As I indicated earlier this week, I will progressively add notes to the body of work that will become the manuscript for my next book (with long-time co-author Joan Muysken) on the – Future of Work. As I write bits and pieces, I will post them here for comments and feedback. The book will be published sometime in 2018. At present, I am working on the philosophical considerations that we will deploy to underpin the more prescriptive elements (policy proposals) that we will produce. Today, I have been writing about the ethical basis for work. This is derived from work I did at the turn of the century. Part of the text today was written in collaboration with a former colleague John Burgess and the body of work we produced was subsequently published in several periodicals and book chapters around that time. However, the ideas sketched here were taken from parts of the papers that I mostly wrote although trying to decipher the exact division of labour is impossible. In that sense, I acknowledge the fruitful nature of my interaction with John at that time and the body of work we produced together.
Quite separate from the obvious material advantages of maintaining full employment that accrue to workers (and capital) and the massive, broad-ranging costs that mass unemployment brings, one can make a case for full employment on deeper philosophical grounds.
Clearly, mass unemployment has acted as a form of social exclusion perpetrated against particular sections of the community, in general the young, the old, the poor and those lacking skills and education.
The burden of unemployment is not shared evenly across the community.
We also note that mass unemployment arises for one reason – that there is insufficient spending in the economy relative to that which would generate sufficient sales and demand for labour to provide jobs for all
Accordingly, unemployment is a direct consequence of inadequate and misplaced government policy.
In Modern Monetary Theory (MMT), it is emphasised that the government, when all is said and done, chooses the unemployment rate at any particular time.
After all the spending (and saving) decisions of the non-government sector have been taken and implemented, any idle labour is the result of the net spending position of the government being lower than is required to generate full employment.
So if there is mass unemployment, we know at least one other thing – the fiscal deficit is too small or the surplus is too large, depending on the circumstances in the non-government sector.
Given that a currency-issuing government can purchase anything that is for sale in its own currency, including any idle labour, the existence of mass unemployment is thus a political rather than a financial outcome.
Within this context, an empirically based, experiential notion of human rights suggests that governments are violating the right to work by refusing to eliminate unemployment via appropriate use of fiscal deficits.
Mass unemployment is not compatible with fundamental human rights in that unemployment denies those affected access to income and hence participation in markets, it reduces the opportunity for advancement and stigmatises those affected, and violates basic concepts of membership and citizenship.
Without the right to work, afflicted individuals are denied citizenship rights as surely as they were denied the right of free speech or the right to vote.
As long as employment is not considered to be a human right, a portion of the community will be excluded from the effective economic participation in the community
The concept of work as a human right is not new, and has spanned the ideological domain for the past 300 years.
In this last century, both the United Nations and the International Labour Office debated with the right to work question.
A good account of those debates appears in Richard Siegel’s 1994 book – Employment and Human Rights: the International Dimension.
Siegel noted that (p.4):
Images of mass unemployment cannot match the intensity of television pictures of starving and diseased babies or of homeless adults in India or America. Yet the raw numbers of the unemployed and underemployed also reach into the hundreds of millions. These numbers also represent misery and hopelessness, and often trigger crises of sickness, homelessness, hunger, violence, and early death … unemployment is like many gross violations of human rights violations in being a price that a ruling elite or even a majority of the population is willing ot pay periodically to achieve other ends.
His reference to “other ends” is in relation to using unemployment to “control … price and wage inflation” as one example, where unemployment has become a policy tool rather than a policy target.
In doing so, governments have clearly violated human rights and abrogated on their responsibilities under international agreements that they signed and endorsed in the immediate Post Second World War period.
[Reference: Siegel, R.L. (1994) Employment and Human Rights: the International Dimension, University of Pennsylvania Press, Philadelphia.] (Siegel, 1994, Ch.1).
Siegel (1994: 19) argued the “right to employment evolved from conceptions of national solidarity and welfare state obligations in the century before World War II” and “It first received broad international recognition in the post-1945 era, with its inclusion in the United Nations Universal Declaration of Human Rights and International Covenant on Economic, Social, and Cultural Rights as well as in the Council of Europe’s European Social Charter”.
There are many other “conventions and recommendations concerning full employment” in statements made by the OECD, ILO and other European Community organs.
It is clear that the international community signed up to guaranteeing a right to work.
