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GOP Block Unemployment in Effort to Punish the Poor

Updated on January 7, 2014

As of December 28, 1.3 million people were booted from Unemployment Insurance. By the end of 2014, 5 million will have been treated in kind. The CBO has estimated that over 200,000 jobs and 0.2% GDP would be created by the end of 2014, should UI be extended.

How does UI create jobs? Simply - when a person can purchase goods, that money goes to a local businessman who then has more money to spend himself at another local business, or to reinvest in his own business and hire another worker, who can then purchase goods from another local business...

This virtuous cycle is called the multiplier effect, or dynamic growth. The trickle-down crowd is all about dynamic growth when it comes to tax breaks for the wealthy, far less so when discussing the poor and working poor (this despite the far superior return on social insurance program spending versus spending on tax cuts).

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From a strictly economic perspective, extending UI is sound policy. From a moral perspective... Well it is certainly odd that the party (who claims to be the party) of Jesus has no qualms with punitive punishments for being poor. The right-wing (Limbaugh, Varney, Dolan, et al) are rendering their garments and gnashing their teeth over Pope Francis, who has utterly destroyed on moral grounds, the only economic theory the GOP has known for 30 years. The right-wing believe that the wealthy are incentivized by getting more, but the poor are incentivized by getting less. If we make is soooo hard to be poor in America, then no one will be...

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Rand Paul offers his own reasoning - the good senator is fine with 26 weeks of UI, but anything beyond that is a "disservice." Ye olde welfare hammock.

This line of thinking is completely out of touch with reality. The average UI benefit is $300/wk. To suggest that $1300 a month (plus $133 in SNAP) is enough to "lull one into complacency" is quite a bold assertion.

To be clear, UI is an earned benefit. You have to work and pay into UI every check for at least 26 weeks, and if you lose you job through no fault of your own, you can qualify for UI which pays roughly 60% of what you were making at work, federally guaranteed for 26 weeks so long as you can prove that you are actively searching for work.

Today, there are three applicants for every job opening. Generally, we extend UI benefits beyond 26 weeks in economic down times. In fact, the UI extension has never been allowed to expire with an unemployment rate as high as it sits now. Not once in US history. When elementary economics evade elected officials, shame inevitably effects even the most earnest of austerians.

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It has, at least...

This GOP wants to punish the American people for voting for Barack Obama. Whatever they have to do to tank the economy and make the gov't disfunctional is fair game, no matter how harmful. They have convinced themselves that Obama as President is far worse than any pain they inflict on the populace to stop him and tarnish his legacy. If they can screw up the economy and Obamacare roll-out enough - then they can win the Senate in 2014, impeach Obama and repeal Obamacare, effectively erasing his presidency altogether and tainting liberalism for a generation in the process. We are all collateral damage in this nefarious quest.

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This GOP is demanding offsetting budget cuts (after McConnell dropped his demand to delay Obamacare...). It's entirely is ridiculous - people are suffering right now, today. First of all, $25b (for a 12-month extension) over a 10-year budget is miniscule. Second, tax receipts will be higher if these folks have the UI to spend, so the cost is reduced. Third, 14 of the last 17 times UI was extended, it was not "paid for." Fourth, it took four years of negotiations to finally get us a budget, and hunger can't wait for a grand bargain.

Possible solutions? Marry the duration of (extended) benefits to the jobless rate or long-term unemployed rate. Pay UI directly to the employer to keep folks employed rather than sending them home to receive a check. Continue benefits for a period of time after they find work, so there is no incentive to stay unemployed. Block-grant UI for individuals to open small-businesses. Shift UI funds to job-training programs. Grants to relocate to a new job. A modern WPA to put people to work on infrastructure such as retrofitting buildings...

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The Beltway debate is insane. The discussion should not be how and how much to punish the poor, but how to put people to work. The GOP has an identical economic policy, no matter the state of the economy - trickle down. This shows how little economic theory actually goes into their political theory on economics. Tax cuts for the wealthy will inevitably trickle down to the rest of us...

Rand Paul notes that businesses are more likely to hire someone who has been out of work for 4 weeks over someone who has been out of work for 99 weeks. The good senator from Kentucky uses that knowledge to insist that the long-term unemployed be cut off and left to suffer in abject poverty for their own good rather than addressing the root causes of joblessness.

Because freedom...

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    • junko profile image

      junko 3 years ago

      The Republican-teaparty don't care how the American people and Economy suffer They will do any and everything they can to make The Obama Presidency a Failed Presidency. That includes to do harm to the United States of America by sinking the ship.

    • Nathan Orf profile image

      Nathan Orf 3 years ago from Virginia

      The GOP never fails to amaze me with its hypocrisy. These people have got to realize that extending Unemployment Insurance leads to higher employment and, eventually, a less expensive welfare net. In fact, I doubt that the hard Right is ignorant of this. They simply allow their "ideology" to cloud their thinking. Voted up, interesting and followed.

    • Superkev profile image

      Superkev 3 years ago

      Really? We've had extension after extension and the economy is still crap. If it were not for those who have completely stopped looking no longer being counted as unemployed the UE rate would be more than 11%.

