These two paragraphs in particular stuck out to me:
> Critics of labor-market programs such as the Job Guarantee argue that they enable precisely this sort of choice—they make it easier to decline work that one doesn’t like. One program participant in his thirties told me that, while on unemployment benefits, he’d been offered a job cleaning toilets at a gas station; he’d decided that he didn’t want “that sort of job,” and had instead found work in the carpentry workshop. If everyone were guaranteed a reasonably pleasant job, suited to their interests and needs and paying a living wage, who would do the grungy, difficult work? Austrian employers, like those in America, are currently having difficulty hiring people to take hard, poorly paid jobs; many of the workers in Austria who wash dishes or clean hotel rooms are immigrants from Eastern Europe, and during the pandemic many of them went home, some for good. Jörg Flecker, a sociologist at the University of Vienna who is evaluating the program in Gramatneusiedl, told me that pressure from employers could prevent its expansion across Austria. “Employers say, ‘There are so many unemployed. We have to have a tougher regime for them because we have jobs to fill.’ ”
>
> Lukas Lehner and Maximilian Kasy, economists at Oxford who are evaluating data from Gramatneusiedl, argue that competition with the private sector is a good thing. “I think, from an economic perspective, that argument doesn’t make much sense,” Kasy said, of the dirty-jobs view. “If they’re shit jobs, try to pay them as well as possible. Try to change the working conditions as much as possible until you reach the point that somebody wants to do them, or automate them if you can. And then, if nobody wants to do them, maybe we shouldn’t do them.” Kasy thinks that an important function of initiatives like job guarantees—and of universal basic incomes—is to improve the bargaining positions of people who want to change their lives. “Whether it’s abuse from an employment relationship, a bureaucrat in the welfare state, or a romantic relationship, the question is, What’s your outside option?” he said. “Having the safety of the basic income or a guaranteed job improves your outside option. If your boss is abusive, or doesn’t respect your hours, or is harassing you or whatever, you have the option to say no.”
> Austrian employers, like those in America, are currently having difficulty hiring people to take hard, poorly paid jobs
Sounds like a signal from the market that they are not paying enough. One might argue about how social welfare programs and / or importing cheap labor distort the labor market; but it doesn’t change the fact that jobs are the dregs of the labor market.
It is that signal, but are we ready to pay everyone more, even for low-skill jobs? How much more is everyone willing to pay for groceries? How much more for health care?
For most people here, that won't matter, because paying 50% more for groceries would barely be noticeable, and neither would 50% more for health care be. But for society at large, that would kill many lifestyles.
Exactly, wealth is being concentrated at the top to such extremes that there is no more excess money in the lower/middle classes to tap. So somehow or other the increase in wages will have to come from the wealthy, whether through intentional redistribution, market forces, or peasant uprisings. Likely some combination of all three.
Eventually it just becomes a physics problem. If $100 exist in the world, and one guy has $99, and you need to fund something that takes $2, you have to get $1 out of the rich guy somehow.
Your comment assumes that like energy, money cannot be created or destroyed. Which is false. Anyone can create new money by talking a loan from the bank.
However this point also helps your argument: When you borrow you pay interest to someone richer. In a sense a combination of whoever you sent the money to, and the bank.
My understanding is any loan from a bank creates new money. However not sure about the types of loans that poor people use such as payday loans and pay-in-4 services. Maybe that us too since an investor may use bank borrowed money to fund them?
Or devalue the dollar to the extent that $1 becomes $2. In which case, the person who holds $99 doesn't hold $99 as "raw cash"(nominal asset), but holds $99 worth of real assets. With this inflation or devaluation, his $99 will become $198 + delta. This delta comes as rent extraction from the ordinary people.
It's not only about the person cleaning the toilets, companies often have more than one employee that's paid too little.
Look at nurses for example: you need plenty of them in hospitals and nursing homes, they are (in my opinion) severely underpaid. Raise their wages by 50%. You can make an educated guess how that will influence the price of healthcare or living in a nursing home.
>You can make an educated guess how that will influence the price of healthcare or living in a nursing home.