In this book, we argue that this right should be embedded in relevant and enforceable legislation – in other words it should be a statutory right.
Flowing on from that:
1. The State should bear the responsibility for implementing this right.
2. Access to work should not be conditional.
3. The right to work means there must be a viable full employment policy.
4. A full employment program, encompassing the right to work, can be implemented which also guarantees price stability.
Employment as a fundamental human right
We can establish the right to work in two broad ways:
1. To assert a natural right along the lines of the doctrine of natural rights which dominated the thinkers of previous eras.
2. To use factual experience and analysis of outcomes derived from these experiences. This is a pragmatic, instrumentalist approach.
This dichotomy follows the distinction made by Marc Tool (1998, 285):
The natural right to employment . . . is a non-empirical, non-experiential, extra-causal, conception of what ought to be. Its credibility derives from the acceptance of an antecedent metaphysical belief which cannot be integratively incorporated into the human inquiry process. The human right to employment is grounded in the continuum of factual experience and rational appraisals of actual consequences experienced and is validated by inquiry-embedded instrumental social value theory.
[Reference: Tool M. (1998) ‘Employment as a Human Right’, in Reati A., Michie J. (eds), Employment, Unemployment and Public Policy, Cheltenham, Edward Elgar, 279–302.]
Crane Brinton wrote in 1947 that establishing employment as a natural right is difficult (p.300):
The doctrine of natural rights is … not a theory, not an attempted description or ordering of the facts, but a faith, the essential dogmatic basis of what Carl Becker has called the ‘heavenly city’ of the eighteenth century.
The crucial difference is that the natural right approach relies on faith to motivate the conclusions.
Tool (1998: 285) said that the validity of a natural right:
… is a function not of causal demonstration but of antecedent reverential belief. It embodies and recommends a value premise that must be accepted prior to inquiry and is validated not through causal demonstration of connectedness but through a priori deference to God, Nature, or other metaphysical ‘determinant’ (sic)” (emphasis in original)
[Reference: Brinton, C. (1947) ‘Natural Rights’, in Seligman, E.R.A. (ed.), The Encyclopeaedia of the Social Sciences, New York, Macmillan.
The calls for full employment based on various Papal Encyclicals (for example, Rerum Novarum , 1891; Laborem Exercens, 1981) and other Catholic writings fit into this approach.
The content depends on the prior faith.
While the Christian Democratic ideals embodied in the All Souls concept in Catholicism provide a firm basis for solidarity or collective will in society and thus a justification for government intervention to drive unemployment to its irreducible minimum, they still require one to accept the prior belief system.
However, the conclusions can be separated from the prior beliefs and be based in the empirical, causal level of perception.
In contradistinction, Mathew Forstater (2015) suggests that we should not abandon the argument for a natural right to employment just because it might be harder to establish and rely on faith statements.
He writes (2015: 63) that:
… the natural rights argument can be combined with other rationales to bolster support for the right to employment. One compelling reason not to reject the natural rights argument is that it is the ‘most traditional, and probably most legitimate, Western frame of reference concerning rights’ (Siegel, 1994: 78). In addition, a number of important supporters of the right to employment base their case on natural rights. These include prestigious scholars, but perhaps most importantly the Roman Catholic Church has long supported the natural right to employment. The nat- ural right to a job is usually deduced from self-evident first principles of natural law, such as inalienable rights to ‘life, liberty and the pursuit of happiness’.
[Reference: Forstater, M. (2015) ‘Working for a better world: Cataloging arguments for the right to employment’, Philosophy and Social Criticism, 41(1), 61-67.]
In this book, we do not resort to these non-empirical and extra-causal concepts for our claim that employment should be considered a human right.
Discussion of human rights tends to concentrate on civil and political rights, where citizenship and membership are relevant concepts.
As noted in the Introduction, the Universal Declaration of Human Rights does include the right to work, the right to food and the right to social security.
Both the United Nations and the International Labour Office have ratified the right to work with the 1946 ILO Declaration of Philadelphia asserting full employment as a national and international goal.
Siegel (1994: 25) points out that countries have been reluctant or unable to mandate such a right, often within the context of their reluctance to codify and enforce any human rights for citizens.
