FJG competition destroys biz con and decks growth

Even more troubling, there's the possibility that the guaranteed federal jobs could cannibalize the private sector and make the economy less productive. The New Deal jobs programs were undertaken at a time when the economy had a huge amount of unemployment, and there was little chance that workers with private-sector jobs would jump ship. But in the absence of very high unemployment like that of the Great Depression, a job guarantee will compete with private companies.

And the job guarantee would often win that competition. Modern proposals would require that the federally guaranteed jobs be good jobs, with good pay and benefits. For example, here is the relevant text from the Green New Deal resolution recently introduced by Rep. Alexandria Ocasio-Cortez: "guaranteeing a job with a family- sustaining wage, adequate family and medical leave, paid vacations, and retirement security to all people of the United States."

This sounds better than many of today's low-wage jobs.

Competition from these government-sponsored jobs would have an initially healthy result. It would force private companies to raise wages and increase benefits in order to keep up with the government. But as private-sector jobs improved, activists' notion of what constitutes a good job would increase, and they would call for steadily higher wages and benefits for government work. Eventually this would exceed private companies' ability to pay, so the job guarantee would come to represent the benchmark in the labor market and make up an ever-larger slice of the economy.

This would reduce productivity, since government jobs would likely generate less real value than private-sector jobs. Economists have found evidence that the beneficiaries of short-term government jobs tend not to go on to find work in the private sector after the programs end, suggesting that guaranteed jobs would be low-productivity work. As activists forced government wages and benefits higher, the private sector would find itself deprived of cooks, janitors, housekeepers, cashiers and the other people who make a modern economy run. In a worst-case scenario, this would be a one-way ratchet to a peculiarly dysfunctional form of communism.