      If this is the best Obama can do after 5 years and his supposedly being "focused like a laser" on job creation, then it's time to try something different. Like maybe actually doing something to create jobs.

      How did that "Recovery Summer" thing work out for you? Or all those "Shovel Ready" jobs? Or how about those 400,000 jobs "Almost immediately" that San Fran Nan promised if they passed Obamacare?

      Obama has not a clue what he is doing, never has and never will. He is a failure as a president in every possible metric used to measure such things.

    • Justin Earick profile image
      Author

      Justin Earick 3 years ago from Tacoma, WA

      Once again, we have *never* cut off unemployment extension when the rate was this high in US history - it's economically stupid as well as immoral. Your argument that the real rate is higher only highlights the fact that UI must be extended. And I agree, the jobless rate is closer to 13% (*unemployment* is simply the number of people collecting unemployment, not the number of non-participants in the job market). But no one is claiming that UI extensions are the solution to a failing economy - that is a ridiculous argument to make.

      UI *is* a way to keep people in the job market and off the streets by helping to pay their rent and cell phone bills (right back into the economy) while they look for a job. You can't get a job without an address, without a phone to call back, without internet to apply, without transportation and nice clothes and shoes for an interview.

      So why do you want to take money and the jobs it would create out of the economy, by cutting off the most vulnerable people from the job market altogether?

      In case people don't know how democracy works, Obama can't appropriate any funds on his own - you're thinking of a monarchy. Are you saying that Obama should have unilateral rule so he can create jobs? Not sure I agree about that one.

      In fact, scores of jobs bills have been passed in the senate only to die a slow death in the House.

      Shovel ready? Yeah, that was 4 years ago and shovel-ready means short-term by definition. There was a spike in public employment and the economy grew. Unfortunately, nearly 40% of the stimulus package was tax-cuts for the wealthy. Since then, we've enacted austerity and shrunk the deficit more and more every year. By more than a third in fact, the most dramatic decrease in over 50 years. The right-wing bubble still think the deficit is growing. If we had only kept the number of gov't employees that we had then, the unemployment rate would be 6% rather than 7%.

      Thanks a lot, GOP...

    • junko profile image

      junko 3 years ago

      Superkey, Austerity is historically the wrong solution for a great depression or a great recession. You and the far right know that is wrong-headed solution to the Great Recession. Y'all see an opportunity to do everything wrong and blame the failures on the first Black (Foodstamp) President.

    • Nathan Orf profile image

      Nathan Orf 3 years ago from Virginia

      Well, looks like Justin Earick beat me to the main points of Superkey's arguments. Oh well. I just have a few bones left to pick, so I'll go for those.

      "Obama has not a clue what he is doing, never has and never will. He is a failure as a president in every possible metric used to measure such things."

      I think after five years in the White House, Obama has an idea of what he is doing. He won reelection, after all, so that should tell you something about his success as a politician, if not a President. The very fact that he managed to push the Affordable Care Act through Congress, when no other President had done so in 50 years, is historic. Forget the lousy implementation; the fact that the thing got passed is a big deal.

      So much for your "Obama is a failure" argument.

    • Shawn McIntyre profile image

      Shawn McIntyre 3 years ago from Orlando, FL.

      @Justin Earick

      As an Economist, I generally don't like to get involved in politics, but I feel like I have to jump in on this one.

      While I agree that this probably isn't the best time to cut people off, your argument that these benefits somehow inject money into the economy is wrong, and anyone who tells you otherwise is either lying to you, or they have a political agenda. It's just another variation of the "Glazier's Fallacy".

      The CBO estimate that you're referring to, also warns that the program would add another $25 Billion to the deficit over the next ten years, and that the gains you're talking about would be, at least partially, offset by both the increase in the deficit and the:

      "effects of an increase in the duration of unemployment for some people. Specifically, in response to the extension of benefits, some unemployed workers who would be eligible for those benefits would reduce the intensity of their job search and remain unemployed longer—which would tend to decrease output and employment".

      (You can read the full CBO report here: http://www.cbo.gov/publication/44929)

      So while the extension of this program may be a necessity (and it is), let's not act like it's a "good" or "moral" thing to do. It represents a failure of both sides to get their heads out of their collective asses, and to stop reading "The General Theory of Employment, Interest and Money" like it's the frickin "Bhagavad Gita".

    • lovemychris profile image

      Yes Dear 3 years ago from Cape Cod, USA

      Its obvious what is going on here, and the total sell-out to big biz is complete.

      Republicans work for corporations, and many Dems. And, as Jefferson said, "a merchant has no country"

      Why did all the jobs leave?

      Why is biz sitting on 2.2 trillion?

      They have been waiting on third-world America, and brother, they are almost there.

      House will bow to Koch--he owns them.

      Workers have been relegated to "the lazy 47%".

      And we worship people like Rmoney, who was almost prez, yet is charged with racketeering!

      We all need to stand with Obama, Pelosi, Brown, Warren, etc, and stand hard.

