JEEP: no laughing matter

Ian Boyne, Contributor

Ever since Portia Simpson Miller announced at her party conference in September that, if elected, she would create the Jamaica Emergency Employment Programme (JEEP), there has been no shortage of jokes and belly laughter around the acronym.

I immediately thought that the People's National Party's (PNP) usually perceptive communications people had slipped up badly, as it was not difficult to predict that detractors would have a field day in ridiculing the very name of the programme.

The PNP has clumsily played into the hands of its critics by providing them with exactly the name which would guarantee diversionary humour, trivialising what is no laughing matter: The urgent need to create employment for our underclasses and others.

But there is one positive unintended consequence of all this boundless humour and endless jokes about JEEP: Employment creation is now prominently on the agenda, sharing space with economic growth, the International Monetary Fund (IMF), energy, interest rates, inflation and investments. For a long time, employment had been seen as a by-product of growth, a mere trickle-down effect from increased investment in the economy.

Once you took care of the macroeconomic environment, created a business-friendly environment, kept interest rates and inflation low, then as night follows day, employment would grow. That was (and is) the mantra of the Jamaica Labour Party and its neoliberal cohorts. That they have been crashing against all the evidence all over the world does not matter one bit. They continue believing in magic - the 'magic of the market'.

What the PNP has done is to again centre-stage employment and the plight of the unemployed, and to get us talking about how we can create jobs. Even if we think JEEP is unadulterated foolishness and madness, impracticable, counter-productive, etc., it gets us talking about employment. So if not JEEP, what? Let us debate the issues. Those who feel that we deal with unemployment by dealing with the macroeconomy and by following IMF prescriptions, should draw for the empirical evidence.

Serious job challenge

Just this past week, the International Labour Organisation (ILO) issued its 121-page Global Employment Trends 2012 report subtitled 'Preventing a Deeper Jobs Crisis'. Says the report: "The outlook for global job creation has been worsening. The world enters 2012 facing a serious job challenge." The ILO report goes on to say: "Faltering employment creation and ensuring weak growth in labour incomes have been at the heart of the slowdown in global economic activity and the further weakening of public finances."

In other words, employment growth is good for the economy, while economic growth, in itself, is not necessarily good for employment growth. All over the world there is the phenomenon of jobless growth. Indeed, that is becoming almost a structural issue at this stage of 21st-century technological development.

The ILO goes on to make an important point in its premier annual report: "The ILO's particular concern is that despite large stimulus packages, these measures have not managed to roll back the 27-million increase in unemployed since the initial impact of the crisis. Clearly, the policy measures have not been well targeted. Indeed, estimates for advanced economies regarding different labour-market instruments show that both active and passive labour-market policies have proven very effective in stimulating job creation and supporting incomes."

That is very important. The ILO is showing that labour-market policies have an impact on job growth. Laissez-faire capitalism does not guarantee employment growth. The ILO has more: "Country evidence across a range of labour policies - including extension of unemployment benefits and work-sharing programmes, the re-evaluation of minimum wages and wage subsidies, as well as enhancing public employment services, public works programmes and entrepreneurship incentives - show impacts on employment and incomes." These are the hard facts. Let the neoliberals come with their 'facts'.

Notice one of the initiatives is in the category of public works programmes - like JEEP. But in Jamaica, JEEP is the butt of humour, satire and lampooning. The PNP has not done a good job of selling the programme, even conceptually, perhaps because it is too afraid of being labelled 'socialist'. I am happy to see that Wayne Chen, head of the Jamaica Employers' Federation and certainly no socialist, call for a jobs summit. If JEEP has done nothing else, it has got people like Wayne Chen to talk about jobs and not just interest rates, inflation, foreign direct investment and the general macroeconomy. JEEP has influenced public discourse. If the humour has helped to keep it alive, let's now use that window of opportunity to have a serious discussion about the way forward to job growth.

One of the major problems I find with neoliberals is, as Ha-Joon Chang and Erik Reinert have demonstrated, is that they are ahistorical. If they had a sense of history, they would not talk the ignorance they often do.

What did the United States do to get itself out of the Great Depression of the 1930s? Wait on the private sector, 'the engine of growth', to rev up the vehicle? No.

