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Humanity’s phenomenal social progress over the past few hundred years has been driven by the realization that maximum development of the collective is accomplished by providing maximum freedom and opportunity for the development of each individual member of the collective. This realization underlies the extension of fundamental rights to every citizen, which is the foundation of all democratic forms of governance. The same realization also underlies the commitment of all societies to provide universal primary education to all their citizens. The combination of democracy and education has formed the basis for the scientific, technological and industrial revolutions that have spurred a 20-fold increase in real per capita income in Western Europe since 1800, while halving the average number of working hours since 1900, which makes the accomplishment even more remarkable. The further extension of fundamental human rights to other spheres constitutes the essential and most powerful lever for both extending and accelerating the process of social development worldwide.
The science of economics was founded at a time when it was widely believed humanity had limited capacity to meet its basic material needs. Global achievements during the last century discredit this notion. The economics of global scarcity is rapidly giving way to surplus production capacity, at least with regard to a wide range of basic commodities. Today a few nations possess the potential capability of supplying the entire world’s need for food, clothing, steel, automobiles, computers and many other commodities. The real issue today is not the world’s capacity to produce sufficient goods and services to meet everyone’s material needs, but the capacity of our economic systems to provide everyone with the purchasing power needed to fulfill those needs.
The social life of large sections of humanity has been radically transformed over the last century. Hundreds of millions of people have been drawn away from a subsistence level existence in agriculture to urban areas and industrial employment. These changes have been accompanied by an unprecedented advancement in living standards around the world. At the same time, they have promoted a way of life that makes individuals far more dependent for their economic security on external social conditions than they have ever been in the past.
Today the livelihoods of billions of individuals around the world are powerfully influenced by factors affecting the national and global economy, such as trade policies, interest and exchange rates, levels of military spending and consumer demand. While it dramatically enhances social, political, religious and intellectual rights and freedom, at the same time modern society has become so structured that it also reduces freedom for individual economic initiative in many ways. Governments today routinely intervene in every aspect of the individual’s economic existence. These interventions exert a powerful influence on the type and number of jobs available in every country. Employment opportunities are directly linked to government policies governing minimum wage laws, interest rates, budget deficits, imports and exports, environmental regulations and restrictions, taxation policies, defense spending, immigration, industrial development, investment, licensing of practitioners, zoning laws and countless other public policy issues. A tax system that provides incentives for capital investment in the form of depreciation allowances while discouraging employment through the levying of payroll tax is an example of an explicit policy that creates an inbuilt bias toward investment in technology rather than labor.
Under the current economic system, employment is the only viable means of distributing purchasing power to every citizen. As the right to vote is the basis for modern political democracy, the right to employment is the essential foundation for economic democracy. In the absence of alternative means of ensuring the livelihood of all its citizens, society has the responsibility to provide employment opportunities for everyone. Employment can no longer be considered a privilege. It is a necessity for economic survival and should be recognized as a fundamental human right. The Initiative should project the view that the right to employment must be backed by the full commitment and determination of governments.
An international labor convention calling for a commitment to full employment was ratified by over 80 countries in the mid 1960s. During the early 1990s, the United Nations called for a broader definition of human rights to include economic as well as political rights. This view was strongly projected by the International Commission on Peace and Food (ICPF) in the report it submitted to the United Nations in 1994 entitled Uncommon Opportunities: An Agenda for Peace and Equitable Development. The Commission argued that global prosperity can become a reality in the near future, provided that the necessary foundation is laid down and the cornerstone of that foundation is a global affirmation and commitment to extend fundamental economic rights to every human being.
- Recognizing the right of every citizen to employment is the essential basis and the most effective strategy for generating the necessary political will to provide jobs for all. What is needed is not another job generation program, but a change in social values that will accelerate the natural and inevitable evolution of society, from one in which labor is regarded as a dispensable resource to one based on full human rights and the enormous productive potential of the human being. The type and magnitude of change needed today is comparable to that embodied in President Roosevelt’s New Deal for the American people during the Great Depression at a time when 25 percent of the work force was unemployed, to the Indian Government's decision to launch the Green Revolution in the mid-1960s to achieve self-suf¬ficiency in food grains at a time when the country was highly dependent on imported food to stave off famine, and to Mikhail Gorbachev’s initiatives late in the 1980s to end the Cold War and transform Soviet society.
Affirmation and commitment to this principle does not mean that government should or could employ every job seeker, any more than a commitment to food security means that government should or could by itself grow all the food needed to meet all the needs of its population. What it does mean is that government has the obligation—and it also has the power—to formulate and modify its policies to make the economic system meet the objective of full employment.
The power of this commitment can be illustrated in the case of Japan, which has been struggling to revive consumer confidence and economic growth for more than a decade. The Japanese people enjoy one of the highest living standards in the world and possess in excess of $10 trillion in personal savings. Yet, repeated efforts by the government to stimulate the economy through public works expenditure, large scale government borrowings, soaring public debt, zero interest monetary policy, and restructuring of entire industries have failed to bring about a recovery. The primary reason for this failure is the loss of the people’s confidence regarding employment and financial security. During the 1990s unemployment rates have risen from under 2% to nearly 5%, causing widespread anxiety regarding the future. Although the government possesses many policy instruments that can address this issue, its commitment to other goals has aggravated the county’s economic problems and delayed recovery. A commitment to full employment could dramatically change public sentiment, investment and consumption patterns within a short time, which fiscal and monetary policies have thus far been unable to do.
Is full employment possible?
None will quarrel with the desirability of full employment, but many will question whether it is practically possible. Therefore, it is essential that the conceptual framework reveal the enormous untapped potential for additional employment generation nationally and globally. The initiative must project the view that society has the ability to create as many jobs as necessary without undermining the basic efficiency of the market economic system, provided it first makes the commitment to give employment the importance it deserves.
In its World Employment Report 1995, ILO argued that “if most countries accept the defeatist attitude that full employment is unattainable then this by itself is likely to contribute to a worsening of the current situation.” The converse is also true. If the countries of the world accept the constructive attitude that full employment is attainable, attainable in the near or mid term, then this by itself will generate commitment, release energy and compel actions to achieve it.
A theoretical framework for employment is essential because it will establish the fact that full employment is an achievable goal. Quoting further from ICPF’s report:
- We must recognize that the present status and functioning of our economies is the result of specific choices that have been made in the past, based on priorities and values that were relevant or dominant at the time, but which we certainly are not obliged to live with indefinitely and, in fact, are continuously in the process of discarding in favor of new values and priorities. The rapid adoption of environmentally-friendly policies around the world is positive proof of how quickly the rules, even economic rules, can change when there is a concerted will for a breakthrough. So too, the welfare policies of the European Union that have resulted in 70 percent rise in national income over the past two decades, but only a 9 percent increase in the number of jobs, were due to conscious choices that favored the employed over the unemployed, not the inevitability of the market.
The task of the initiative is to identify those ‘conscious choices’ that determine the current composition of economic activities and to demonstrate that a modification in those choices can usher in an economic system which generates greater opportunity and prosperity for all, just as the introduction of universal suffrage and universal education engenders a stronger, freer, more productive society for all.
- International Commission on Peace and Food, Uncommon Opportunities: An Agenda for Peace and Equitable Development, Zed Books, 1994, p.86.