Among economists and central bankers, the traditional narrative views unemployment as either a personal choice or a structural requirement or adjustment. Monetarist economist Milton Friedman identified the buffer stock of unemployed workers as necessary to keep wages and prices stable. Formally dubbing it the Non-Accelerating Inflation Rate of Unemployment(NAIRU) and incredibly referred to as the “Natural Rate”. Among policy makers the preference between these two competing interests, unemployment and inflation, has elevated inflationary concerns over those of full employment. While stable, positive inflation is required in order to support sustained growth, employment receives mostly only rhetorical consideration.
At Functional Finance, we believe policies to promote full employment should be the primary objective of our democratic institutions and measure of success for economic management. Recognizing the failure of schemes to provide a basic income, we believe solutions to promote full employment in support of public goods are a necessary development and social obligation.
“No country, however rich, can afford the waste of its human resources. Demoralization caused by vast unemployment is our greatest extravagance. Morally, it is the greatest menace to our social order.”
-Franklin Delano Roosevelt
The estimated costs of the unemployed($9000 a year) do not include the opportunity costs of additional public goods such as clean streets, support for education and public infrastructure the fruits of which are long lasting. Similarly, the negative social impact associated with unemployment increased crime and prison sentences, suicide rates and poor health. While nurturing skills, breaking the cycle of dependency and preparing individuals for jobs in the private sector are just a few of the benefits of policies to promote full employment.
Your financial support will sustain employment research and promote a broad range of policies from work share schemes and tertiary training to job guarantee programs to finally break the cycle of unemployment.
At Functional Finance, we believe policies to promote full employment should be the primary objective of our democratic institutions and measure of success for economic management. Recognizing the failure of schemes to provide a basic income, we believe solutions to promote full employment in support of public goods are a necessary development and social obligation.
“No country, however rich, can afford the waste of its human resources. Demoralization caused by vast unemployment is our greatest extravagance. Morally, it is the greatest menace to our social order.”
-Franklin Delano Roosevelt
The estimated costs of the unemployed($9000 a year) do not include the opportunity costs of additional public goods such as clean streets, support for education and public infrastructure the fruits of which are long lasting. Similarly, the negative social impact associated with unemployment increased crime and prison sentences, suicide rates and poor health. While nurturing skills, breaking the cycle of dependency and preparing individuals for jobs in the private sector are just a few of the benefits of policies to promote full employment.
Your financial support will sustain employment research and promote a broad range of policies from work share schemes and tertiary training to job guarantee programs to finally break the cycle of unemployment.