Let’s test Romney’s claims about the 47% by offering the unemployed jobs

By William Black
(Cross posted at Benzinga.com & Huffington Post)

I have explained how Governor Romney and Representative Ryan have self-destructed because they have followed Charles Murray’s demands that the wealthy denounce working class Americans’ supposed refusal to take personal responsibility for their lives by refusing to work.  Murray is the far right’s leading intellectual.  Murray’s Myth is that the wealthy are rich because they are morally superior to the lazy poor and that the poor are not employed because they are lazy.  Murray’s explanation for his support for Governor Romney says it all:  “Who better to be president of the greatest of all capitalist nations than a man who got rich by being a brilliant capitalist?”

Consider the missing aspect of Romney’s famous denunciation of the 47% — jobs.  A careful reading shows that Romney implicitly embraced Murray’s Myth.

“There are 47 percent of the people who will vote for the president no matter what. All right, there are 47 percent who are with him, who are dependent upon government, who believe that they are victims, who believe the government has a responsibility to care for them, who believe that they are entitled to health care, to food, to housing, to you-name-it.

“That that’s an entitlement. And the government should give it to them. And they will vote for this president no matter what…These are people who pay no income tax.”

“Romney went on: “[M]y job is not to worry about those people. I’ll never convince them they should take personal responsibility and care for their lives.””

I propose that America test Murray, Romney, and Ryan’s claims about the supposed refusal of the 47% to take “personal responsibility.”  Romney says “I’ll never convince them they should take personal responsibility and care for their lives.”  I think that Murray, Romney, and Ryan’s claims that the 47% are unwilling to take personal responsibility are false.  I think that the issue has nothing to do with Romney’s persuasive abilities.  I also know how to test the validity of their claims.

Even Romney’s knows that his claims about the 47% fail on many levels.  First, many of the 47% vote for Republicans.

Second, Romney knows that many of the 47% are in no position to avoid being “dependent upon government.”  Tens of millions of the 47% are minor children.  Tens of millions are elderly and retired.  Millions are profoundly disabled – hundreds of thousands of them injured veterans.

Third, the adult members of the 47% overwhelmingly took personal responsibility for their lives.  They paid taxes – income, social security, sales, and property and corporation taxes.  (A word about tax “incidence” – the people who actually bear the economic cost of a tax frequently differ from the entity that nominally pays the taxes.  Economists generally believe that businesses pass on sales taxes to customers, landlords pass on property taxes to their renters, both the employer and employee portions of Social Security are borne by workers, and that corporations generally pass on corporate taxes to their customers in the form of higher prices.)  These members of the 47 percent eventually became elderly, sick, disabled, or unemployed.

Fourth, hundreds of thousands of the 47% are “dependent upon government” because they took “personal responsibility” and cared for our lives at the risk of their lives and health.  These are the veterans, police officers, and firefighters who were injured protecting the public, and the families of those who died protecting the public.  These are the government employees who sacrificed their health or even their lives to protect us.  The disabled former government employees are in fact victims, but they generally do not view themselves as victims.  Those that die protecting us often leave minor children who are “dependent on government.”  Many of them will choose to follow in their deceased parent’s path and protect us by routinely risking their lives and their health when they become adults.

In his rant against the 47%, Romney implicitly adopted Murray’s claim that the unemployed lack jobs not because of the Great Recession, but because they are shiftless and refuse to work and take personal responsibility.  (Romney and Ryan often make inconsistent claims that unemployment is caused by regulation, or taxes, or whatever is their complaint de jour against Obama.)

Testing Murray’s Myth

We can test the claim that unemployment is high because the unemployed are shiftless.  My colleagues at UMKC have detailed how to create a job guarantee program that offers a job to everyone who wishes to work.  Our experience is that such jobs prove very attractive to the unemployed.  A jobs guarantee program creates many winners.  The public gains from the services provided by the newly employed.  The unemployed gain not only income but far greater psychological well-being.  The government gains greater tax revenue.  Businesses see increased demand for their goods and services.

