018, Crux, https://cruxnow.com/vatican/2018/04/12/pope-francis-the-church-cannot-be-silent-about-economic-suffering/. 12.

The Fiume Crisis
by Dominique Kirchner Reill
Published 1 Dec 2020

Report of skirmish between soldiers and civilians over disrespect to Italian flags and uniforms, March 26, 1920, cass. 196 / 4, Atti 498, AFV. 51. Lina Dolezal also went by the names Nina and Dina. 52. Consiglio nazionale italiano, Fiume state policy for ­those unemployed ­after the war who could prove full employment in 1914, March 3, 1919, 3, predmet 1, str. 16–18, HR-­DARI. For another way to understand what three hundred crowns was worth, figures in February 1920 on maximum prices for goods indicate that that amount could get you ten pairs of “luxury leather shoes,” six “luxury silk shirts for ­women,” or “12 large ­bottles of olive oil.”

Madoff Talks: Uncovering the Untold Story Behind the Most Notorious Ponzi Scheme in History
by Jim Campbell
Published 26 Apr 2021

Lot of internal fighting. My guess would be over fee allocation, who got credit for what. Law firms always end up fighting over that stuff.”26 Picard’s right-hand partner, David Sheehan, was the hands-on senior manager. Picard, though, got the lion’s share of media attention and victims’ vitriol. It was a lawyers’ full employment case, 12 years running, with a percentage take on every dollar brought in, a veritable fee extravaganza. The Trustee and his law firm had taken in $1.2 billion as of October 2020. External consultants, such as the forensic firms brought in, have billed $455 million. Duff & Phelps fraud investigation team, led by Dubinsky’s brilliant work, have been on the case since the beginning, billing $45 to $47 million.

Woke, Inc: Inside Corporate America's Social Justice Scam
by Vivek Ramaswamy
Published 16 Aug 2021

Democratically elected officeholders and other public leaders, not CEOs and portfolio managers, should lead the debate about what values define America. Business leaders are supposed to decide how much to spend on a manufacturing plant or whether to invest in one piece of technology or another—not whether a minimum wage is more important for society than full employment or whether reducing America’s carbon footprint is more important than the geopolitical consequences of doing so. CEOs are no better suited to make these decisions than an average politician is to, say, make the R&D decisions of a pharma company. To be clear, that doesn’t mean that citizens, including CEOs, should refrain from speaking up strictly in their personal capacities.

Break Through: Why We Can't Leave Saving the Planet to Environmentalists
by Michael Shellenberger and Ted Nordhaus
Published 10 Mar 2009

The only opinion research Friedman cites to substantiate his claim about more liberal attitudes toward the less fortunate is in regard to immigration. But the survey questions Friedman cites are entirely related to attitudes about the connection between immigrants and the economy—not about immigrants themselves. This difference is crucial. In an economy approaching full employment, as it was in the late 1990s, the vast majority of Americans no longer found the argument that immigrants were stealing American jobs particularly persuasive. Our research suggests a more complicated picture: xenophobia has been rising, not declining, since 1992, perhaps the result of increasing status insecurity rather than increasing job insecurity.

Making It in America: The Almost Impossible Quest to Manufacture in the U.S.A. (And How It Got That Way)
by Rachel Slade
Published 9 Jan 2024

He wanted his people to benefit from their rapidly industrializing economy. Shortly after taking office, Allende nationalized major industries, including copper mining, and used the funds to finance infrastructure, education, and health care. He set a minimum wage, expanded public works programs toward the goal of full employment, and bolstered the voice of labor. In the context of the Cold War, Allende’s agenda sounded like dreaded socialism. In Chile, U.S.-owned Anaconda, then the largest mining company in the world, owned the Chile Copper Company, which owned the most productive mine in the world. If Allende returned ownership of the mine to the people of Chile, Anaconda would lose a fortune.

A Walk in the Woods: Rediscovering America on the Appalachian Trail
by Bill Bryson
Published 8 Sep 2010

“Are you saying, Dave, that I pay $250 for a pack and it doesn’t have straps and it isn’t waterproof?” He nodded. “Does it have a bottom in it?” Mengle smiled uneasily. It was not in his nature to grow critical or weary in the rich, promising world of camping equipment. “The straps come in a choice of six colors,” he offered helpfully. I ended up with enough equipment to bring full employment to a vale of sherpas—a three-season tent, self-inflating sleeping pad, nested pots and pans, collapsible eating utensils, plastic dish and cup, complicated pump-action water purifier, stuff sacks in a rainbow of colors, seam sealer, patching kit, sleeping bag, bungee cords, water bottles, waterproof poncho, waterproof matches, pack cover, a rather nifty compass/thermometer keyring, a little collapsible stove that looked frankly like trouble, gas bottle and spare gas bottle, a hands-free flashlight that you wore on your head like a miner’s lamp (this I liked very much), a big knife for killing bears and hillbillies, insulated long johns and undershirts, four bandannas, and lots of other stuff, for some of which I had to go back again and ask what it was for exactly.

