When the U.S. economy is sluggish or when a recession like we are currently experiencing happens, the U.S. government with all good intentions, invests its resources in government-created jobs to try to bolster the economy. History would say this kind of activity evidenced by the effect of World War II on the post-depression years is a recipe for success. World War II production is frequently identified as the key variable that pulled the U.S. out of the Great Depression. There is little doubt that the nationalism and sense of pride experienced by the U.S. post-World War II set the stage for decades of prosperity yet unforeseen in the world. Wouldn’t it be nice to experience that sort of economic revival today?!
Unfortunately, times are different today, and the activity of creating government jobs actually disguises the problem and diminishes economic growth, especially in the long run. So what’s so different today? A full and sold-out commitment to something like a world war serves to unite a country of diverse people toward a common end. With a clear end in mind, citizens become patriot soldiers, if only from afar, who contribute in their way and with their means in something bigger than themselves. They volunteer. They sacrifice. They give. They hope. They pray. They unite.
What happens to these same people post world war? After the euphoria of victory has passed, they settle into peacetime, and arguably, get lazy. What was considered the ultimate in public service supporting a critical common end, becomes a mundane, paper-pushing, check-the-box, work-for-a-pay-check, “you owe me this job because of my service,” type of employment. Recent history speaks to this phenomenon. Tell me you don’t experience this as a citizen who engages those employed providing government services. Gross over-generalization? Not hardly. This becomes the peace-time government employment culture. Yes, there is a thread of public service commitment and patriotism, but it is often far outstripped by the lack of innovation and sense of entitlement.
So, when the economy slows down and/or a recession is on the horizon, the natural response is to believe that growing government jobs, like those generated during World War II, will help generate the same kind of prosperity experienced thereafter. Unfortunately, the employment culture, as it does in the marketplace, will often dictate results. So the government, with all good intentions, creates jobs in a ‘thread-of-patriotism’ work culture that is lazy, technology-poor, lacking innovation, and entitled. Acknowledging this commonly experienced government work culture, some may argue that some jobs are better than no jobs. True, as long as the core problem is not disguised and as long as the effort does not diminish economic growth. I contend that adding government jobs in this type of work culture does both.
Disguising the Problem
Including government jobs with marketplace jobs in the pool of jobs created infers that the jobs are equal. Are they? In the marketplace, there is a bend and necessity to innovate, perform, work hard, earn, thrive, and compete. Failure to do so will likely mean one’s demise. In the peacetime government work culture, failure to innovate, perform, work hard, earn, thrive, and serve appears to have no consequence. On the contrary, this work culture provides one insidious benefit; it preserves employment for those imbedded in the culture. And we wonder why the government doesn’t change!
Diminishing Economic Growth
By creating government jobs, a healthy cycle of economic activity becomes tainted and the government activity in the realm of the marketplace signals the absence of rules and regulations intended to protect competition and individual liberties while also setting the stage for more debt and future taxation of citizens. Both of these serve to diminish economic growth.
Citizens working in a free market bring their time and talent to the pool of factors of production to be leveraged together, converting factors into value in the form of goods and services offered to citizen households. Where value is recognized, these good and services are purchased by citizens providing revenue for the combined effort of citizens in the process of work – or the company. The company then rewards the citizens through compensation for their value-added work. The citizens contribute daily, converting factors to value, buy goods and services, and the cycle continues. This is what a healthy cycle of economic activity looks like.
When economic troubles hit with the inevitable rise in unemployment, many citizen households cannot consume the goods and services produced by the combined effort of many. The company scales back in an attempt to survive or buy time to innovate and protect the value in its remaining workforce. Often wages are diminished and households begin to scale back spending on goods and services perpetuating the economic slowdown. Though things are bad in this economic cycle, the need to survive and compete fuels the company to improve and compete. This sets the stage for enhanced performance in the future, driving quality-of-goods and services up, bringing, over time, an economic recovery.