Given these issues it has been acceptable to regard the right to work as a non core right that should be left to individual countries to enforce or to be interpreted in the context of rights of work, including EEO, non discrimination and freedom of association (Siegel, 1994, 28).
An examination of the procedures adopted by various governments leads to the conclusion that the concept of employment rights has been narrowly interpreted as encompassing the rights of those in employment and excluding any rights to those who are unemployed.
We can justify regarding work as a human right in a number of ways.
First, labour income constitutes the major income source for the majority of individuals and households. Without income, ability to participate in a market economy is curtailed.
Advanced nations have recognised this by introducing income support for those who cannot earn income because they are old, sick or are otherwise engaged (for example, in caring).
These income supports have also been extended to the unemployed in various guises.
Second, access to income also governs access to other rights, including minimum requirements of clothing, food and housing.
In this regard, paid employment shares a direct relationship with food and water as a requisite for subsistence in many societies.
As Siegel noted above, being excluded from work often is accompanied by misery and early death for millions of people.
Third, having paid work enhances the choices available and the opportunities for advancements. The unemployed are often prevented from accessing credit, which limits their consumption possibilities.
They are typically deprived from accumulating wealth in the form of homeownership. They cannot engage in risk management through saving and thus have less chance to take vacations, invest in their own education and training and maintain fixed assets that we deem to be essential (housing, motor vehicles, etc).
Fourth, while their choices are constrained by their lack of income, their exclusion goes beyond this. They are not accorded the status attached to employment and they make no contribution to market activity; the barometer of worth in a market economy.
The right to work is thus established. But what exactly does that mean – what is a ‘right to work’?
We argue that it is a State responsibility for ensuring that those who wish to do so should be able to obtain paid full-time (or fractional) employment.
The guarantee should be made operational by the State and if the non-government sector cannot generate sufficient employment to match the preferences of the workers, then the State has a legally enforceable duty to ensure there is full employment.
We then encounter all manner of detail about the quality of the work guaranteed, the remuneration that would be guaranteed and the working conditions that come under the umbrella of state responsibility.
In general, the guidelines that the State should apply is whether the work provided is safe and advancing both the worker and societal well-being.
The guaranteed wage should permit a worker reliant on it to enjoy a socially-inclusive life relative to the norms of the society they live in.
This is not a ‘subsistence’ wage. It encompasses broader considerations and would be supplemented by public goods (so-called ‘social wage’ components) such as child care, free education, and other benefits.
The guaranteed wage would become the legal minimum wage and all workers would receive the standard protections consistent with the right to work – holiday and sickness benefits, protection against unfair dismissal, and occupational safety.
The reason these rights are not enjoyed by all workers is due to failings of government and any neglect of the right to work by such governments, enables unemployment to flourish across the globe.
The link between full employment and the right to work
Full employment was regarded as a standard objective of economic policy in the post war period. An economy cannot be efficient if it is not using the resources available to it to the limit.
The concern about full employment was embodied in the policy frameworks and definitions of major institutions in most nations at the end of the Second World War.
The challenge for each nation was how to turn its war-time economy, which had high rates of employment as a result of the prosecution of the war effort, into a peace-time economy, without sacrificing the high rates of labour utilisation.
The challenge and aspiration was articulated in the advanced nations in the immediate Post War period in the form of White Paper statements.
For example, in 1944, the British Government released its Economic Policy White Paper – which set the Post-War policy agenda that the government proposed.
Its opening statement is that:
The Government accept as one of their primary aims and responsibilities the maintenance of a high and stable level of employment after the war … A country will not suffer from mass unemployment so long as the total demand for its goods and services is maintained at a high level … Total expenditure on goods and services must be prevented from falling to a level where general unemployment appears.
It was left to the British economist William Beveridge to define what was meant by full employment.
His 1944 book – Full Employment in a Free Society – said that full employment (p.18):
… means having always more vacant jobs than unemployed men, not slightly fewer jobs … It means that the jobs are at fair wages, of such a kind, and so located that the unemployed men can reasonably be expected to take them; it means, by consequence, that the normal lag between losing one job and finding another will be very short.
Today, we would express this in gender neutral terms but the intent would be the same.
Beveridge’s definition does not mean zero unemployment:
Full employment does not mean literally no unemployment, that is to say, it does not mean that every man and women in this country who is fit and free for work is employed productively on every day of his or her working life.
