EA Grant Proposal: Designing a Politically Viable Job Guarantee Pilot for New Zealand

(Drafted by Sonnet 4.6)

Funding requested: NZD $20,000
Duration: 6 months
Applicant type: Policy advocate / NGO
Primary cause frame: Global poverty & economic security (with AI transition co-benefit)

Abstract

Structural unemployment is one of the most robustly documented causes of poor health and poverty in the developed world — a 63% increase in mortality risk, enormous mental health burden, and in New Zealand, falling disproportionately on Māori and Pasifika communities. As AI displaces an increasing share of the labour force over the coming decades, this problem gets structurally worse. Yet the EA community has almost entirely ignored the policy response with the strongest theoretical and historical grounding: a Job Guarantee.

A Job Guarantee (JG) makes the government an employer of last resort — offering paid work to anyone who wants it, at a fixed wage, in socially useful community roles. It eliminates involuntary unemployment without inflating wages, acts as an automatic economic stabiliser, and builds the care and community infrastructure markets chronically underprovide. It has serious historical precedent: the US New Deal employed 8 million people; Argentina's 2002 JG programme reached 13% of the labour force; India's MGNREGA currently serves over 70 million households.

The bottleneck is not theory — it is design. Every serious JG proposal in the Anglophone world has stalled at the same point: no ready-to-implement programme architecture exists that a minister could hand to officials and say "cost this and run it." This post proposes closing that gap in New Zealand — a small, agile policy environment with a proven track record of exporting policy innovation globally — for $20,000.

Why is this neglected by EA? The JG sits in a structural blind spot. It gets pattern-matched as MMT-coded ideology despite strong non-MMT versions existing across the political spectrum. It triggers EA's wariness of policy advocacy over direct intervention. The causal chains are longer than bednets. And there are no EA-fluent champions who have run RCTs and published in EA-legible venues. None of these are good reasons to ignore an intervention with potential impact on hundreds of millions of workers globally.

The asymmetry is compelling. $20,000 funds a 6-month design sprint producing a publication-ready 500-person pilot specification. If ignored, the result is still a valuable contribution to the global policy literature. If adopted, New Zealand becomes the proof of concept that breaks the logjam for every comparable economy — and builds the institutional infrastructure the world will need as AI displacement accelerates.

I'm seeking feedback on the cause framing, the neglectedness argument, and whether this fits existing EA funding categories — and ultimately, whether this is something the community thinks warrants a grant application.

Background: What Is a Job Guarantee?

A Job Guarantee (JG) is a government policy that offers paid employment to anyone willing and able to work, at a socially acceptable wage, effectively eliminating involuntary unemployment. Rather than managing unemployment through welfare payments or hoping private sector growth will absorb surplus labour, the state acts as an employer of last resort — providing a permanent, voluntary buffer of public employment that expands during downturns and contracts as the private sector recovers.

The intellectual roots of the JG run deep. John Maynard Keynes argued in the 1930s that governments had both the capacity and the obligation to maintain full employment through active fiscal policy. Hyman Minsky, writing in the 1960s and 70s, developed this into a more explicit employer-of-last-resort framework, arguing that the price stability problems of traditional full-employment policy could be resolved if government hired at a fixed buffer wage rather than bidding up wages by competing with private employers. This insight — that a JG anchors price stability while eliminating unemployment — is central to the modern case for the policy.

The most fully developed contemporary JG framework comes from Modern Monetary Theory (MMT), associated with economists Randall Wray, Pavlina Tcherneva, Stephanie Kelton, and Bill Mitchell (an Australian economist whose work is particularly relevant to the Anglophone Pacific context). MMT argues that a sovereign currency-issuing government like New Zealand faces no intrinsic financial constraint on employing its own citizens in its own currency — the real constraints are labour and resource availability, not money. Under MMT, the JG is not just a welfare measure but a macroeconomic stabilisation tool: a countercyclical automatic stabiliser that replaces the current system, in which unemployment functions as the primary inflation anchor, with one in which a buffer of employed people serves the same purpose at far lower human cost.