Americans overwhelmingly seek to take personal responsibility for their lives.  Indeed, Americans work extraordinary hours.  American mothers with young children frequently work outside the home.  So let’s put the vicious abuse that Murray urged the wealthy to heap on the purportedly shiftless unemployed a rest and actually test his claims through a job guarantee program.

I predict that the Republicans will fight ferociously to prevent us from testing the truth of their abuse of the poor.  They cannot allow a test because they know they are slandering many millions of Americans.  Their first nightmare is a job guarantee program that leads to television images of millions of Americans eagerly signing up to jobs.  Murray’s Myth would be destroyed in full public view.  Their second nightmare is that the job guarantee would speed the recovery and provide useful projects and services that Americans would love.  The slander is despicable, but the fact that they will do anything to prevent a test of Murray’s Myth compounds the slander with a toxic mix of cowardice and hypocrisy.

 

Bill Black is the author of The Best Way to Rob a Bank is to Own One and an associate professor of economics and law at the University of Missouri-Kansas City. He spent years working on regulatory policy and fraud prevention as Executive Director of the Institute for Fraud Prevention, Litigation Director of the Federal Home Loan Bank Board and Deputy Director of the National Commission on Financial Institution Reform, Recovery and Enforcement, among other positions.

Bill writes a column for Benzinga every Monday. His other academic articles, congressional testimony, and musings about the financial crisis can be found at his Social Science Research Network author page and at the blog New Economic Perspectives.

Follow him on Twitter: @williamkblack

28 Responses to Let’s test Romney’s claims about the 47% by offering the unemployed jobs

  1. chuck martel

    As is obvious to anyone that’s ever been an employee or an employer, everyone wants a job but nobody wants to show up for work. Ergo, everybody wants maximum income at minimum effort, a truism that’s as valid as the law of gravity. But that’s not the issue. Your proposed test doesn’t require any government action at all. You, and your like-minded fellows, are free to hire as many of the unemployed as you wish. There are endless opportunities to put these employees to use and many unused facilities to accommodate them if necessary. In fact, such experiments are being conducted even now. Groups of investors, through stock purchases, own companies that employ thousands of people, companies like Target, for example. If you’re truly concerned with the level of employment in the country it behooves you to perform some concrete action to affect it in a positive manner. Nothing could be more effective in this regard than organizing some entity with the purpose of providing employment, rather than accumulating profits. Evidently, there is no shortage of raw materials.

    • As is obvious to anyone that’s ever been an employee or an employer, everyone wants a job but nobody wants to show up for work. Chuck (thinks he’s a hammer?) Martel

      That’s not quite true. Almost all of us enjoy doing some work especially if we can choose what, where, when, how and how much (cf. Ecclesiastes).

      The Biblical ideal appears to be small family farms for most of the population. I suspect that with modern farm equipment that very many Americans would not mind a return to such especially with a Basic Income Guarantee lest they starve during bad years.

      And since family farms were basically stolen by the banks, the case can be made for nationalizing the corporate farms at least and redistributing the land.

      Of course, we’ll have none* of the above until we squarely face the fact that the banks have been and continue to be dangerous thieves.

      *Until the Millennium.

    • Chuck Martel:You, and your like-minded fellows, are free to hire as many of the unemployed as you wish.

      Really! I’m very glad to know this. I have a big enough bank account to hire as many people as wish!

      Surely you must be my personal banker then, and surely you wouldn’t mind dropping off a few million for my petty cash fund. I seem to be a bit short. If you don’t remember my bank, account number & codes, surely you can lend such a great customer the millions – you seem to know I am good for it.

      Until you come by & I get things going, however, there will be massive, destructive unemployment because the government causes & decides on unemployment, and nobody else but the government can permanently prevent this easily preventable but colossally destructive state of affairs.