Immigration worldwide: policies, practices, and trends
by Uma Anand Segal , Doreen Elliott and Nazneen S. Mayadas
Published 19 Jan 2010

Ward and Masgoret (2008) found that New Zealanders have generally positive attitudes toward immigrants and a multicultural society, but also note that there are marked differences between Maori and others, with the former having less positive attitudes toward immigration because they are more likely to see immigrants as a source of threat or competition. Level of Immigrant Adjustment Due to the relative homogeneity of the migrant inflow up to the 1980s and conformity of immigrants to the dominant culture there had been little concern for immigrant adjustment in policy circles. New Zealand was blessed in any case with full employment until the energy crises of the 1970s and unemployment among immigrants was not considered to be an issue. Pacific Island migrants—like Maori who migrated in 266 Nations with Increasing Immigrant Populations large numbers from their rural tribal lands–readily found jobs in the large cities.

…

In turn, this new immigration has generated an increase of ‘‘tied movers’’ (relatives to earlier immigrants). In the year 2005, the foreign born part of the Swedish population numbered over one million, which amounts to 12.4 percent of the total population. One of the central goals of the socialeconomic and citizenship policies of the welfare system in Sweden has been to ensure full employment for all Swedish residents, immigrants included, and to increase the political participation of immigrants, citizens as well as noncitizens. Linked to the equality aims of the Sweden integration policies of the Swedish governments since the mid-1970s, it is interesting to study the participation and possible nonparticipation of immigrants, and especially refugees, in the Swedish arenas of the labor market and democracy.

The Ragged Trousered Philanthropists
by Robert Tressell
Published 31 Dec 1913

In a seat at the back of the hall knelt a pale-faced, weary-looking little woman about thirty-six years of age, very shabbily dressed, who had come in during the singing. This was Mrs White, the caretaker, Bert White’s mother. When her husband died, the com- mittee of the Chapel, out of charity, gave her this work, for which they paid her six shillings a week. Of course, they could not offer her full employment; the idea was that she could get other work as well, charing and things of that kind, and do the Chapel work in between. There wasn’t much to do: just the heating furnace to light when necessary; the Chapel, committee rooms, classrooms and Sunday School to sweep and scrub out occasionally; the hymn-books to collect, etc.

…

Tariff Reform Paradise: tariff reform (imposition of tariffs on foreign goods) was supported by a sector of the Tory party in the face of foreign Explanatory Notes protectionist measures aimed at countering Britain’s historical trade and industrial advantages. In 1903 Joseph Chamberlain (1836–1914) famously advocated the policy in a speech in Glasgow; however, the policy was defeated in the Liberal landslide election of 1906. Tariff reform supporters contended that the policy would establish an imperial trading bloc and bring full employment. 7 Plenty of Work: Ball identifies the term as a ‘Tory ideal’: Tressell of Mugsborough (1951), 92. Tressell mocks the idea, as Blatchford also had in Merrie England: ‘what the people want is food and clothing and shelter and leisure, not work. Work is a means, and not an end. Men work to live, they do not live to work’ (p. 90). 8 condensed milk tins: condensed and evaporated milk were used because they kept better and posed less risk than fresh milk.

Presidents of War
by Michael Beschloss
Published 8 Oct 2018

Theodore Roosevelt charged that Wilson’s “spiritual forebears” were the Tories of 1776 and the Copperheads of 1864: they too had “demanded peace without victory.” The President confessed to his New York financial backer Cleveland Dodge that after the frustration of his plea to the Senate, he was feeling “a little low.” Wilson did not know that in early January 1917, the Kaiser had secretly approved “full employment” of German submarines against “all sea traffic” in the neighborhood of the European war zone. Wilhelm told his Army and Navy chiefs that the action would probably provoke the United States to enter the war on Britain’s side, but he hoped that the brutal show of force would resolve the long stalemate in Germany’s favor.