The historical record of JG-adjacent programmes is substantial. The United States' New Deal in the 1930s employed over 8 million people through the Works Progress Administration and Civilian Conservation Corps, building infrastructure, schools, and public art that still exists today. Argentina ran a large-scale JG programme — Jefes y Jefas de Hogar — from 2002 to 2007 following its financial crisis, employing approximately 2 million people (13% of the labour force) at its peak, with documented reductions in poverty and strong evidence of private-sector transition. India's National Rural Employment Guarantee Act (MGNREGA), passed in 2005 and still operating, guarantees 100 days of paid work annually to rural households and currently reaches over 70 million households — the largest JG-type programme in history. Closer to home, New Zealand itself ran extensive public employment schemes through the Depression era and maintained near-full employment through active labour market policy until the neoliberal reforms of the 1980s and 90s deliberately reintroduced unemployment as a policy instrument.

The public health dimension is consistently underappreciated in economic debate. The evidence that unemployment causes — not merely correlates with — poor mental and physical health is now overwhelming. Unemployment is associated with substantially elevated rates of depression, anxiety, cardiovascular disease, and premature mortality. A landmark meta-analysis found that unemployment increases mortality risk by around 63%. In New Zealand specifically, Māori and Pasifika communities bear a disproportionate burden of structural unemployment, meaning the health equity case for a JG is inseparable from the poverty and racial justice case.

The AI transition context gives the JG renewed urgency. As automation and AI progressively displace routine cognitive and manual labour, the private sector's capacity to absorb the full working-age population becomes increasingly uncertain. UBI proposals have attracted significant attention as a response, but they address income without addressing the documented non-financial benefits of work — social connection, structure, purpose, and identity. A JG, by contrast, offers both income security and meaningful activity, while building the community and social infrastructure (care work, environmental restoration, local services) that markets chronically underprovide. In a world of significant AI displacement, the JG is not a temporary safety net but a permanent institutional architecture for a new relationship between people, work, and value.

The System & Bottleneck Being Targeted

The bottleneck is not the absence of good job guarantee (JG) theory — it is the absence of a credible, politically viable pilot design that translates MMT-grounded JG proposals into an implementable programme a centre-left or centre-right government would actually adopt.

The proximate failure point is this: every serious JG proposal in the Anglophone world has stalled not because governments lacked interest, but because no ready-to-go programme architecture existed — specifying employer of last resort mechanics, wage levels, job types, transition pathways back to private employment, and administrative infrastructure — at sufficient resolution that a minister could hand it to officials and say "cost this and run it."

New Zealand is the ideal jurisdiction to break this logjam. It has:

• A small, agile policy environment where a single well-connected NGO can move ideas to Cabinet
• A Reserve Bank and Treasury already familiar with MMT-adjacent arguments
• High public legitimacy around government employment schemes (historical precedent in public works)
• A growing AI-displacement anxiety that creates political demand for exactly this kind of transition architecture

This project targets the design gap — the missing schematic between "JG is a good idea" and "here is the bill."

Why Is This Neglected?

EA funders have largely ignored job guarantee work for three compounding reasons:

1. It is perceived as ideologically coded. JG is associated with heterodox economics and the political left, which causes risk-averse funders to avoid it regardless of the evidence on unemployment harms.
2. The public health case is underweighted. Unemployment and enforced idleness are among the most robustly documented drivers of poor mental and physical health outcomes. A conservative estimate from the UK and Australian literature puts the DALY burden of structural unemployment on par with mid-tier neglected diseases — yet this framing almost never appears in economic policy philanthropy.
3. AI transition funding has flooded into tech-side solutions (retraining, UBI pilots, STEM education) while the demand-side labour market architecture question — who employs people when private demand falls short — is almost entirely unfunded in the policy design space.