      • While the banks don’t really have anything to do with you ending the unemployment of a herd of deserving souls, if a bank were approached by you to finance payroll and the other expenses of a start-up, don’t you suppose that they would evaluate your plan and consider if its risk was worth taking? Of course, the government, through shenanigans like the Solyndra affair and many others we’ve never heard about, doesn’t need to measure risk because it isn’t their money! There’s no reason for me to be involved in your mercy mission because I want the monster government-corporate system to fail on its own terms, applying band-aids to the cancer that is the warfare-welfare state will just keep it alive a little longer when it deserves a quick burial. You MMT ideologues are simply socialists dressed up in funny clothes, calling for more government when government has created the problem is a denial of reality.

        • Of course, the government, through shenanigans like the Solyndra affair and many others we’ve never heard about, doesn’t need to measure risk because it isn’t their money! Chucky the Hammer

          Sadly, because of legal tender laws for private debts, that is true. However, if fiat was ONLY legal tender for government debts and genuine private currencies for private debts only were allowed then government would have to spend more carefully or lose purchasing power UNLESS it (shamefacedly) raised taxes to compensate.

          But as for the government backed banking cartel, they create the temporary money (so-called “credit”) but the purchasing power is stolen from the entire population. The banks are thus thieves.

      • Chuck Martel: the unemployment of a herd of deserving soulsNo comment.

        if a bank were approached by you to finance payroll and the other expenses of a start-up, don’t you suppose that they would evaluate your plan and consider if its risk was worth taking? Yes, sure. But banks are not lending now, because of the risk, because they must measure the return on their investments in their own monetary rewards. The government must not and can not do this – it is nonsensical for it to do so.
        The idea that the government should try to get back more of its own money than it puts in is crazy, impossible and destructive. The government “has” an infinite amount of money. Everybody gets their money ultimately from the government. Not vice versa.
        Of course, the government, through shenanigans like the Solyndra affair and many others we’ve never heard about, doesn’t need to measure risk because it isn’t their money! Of course it is “their [our] money.” That is what (base) money is – debt of the government. It is a measure of the decline of economic understanding that the older phrase for government spending -”public money” was replaced by the illogical, nonsensical, untrue “taxpayer money”. The government “doesn’t need to measure risk ” in terms of its own money because it CANNOT measure risk in terms of gains of its own money. The government MUST behave oppositely from the private sector – as a money losing proposition. If the government does not “lose money”, then the private sector will not have any (base) money, which comes only from these government losses = deficits.

        You MMT ideologues are simply socialists dressed up in funny clothes, calling for more government when government has created the problem is a denial of reality.

        No, what MMTers call for is government that rationally “balances” its taxation and its spending. That does not usually underspend and overtax. It is consistent with government of any size in the economy, including a night watchman Austrian laissez-faire state.

        We very much understand that inappropriate government action is the cause of the problems; I said so above.
        Government creates the problem by not spending enough to accomodate private desires for savings, it forces people to not work, to their and everyone else’s immense detriment. Nobody is demanding mercy missions. All we are saying is the government should behave as rationally as any private firm or household. Stop disemploying its own people. This essentially implies the Job Guarantee.

        The problem with you way of thinking is that it seems to be ultimately based on a false and illogical theory of money. The problem with such things is that they are usually held so axiomatically that they are hardly ever squarely stated. Take a look at the Modern Money Primer link above.

    • “As is obvious to anyone that’s ever been an employee or an employer, everyone wants a job but nobody wants to show up for work. Ergo, everybody wants maximum income at minimum effort, a truism that’s as valid as the law of gravity.”

      Exactly how does this explain why public employes in low income countries may go unpaid for weeks or months at a time and still show up for work?

      The argument is too simplistic to be taken seriously ~ a tendency to want more pay and a tendency to not want to go to work does not, in fact, support any conclusion that everybody wants maximum income for minimum effort. Instead, neoclassicaly inspired models of people as quivering gobules of desire assume in the face of evidence to the contrary ~ evidence that numbers of people are willing to work up to a certain level of effort for modest income or on a volunteer basis, and evidence that workers on the same pay that feel that they have more control over the work done in their workplace are more productive, which amounts to more than minimum effort for less than maximum income.

      What people are reluctant to do, of course, is to work intensely for no compensation in order to enrich those employing them.