Some unemployment will be associated with full employment due to frictions (people moving between jobs) but full employment meant, in operational terms, that there would always be more unfilled vacancies than unemployed workers.
The Nobel Prize winning economist William Vickery said in 1993 that full employment is:
… a situation where there are at least as many job openings as there are persons seeking employment, probably calling for a rate of unemployment, as currently measured, of between 1 and 2 percent.
In terms of the time that was reasonable for a person to remain unemployed, he considered full employment meant that an unemployed person “can find work at a living wage within 48 hours”.
[Full reference: Vickrey, William, 1992. “Chock-Full Employment without Increased Inflation: A Proposal for Marketable Markup Warrants,” American Economic Review, American Economic Association, vol. 82(2), pages 341-45, May].
Who was responsible for maintaining full employment? Beveridge (1944: 123-135) said
The ultimate responsibility for seeing that outlay as a whole, taking public and private outlay together, is sufficient to set up a demand for all the labour seeking employment, must be taken by the State…
So he was in accord with our right to work approach.
There were other major White Paper-type policy statements in advanced countries that followed the British White Paper and Beveridge’s book, which defined full employment as a fundamental aim of the national government.
The wording of these documents was clear – full employment required active government support to ensure that aggregate demand was sufficient to maintain employment opportunities for all those who desired to work.
The commitment to full employment by governments started to wane in the mid-1970s.
From the early 1970s and the first oil price shock, unemployment edged upwards and full employment has either been either redefined or ignored.
Indeed, unemployment became an important tool for reducing inflation and stabilising inflation expectations.
In abandoning the responsibility to maintain full employment, governments, effectively, also denied workers the right to work.
To restore the human right to work, governments would have to actively pursue a full employment policy.
The implications of a full employment policy are considerable.
First, it would mean greater use of labour and capital resources, as mentioned the single most significant efficiency reform that could be implemented in Australia is the elimination of unemployment. The direct financial benefits to the economy would be enormous in terms of additional GDP every year.
Second, it would mean fewer fluctuations in aggregate economic activity. It would be clear that government policy would trigger mechanisms to generate jobs for those who are made redundant by the private sector.
Such a situation would offer greater certainty for investors in the private sector since investment decisions would be undertaken in an ongoing full employment economy.
Third, the extent of social exclusion and alienation and the poverty associated with unemployment would be significantly reduced.
A full employment policy is a policy that facilitates social inclusion.
Fourth, employers would be forced to contemplate how to better utilise labour and how to raise labour productivity through investment in machinery, technology and training.
There would no longer be the emphasis upon cost cutting, lower wages and static efficiency gains associated with surplus labour conditions.
What is the way in which a progressive government can integrate the right to work within a full employment policy?
A Job Guarantee
The starting point for a full employment policy should be the introduction of a buffer stock employment function, which we now refer to as the Job Guarantee.
While later chapters will consider this policy in more detail, the essential characteristics of the framework satisfies the necessary conditions to guarantee the right to work within the legislative structure of a nation.
Effectively, the government uses its fiscal capacity to guarantee the right to work by offering a guaranteed, socially-inclusive minimum wage to continuously absorb workers displaced from the non-government sector.
The Job Guarantee would automatically increase government employment and spending as jobs were lost in the non-government sector, and decrease government jobs and spending as the non-government sector expanded.
In other words, it constitutes a mechanism through which the right to work could be delivered.
To eradicate the burden of mass unemployment governments must implement new policy structures.
First, the right to work must be recognised and codified within legislation. Governments must be held accountable for their responsibily to enforce the legislation, which means they have to stand ready to provide sufficient work for all those who desire it.
Second, by guaranteeing the right to work, the State is forced to develop and implement a full employment policy.
Third, the introduction of a Job Guarantee offers a means for realising the right to work and full employment objectives. It is a practical solution and should be the minimum policy offering for any government serious about maintaining the human right to work.
The series so far
This is a further part of a series I am writing as background to my next book with Joan Muysken analysing the Future of Work. More instalments will come as the research process unfolds.
The series so far:
The blogs in these series should be considered working notes rather than self-contained topics. Ultimately, they will be edited into the final manuscript of my next book due out in 2018 and will probably be published by Edward Elgar (UK).
That is enough for today!
(c) Copyright 2017 William Mitchell. All Rights Reserved.