This means a small, well-executed grant can have outsized influence precisely because it is entering a low-competition, high-leverage design space.

What Does the $20,000 Fund?

The grant funds one focused 6-month pilot programme design sprint, producing a publication-ready policy document and stakeholder consultation process. Specifically:

The deliverable is a 40–60 page programme design document covering: institutional home for the JG (local government? MBIE? community employers?), wage and hours structure, job type taxonomy (prioritising community/social/environmental work), private-sector transition pathway mechanics, and a costed 500-person pilot specification ready for government consideration.

What Happens If It Works?

The causal chain is:

Design document exists → Ministerial interest can convert to action → Pilot legislation or budget line → 500-person pilot → Evidence base → National rollout

If the design document is adopted even partially:

• A 500-person pilot would provide immediate income security and structured activity to some of New Zealand's most marginalised unemployed people
• If scaled to match New Zealand's ~100,000 structurally unemployed, the programme addresses a chronic source of poverty, poor health, and social disconnection for approximately 2% of the population
• The model becomes exportable: New Zealand has a strong track record of policy innovation that other Anglophone countries adopt (KiwiSaver → auto-enrolment pension reform in Australia and UK; ACC → no-fault injury schemes elsewhere). A working NZ JG design is a global proof of concept

The AI transition angle amplifies the stakes significantly. If AI displacement accelerates over the next decade, the JG architecture built here becomes the institutional backbone for absorbing displaced workers — not into passive welfare, but into paid, purposeful community work. The long-run vision is a programme that evolves from "job transition support" toward "socially-defined work" — caregiving, environmental restoration, community infrastructure — redefining what counts as economically productive activity. This positions the work not just as poverty alleviation but as civilisational labour market infrastructure for the post-AI economy.

What Are the Failure Modes?

Being honest about failure is important for EA reviewers. The realistic failure modes are:

Design document produced but ignored politically. This is the most likely failure. Mitigation: the stakeholder consultation process is designed to build champions inside government during the design phase, not after. The roundtable event directly targets this.

MMT framing triggers fiscal credibility objections that kill the proposal. Mitigation: the political framing foregrounds this as a job transition programme — not as deficit spending ideology. The design explicitly addresses fiscal mechanics in terms Treasury officials will accept (the JG as an automatic stabiliser with countercyclical spending, not permanent structural expansion).

Pilot design is too ambitious to be costed credibly. Mitigation: the 500-person pilot spec is deliberately modest and designed to fit within existing Workforce Development or MBIE budget envelopes, not as new appropriation.

The policy window closes before the document is complete. Mitigation: 6-month sprint timeline is calibrated to current parliamentary cycle.

Leading Indicators of Progress at 6 Months

EA reviewers reasonably ask: how will you know this is working before the endpoint? The following are observable, honest indicators of progress:

1. Interviews completed and documented (target: 15+ stakeholders by month 3) — indicates the proposal has sufficient legitimacy to get officials in the room
2. At least one MBIE or Treasury official engages substantively with draft design (not just attends) — the key early signal of institutional traction
3. Roundtable event held with 20+ attendees including at least 2 people with direct ministerial access
4. Draft document circulated for comment by month 5 — indicates the design is coherent enough to survive expert scrutiny
5. At least one media or policy outlet (e.g. Policy Quarterly, The Spinoff, Newsroom) agrees to publish or cover the release — indicates the ideas are entering public discourse

None of these are vanity metrics. Each one represents a genuine step in the policy adoption chain.

Evaluation Against EA Criteria

Closing Statement

The case for a job guarantee is no longer purely ideological — it is increasingly the rational institutional response to a labour market facing structural displacement from AI. New Zealand has a rare combination of policy agility, existing political appetite, and a credible heterodox economics tradition that makes this the right place to build the proof of concept the world needs.

This grant funds not a research project but a design-to-deployment pipeline — the specific, practical work of turning a compelling idea into something a government can actually do. The cost is modest. The leverage is exceptional. The window is now.