Tuesday, April 27, 2010

Unemployment makes unemployment rates rise

This article from the Seattle Times notes that many of the unemployed may never recover their jobs, and may never get new ones either. And that is why Congress is set to debate whether or not to extend unemployment benefits.

The awkward thing about extending unemployment benefits is you make more unemployed. This happens because those who are already unemployed seek to stay on unemployment, because it beats working.

Now some say this is crazy talk, considering unemployment benefits creates a "disincentive" to get off unemployment, noted SenatorSen. Jon Kyl of Arizona via this article. But who's to take the word of one senator.

Kyle notes, ""I'm sure most of them would like work and probably have tried to seek it, but you can't argue that it's a job enhancer. If anything, as I said, it's a disincentive. And the same thing with the COBRA extension and the other extensions here."

Of course Sen. Max Baucus (D-Mont.) argues the opposite, that unemployment adds jobs because the money is spent to bolster the economy. Yet, IMO, that argument fails too. The government alone cannot stimulate an economy. It has never in the history of the U.S. ever happened.

So is it a good idea to extend unemployment or not? Sure we don't want people hurt, yet sometimes the best incentive to get them back on their feet is to force them. Sure it sounds harsh, but the best way to help people is to let them fail.

It may not be fun, but many of these people could easily get a temporary job at McDonald's, but because they are on unemployment, they don't seek these jobs. They become complacent receiving their check. They become dependent on Uncle Sam. There is no incentive to seek work.

Thus, the unemployment rates rise. Although bloggers like this will make you think that people like me, and the GOP, who don't want increase unemployemnt benefits could care less about the unemployed. However, that is the opposite of the truth.

There are no proposals by anyone to get rid of unemployment, only to not make it an eternal fix. Unemployment for a while is fine, but to make it a crutch is a bad idea. Besides, we cannot afford such luxuries (if you want to call it that).

If we had tons of money, then it would be different. It's unfortunate many Americans don't have any money and are out of jobs. Because of tax and spend politics in Washington, Washington has no money either, and should not keep spending like it does.

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