December 17, 2008

Unemployment: How Much Is Hardship and How Much Is Chosen?

Filed under: Economy,Taxes & Government — Tom @ 5:09 pm

Matt Spivey at American Thinker makes some very good points in sync with some observations by your truly:

Mr. Obama and his fellow Dems would like us to believe that the current job market is a barren desert or frozen wasteland, from which there is no escape except by the guiding hand of government.

In my home state of Arizona, one can “earn” up to $240 per week while unemployed. In New York, a recipient can get up to $405 per week, and in California, the rate can be as high as $450 per week. Now let’s put that into a practical comparison. Let’s say the only available job in town is a part-time offer of $10 per hour for 20 hours per week. One could be contributing a valuable service, such as tutoring at a school, cooking in a restaurant, or handling luggage at the airport. Yet, at $200 a week, before taxes, why would anyone take such a job when he or she could earn as much as twice that amount sitting at home in pajamas?

Where’s the motivation to work, to contribute, to move up?

Indeed. Spivey doesn’t even get to other key points about unemployment:

  • Cheating is rampant (please don’t tell me it’s not). At any given time, I’ll guarantee you that there are hundreds of thousands who are either on unemployment but only going through the motions of trying to find work while not really doing so — until a few weeks before the bennies run out. The supposedly compassionate blanket extensions of unemployment benefits from 26 to 52 to 78 to who knows how many weeks enable large numbers of slackers to play stallball even longer.
  • Another form of cheating is doing contract work while either getting paid in cash or by those who don’t issue 1099′s. For that matters, do the states even try to cross-check the unemployed against W-2s and 1099s? If not, why not, especially since many state systems are underwater?
  • Then there are those who go to jobs and work at screwing up and getting fired so they can collect benefits. That’s not as rare as you might think. The mentality is enshrined in this article from earlier this year by a guy (can’t find the link at the moment) who bragged (yes) about he was gaming the system.
  • While unemployment benefits can be taxable, they mostly aren’t, and they aren’t subject to Social Security or Medicare taxation. That isn’t to argue that they should be, but I am pointing out that the benefits are mostly tax-free. Yes, health insurance is an issue, but the 18-35 and single set that largely dominates the slacker population usually doesn’t care if they’re uninsured.
  • The current economy has many more part-time opportunities than existed 20-30 years ago, or even 10. Those who want to work could usually find it if they want it and still have plenty of time during the rest of a given week to find a job in their chosen profession.
  • Oh, and by the way, what if your chosen profession isn’t hiring, or is shrinking, or becoming obsolete? Does that give you an automatic right to a year or so of bennies? I don’t think so.

That isn’t to say that there’s not a lot of suffering going on in certain sectors of the economy, but Spivey’s fundamental point is correct: The unemployment rate is higher than it would be if the system were managed with the goal of ensuring that people find work, or interim part-time work, instead of managed to maximize the number of beneficiaries and the benefits they’re paid.

NewsBusters and Pajamas Media Highlights and Opinionated Extensions

At NewsBusters:

