Subject: Guest Column
Extending benefits helps economy and reduces unemployment
This is no time to end unemployment benefits. There is no economic evidence to support not continuing helping millions of Americans during the worst economic downturn since the great depression. The evidence confirms unemployment benefits fuel jobs and the economy.
And, more importantly, what about our commitment to one another as human beings?
Most economists indicate extending unemployment benefits create $1.63 in demand for every dollar spent. Unemployment benefits are spent quickly and locally.
Individuals seeking jobs no longer get a pay check, but their bills don't stop.
Congress needs to extend unemployment benefits so that struggling Americans can worry about finding a job instead of worrying about feeding their families and keeping a roof over their heads.
U.S. Representative Lloyd Doggett (D-Texas) has recently introduced a bill to preserve benefits through next year. U.S. Senator Jack Reed (D-R.I.) is sponsor of the Senate's companion measure. The Congressional Budget Office scores the bill as having an "out sized effect" on the economy - pumping in double the money. (In addition, individuals pay taxes on unemployment benefits. And, economists have warned that failure to pass an extension would have a negative impact on a struggling economy.)
U.S. Rep. Doggett claimed, " With almost five unemployed Americans for every job opening, too many people remain jobless because of a lack of work, not a lack of wanting to work."
Based on research by The John J. Heldrich Center for Workforce Development at Rutgers University, some myths about unemployment benefits are debunked.
•Overwhelming evidence indicates the jobless who receive benefits more actively seek work than those who don't.
•Two thirds of America's 14 million unemployed are not receiving benefits. (Those who did not work long enough or earn enough are ineligible.)
•Unemployment benefits amount to only a fraction of a worker's previous income. ($296. is the average weekly benefit.)
•80% of those who receive benefits are willing to take a pay cut to get a new job. (It is wrong to suggest Americans want unemployment checks. Americans want work.)
•Benefits raise the re-employment rate of long-term unemployed workers. (700,000 new jobs have been created thanks to emergency and extended unemployment benefits in recent years. And, 3.2 million were pulled out of poverty in 2010 thanks to unemployment benefits.)
Unemployment insurance benefits pump demand into the economy and help the unemployed workers and their families. Extending these benefits is a far better way to help our economy and our workers recover than to ask the American people to borrow $830 billion to give tax breaks to the richest 2% of Americans.
Richard O. Schwab was formerly associate head of school, and middle school head, Cincinnati Country Day School. He is currently neighborhood team leader, Glendale Organizing For America Community Team (www.gofact.blogspot.com)
Richard O. Schwab
