Keywords: modern money, price stability, hyperinflation, inflation, basic income guarantee, employer of last resort, job guarantees, employment guarantees
Universal assurances in the public interest: evaluating the economic viability of basic income and job guarantees
This article evaluates the strategies of guaranteeing unconditional basic income against those of guaranteeing employment. It is argued that, moral justifications notwithstanding, an open-ended commitment to either policy requires a clear grasp of its macroeconomic effects and institutional aspects. The tax-driven approach to money (also known as 'modern money') reveals that, while government funding for either proposal is not 'operationally' constrained, it produces disparate economic outcomes, depending on the program design of the universal guarantee. A modern money critique of the basic income proposal demonstrates that, in a monetary production economy, the unconditional supply of the monetary unit is inherently inflationary. By contrast, job guarantees can provide an important safety net by simultaneously stabilising prices. Additionally, job guarantees offer an institutional vehicle for achieving other social goals that are important to all advocates of universal assurances. The paper concludes that, to provide for all members of society, a joint policy option is necessary and outlines the broad contours of such a policy.