      • chuck martel

        Exactly how does this explain why public employes in low income countries may go unpaid for weeks or months at a time and still show up for work?

        Their salary is a minor part of their income compared to bribes and baksheesh. That’s why they’re paid so little or not at all.

        In his classic work, The Ordeal of Change, Eric Hoffer points out that working for a living, having a job, is a new experience in the western world. For thousands of years no one worked any harder than necessary to satisfy his immediate wants. This is still the case over much of the world, including parts of the US. Not everyone has the same value system. Many people are happy to hang around the house and play with the kids, watch TV and BS on the front porch with the neighbors, especially when their lifestyle is subsidized by the government and private charitable organizations. There are millions who have no desire to spend much of their lives doing boring labor, even if it could result in the purchase of a bass boat or trip to Branson, MO. Assuming that every unemployed person is in some kind of existential agony is measuring mankind by your own standards and fallacious in the extreme.

        • In low income countries most of the employees are low paid but it does not mean that every body gets bribe and ‘bakhsheesh’. In Pakistan for example per capita income of more than forty percent is hardly US 1,000.00 and they live a very shabby life.

  2. The rich work when, where, how and how much they want to work doing what they wish to do and very often with inherited wealth. And if they get tired of that hobby they can switch to another after a nice long vacation or two.

    So Romney can hardly claim to be non-lazy himself.

    As for a JG, that proposal is lame to insulting. The US population is entitled to restitution for theft from what is essentially a government backed/enforced counterfeiting cartel, the banking system. Just why should the victims have to work for that restitution?

    This is a private balance sheet Depression. The problem is lack of government MONEY not lack of government jobs.

    The American people have nothing to prove to anyone. How long would pretty boy Romney’s looks survive if he faced the stress and insecurity of the average American worker?

    • But after the restitution, what then?

      An employment insurance program is not a silver bullet policy, able to solve all problems for all people. It is, of course, not sufficient on its own, since no single economic policy is sufficient on its own. It is, however, an essential policy if we are to claw back from private governments operating on the principle of one dollar, one vote sovereignty over our economy.

      • But after the restitution, what then? BruceMcF

        A ban on further counterfeiting by the banks is not only morally required but would allow about $8.5 trillion of new reserves to be handed out equally to the population WITHOUT increasing the total money supply (credit + reserves) since the new fiat would simply go, as it should, to backing bank deposits 100% with reserves.

        That’s $8.5 TRILLION that can be used for restitution without significant price inflation risk IF we put the banks out of the counterfeiting business at the same time.

  3. Next step is Romney saying “Let them eat tax deductions!”
    He’s already pretty close.

  4. I predict that the Republicans will fight ferociously to prevent us from testing the truth of their abuse of the poor. Bill Black

    The Republicans imagine themselves to be moral. So how can they resist the moral argument for restitution? If only more people would make it?

    I expect the Republicans, should they win, to simply handout “Recovery Checks” (ala G.W. Bush’s “stimulus checks”) to the population and they’ll be heroes for doing so.

  5. Murray’s Myth is that the wealthy are rich because they are morally superior to the lazy poor and that the poor are not employed because they are lazy. Bill Black

    The rich, being considered “credit-worthy”, have access to the stolen purchasing power of the poor via the government enforced/backed counterfeiting cartel, the banking system. Thus the poor tend to stay poor and the rich tend to stay rich. Whocouldaguessed such would be the outcome? Hint: Google “famous banking quotes”.

  6. Everything you say is true, but I don’t believe we can get directly to a JG in the US. We need some intermediate steps before that can happen. In fact, we need to stop going in the other direction first.

    Not a very appealing choice this time for President. Obama is much better than Romney, but I fear we will never get the ‘change’ we want there. Local politics (there are actually a few Democrats that are not on the fat-cat payroll), and protest movements like Occupy Wall Street, are probably the best avenues for a better future.

