Proof positive: Unemployment benefits NOT a work disincentive

by: Paul Rosenberg

Thu Jul 29, 2010 at 17:00


Ordinarily, a bad economy is bad for the party in power. This is far and away the greatest factor working against Democrats in the mid-terms.  But the GOP's outright hostility to the unemployed may turn out to be a key factor in muting that effect.

It's a bit strange how things are suddenly moving quickly on this front after uninsurance benefits finally passed the Senate.  This morning, Greg Sargent wrote a post, "The 'Let Them Eat Want Ads' Caucus", which began:

Let's call it the "Let Them Eat Want Ads" Caucus -- those candidates and public officials who argue that unemployment benefits are problematic because they discourage people from seeking jobs.

And let's add another Republican to that caucus: Candidate Michele Rollins, who's running for Mike Castle's open House seat in Delaware.

Rollins, who's running in a contested race against green technology exec John Carney, was asked by a constituent if she would have voted to extend unemployment benefits. She suggested she wouldn't, claiming that "for someone who hasn't worked in two years" it's "pretty hard to get energized to go back and look for a job."

In followup, Rollins denied blaming the unemployed for being lazy, but then did a 180 (probably without realizing it--these folks aren't terribly bright):

But Rollins did tell her constituent that giving people benefits risks ensuring that people "will continue to do nothing." And she's only the latest to make this claim. Sharron Angle suggested that the unemployed were getting "spoiled" by benefits, though she later backtracked. Senators Richard Burr and GOP Senate candidate Ron Johnson, who's challenging Russ Feingold, have also argued that unemployment benefits discourage job-seeking. If I've missed others, let me know

Then this afternoon, Greg posted another installment.  But before getting into it, I want to share a video--which Greg linked to--of a presentation by economist Raj Chetty showing that unemployment benefits are not a disincentive to finding work.  It's true that they look like a disincentive for low-wage workers, Chetty shows, but this effect goes away for those with more savings.  The best explanation:  it's not a disincentive effect, but a cash-on-hand effect, which moves people somewhat out of panic mode, so that they do things like spend more time with their kids.  And to prove his point, he looks at foreign data showing that lump-sum cash payments (which by definition don't continue over time) have the same sort of effect:

Okay, so here's Greg's second post of the day on the subject, "GOP House candidate: Extending UI benefits is 'European'", which contained the linke to the video:

Paul Rosenberg :: Proof positive: Unemployment benefits NOT a work disincentive
Okay, we have another Republican applying for membership in the "Let Them Eat Want Ads" Caucus.

GOPer Scott Bruun, a state representative in Oregon who's running to unseat Dem Rep. Kurt Schrader, told a local radio program that extending unemployment benefits beyond two years is "European," adding that an extension would bring "shame on our government" for "encouraging" joblessness.

Asked by KPAM radio host Victoria Taft whether he would have supported extending benefits, Bruun responded that he wouldn't have:

    "When we're talking up over close to two years and longer with jobless benefits, I think we really start talking about a European style system and all the problems that that sort of system brings if you try to bring that sort of system to the United States."

A bit later, Bruun said that we have to adopt a new approach to those who have been receiving benefits for a long time:

    "We need sort of a new game plan going forward, a new accountability. Shame on our government, if you will, if the government is in a position where we're encouraging people to stay out of the workplace longer."

This comes after Michele Rollins, a GOP Congressional candidate in Delaware, was caught on tape saying that if people get unemployment benefits extended, they "will continue to do nothing for a very long time."....

It should be noted that there's empirical evidence that economics students are more selfish and "economically rational" than those who haven't been exposed to economics as a "science".  Given how much Republicans wallow in this sort of theory-heavy, data-poor kind of "scientific" worldview/fantasy, it might well be the case that hard-core Republicans do show some such effect.  After all, we already know that they can't be bothered to come up with anything in way of solutions.  So why wouldn't they be every bit as lazy and good-for-nothing as they imagine everyone else is?


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Hit the Nail (4.00 / 8)
The last paragraph hits the nail on the head.  People tend to think other people would do as they would do.  They project.  I believe this explains why Republicans in general think so lowly of people in general.  They know that they would cheat, lie and steal.  So they assume everyone will.  They are greedy opportunists who think stepping on others to get ahead is the best way.  So the assume everyone else is trying to take advantage of them.  They are narcissistic and think they got everything on their own.  They do not acknowledge the advantages they had that others do not.  They do not even acknowledge when government program or spending helped them.  So of course no one else should have assistance.  Then you can add in religion and you have the perfect storm of self delusion and certitude.

Confused (0.00 / 0)
If it is economically beneficial to corporations to out-source jobs to places with lower wages and weaker worker rights laws, then why should a GOPper not support government programs that discourage Americans from working?

The corporations profit from low wage foreign workers, while the US government - to which their tax contributions are minimal - pays off the displaced American workers. Seems a win/win from the corporate perspective - why aren't their shock troops on the same page?


"It sounds wrong...
     ...but its right."


My two cents (4.00 / 2)
1. Because it's not just corporations, it's the wealthy individuals who own and run them, and their tax contributions are not minimal.
2. Because the same corporations/upper class also profit from low wage U.S. workers.  In fact, shipping jobs overseas creates desperation at home, making U.S. workers easier to exploit, which is part of the idea.
3. Because they want a "disciplined"/scared/whipped work force worldwide, including here, no welfare state measures to give them any security, independence, or dignity.
4. Because ideology is not always purely "rational."  The right-wing business types, whether as corporate leaders or individuals, need to believe that they're "good" (hard-working, etc.) people, while the people they exploit are dumb and lazy, or it would be harder for them to live with themselves.  They think the American workers deserve to be replaced and whipped into shape, not rewarded with "handouts."
5. Because (following from the above) our opponents aren't always all that bright.  

[ Parent ]
Of course (4.00 / 3)
since Democratic officials and candidates lack both the will and the language to push back against this, there will be no political fall out for them taking this position. They can appeal to their base with no fear that the rest of the electorate will ever hear their opponent attacking them for it.  

We're at a point now where we've all but given up on the possibility that Democrats will do anything more than pass unemployment extensions to address the jobs problem. That's insane. Until we change that, we can expect ever more ridiculous claims from the other side without any political fallout, while the problem continues to fester.

Politics is the art of the possible, but that means you have to think about changing what is possible, not that you have to accept it in perpetuity.


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