Based on the $49 charge for 5ml of sugar water to calm our newborn baby down so a nurse could draw his blood, probably not much.
(The nurse failed to draw his blood. After four or five failed attempts over several hours they eventually asked a nurse from the NICU to come over, who got it first try.)
The nurse is probably receiving very little of these $49. It's probably an inflated price charged by the hospital that is usually negotiated down to something reasonable by the health insurance provider. Similar to the discussion I had with my product manager recently: she can't expect that consultant to work according to the 100$ per hour that his company charges, because he is likely receiving a lot less.
That assumes that the employer is willing to lose part of their margin and doesn't charge it back to their customers. Maybe not on the current contract, but future ones.
In some places they may be highly paid. In many, they are not. I know this because of close family who have worked as managers of multiple hospitals and hospice that have extremely uneven pay scales even in a single region. You might even assert that the people with less pay have more/sufficient staffing on hand but you would be wrong. The amount of WTF/hospital in the US never ceases to surprise me.
That may be the case in the US, but not in Germany and Austria. Nurses are paid pretty bad, and, surprise surprise, they're having problems finding people to choose that career.
Yeah there's this huge demand, for which they blame blame the nurses "ungrateful snobs" or get upset that immigrants are hired "taking away our jobs" or...
I'm actually curious in what parts of world anyone would genuinely consider nurses to be "highly paid". The hourly rates for some types of nursing work can be quite decent, but still markedly less than what virtually anyone in IT with similar levels of experience would expect to receive. And it's often sufficiently physically draining that it's not feasible for most to work 40-50 hours a week.
Yes, if you can't painlessly absorb a 50% increase in most peoples' second biggest expense after housing, it's all your fault and you're just being a spoiled child. /s
The word "lifestyle" means more than beer, nice cars, and smoked-salmon-avocado-toast on vacation. It includes peoples' capability to invest in their future. I'm sure you can cite many examples of fools and their money being soon parted, but there are plenty of people doing everything right who are being screwed by inflation as well.
'The market has spoken, but suddenly we'd rather not listen.'
Your argument rests on an unspoken (and perhaps unrealized) premise that profits cannot be allowed to shrink; all costs must be passed to someone else.
Totally, but it's a society-wide conspiracy. You could try a policy proposal asking people to pay 22% instead of 18% of their income for health insurance, and 4% instead of 3% for long-term care insurance, but I doubt that you'll be very successful.
I thought society was supposed to have learned its lesson during the pandemic, that the "low-end" jobs are often the most critical. But it seems that John Q Public has the memory of a goddamned fruit fly.
So what do "we" do to make these jobs more tolerable, perhaps better-rewarded ? Nothing, apparently, because "we" wants the cheapest possibly everything.
If jobs that are tangibly important are still treating workers badly, simply because formal qualifications don't exist or are in oversupply, and then economic pressures push people into these crappy jobs despite poor pay & working conditions, then that's a sign that our oh-so-holy "market" is fundamentally dysfunctional, treating human beings like barely sentient Roombas-with-mops. Rant concludes here.
This will sound like a crazy commie rant to some people, but the trick that the powerful have played on is all is to think there's some natural market condition that is had for us to influence.
Thats not the trick. The trick was and is underplaying the market power these guys have in specific labor segments because market power in labor can be a lot more localized than one would expect in certain situations and stuff like minimum wages give a tacit signal for what all the big employers in, for example, fast food should pay coordinating them like how a cartel would but without the illegal coordination meetings.
Social welfare programs distort in the sense that it turns people who could be contributing to the economy into drags on the economy by becoming unemployed welfare recipients.
This matters because it leads to a generally lower quality of life.
Importation of cheap foreign labor distorts in the sense of reducing the wages of low-skilled native residents.
In general, there’s a scratch for every itch. There’s no dishonor in cleaning toilets, but if you’re aspiring to be a carpenter, it’s not an optimal choice.
The manipulative behavior around hours and time off traps people in jobs and makes them “dirty jobs”.
I have a high fulutin’ tech gig, but I worked on farms and in retail in high school and college. The laws don’t protect workers, and the people who were working in those jobs for a living were beaten down and exploited because the employers could.
