[PEN-L:33633] Re: Unemployment Insurance

["Ellen Frank" <frank@xxxxxxxxxxxx>]

Interesting point.

As for Bush's proposal: the idea that a benefit which replaces (at best)
half the wage and only one third on average will dissuade
people from looking for work -- unless they're pretty sure
they'll be called back from a layoff -- is just ridiculous.
I was listening to Jim Glassman (?) -- some libertarian
creep -- on NPR gushing about how this was another
example of the innovative, creative economic thinking
from the Bush team.  Give people a lump-sum they can
keep if they do find work, and the people who DON'T find
work get the same benefit as the people who do.  In what
moral or economic universe does this make sense?

Ellen

Jim writes:
>some labor economists argue that many businesses like UI because it
>prevents
>laid-off workers from taking jobs elsewhere. It keeps them around to be
>rehired later, so that the biz doesn't have to spend money on re-training
>and the like. But the trend has been away from temporary layoffs toward
>permanent layoffs (and the hiring of temps, who aren't counted as
>"unemployed" and don't get UI benefits when waiting for a call). This
>trend
>seems to have undermined biz support for UI, as has the fact that UI taxes
>make employment more expensive to them while businesses have had a hard
>time
>passing this cost onto consumers in recent decades.
>Jim