      Levy a tax on turn-coats. All the businesses that took the jobs elsewhere, and for god sakes, end loopholes, raise tax on uberrich--theres your offsets!

      We OWE our citizens UI for as long as they need it!

      It wasnt they who made the policies, or PROFITED from the job losses.

    • profile image

      retief2000 3 years ago

      Didn't the economic recession end in 2009?

      Isn't the unemployment rate continuing to fall?

      Isn't the economy growing"

      Isn't the Stock Market booming"

      So why is there a need for extended unemployment benefits?

      Aren't we in great shape already?

    • lovemychris profile image

      Yes Dear 3 years ago from Cape Cod, USA

      Stock market is booming.

      Money calls the shots, as anyone knows.

      Which is why the Teabaglicans give prez such disrespect.

      Not only is he black, but he doesnt have the pockets of Koch, Adelson, etc.

      Money talks.

      Any student of life knows this.

      We are fighting the Pharisees, who have turned the temple into a den of thieves.

      Get a clue, please.

      And pick a side.

    • profile image

      retief2000 3 years ago

      Isn't one of the indicators of Obama's success as a President that the stock market is booming? I keep hearing that it is.

    • lovemychris profile image

      Yes Dear 3 years ago from Cape Cod, USA

      Absolutely. This is Capitalism, is it not?

      However, Prez Obama and some other Dems want the rest of us to be booming, too.

      The Tea Rs would like it to end at 7 figures and up.

      The quintessentual Robber Baron Rogues.

    • profile image

      retief2000 3 years ago

      But isn't the economy better than when Bush was POTUS? I keep hearing that it is. If the economy is better and there are more jobs than why is extended unemployment benefits necessary?

    • lovemychris profile image

      Yes Dear 3 years ago from Cape Cod, USA

      The economy wont get better until Tea People are removed from power.

      Surely, you know prez is one part. Nothing passes w/o House, and they control purse strings as well.

      Bush had 6 yrs of it all....hence, the horror show that it was.

      We need Koch-puppets OUT of there, before any real jobs concerns be met.

      And, since it is jerry-mandered for the next decade: UI will be neccessary....until such time as Tea Bags have been removed.

      The sooner the bettrr!

    • profile image

      retief2000 3 years ago

      The economy is good. The Affordable Care Act is working. The government shut down was terrible for Republicans. 2014 should be a cake walk for the Democrats.

    • lovemychris profile image

      Yes Dear 3 years ago from Cape Cod, USA

      it should......but, like I said before: money talks.

      google "Koch network", you will see what im talking about.

      Or, as Goebbels said, "repeat a lie enough, people believe it"

      Or hell, just use our own philosopher, PT Barnum, "theres a sucker born every minute"

      ....I mean, how many people really believed there were death panels!

      You had Trump the Birther!

      All of media follows the money, so you do the math.

      Just observe!

      WE elected Obama, and Republicans act like he has no right to govern!

      No--if this election told us anything, its that money talks.

      Our votes have been nullified by paid Rogues.

    • profile image

      retief2000 3 years ago

      Didn't Obama win the election by a wide margin? Didn't Obama win his first election by a wide margin? So, who had the most money to spend?

    • Nathan Orf profile image

      Nathan Orf 3 years ago from Virginia

      I think it is undeniable that the economy is better of now than in 2009. Five years ago, the U.S. economy, and the world economy, was on the verge of the Great Depression, Round 2. President Obama believed that the best way to control the problem was to spend money in ways that would get people back to work. So he pushed for the economic stimulus package.

      He failed to get Republicans on board with this idea, but the package was still watered down because of conservative Democrats whose support he needed to get the plan through the House, which the Democrats controlled at the time. The plan was passed. It was weakened by the compromises Obama made with the conservative Democrats, but it was better than nothing.

      The thing worked, as far as it went. A larger stimulus was probably needed. I would have liked to see more spending on infrastructure, since this would have noticeably added more jobs at a time when they were needed.

      Ever since then, and especially ever since Republicans took control of the House, they have rejected every single jobs bill that the Senate sent their way, while offering no such bills of their own, all the while calling for more jobs.

      Their words are wind. They have done more to harm the economic recovery than to help it, as their recent escapade over unemployment benefits shows. In fact, between this and the Republicans attempt to cut food stamps, I would say that Republicans are more intent on ruining people's lives than on "creating jobs."

    • lovemychris profile image

      Yes Dear 3 years ago from Cape Cod, USA

      Did I forget to mention....Dems got 1.5 million more votes than Rs in last House race, but that old gerry-mandering......

      Face it. Its a rigged deck. Only thing we can hope for is mutiny from within.

      "Mutiny on deck!!!"

    • lovemychris profile image

      Yes Dear 3 years ago from Cape Cod, USA

      House Republicans receive memo on how to show compassion to unemployed....Easy.

      Extend benefits, no strings attached, like you did 5 times with ElBush.

    • lovemychris profile image

      Yes Dear 3 years ago from Cape Cod, USA

      John Boehner, member of ALEC, proposes extending the benefits if Keystone Pipeline gets approved.

      ....

      Is this a big enough 2 by 4 for you to see whats going on?

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