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Why Republicans Should Relax and Learn to Love Unemployment Benefits

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Republicans have stubbornly opposed any extension of benefits to keep the nation’s millions of unemployed keep their heads above water. Conservatives clearly are unmoved by appeals to basic decency to provide assistance to honest out-of-work Americans who are out looking for their next job. Don’t let anyone tell you that folks collecting unemployment insurance are just sitting home collecting a check. Recipients have to prove they are job-hunting as part of receiving benefits.  And don’t believe the claims that an extension of benefits now would be unprecedented in some way. The last time the nation’s unemployment rate was this high, back in the early 1980s, President Ronald Reagan saw to it that checks kept coming to the jobless back then for three years, until the unemployment rate came back to 7.2 percent. 

So when conservatives like Judd Gregg insinuate extended benefits now would constitute creeping socialism, no “we’re not Europe,” to use Gregg’s own words. We just have to be as good as we were during the Reagan administration.  Lastly, don’t buy the arguments that we just can’t afford an extension of benefits. The amount that an extension would add to the federal budget deficit is a small fraction of the $700 billion pricetag hanging off those tax cuts for the rich that Republicans long for.

Saturday’s votes blocking an extension of tax cuts for 98 percent of taxpayers only proved whose side Republicans are on. They are holding middle-class tax cuts hostage until they get the cuts they crave for the wealthiest 2 percent. The GOP clearly is in the corner for the rich; fair enough, that’s its right (no pun intended).

The secret of unemployment benefits, is, however, that they help the wealthy at least as much as the jobless.  Unemployment insurance helps the rich stay rich.  It’s true, after all, how do the rich stay rich? And get richer?  Mostly from the rest of us buying stuff from them.  Consumer spending accounts for about 70 percent of the nation’s economic activity. 

Putting a little money in the hands of the unemployed helps put those dollars into the economy, and ultimately into the hands of wealthy business owners.  That’s not a liberal or socialist notion, that comes straight out the mouth of Mark Zandi. As chief economist at Moody’s Analytics, Zandi is himself wealthy, and as a top Wall Street banker, his employment is in service of helping the rich become more so. “No form of the fiscal stimulus has proved more effective during the past two years than emergency [unemployment] benefits, providing a bang for the buck of 1.61, that is, for every $1 in [unemployment] benefits, GDP one year later is increased by an estimated $1.61,” he told Congress earlier this year. Oh, and by the way, Zandi was a top adviser to Republican John McCain’s 2008 presidential campaign.

The unemployed don’t hoard their checks as some might have you believe. They spend them, Zandi says,

This was particularly important during the depths of the recession when consumers had aggressively cut spending. While consumer spending has since notably improved, it remains fragile and would likely weaken again if emergency [employment] benefits are not extended. The recovery would struggle to evolve into an expansion as anticipated.

Consumers’ dour moods reinforce this concern. While surveys of consumer confidence show improvement over the past year, they are not much higher today than in the depths of the past recent recessions. If large numbers of unemployed workers begin running out of [unemployment] benefits this spring and summer, consumer sentiment could sink further. Attitudes would sour not only among the unemployed but also among their relatives, friends and neighbors, as they worry more about their own situations.

Did you get that last idea, Republicans? Zandi is saying that the wealth of the rich could well be in jeopardy without extended benefits. That should be a good GOP motivator.

So to the Republicans, I suggest you hightail it down to the House or Senate floor and vote for those extended benefits. Close your eyes if you have to and just imagine the sounds of those cash registers belonging to your rich friends.

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About Scott Nance

  • Clavos

    According to a report published today in The Miami Herald, President Obama and Republican congressional leaders reached an agreement on the afternoon of December 6, 2010 to extend and deepen tax cuts and to extend unemployment insurance for a period of 13 months. Democratic leaders are discussing whether or not they will accept the deal in closed door sessions, today, December 7, 2010.

  • MM-99er ready to give up

    I am 25 years old an have not been able to find work for more then 2 years. I’ve somehow managed to get by but I am at the point where I can no longer pay my bills and manage to live. I am ready to kill myself because I cannot live like this anymore. The stress is eating me alive and I can’t live day by day anymore. There are not enough jobs and employers would rather hire someone that hasn’t been out of work for soo long or they send the jobs overseas. SERIOUSLY WHAT IS WRONG WITH OUR COUNTRY??? do they want the people who are struggling to kill themselves?? Is that why they would rather give tax breaks to the rich and not help the poor. It is so sad what is happening to our country. I feel bad for all the kids that have to suffer through all this. THANK GOD I HAVE NO KIDS, I WOUDL NOT WANT TO BRING A CHILD INTO THIS SICK AND TWISTED WORLD. THANKS AMERICA FOR KICKING US IN THE A**, The ones that actually need the help. I hope they use the stimulus to help bury every one that kills themself over all of this.

  • mack

    MM-99er ready to give up

    Don’t give up MM-99er, you are not alone!
    we are in this together, we have to wait it out like a storm.

  • Don’t give up MM-99er, don’t wait it out mack. The problem is that capitalism is failing. You may wish to consider joining with people who are just as frustrated and learn what the problem is actually about. Then you can decide what to do from there.

  • I think it’s stretching it a bit say the wealth of the rich would be “in jeopardy” without extending benefits right now, but the point is well taken that it would hurt their pocketbooks some if working people can’t afford to buy things (even basic needs). Ironically, the rich-loving Repubs have Obama’s economic team to thank for the security of their wallets, since it seems to have saved us from plunging into a real new Depression. That’s what would’ve really hurt the rich along with everyone else.

  • James

    As someone who lost a job at the start of the recession it is a completely helpless situation to be in with such a lack of jobs (luckily back in work now though). Although I agree the ‘work shy’ should face tougher benefit restrictions the amount of unemployment benefit paid out by the government should be inversely related to economic growth so the budget rises when the economy is weak and jobs are hard to come by.