>> If everyone were guaranteed a reasonably pleasant job, suited to their interests and needs and paying a living wage, who would do the grungy, difficult work? Austrian employers, like those in America, are currently having difficulty hiring people to take hard, poorly paid jobs; ma....
That the answer. Pay people more to do the jobs nobody wants!
Or if not pleasant, then at least the jobs that people are intrinsically motivated to do.
This is how America treats its teachers. Teachers want to do the job, so skimp on their pay and call it a budgetary victory.
Other countries will choose to value teachers, and pay them well, and generate more competition for positions, and reach a higher general level of qualifications & abilities.
This is the classic answer to the classic question about anarchy:
"who will do the unpleasant, demeaning work?"
"We only think it's unpleasant because we make it unpleasant. We can have clean, well lit factories. We just have to prioritize making that work more pleasant."
Also perhaps the least dignified work should be the highest paid? Unfortunately America has a sort of wealth cult going on that we dignify (and deify) those who are already wealthy.
The unfortunate reality is because these jobs are plentiful and easy to do (NOT saying they aren’t demanding, just that they don’t require advanced training) it incentivizes a race to the bottom in terms of wages - but we should do better as a society in guaranteeing high working standards and wages through regulation instead.
Plentiful and easy to do means nothing in the face of sufficiently low supply of workers. If there isn't a low supply of workers, then why is there a quote given about people turning down work?
If there was an alternative in the form of a guaranteed not-terrible job at minimum wage, wouldn’t that necessarily raise wages (or maybe working conditions) for currently terrible jobs?
Giving people a real choice seems easier than regulating every possible kind of job.
There is a problem right with the motion of "uneconomic". If fixing basic infrastructure or growing food is unprofitable, but building sportscars or yachts is not... that seems to indicate a problem with the economic system of allocation of resources.
If society thinks there are too many sports cars or yachts, then it can increase marginal wealth/income/property/sales taxes. And if society thinks there is insufficient food or infrastructure, then it can pay people to make food and build infrastructure. Either way, if both are competing for the same supply of labor, only the highest bidder will get it.
There are too many sports cars and yachts. We don’t need a single one of them. There are half a million homeless people in the US. The only reason taxes aren’t being raised on those and other luxury goods is because politics isn’t controlled by an algorithm but by a system whose outputs feed back into its inputs: the wealthy are made wealthier through political decisions.
Given the jobs are plentiful, isn't that an incentive to raise the wages? If you actually want somebody at your horrible job, you have to incentivize them to do yours and not somebody else's
Why's there a need to? If it's highly unpleasant and there's a shortage of people willing to do it then surely it's a perfect opportunity for the development of self-cleaning tanks...
As it is most of the truly unpleasant jobs of previous centuries don't exist anymore - if someone had found a way to make gong farming pleasant (look it up!) then flushing toilets and town sewerage systems might never have been invented...
UBI would go a long way towards pulling the very poor up out of the cycle of "I'll take whichever bad choice is least bad right now because I'm desperate."
If you work a minijob, you get welfare (housing, utilities, health insurance, cash) + the first 100€ you earn are yours to keep. On the next ~350€ you'll pay 20% for social insurance and get to keep some of it, the rest is deducted from your benefits, so you'll keep 100% of your welfare + 184€. There's no way you're worse off than on benefits if you're working.
If you work more, your benefits will be reduced until you earn enough to not get any benefits. Roughly 20% of people on benefits work, but make less than benefits, so they get the rest via benefits ("Aufstockung").
So I work, but still get roughly the same as if I didn't work. 200€ per month more doesn't seem to be a great incentive to start working again if it's, let's say, one of the less desirable jobs.
Furthermore, the "Aufstockung" means that effectively the tax payer is footing the bill for companies unwilling to pay a reasonable wage.
15-20% more is some incentive, I agree though, the delta should be larger.
> Furthermore, the "Aufstockung" means that effectively the tax payer is footing the bill for companies unwilling to pay a reasonable wage.
