Re: Full Employment is what?

["Forstater, Mathew" <ForstaterM@xxxxxxxx>]

Bill Mitchell wrote:

>we can also truly see the government as an infinite life unit.

If I understand this correctly, this is an extremely important point.  It
relates to what Bill wrote in his paper "The Job Guarantee in a Small Open
Economy" in E. Carlson and W. F. Mitchell (eds.): THE PATH TO FULL EMPLOYMENT
AND EQUITY, The Economic and Labour Relations Review, Vol. 11, supplement, 2000:

"Even if it were possible to expand demand enough to promote growth sufficient
to keep pace with labour force growth and productivity growth and mop up the
huge stocks of long-term unemployment, how could the natural ecosystems, already
under great strain, cope? There is a need to change the composition of final
output toward environmentally sustainable activities.  It is not increased
demand per se that is necessary, but increased demand in certain areas of
activity." (Mitchell, 2000, p. 113 n8)

This also relates, if I may say so, to some of what I was trying to get at in my
paper in the same volume, "Full Employment and Economic Flexibility" (as well as
in "Flexible Full Employment" JEI, June 1998, and Levy Public Policy Brief No.
50 and Levy Public Policy Brief Highlight No. 50A at http://www.levy.org ):

"Since the government is not in business to make a profit, it can base its
decisions about products, production methods, and hiring not on cost
minimization, but on broader macroeconomic goals or social values...

...Whereas private firms are compelled by competitive pressures to choose the
method of production that will maximize profits, government is not so
constrained. For any given activity, choice of technique can be based not on
cost minimization but on impact on the system as a whole. For example, more
labor-intensive methods may be chosen even where more capital-intensive methods
are available and might be chosen under different conditions, and alternative
technical means may be utilized to ease pressures on natural resources or the
assimilative capacity of the environment."

In this sense, activities peopled by the Job Guarantee provide a full employment
that is more sustainable than a fully employed private sector capitalism, even
if the latter were possible, and further, may provide services without which the
private sector itself would be unsustainable, fully employed or not.

Bill: if you read this far, in the "Small Open Economy" paper you refer to a
paper where you discuss the job guarantee and environmental
sustainability--Watts and Mitchell 2000, on the genuine progress indicator. Is
that paper available on the web?