Re: City of Beijing announces Job Gaurantee

[Bruce McFarling <ecbm@xxxxxxxxxxxxxxxxxxx>]

On Sat, 06 Apr 2002 11:15:21 +0200 (CEST), larson@xxxxxx
wrote:
>Quoting Bill Mitchell <ecwfm@xxxxxxxxxxxxxxxxxxxxxxx>:
>> I suggest you see this in the context of the two welfare
>> support systems run by the US and australia. They are very
>> different and once you perceive the differences the "tremendous
>> difference" you wish to highlight becomes rather less tremendous.

>John Doe is unemployed. John Doe has the right to a welfare check of
>$W pr month. Comes Mitchell's Job Guarantee. John Doe is offered to
>paint schoolyard fences for $W pr month. John Doe says no. John Doe
>gets no money.

The first point is that this is an inaccurate description of a
JG/ELR program in an Australian context.  The second point is the
question: if Jane *refuses* to work, why should she be receiving
income support that is offered to those who are willing to work
but cannot find employment?

POINT ONE

What you describe is work for the dole.  The JG/ELR program
that Bill describes involves award wages AT LEAST, and award
wages are substantially higher than someone would receive
on the dole, if not supplemented by other income support.
The wages from a JG/ELR are just that: wages for hours
worked, because the JG/ELR job is a JOB.  The dole received
on work for the dole is just the dole that anyone receives,
but the government has decided to put an additional
eligibility requirement that you work two days on a work for
the dole program or engage in two days training if you are
under a certain age and unemployed for over a certain period
of time.  Work one hour less than the two days ... lose your
dole check.  Put in the require times, or an extra hour, or
an extra day ... keep your dole check.  It is NOT a job,
because you are NOT paid for it.

If John is offered that job (at award wages) from the private
sector, they are no longer qualified to receive the dole.  Of
course, the dole bludger of myth and legend will deliberately
seek jobs that they will not be offered, in order to satisfy
the requirement, and the JG/ELR will eliminate that, but if
that is being objected to, do not direct the objection to the
JG/ELR program ... more on that in Point Two.

Most US federal "welfare checks" to working age people are aid
to families with dependent children, supplemented by food
stamps (and, obviously, 50+ variations of add'l state and local
income support programmes).  The Australian equivalent would
NOT be cut off because of the availability of a JG/ELR job.

>Jane Roe is unemployed. Jane Roe has the right to a welfare check
>of $W pr month. Comes ELR. Jane Roe is offered to paint schoolyard
>fences for $W pr month. Jane Roe says no. John Doe gets a welfare
>check of $W pr month.

In the US system, unemployment benefits RUN OUT.  So anyone
on longer term federal "welfare" is receiving the welfare due
to some entitlement OTHER THAN unemployment itself (under the
qualification that I haven't followed the "welfare reform" of
the whiggish Republican administration elected under the
"Democrat" label, prior to the current dry Republican
administration operating under the "Republican" label).

>How can this not be a tremendous difference? What else can be
>more important than to keep people afloat cash-wise?

But if Jane Roe quits her job painting fences after two days,
and gets a JG job the next week planting salt bush to reduce
salinity, she would have to be AT LEAST as well off as if she
had been on the dole for the entire previous week.  And if she
had been on the dole, there is a growing likelihood that she
would have to take the job painting fences for two days a week
ANYWAY, or lose her dole check, and it would take her far more
time than placement in a new JG job to get back on the dole ...
it can take six weeks and more to get the money flowing again.
So she is better off under the JG guarantee, because she can keep
painting for three more days and get more money, or she can quit
and reapply for another job.  The government GUARANTEES that it
will provide a job to the unemployed.

POINT TWO:

Sven, maybe you do not LIKE the Australian system, in which
a substantial amount of income support is tied to being
unemployed in the sense of being willing to work but unable
to find a job.  You may believe that Australia SHOULD have
an income support program that is just provided directly to
anyone that applies, without any requirement other than
perhaps a means test.  Perhaps you believe that Australia
should replace its current system with a negative income tax,
with the means test automatically folded into the income
tax system.

But the "willing to work but unable to find work" is the
PRESENT Australian system.  Whether rightly or wrongly,
it enjoys widespread support.  Those looking to undermine
income support programs work very hard to paint most of
those receiving the dole as being "dole bludgers" ... that
is, people who COULD find work if they wished to, but who
prefer to remain on the dole, and who seek to "look" for
jobs that they will fail to receive, in order to prove that
they are willing to work but unable to find it.

The *intent* of the dole is that if there is a private sector
job available to the person, the person should NOT receive
a dole check.  In other words, if it is a constraint on
people's freedomg to NOT be able to receive unemployment
benefits when a job offer is on the table, the CURRENT SYSTEM
is the source of that constraint.  And by contrast to the
current system, a person receiving income by working at a
JG/ELR job enjoys more freedom than someone on the dole, since
they have the freedom to "drop out" of the system partially
by cutting back their working time, with their wages dropping
back in line, while under the dole, receipt of the payment
is "all or nothing" ... either get through each and every
hurdle that is placed between the applicant and the dole
check, or receive zero.

Note that if the current Australian income support system
is replaced in whole or in part with a negative income tax,
there is no change in the JG/ELR programme.  The Job Guarantee
would still be there who wish to avail themselves of it.  Of
course, there might be differences in who decides to make
use of the guarantee, and how they choose to do so, but the
same JG programme would be in place even if income support
payments contingent on unemployment are completely replaced.

IOW, I think you are confusing the entire system of income
supports *if* a JG programme is implemented in the current
Australian context with the JG programme itself, and imputing
something to the JG programme that is instead the current
public policy in Australia, whether or not a JG programme is
put in place.  In addition, I think that you are comparing
the JG programm in the context of the current Australian
income support system with a hypothetical income support
program that does not contain work-for-dole, increasingly
restrictive eligibility condition, increasingly onorous
eligibility policing, and all the other features of the
current Australian system.

Virtually,

Bruce McFarling, New Lambton, NSW
ecbm@xxxxxxxxxxxxxxxxxxx