…

“We are drawing nearer”: PWW, vol. 40, p. 307. “Not too many ideas”: PWW, vol. 33, p. 397. “Peace without victory”: Wilson speech, Jan. 22, 1917. “Make Don Quixote”: John Cooper, Breaking, p. 22. “Spiritual forebears”: New York Herald, Jan. 29, 1917. “A little low”: Wilson to Cleveland Dodge, Jan. 25, 1917, WWP. “Full employment”: John Cooper, Wilson, 373. New policy: Greenhalgh, p. 221; Sondhaus, Submarine, p. 95. Wilson talks with Lansing and House: PWW, vol. 41, pp. 121, 87. “Sad and depressed”: Striner, Wilson, p. 99. “Time for patience”: PWW, vol. 41, p. 99. Wilson policy, Feb. 1917: Link, vol. 5, pp. 290–301; Berg, pp. 423–426; John Cooper, Wilson, pp. 362–380.

This Is Only a Test: How Washington D.C. Prepared for Nuclear War
by David F. Krugler
Published 2 Jan 2006

In September, he successfully urged Congress to authorize the first peacetime draft in American history, and defense spending rose dramatically. National readiness had profound, yet mixed, effects on Washington’s economy and racially divided population. The military build-up and the federal government’s expanding tasks swiftly cut into the city’s unemployment rate. In February 1941, a family services agency reported full employment for all semiskilled workers. The federal government established job-training programs, though most perpetuated entrenched racial divisions. At two Washington high schools, night classes for young black men taught metal work and carpentry; separate classes trained whites. Black women hired as typists and stenographers often worked in segregated pools within federal offices.

Age of Discovery: Navigating the Risks and Rewards of Our New Renaissance
by Ian Goldin and Chris Kutarna
Published 23 May 2016

In the US, too, the top 1 percent hold more than one-third of all wealth.72 Legislatures have enormous power to transfer wealth up or down the social ladder: by expanding or shrinking welfare programs; by shifting the tax burden between rich and poor, between investors and wage earners, or between corporations and private citizens; through the pricing and sale of state assets and public goods like railroads, postal systems, oil patches and wireless spectrum; by deregulating or re-regulating industries; by making it harder or easier for persons or corporations to clear their debts through bankruptcy; by deciding whether monetary policy should target low inflation or full employment. For their 2012 elections, US presidential and congressional candidates raised and spent a record $7 billion.73 The final tally for the 2016 election cycle may double that.74 Clearly, on assuming power, successful candidates (and their staffers) owe a lot to the lobbyists and other financial backers who paid for their campaigns.

Nomad Citizenship: Free-Market Communism and the Slow-Motion General Strike
by Eugene W. Holland
Published 1 Jan 2009

A guaranteed income for all, furthermore, would partially counteract destitution-dependency by dramatically reduc­ ing capital’s ability to use labor market competition to suppress wages and thereby vastly increase the prospects for workers’ self-valorization. (Fredric Jameson’s “utopian” demand for full employment would promise similar benefits.31) But these demands do nothing to challenge the wage relation itself. Workers—and indeed everyone, if there were a guaranteed income—would still be dependent on capital for the means of life pur­ chased with that social wage or guaranteed income and would still con­ tribute to the realization and private appropriation of surplus value.

When Work Disappears: The World of the New Urban Poor
by William Julius Wilson
Published 1 Jan 1996

Hannan. 1984. “An Analysis of Time on Welfare.” Contract no. HHS-100–83–0048. Washington, D.C.: Urban Institute Press. Orfield, Gary, and Carole Ashkinaze. 1991. The Closing Door: Policy and Black Opportunity. Chicago: University of Chicago Press. Osterman, Paul. 1990. “Welfare Participation in a Full Employment Economy: The Impact of Family Structure and Neighborhood.” Unpublished manuscript, Massachusetts Institute of Technology. Park, Robert E., and Ernest W. Burgess. 1925. The City. Chicago: University of Chicago Press. Parrott, Sharon. 1995. “An Analysis of the Personal Responsibility Act (H.R. 1214).”

How I Found Freedom in an Unfree World: A Handbook for Personal Liberty
by Harry Browne
Published 1 Jan 1973

Back in 1964, the government started promising an "early end" to the Vietnam War, but the promises and realities were far, far apart. At home, look at the many housing projects that were going to do away with slums. Where can a government point to a slum-free big city as proof of its effectiveness? Remember the War on Poverty? The Alliance for Progress? The Full Employment Act of 1946? Grand dreams, lots of money spent, no success. Governments have a consistent record of failure in their endeavors. Even if you're willing to force others to pay for what you want, no government is going to solve the ecology problems, make women professional equals, prevent monopolies, or fulfill any other objective you may have in mind.

Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist
by Kate Raworth
Published 22 Mar 2017

In an expanding economy workers laid off by one business can hope to find jobs elsewhere, but when economy-wide demand does not keep up with productivity growth the result is widespread unemployment. As history has repeatedly demonstrated, that can quickly lead to xenophobia, intolerance and fascism. It was the Great Depression’s endless unemployment lines that convinced John Maynard Keynes to focus on full employment as the economy’s goal in the 1930s, and the answer, he believed, was continual GDP growth. A century on from the Model T revolution, however, robots have taken over much more than car production. It is simply no longer feasible to expect GDP growth rates to keep pace with the anticipated scale of lay-offs due to automation, which only reinforces the case for introducing a basic income for all.

Alistair Cooke's America
by Alistair Cooke
Published 1 Oct 2008

He needs to be fought all the time, for he has an enormous appreciation of himself and of any idea which he happens to approve, but if the country doesn’t go absolutely broke in his time, it will be a more intelligent and a better country after him. Yet Roosevelt came in on a promise to do something that has balked governments of every ideological brand before and since – to guarantee full employment in peacetime. He didn’t make it. In 1938 there were still ten million unemployed. In the next four years the number did indeed shrink – it went out of sight – but this was not Roosevelt’s doing but Hitler’s. Because the stacks of the steel mills barely began to belch smoke again until the first war orders came in from the British and the French. 11 The Arsenal On the day that the Second World War began, George Bernard Shaw wrote: ‘There will be only two winners: the United States and the Soviet Union.’

The Age of Entitlement: America Since the Sixties
by Christopher Caldwell
Published 21 Jan 2020

With extraordinary social sensitivity, Rajan linked the financial crisis to the gradual rise of American inequality. Since 1992, the U.S. economy had recovered slowly from recessions. All its recoveries were “jobless recoveries”; after the 2001 recession, it took 38 months for the economy to return to full employment. And, Rajan warned, “the United States is singularly unprepared for jobless recoveries.” It has no big transfer programs. Under such circumstances, any recession with the slightest perceptible effect on the public will end political careers by the score. The result was reckless government extension of credit under both Democratic and Republican leadership.

The Code of Capital: How the Law Creates Wealth and Inequality
by Katharina Pistor
Published 27 May 2019

Recent data suggest an upward trend in pensioners filing for personal bankruptcy in the United States, which has been attributed to the costs of health care. See Tara Siegel Bernard, “Too Little, Too Late: Bankruptcy Booms among Older Americans,” New York Times, August 5, 2018, available online at www.nytimes.com (last accessed August 8, 2018). 72. Some central banks, the Fed among them, operate under the dual mandate of price stability and full employment. See Sec. 2.a. of the Federal Reserve Act, available online at https://www.federalreserve.gov/aboutthefed/section2a.htm. 73. For a useful overview of the scope of regulatory reforms in the United States, see Viral V. Acharya et al., Regulating Wall Street: The Dodd-Frank Act and the New Architecture of Global Finance (Hoboken, NJ: Wiley, 2011).

Moneyland: Why Thieves and Crooks Now Rule the World and How to Take It Back
by Oliver Bullough
Published 5 Sep 2018

At Bretton Woods, the Allies – desperate to avoid a repeat of the horrors of the inter-war depression and the Second World War – decided that, when it came to international trade, society’s rights trumped those of money-owners. This was just one element of a whole series of measures created in the 1930s and 1940s to provide full employment and better services in the interests of stability and prosperity. The New Deal legislation in the United States severely limited the rights of banks to speculate, while the Welfare State in Great Britain provided universal healthcare and free education. The innovations were remarkably successful: economic growth in most Western countries was almost uninterrupted throughout the 1950s and 1960s, with massive improvements in public health and infrastructure.

Treasure Islands: Uncovering the Damage of Offshore Banking and Tax Havens
by Nicholas Shaxson
Published 11 Apr 2011

Keynes’s answer was simple and powerful: control and constrain the flows of capital across borders and limit the trade in currencies through exchange controls. He believed that financing was usually best when it happens inside, rather than between, countries. Capital controls would give governments more room to pursue objectives like maintaining full employment: Instead of limiting the scope of democracy in the interests of speculators and financiers, the plan was to limit the international mobility of capital: Finance would be society’s servant, not its master. “Let goods be homespun whenever it is reasonably and conveniently possible,” he wrote. “Above all, let finance be primarily national.”