    • No, the US is probably the best place in the world for a JG, the closest to it. Directly. Immediately. No intermediate steps are needed or helpful. Historically & culturally very appropriate. The biggest obstacle imho is not ordinary USAns, who grasp it immediately, but the intelligentsia, even, maybe especially, good guys like say Dean Baker who think that it won’t fly.

      Have the MMTers et al on national TV for a month, explaining its virtues & laughing at & puncturing the silly objections to it & it would become a constitutional amendment. In fact, that’s a good campaign to start. A Job Guarantee Amendment to the US constitution.

  7. Chuck, your statement “Ergo, everybody wants maximum income at minimum effort, a truism that’s as valid as the law of gravity” applies nicely to the big banks that brought us the financial crisis.

    The government (for, of and by the people) is in a better position to provide a job guarantees for anyone who wishes to work. It can pay the minimum wage with benefits and with the proviso of future increases. It would not compete with the private sector with such a wage. Only the government has the vast resources needed to put millions of Americans to work. The work should be necessary and fulfilling especially when compared to no work at all. Government should be for all the people even those who are the poorest and most needy. You have no compassion, Chuck, from the way you speak.

    We know that corporations are sitting on hoards of money because of the volatile times we live in. Ask them to release their money resources and start hiring and what will they say? They would be afraid to hire because of the uncertain economic situation that we have today thanks to the banks. Only the government would be able to create the large number of necessary jobs and could organize and hire the unemployed to work in them.

    It can be done. See: http://www.levyinstitute.org/pubs/conf_june09/conf_june09_files/presentations/Session4c_deAssis.pdf

    • chuck martel

      . Only the government has the vast resources needed to put millions of Americans to work.

      We know that corporations are sitting on hoards of money

      Well, which is it? And all of the vast resources that the government has, where did it obtain those vast resources?

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  9. Good to see Bill making a MORAL and PRACTICAL case for MMT policies.

    George Lakoff would approve.

  10. Another brilliant article Bill. From your pen to Obama’s ears.

  11. Offer me a job that pays a living wage and one that doesn’t tax my physical limitations (I’m 56), I’ll be there in a heartbeat. Every day & on-time as well. Just like I did for >36 years until the last layoff…

  12. The dishonesty and hypocrisy deepen, because Romney and his paymasters want a fairly high level of unemployment. Full employment is regarded as a destabilising factor; an unacceptable threat to labour discipline and a weapon in the hands of organised labour. Hence the outright hostility to any kind of ethical jobs guarantee programme.
    Of course, deficits are just fine when they’re used to fund wars and provide welfare programmes for Boeing and Blackwater. The real fear is that the population might get infected with the subversive notion that government exists for them, and not just the psychopathic 1%.

  13. Charles Murray, an intellectual????? (The only inference of Prof. Black’s I have ever disagreed with!)

    Thanks, Prof. Black, for demonstrating the obvious for the benefit of the staggeringly ignorant Americans out there.

    I’m a typical example: the longest job I’ve held over the past 25 years was 19 months, before all of us were laid off and all our jobs were offshored. According to a recently published BLS survey, I am typical for my age group of the unemployed: the longest average job we’ve held during the previous 5 years was exactly 1 year.

    What few Americans understand, being rather staggeringly ignorant thanks to the lack of a real media today, is that this, the fourth official jobless recovery, is the worst of all: worse than the previous three as with those half of the jobs lost were later recreated, although half of those typically at lower wages — this time around it’s not even half in jobs recreation!

    So, effectively each time with each jobless recovery, the overall jobs base has been downsized.

    Having worked hard all my life, and watched as the last 17 jobs were most certainly offshored, and I believe the last 30 of the last 32 jobs were probably offshored, the will to work hard and hustle continuously for work is sadly lacking now.

    But if I ever happen upon Romney, Ryan or Murray on a dark night when there are no witnesses around …..

  14. James W, British folk singer, Roy Harper got it about right. Over three decades age he wrote a song called ‘One of those days in England, with the wonderful line: “The Government must love me ‘coz they keep me out of work, they must be saving me up for something special, like…rolling spliffs for Captain Kirk”.

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