The Unworthy Unemployed

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  Senator Durbin stood in front of the Senate this morning and tried his best to whip up support for an unemployment extension bill during his nine minute speech.

  When his speech finished the Senate immediately went back to discussing what it considered more important: nominations and the border patrol.

 1.2 million people will lose their last financial lifeline just this month, and the Senate couldn’t find more than nine minutes of their time to address it.

  Yesterday the Senate was in session for 5.5 hours and it didn’t address the unemployment problem even once.

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  Senator Reid says the Senate “could” finish up legislation reauthorizing UI extensions this week, but its hard to see how that would happen when they aren’t even talking about it. Dick Durban says it “doesn’t look good”.

  The reason it is stalled is the Republicans.

 Rep. Peter Roskam (R-Ill.) told The Hill that paying for the cost of an unemployment extension doesn’t cut it for him.

  Asked if he would support Thune’s alternative, Roskam replied, “Not me. It makes no sense to spend more money, because you are just going to create more of a drag on the economy. So guys like me would vote no.”



  On Friday, Kentucky Senate candidate Rand Paul said, “In Europe, they give about a year of unemployment. We’re up to two years in America.”

  Paul, who made the remarks on WVLK-AM in Kentucky, added, “As bad as it sounds, ultimately we do have to sometimes accept a wage that’s less than we had at our previous job in order to get back to work and allow the economy to get started again. Nobody likes that, but it may be one of the tough-love things that has to happen.”

  Sharron Angle, a Tea Party favorite who will face Senate Majority Leader Harry Reid (D-Nev.) in November, has been outspoken on the matter.

  She told KRNV-TV in Nevada that “you can make more money on unemployment than you can going down and getting one of those jobs that is an honest job, but it doesn’t pay as much. … we really have spoiled our citizenry.”

 How does it feel to have politicians telling you that you are spoiled, and that they are doing something to you for your own good? Aren’t these the same guys who talk about elitism?

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  Leading the phalanx against unemployment extensions for the third time this year is Senate Minority Leader Mitch McConnell (R-KY).

 Sen. Orrin Hatch (R-Utah) has proposed legislation that would require people to pass a drug test to get welfare and unemployment benefits, implying that there is no difference between welfare and unemployment, and that all these people are drug fiends anyway.

 I wonder if Hatch realizes that the unemployed actually paid into those funds?

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 44% of all the unemployed have been jobless for more than six months – a post-WWII high by a long shot. 3.4 million have been unemployed for over a year.

  Obviously the Republicans feel that cutting off unemployment benefits is the right thing to do. Where do they come by this idea?

  James Taylor, a Central Michigan University professor was invited to testify by congressional Republicans.

 Taylor, who was invited to testify by Ways and Means Republicans, stated that “the longer the time frame people are eligible for such benefits, the longer it takes for unemployment rates to fall. While the poor labor market is to blame for much of this jump in duration, there can be no doubt that incentives to obtain new employment have been, and will continue to be, tempered by governmental action which has extended unemployment insurance.”

 This opinion has been reflected in the editorial pages of the Wall Street Journal. Articles like this suggest the unemployed are just lazy.

   Taylor does have some historical evidence to back up his positions. For instance, it doesn’t make sense to work a part-time, minimum wage job when you have unemployment benefits that pay more.

 But that doesn’t give us any hard numbers. How much does extending unemployment benefits really increase the unemployment rate? Fortunately the San Francisco Federal Reserve did a study which defines that amount.

 The question arises whether this extended availability of UI benefits has contributed to a lengthening of unemployment spells because jobless workers are staying in the labor force longer in order to continue collecting benefits. Such a dynamic could raise the unemployment rate. However, analysis of data on unemployed individuals decomposed by their reason for unemployment, which affects their eligibility for UI, suggests that extended UI benefits have had a relatively modest effect. We calculate that, in the absence of extended benefits, the unemployment rate would have been about 0.4 percentage point lower at the end of 2009, or about 9.6% rather than 10.0%.

  Thus if the Republicans in the Senate want to lower the unemployment rate by 0.4%,  at the expense of hundreds of thousands of people losing their homes, retirement savings, and having their lives destroyed, they are on the right track.

 It seems that facts, like the Fed study above, are not even part of the discussion in this debate. Ideology, opinions, and delusions dominate the subject.

 The moral and emotional tenor of the debate over extending unemployment benefits is consistent with psychological research showing that we all like to believe that people generally get what they deserve. We tend to have a high opinion of individuals who receive fortuitous rewards, and a low opinion of individuals who are victims of bad luck.

  Melvin Lerner, the psychologist best known for his book, “The Belief in a Just World,” considered this belief a delusional means of avoiding moral discomfort.

  As Paul Krugman summarized:

 Everyone agrees that really generous unemployment benefits, by reducing the incentive to seek jobs, can raise the [normal unemployment rate]… But in case you haven’t noticed … What’s limiting employment now is lack of demand for the things workers produce. Their incentives to seek work are, for now, irrelevant.

 I was reading through the comments to this article when I realized just how many people are on the shaky side of losing everything.

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  Meanwhile politics continue to be played in Washington. House Speaker Pelosi refused to consider the “doc fix” bill the Senate passed without addressing the unemployment extension and jobs bill.

 “I see no reason to pass this inadequate bill until we see jobs legislation coming out of the Senate,” she said. “House Democrats are saying to Republicans in the Senate: Show us the jobs!”

 I’m pretty sure that the unemployment extensions will get another vote in the Senate this week. Will it pass? I don’t think anyone knows right now, but it sure wouldn’t hurt if you called your Senator today.

7 comments

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    • gjohnsit on June 22, 2010 at 11:23 pm
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  1. we need a few more unemployed politicians.

    • RUKind on June 23, 2010 at 4:52 am

    Takes a temp job for $8.00 an hour, loses job. UI benefits get recalced and now her UI check is half what is would have been for the next year.

    Of course there is disincentive to take a shit job for shit pay to decimate your UI payments. Even a Rand Paul can understand that one. BTW, just declare yourself an opthamologist as Rand did and you can be rolling in money. I’m sure Medicare reimburses well for all that hardware he needs to buy.

    When real unemployment tops 20-25% there will be blood. I’m at seven years out right now. In about two years I have nothing left to lose except my life. Hopefully I can make that count.

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