In some cases, yes. But you can also view it as "we need to employ people, but their skills really aren't competitive, so it's better to give them some money from taxes than to give them 100% from taxes".
Re a very complex problem with "nobody should be in such a weak position".
It is only complex if avoiding questions about the value of human dignity, and the inability of laissez faire capitalism to deliver that, need to be avoided.
I think libertarian socialism does exactly that but in this case what's being argued for is JG (and UBI) which would help empower many, so we shouldn't be arguing against those things (not saying you are.)
> who would do the grungy, difficult work? Austrian employers, like those in America, are currently having difficulty hiring people to take hard, poorly paid jobs
> “If they’re shit jobs, try to pay them as well as possible. Try to change the working conditions as much as possible until you reach the point that somebody wants to do them, or automate them if you can. And then, if nobody wants to do them, maybe we shouldn’t do them.”
Seriously, if you can't find people to do those jobs then you're simply not paying them enough. This whole idea of intentionally disadvantaging people in order to force them to do what you want them to do is some comic book super villain thinking.
The criticism has some merit if the carpentry job was subsidized by the government whilst the toilet cleaning was not. Why should the latter be less deserving of a subsidy than the former? Ultimately, established social programs such as the EITC are intended to address this in a comprehensive, neutral way.
I think this would cause a fundamental shift in our society.
Who would want to work minimum wage server jobs when offered the same salary for something more rewarding?
Who wants to do gruelling, poorly paid labouring on a construction site, if the alternative is training to be a craftsman for the same wage?
Those jobs would either need to be paid much more attractively (pushing up the cost of restaurant food and construction, in these examples), or - as quoted above - eliminated entirely.
I would be really interested to see how this would play out at scale.
Restaurant food and construction are in the non-tradables sector, so we can just look at places where these jobs pay more by virtue of location - such as expensive city cores, particularly outside the U.S. Looks like they still have restaurants and construction and they're priced roughly the same as anywhere else, so paying low-skilled labor so much more can't be affecting them all that much.
> where these jobs pay more by virtue of location - such as expensive city cores
The way this works is that the workers are commuting in from poorer neighborhoods on the outskirts, since they cannot afford to live in the rich communities that they serve because of the low salaries.
> Critics of labor-market programs such as the Job Guarantee argue that they enable precisely this sort of choice—they make it easier to decline work that one doesn’t like. One program participant in his thirties told me that, while on unemployment benefits, he’d been offered a job cleaning toilets at a gas station; he’d decided that he didn’t want “that sort of job,” and had instead found work in the carpentry workshop. If everyone were guaranteed a reasonably pleasant job, suited to their interests and needs and paying a living wage, who would do the grungy, difficult work? Austrian employers, like those in America, are currently having difficulty hiring people to take hard, poorly paid jobs; many of the workers in Austria who wash dishes or clean hotel rooms are immigrants from Eastern Europe, and during the pandemic many of them went home, some for good. Jörg Flecker, a sociologist at the University of Vienna who is evaluating the program in Gramatneusiedl, told me that pressure from employers could prevent its expansion across Austria. “Employers say, ‘There are so many unemployed. We have to have a tougher regime for them because we have jobs to fill.’ ”
>
> Lukas Lehner and Maximilian Kasy, economists at Oxford who are evaluating data from Gramatneusiedl, argue that competition with the private sector is a good thing. “I think, from an economic perspective, that argument doesn’t make much sense,” Kasy said, of the dirty-jobs view. “If they’re shit jobs, try to pay them as well as possible. Try to change the working conditions as much as possible until you reach the point that somebody wants to do them, or automate them if you can. And then, if nobody wants to do them, maybe we shouldn’t do them.” Kasy thinks that an important function of initiatives like job guarantees—and of universal basic incomes—is to improve the bargaining positions of people who want to change their lives. “Whether it’s abuse from an employment relationship, a bureaucrat in the welfare state, or a romantic relationship, the question is, What’s your outside option?” he said. “Having the safety of the basic income or a guaranteed job improves your outside option. If your boss is abusive, or doesn’t respect your hours, or is harassing you or whatever, you have the option to say no.”