Ending Poverty: Jobs, Not Welfare

by Hyman P. Minsky

Although Hyman P. Minsky is best known for his ideas about financial insta¬bility, he was equally concerned with the question of how to create a stable economy that puts an end to poverty for all who are willing and able to work. This collection of Minsky’s writing spans almost three decades of his published and previously unpublished work on the necessity of combating poverty through full employment policies—through job creation, not welfare.

Genres: Economics, Politics, Sociology, Nonfiction

272 pages, Kindle Edition

First published March 27, 2013

About the author

Hyman Philip Minsky (September 23, 1919 – October 24, 1996) was an American economist, a professor of economics at Washington University in St. Louis, and a distinguished scholar at the Levy Economics Institute of Bard College. His research attempted to provide an understanding and explanation of the characteristics of financial crises, which he attributed to swings in a potentially fragile financial system. Minsky is sometimes described as a post-Keynesian economist because, in the Keynesian tradition, he supported some government intervention in financial markets, opposed some of the financial deregulation policies popular in the 1980s, stressed the importance of the Federal Reserve as a lender of last resort and argued against the over-accumulation of private debt in the financial markets.

Minsky's economic theories were largely ignored for decades, until the subprime mortgage crisis of 2008 caused a renewed interest in them.

Reviews

[Tommy · Rating 4 out of 5]

Collection of essays from 1960s-90s. Questions the consequences of economic growth for solving poverty, the structural desirability of "to big to fail" private institutions and the effects of typical welfare and transfer programs. "Where the American Economy—and Economists—Went Wrong" is noteworthy.
There's quite a bit of naivety throughout some of these in retrospect though on various issues like the popularity and longevity of militarism as well as the prospects for Clintonian economics.

One obvious barrier to the elimination of poverty that will not be discussed is due to the existence of a military establishment whose fun and games absorb some 10 percent of the GNP. This is an especially relevant barrier to the elimination of poverty, for income used here includes the perceived benefits from the output of the public sectors. We can assume that for many Americans the perceived benefits from foreign adventures, military procurement, and space spectaculars are less, per dollar of expenditure, than from private procurement and public goods such as schools, parks, and safety on the streets. This barrier will not be discussed in detail because I assume, perhaps heroically, that it does not reflect powerful forces inherent in the American enterprise economy. No matter how powerful the military-industrial research institute complex may be, they are not, I hope, an essential characteristic of American capitalism.

In a tentative way the Clinton administration is trying to discover the contours of a “new” new model of capitalism: as yet it is not a conscious quest. But as one item in the menu of unmet needs leads to yet another, and as the administration seeks to define “the better” the country deserves, a “new” new model of capitalism will emerge which has as its anchors a commitment to full employment and a partnership of public and private agencies in the development of resources. This “new” new model will be based upon a more explicit recognition than anything that has hitherto guided policy in the United States: that the capitalist market technique of creating resources is flawed in that it is inherently myopic and needs to be permanently supplemented by the long view that government alone can have. Furthermore, in the complex system of product, labor, and financial markets that is a capitalist economy, the market mechanisms cannot achieve and maintain full employment. Institutions which supplement private employment with an open-ended supply of jobs are needed for capitalism to be successful.

[Jan Bos · Rating 2 out of 5]

Minsky has a strong argument, but the book is hard to read due to its old style and it being a collection of papers.