Australian working people have been cruelly betrayed over the past forty years by those elements of the ALP and union leadership who have countenanced the use of unemployment and under-employment as a socio-economic weapon. These people have treacherously dishonoured the historic achievement of Curtin and Chifley who during and after WW2 showed Australians that the federal government can keep the unemployment rate under two per cent if it wishes. They proved that by adjusting public sector employment and expenditure in response to shifts in private sector activity they could keep aggregate demand at a sufficiently high level to ensure the nation’s productive resources were reasonably fully utilised, particularly its willing labour resources.
Alex Carey (1995) and Sharon Beder (2006) have documented the multi-million dollar corporate funded US ‘economic education’ campaign that began in Australia in 1976, establishing the mantra of ‘small government’, ‘deregulation’, ‘private sector good – public sector bad’ that corporate-funded politicians, think tanks and media commentators have been chanting ever since. It is what most people now understand to be ‘economics’, and is in fact the recipe for permanent chronic labour under-utilisation.
Proponents of the Job Guarantee point to key characteristics of modern monetary systems currently in place in countries like the USA, UK, Australia, Canada, Japan, Brazil – in fact nearly all developed countries apart from those who use the Euro – which mean they do not behave, nor impose the constraints on more socially progressive policies, as the prevailing voices of economic orthodoxy claim they do. The pertinent characteristics of the monetary systems of such countries are that their central governments are the sole sovereign issuers of the currencies used by their citizens, their currencies have floating exchange rates, and are not pegged in their value to a quantity of gold or similar precious metal. As a consequence of these characteristics these central governments (eg., the Australian Commonwealth Government) can never run out of money, unlike the households, firms, state governments, local governments, and all other economic actors who use their currencies.
Such central governments could buy everything in an economy before they could ever run out of money, though in outbidding other people that want those same things they would obviously generate a massive inflation. But when productive resources are left unutilised, with no other offers from other buyers, as in the case of the unutilised labour of unemployed people, a government with a modern monetary system can buy as much of it as they want, at the lowest legal price (eg. the federal minimum award), without exerting upward pressure on its price.