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October 01, 2013

Comments

Frank Rizzo

Tim Worstall with an aggressive and simplistic argument? No..

Tim Worstall

Eek, Yah, mebbe.

I'm arguing about something rather different though. The propensity of politicians and other reprobates to insist that their plans are wonderful because they create lots of jobs.

I accept your distinctions above: but in the political rhetoric of our day we do have this idea that "creating jobs" is almost the be all and end all of the benefits of a policy. I'm insisting that we should look at jobs as the cost of a policy or programme, not a benefit.

It may well be that some of the side effects of a job are worthwhile. But the job itself is a cost, not a benefit. It's obviously a cost to the person that has to pay to get the job done. It's similarly clearly a cost to the person doing the job: otherwise, why would anyone demand payment for doing a job? And societally, there's the opportunity cost of having someone doing this work not that other.

That there are benefits, as you say, to employment does not change the point that we should always be regarding a job as a cost.

We must, at least, get jobs on the right side of our cost/benefit analysis. Otherwise we'd end up being Neal Lawson and that's a fate too horrible to imagine.

Oli

I once went to an excellent talk by a chap who actually built the bridge on the river Kwai. He was rather upset about the film: their real motivation was to show their captors they couldn't break them. Amazing man, but the point doesn't undermine you.

Neil Wilson

Fiscal multipliers below one are not necessarily a cost.

That assumes

(i) that saving has no value - clearly it does.
(ii) that you are preventing something else happening by the government engaging people. At the moment the alternative is nothing else happens.

Beware of using fixed exchange, fixed quantity arguments..

Larry

If "jobs are a cost not a benefit", then why do so many people seem to want one?

Richard Gadsden

Larry, it's not a job people want, but a salary.

Most people can't imagine getting paid without working - but try asking "would you rather have a job or win the lottery?" and you'll soon see.

Neil

If it's all about the opportunity cost, why do people waste time writing awful 'clever-clever' cliches on their blogs, rather than do something they're actually good at?

rogerh

Build capital kit - transfer workers to other useful work. Not to do so is to miss out on other goodies - talk shows, soaps, journalists, anaesthetics, the occasional inventor etc etc. The reductio ad absurdum is that we all end up as high-level advisers, theoretical physicists, poets and chess experts or just laze around whilst across the world robots till the fields and drill for oil.

We are only in the foothills of the above Nirvana and in trouble already. Those who cannot be found work are stuck with 'living on the parish', they are stigmatised - a few quite rightly. But what is not said is 'You with the job - yes you, hand over a wedge to look after those without'. Why? Because we have not built all the robots yet - the alternative is to send the unemployed off to the pie factory - and you are next in line.

So, will we ever build all the robots? Will Nirvana turn into hell? As things stand the political narrative is medieval and as untruthful as ever. BTW, what do you do for money in Nirvana - who gets the hovel in Middlesborough and who the villa in Tuscany?

Larry

@Richard Gadsen Yes, or try asking people "do you want your job, or shall we fire you?" and you'll soon see.

People generally want jobs - it shouldn't really be a controversial point.

The broader point is this: if I give you £10 for nowt, that is a cost to me and a benefit to you. So whether something is a cost or a benefit depends on which end of the deal you're on.

The mantra that "jobs are a cost not a benefit" rather ignores this obvious point.

Peter Risdon

It depends on the direction from which you're viewing the transaction. Widget are less emotive: they're expense for the buyer and income for the seller. It's nonsense to say that widgets are a cost to the seller because the seller wants money for them.

Jobs are a benefit to the employee and a cost to the employer.

Maybe someone could invent a system of bookkeeping that reflects this double aspect of transactions.

Zorblog

Tim Worstall is right, both in his statement and his comment.
Jobs are a way of producing goods and distributing goods. When you can think of another way for producing goods (such as robots or low-paid Asian workers), you should also think of another way of distributing them (or distributing money).
I'm afraid that for once Chris is victim of a moralistic approach (one that may be the biggest flaw of Marxists by the way).

Zorblog

By the way, there are plenty of other ways of keeping people busy other than jobs.
Hobbies, sport, culture, charities, food, etc.
There is about a quarter of the population (including aristocrats and retirees) that don't have a job and don't need one for their living. Are those people unhappy (apart from a few desperate housewives)?

Damien

@Zorblog: I mostly agree with you, but with one caveat. In present society, there's a huge difference between being retired and being unemployed. Pensioners are by and large perceived as people who have been working their whole lives and are now enjoying some well-deserved rest. The unemployed, on the other hand, tend to be perceived as lazy scroungers who'd be having a job if they really wanted to. Being unemployed is much more stigmatized: if someone ask you what you do at a party, would you rather say you're retired or unemployed?

Of course, the ideal solution would be to change people's view of the unemployed. But I'm sceptical about it. It comes from the same deep-seated instinct as the idea that "creating jobs" is always a good thing because more work equals more prosperity, and the concept of output doesn't enter the picture.

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