  • The Bush Derangement Syndrome-addled media is milking one Iraqi journalist’s shoe-throwing fit as if it symbolizes something beyond one guy throwing a couple of shoes. NB’s Tim Graham excoriated Washington Post reporter Sudarsan Raghavan for calling the incident a “PR Fiasco,” when Bush’s handling of the incident (“that was a size 10“; and later “I didn’t know what the guy said, but I saw his sole.”) was pretty cool and calm. Mark Finkelstein observed how MSNBC’s Tamron Hall managed to characterize these reactions as “unnerved.”
  • NB’s Clay Waters caught the New York Times claiming that the shoe-pitching journo has “hero status” in the Arab world, while Brent Baker saw the same thing on CBS’s and ABC’s evening news shoes, er, shows. Separately, I found this NYT item claiming the guy is “a folk hero in the Arab world.” Uh huh. Come back in two months and see if anyone even remembers the guy’s name. Fairness and balance would require that the multiple Iraqi journos who apologized to Bush for the incident must therefore reflect a larger microcosm of Iraqi and Arab sentiment. Stretching the NYT-ABC-CBS “logic” further, that therefore makes Bush a bigger “folk hero.”
  • NB’s Kerry Picket saw the LA Times saying that the shoe thrower is “the Middle East(‘s) ….. own version of Joe the Plumber” (JTP). Oh sure. The “only” differences are that Obama sought out JTP while on a walking tour of a neighborhood, Joe the Plumber didn’t throw anything except a few questions and some truth at Obama (come to think of it, that is a lethal weapon to a Chicago machine Democrat), and JTP didn’t insult Obama. Otherwise, they’re “exactly” the same.
  • Read the review by NB’s Brad Wilmouth of Bill O’Reilly’s interview of Ted Turner and the accompanying transcript, if you dare. CNN’s founder admits that “that he and Jane Fonda, who both opposed America’s involvement in the Vietnam War, had ignored the slaughter of millions by the Khmer Rouge communists in Southeast Asia after America’s withdrawal from the region.” He says of Fidel Castro, “I admire certain things about him. He’s trained a lot of doctors, and they’ve got one of the best educational systems in the developing world, and, you know, he’s still popular with a lot of people down there.” (Yeah, just ask ‘em, while spies and tattle-tales are everywhere.) He refuses to concede that Castro has executed dissidents.
  • The Associated Press’s Seth Borenstein wrote an item Sunday (“Obama left with little time to curb global warming”) about the impending doom from supposed global warming that is a strong contender for “Worst AP ‘Report’ Ever.” Perhaps it’s the Worst Pseudo-Science Report Ever, but the AP item reviewed here at BizzyBlog on June 22 is still the Worst Ever overall. NB’s Noel Sheppard has a collection of scientists’ reactions to Borenstein’s over-the-top claims. The best: “But it is certain that anybody who proclaims that “Global warming is accelerating” is a liar, a fool, or both.”
  • Yours truly put up an NB post last night about an amusing and childish attempt by Associated Press reporters and photographers to get some kind of leverage in contract talks — “AP Photogs and Journos Withholding Bylines; World Somehow Survives.”

At Pajamas Media:

  • Pam Meister rips John McCain — “Now that he doesn’t need conservatives anymore, the “maverick” has returned to his backstabbing ways.” There are at least three Arizona Congressmen who should seriously consider challenging McCain in the 2010 Senatorial primary. Either Jeff Flake, John Shadegg, or Trent Franks — all of whom scored over 90% with the Club for Growth — would be vast improvements. McCain scored 94% with CFG on an incomplete voting record, but his Miss Manners act, whereby conservatives can’t criticize anyone even when they’re being vilified, is beyond tiresome. His lukewarm support of Sarah Palin in the face of non-stop efforts to defame her has been disgraceful. His recent statement that people should in essence (my words) “Leggo of Blago” is bizarre. If Franks’s performance on Rush’s show yesterday while Jason Lewis was subbing is any indication, Franks would wipe the floor with McCain in a debate.
  • Richard Fernandez makes an important observation about why Bernard Madoff’s Ponzi scheme worked that I meant to get to yesterday — “Some of those who escaped ruin may have owed their survival to crass skepticism. Despite Madoff’s long record of producing returns one country club member refused to participate because Madoff would not explain his methods. In a world that ran on trust, he impolitely insisted on evidence.” The “trust” was based on affinity. The lesson is that the cleverest cons are people who successfully exploit their friendships, family, and networks (churches, social organizations, etc.). People should ask themselves, “Could I justify doing this if I DIDN’T know this person?”
  • Rand Simberg has a great riff on how UAW union-enforced work rules have contributed to the Big Three’s near demise — “What are work rules? They are agreements negotiated in the contract between management and the union covering how the employees are to be classified, how many breaks they get, how much time off they get, who can do which jobs, how discipline is to be enforced, etc. The goal of the rules is not to enhance productivity or production quality. It is to provide opportunities for featherbedding, increase numbers of (overpaid) jobs for union workers, and minimize how much they have to actually work. This is important because it’s at least in theory possible that the industry could be making money even at current wages, if they could be provided with the flexibility to increase worker productivity.” Exactly.