A number of American senators recently came out in support of a federal job guarantee. The idea—that the government would provide work for anyone who wants a job but can’t find one—is a way of ensuring full employment. That’s a goal that was prominent in U.S. politics in the years after World War II, but faded from policy debates over the following four decades, as sociologist Margaret Weir explained in a 1987 paper.
During the Depression, mass unemployment spurred a revolutionary effort to create public-sector jobs. Then, the vast increase in military production during World War II created a huge demand for labor. After the war, full employment looked both achievable and worthwhile to much of the public.
Weir writes that the Full Employment Bill introduced into Congress in 1945 offered an ambitious plan for the federal government to create jobs for everyone who wanted one. It called for the creation of a National Production Budget that would guide investments, under the control of the executive branch.
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But groups like the National Association of Manufacturers, the Chamber of Commerce, and the American Farm Bureau Federation fought hard against it. They warned that it would interfere with free enterprise, give the federal government too much power, and make it too difficult to recruit low-wage workers. Opposition by agricultural interests was particularly powerful politically because it united southern Democrats with Republicans.
Ultimately, Congress instead passed the 1946 Employment Act, which called for the government to promote “maximum” employment. But, Weir writes, it was based on a much more modest vision than the previous year’s bill. Instead of supporting public works projects or job training, it depended on the theory that tax cuts and increases in social spending could balance the economy during downturns.
As it turned out, Weir writes, the robust post-war economy kept unemployment fairly low anyway. It wasn’t until the 1970s that the government had to address a widespread lack of jobs. By that time, though, economists and policy experts had solidly lined up behind the idea that the government’s role was to nudge the private sector toward job creation rather than create jobs directly.
That’s not to say there was no support for a stronger approach. Many black activists and politicians had promoted a job guarantee for decades. When unemployment ballooned in the 1970s, some white liberals joined in. The result was the Humphrey-Hawkins Full Employment and Balanced Growth Act. The bill’s early versions would have set a target of 3 percent unemployment and created a planning function to help reach it.
But the mainstream policy establishment argued that a big push for higher employment would increase the already-high inflation rate. With little popular mobilization in support of a jobs program, the final Humphrey-Hawkins Act passed in 1978 was toothless. Mainstream politics turned toward workfare and other ideas that blamed jobless people rather than the economic system for their situation.
The renewed push for a job guarantee will test whether things are different today.