Franklin D. Roosevelt (FDR) created public works programmes and put people to work. And that work involved using unskilled labour. People forget that we can't simply forget about our large army of unskilled, and that while the grass is growing, the horse is starving - to answer these who say 'train them, don't given them unproductive work'. They need to earn to feed themselves now, not tomorrow.

DANGER OF IDLE HANDS

Many have not calculated the potential costs of this army of unemployed, most of them young, energetic, testosterone-driven men having nothing to do and no income. They represent a national-security threat. What you don't expend on them in public works programmes like JEEP, you would have to expend on crime-fighting efforts and on prisons.

FDR created the Civil Works Administration (CWA) in November 1933 as the US headed into its fifth depression winter. CWA did not offer tax breaks. Unemployed people were put to work. In a fascinating article in the December issue of Harper's magazine ('More government, please!'), Thomas Frank says CWA "did not wait for grand projects to be fleshed out: It simply sent people into the nation's public spaces to rake leaves, shovel snow, fix roads, dig ditches and so on. The programme's administrator, Roosevelt confidant Harry Hopkins, had famously spent more than US$5 million in his first two hours as a federal official. At the CWA, he found jobs for four million people in two months."

It is true that emergency public works programmes are just that - emergency, unsustainable work. But no one can accurately estimate the benefits of finding work, for even a short period, for some idle hands - for whom the Devil can find lots of work.

What must happen is that any such works programme be completely transparent and have accountability mechanisms - and be out of the hands of politicians. I completely back Carol Narcisse and her Civil Society Coalition group in their call last week for a multi-stakeholder approach to allocating work for JEEP and other such public works programmes. This matter of choosing work on partisan or even bipartisan basis must stop now. Only with proper accountability mechanisms can JEEP and similar-type projects be optimised.

I agree with the Civil Society Coalition: "Members of Parliament and councillors should be one point of reference, but should not control the implementation of the project." (Incidentally, I have great hopes for and enormous confidence in the impartiality, fearlessness and non-partisanship of Carol Narcisse. She also possesses a very fine intellect.)

Those who believe in 'the invisible hand' of the market as the best means of creating employment should cite examples of countries with a neoliberal model where employment growth is strong. And I urge these neoliberals to get a copy of the Economist magazine (January 21-27) now on the stands, with the 14-page cover feature on 'The Rise of State Capitalism: The Emerging World's New Model'.

There is a lot of misinformation being given in the media by free-market purists. They make no bones that Government can't get anything right and that only the private sector can grow an economy. I don't know whether they have ever heard about China, India, Brazil or Russia, or knew how the Far East achieved its miracle.

Says the Economist special report: "State capitalism can also claim some of the world's most powerful companies. The 13 biggest oil firms ... are all state-backed ... . But successful state firms can be found in almost any industry. China Mobile is mobile-phone Goliath with 600 million customers. Saudi Basic Industries is one of the world's most profitable chemical companies. Russia's Sherbank is Europe's third-largest bank by market capitalisation. Dubai Ports is the world's largest port operator. State companies account for one-third of the emerging world's foreign direct investment between 2003 and 2010, as well as a growing proportion of the very largest firms."

I wonder how many know that "the rich world still has a large number of state-dominated companies. For example, France owns 85 per cent of EDF, an energy company; Japan, 50 per cent of Japan Tobacco; and Germany, 32 per cent of Deutsche Telekom. Across the OECD (Organisation of Economic Cooperation and Development), state-owned enterprises have a combined value of almost US$2 trillion and employ six million people."

Keep these facts in mind the next time you are listening to financial analysts on talk shows or reading neoliberals writing in Sunday's 'In Focus' about why Government can't successfully run anything.

"Governments are becoming more sophisticated owners," says the Economist (no socialist rag). "State capitalism has also been successful at producing national champions that can compete globally. Two-thirds of emerging-market companies that make it into the Fortune 500 list are state-owned, and most of them enjoy state largesse of one sort or another. Governments can provide them with resources they need to reach the global markets."

The problem is our State has been too inefficient, business-destroying and corrupt. We must reform the State and make it people-centred, not do away with it. And the State must concern itself centrally with employment issues. I say, get the JEEP on the road!

Ian Boyne is a veteran journalist. Email feedback to columns@gleanerjm.com and ianboyne1@yahoo.com.