When the government, with all good intentions, injects an increase in either government jobs or programs intended to support those without jobs and incomes, they unknowly taint the pool of factors of production. What were motivated, liberty-loving, free-to-choose workers begins to realize that the government will provide subsidies that take care of them when times are tough. The government peacetime work culture, absent a compelling common end, begins to infect the mind-set and work ethic of those needing and receiving help. Those seeking and able to secure employment on the heels of government jobs created in the economic downturn are now subjected to the government’s lazy, technology-poor, lack of innovation, and entitled peacetime work culture.
When the combined efforts of many in the marketplace – the company – successfully reengineers out of necessity, they now need more factors of production in the form of workers. What is the quality of the pool now available to them? Some have been infected by being supported by government for months and years and some have found employment in a culture that is unproductive and self-protecting. The overall pool of talent is significantly diminished. The goods and services offered to citizen households suffer and the combined effort of many – the company – fails to compete, putting more workers at risk and perpetuating the economic slowdown. This is the effect of government jobs created tainting a healthy cycle of economic activity.
Equally as diminishing on economic growth is the anticipated effect on future taxation of adding government jobs. From where do these jobs receive the resources for compensation? From taxing the citizenry. If the government were an enterprise committed to efficiency and effectiveness, adding jobs would not be perceived so negatively. Because we experience the government quite differently; as a place where few employees are rarely, if ever reduced, it is easy for the combined efforts of many to anticipate higher taxes to pay for the increased number of jobs. If taxes are not increased, the increased borrowings or debt is anticipated as the answer, placing the concern for debt service squarely on the mind of the company. This activity is foreseen as a response to economic sluggishness in the future and further reduces hope for the future and related investment in innovation and improvement. Adding government jobs in an economic downturn is a double-whammy.
Absent a suitable alternative choice, it is the desire to care for those in need that drives a well-intended government to intervene and try to help. Unfortunately, the unintended consequences are many and they disguise the problem and diminish economic growth. If an alternative answer existed that helped those in need and did not disguise the problem and actually accelerated economic recovery, would not the government defer to this alternative? I think so.
There will rarely, if ever, be a time when those in need or the poor, the hungry, and the oppressed will not be among us. So absent government support and government created jobs, what can be done? The first and best alternative is to expect the citizenry to care for their neighbors out of their resources in a way that manifests the dignity of each human being, the common good, and the universal destination of goods in forms of charity. One must be careful to not limit help to charity. The same unintended consequence generated by government assistance can result. Neighbors should invest in their neighbors through skill development and giving. Giving? These are people in need! If it is more blessed to give that receive, then why would we deny those in need the blessing of participating in giving to others out of their need or poverty? Most people have something they can offer in the giving effort that not only helps others, but that encourages innovation, improvement, work ethic, and earning, even if what is earned is only a ‘thank you.’
This first and best alternative implies some moral compass that often accompanies faith in God and a practice of that belief. With the diminishing of God at the center of our country and the relevance of the Christian church in question, this is unlikely to be a timely alternative. If Christian business leaders would take this role seriously, we could begin to forge this answer in our world, but it would require the dismissing of the dominant ideology; that the purpose of business is to maximize shareholder wealth. This ideology does little to temper abuses and perversions that often accompany wealth generation and puts too much weight and expectation on the shareholders. Those of us blessed to live in the U.S. have a responsibility to share our resources, independent of the magnitude of them.
While we wait for the first and best alternative to mature, the second best alternative is to reengineer government to be more efficient and effective at delivering needed goods and services to those who are marginalized or who cannot fend for themselves. This alternative is difficult because improvement and innovation will likely mean the reduction of government jobs and an increase in overall unemployment; neither of which is a popular political outcome. But unlike the unintended negative consequences of increasing government jobs, this alternative produces some very positive intended consequences.
The reduction of government jobs will signal to those engaged in the combined effort of many – the company – that we are committed to serving those in need and protecting the common good while also protecting individual liberty and the process of market investment, innovation, and competing on a global scale. In this case, the illness is far worse than the cure. Absent a new evangelization that brings God and Jesus Christ back to the center of our country and to each business leader and citizen, a leaner and stronger government focused on the common good delivering goods and services efficiently and effectively is the best alternative to creating government jobs. We should plan and execute the latter and pray for the former.