This idea outlines a policy synergy by which both full employment and strong infrastructure for education, skills, health, transport communications, energy, etc. could be achieved so as to meet Economic Growth, Challenge Three.
Challenge Three: to ‘maintain individual and collective quality of life (ICQL) while growing our economy’ could be largely met with a policy synergy designed to turn two structural weaknesses of our economy into four key strengths. Weakness 1, is that infrastructure and services for education, skills development, health, transport, communications, energy, etc, are well below potential either to maintain ICQL or to support economic growth. Weakness 2, is that unemployment significantly underutilizes the capacity of human resources to maintain ICQL or support growth.
Simplistically, a synergy for solving both weaknesses would emerge if it was feasible to simply engage all unemployed workers in building and delivering the infrastructure and services we need.
Realistically, of course, it is not that simple, BUT the principle is valid. In practice, an effective process would progressively (over 4-5 years) create and fill, say, half a million jobs specifically designed to build and deliver the infrastructure and services we need. This, in turn, would enable the unemployed to move into jobs which open up as the new jobs are filled and continue until full employment is reached. Strengthening skills training arrangements would facilitate the adjustment.
Over time, the policy synergy could be managed to sustain four key strengths: full employment, high quality infrastructure and services, enhanced ICQL and support for economic growth.
BUT: how would it be paid for?
Raising taxes would not work because it would take money from existing uses and the net gain would be zero.
In fact, the most effective way to ensure this level of sustainability is for government to directly print the money as needed.
BUT: aargh!! Surely printing money will cause rampant inflation? Well, NO, it won’t! There has been no inflation from the US and Japan printing trillions to bail out financial markets post GFC! Moreover, in this jobs for infrastructure approach there are built in controls: (i) the money is directed at unused resources; (ii) it will be phased in over several years; (iii) it will be offset by huge savings on unemployment benefit; and (iv) the whole process would be closely monitored.
In short, the case for printing money becomes very compelling. The potential to create – without taxes or borrowings – a simple synergy to sustain (i) full employment (ii) high quality infrastructure and services (iii) enhanced access to ICQL and (iv) support to growing our economy, must surely be worth a shot?