The Early Days of a Better Nation

Tuesday, February 10, 2009

Another 'Who knew?' moment

Fascinating post on the WPA's 'make-work projects' by the Infamous Brad. (Via.)


Very interesting link! Thanks, Ken.

That 800 billion dollar stimulus could fund a WPA-like program employing 4 million people (the nominal U-3 unemployment in the US, rounded up) fifty weeks a year for 30 hours a week for two years at $67 an hour. Some of that would need to go to tools, administration, health care, materials, etc-- but that is all stimulus too.

Shame we won't get anything like that.

Ken, I am going to send that fine link to my old friend Larry Wittner. He's a professor of history at the State University of New York at Albany, a well-known leftist historian and activist, and a peace researcher who wrote the definitive left-wing book on the worldwide Ban the Bomb and other disarmament movements (3 volumes, Stanford UP). A one-volume version is now in preparation. His teaching and some research centers on American History, so I am certain that he would like to have the link.

George, that's great - and belated thanks for all the links you keep sending me in email.

Well that was a hell of a read. I didn't really know anything about the WPA before, other than the fact that it existed and had something to do with job creation, so a history lesson was much appreciated...

I posted the following there:-

That's impressive, and it gave me stuff I can use for background information elsewhere that I hadn't known was there to look for. But I can see potential problems with funding anything of that sort on a large enough and long enough scale today, precisely because the pay back is long term and the bind has got so tight.

But about what you wrote about tax breaks not going towards jobs, you might want to look up the work of Professor Kim Swales of the University of Strathclyde and his colleagues. He has worked on a system of employment boosting tax breaks for countries with a GST/VAT or similar, like the UK, Canada and Australia (I also did some independent work on it). Those tax breaks are based on the number of people employed, and they don't have a funding problem either - it's engineered out. P.M.Lawrence.

I got a very angry reply, I don't know why. So I asked for clarification, in particular because I wanted to know why Brad Hicks thought that "It took this many days for someone to quote that ill-informed and unoriginal crank Swales to me? (1) Refuted. Trivially and in detail. Do a search on Krugman and Swales for a long link of point-by-point demonstrations that she [sic] doesn't understand even minimal economics, she's [sic] a flake..." - but answer came there none. (I have omitted the really angry part that jumped to conclusions and made recommendations about me.)

Well, I tried just that sort of search and... found nothing of the sort. Can anyone here point me in the right direction or tell me something about this from direct knowledge? Maybe someone has knowledgeable contacts at the University of Strathclyde? The thing is, internal evidence suggests that Brad Hicks may be too caught up in that anger to be objective, what with not even realising that Kim Swales is male. Also, that independent work of mine I mentioned backs it up with a separate line of argument. So, either Brad Hicks is mistaken (possibly about just which work I was referring to), or there is something else going on that I don't know about - and, if so, I would very much like to know about it and learn from it, if nothing else just why Brad Hicks found the mere topic so offensive.

Brad lives in a country which has been experimenting with tax-cut-stimuli for almost three decades. As a fellow citizen of that benighted land, let me assure you-- they don't work.

... Which doesn't stop half of the elected assholes from using it as their catch-all solution for everything.

That is where the venom comes from.

As for not being able to fund it... go ahead and divide 800 billion by your choice of unemployment numbers.

Ah, that's like saying that coal mining doesn't work because lots of mines have been tried in Italy and no coal was ever found. The Swales approach links tax breaks to staffing, and - as far as I know - that has never been tried across the board (a localised trial would just move jobs around and not affect overall numbers).

But that doesn't account for the specificity of Brad Hicks's response. He's clearly claiming that this in particular has been refuted, and that the refutation is easily found - but I can't find it, so I suspect he's reaching. I don't know that, though, so I want to find out more.

I have no doubt a new WPA could be funded with the money numbers now being thrown around, but I doubt that it could be sustained long enough to get out the other side of this recession/depression, let alone start paying for itself. That last objection applies to anything the funding was used for, of course, so you might as well buy some time for a WPA with it anyway in the hope that something would turn up. But whether the Swales approach worked or not, it could be sustained indefinitely. If it didn't work it would be revenue neutral, and if it did it would be budget neutral for countries like Australia that pay unemployment benefits from consolidated revenue, because the tax take would only fall in step with falls in unemployment benefit outgoings and on costs.

Different anonymous reader has come up with a very plausible explanation of the above, one that even fits Brad Hicks's accusations, gender confusion and suggestions about a search involving Krugman once you realise Brad Hicks was shooting from the hip and going for the wrong target anyway:-

I think you may be confusing Swales with Amity Shlaes, author of _The Forgotten Man: A New History of the Great Depression_.

...But that's still no excuse for being blinded by rage without even stopping to see if it was justified. It's like an autoimmune disease of the mind, getting in the way of proper function and doing more harm to the person who's got it than taking things easy would. Brad Hicks is self-blocked from ever checking out what I wanted to raise.

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