Funding a Job Guarantee

Adopting a conventional view of the need for governments to raise the funds they spend, I have argued that a well-designed Job Guarantee (JG) programme could be funded entirely from the savings and additional revenues it would generate (Harvey, 1989; 1995). In contrast, JG advocates working in the Post Keynesian tradition have grounded their proposal for funding such a programme on a more expansive view of the fiscal capacities of currency-issuing governments. Based on that view, they have argued that a JG programme could be funded without relying on any of the funding sources identified in my analysis of the issue (Mitchell and Wray, 2005; Tcherneva and Wray, 2005; Mitchell and Watts, 2005). This article argues that these two approaches to the funding issue are not inconsistent with one another and that they jointly reinforce the conclusion that a JG programme could achieve full employment without generating unacceptable levels of inflation.