Philanthrocapitalism
by Matthew Bishop , Michael Green and Bill Clinton
Published 29 Sep 2008

It was Wilson who famously observed that what was good for General Motors was good for America, and vice versa. These corporate statesmen testified frequently before Congress on all sorts of social issues. Much of this activity was coordinated by the Committee for Economic Development, a business-led organization with a broad, progressive social agenda. It campaigned, among other things, for the Full Employment Act and for the Marshall Plan that directed millions of American dollars to revive foreign economies devastated by the Second World War. At the same moment that this old social contract was being torn up, not least by globalization and the intensification of competition that came with it, from the 1970s on, corporate leaders were challenged by new demands from consumers and citizens who felt that businesses had a broader social responsibility beyond treating their workers well.

Faster, Higher, Farther: How One of the World's Largest Automakers Committed a Massive and Stunning Fraud
by Jack Ewing
Published 22 May 2017

Remaking the assembly lines and products played to Piëch’s strengths. But he also had to deal with Volkswagen’s German workforce, a task that required a degree of political savvy and finesse—not his obvious strong point. Even Carl Hahn, much more of a diplomat and compromiser, had struggled to control organized labor’s tendency to view Volkswagen as a full-employment scheme and to demand higher pay while pushing for shorter working hours. By the late 1980s, a typical Volkswagen worker earned monthly base pay of about 4,100 deutsche marks, or $2,630, for a thirty-six-hour workweek. Even after instituting a hiring freeze and pushing some workers into early retirement, the company had thirty thousand more people than it needed, according to the company’s own estimates.

The Plague Year: America in the Time of Covid
by Lawrence Wright
Published 7 Jun 2021

Keynes, the avatar of liberal economists, had been puzzled by the persistence of the Great Depression. Classic economic theory held that savings and investment were like a seesaw; too much saving caused too little investment, and vice versa. But as long as government didn’t meddle, markets would naturally settle into balance and trend toward full employment. “When Keynes saw how long the depression was lasting in the early 1930s, he came to the conclusion that the image of a seesaw wasn’t quite right,” Hubbard said. “It could be more like an elevator that could stall on any floor.” In that case an outside force—government stimulus—was required to get the elevator back into service.

Anatomy of the Bear: Lessons From Wall Street's Four Great Bottoms
by Russell Napier
Published 18 Jan 2016

Eminent authorities believe that our economic system is now ‘replete with built-in inflationary bias,’ especially in periods of war or international tension accompanied by heavy expenditures for defense. They point to the tax structure, escalator wage clauses, parity prices, budget deficits, government borrowing from commercial banks, low rates of interest, cost-plus contracts, subsidies and the like. Some point to Keynesian economics, emphasis on full employment, the public welfare state, disinclination to return to the gold standard. [62] So there were those who foresaw that the postwar deflation would be muted. These investors presumably were increasing their exposure to cheap equities throughout the 1946-49 bear market. It did indeed turn out to be different this time.

Luxury Fever: Why Money Fails to Satisfy in an Era of Excess
by Robert H. Frank
Published 15 Jan 1999

“Who They Are: The Upper Tail,” New York Times Magazine, November 19, 1995: 70, 71. Hagan, John. “Crime, Inequality, and Inefficiency,” in Paying for Inequality: The Economic Cost of Social Injustice, ed. Andrew Glyn and David Miliband, London: Rivers Oram, 1994. Hall, Robert E. “Why Is the Unemployment Rate So High at Full Employment?” Brookings Papers on Economic Activity, no. 3, 1970: 369-402. Hall, Robert E., and Alvin Rabushka. The Flat Tax, 2nd ed., Stanford, CA: Hoover Institution, 1995. Hamilton, W. D., and M. Zook. “Heritable True Fitness and Bright Birds: A Role for Parasites?” Science 218, 1982: 384-87. Hardin, Garrett.

Hacking Capitalism
by Söderberg, Johan; Söderberg, Johan;

In fact, the spontaneous, laissez-faire market depends heavily on state planning and an authoritarian form of Keynesianism. The changes that have taken place in the involvement of the state in the economy are described by Bob Jessop by contrasting the ‘Keynesian Welfare National State’ of yesterday with the ‘Schumpeterian Competition State’ of today. The Keynesian state addressed overproduction. It ensured full employment and sought political stability at the national level. The Schumpeterian state, in contrast, is geared towards fostering innovation and advancing the national economy in fierce international competition. Market success in knowledge-intensive sectors is decided by extra-economical factors, such as collective learning processes, institutional knowledge, and socio-cultural practices.

The Unclaimed: Abandonment and Hope in the City of Angels
by Pamela Prickett and Stefan Timmermans
Published 11 Mar 2024