Do Unemployment Checks Create Jobs?

Only in today’s Orwellian political climate can a politician actually make an inane, absurd, and irrational claim that unemployment checks create jobs.  Last year, Nancy Pelosi said “unemployment checks are the best way to create jobs”.  More recently, President Obama responded to Republican efforts to approve the Keystone XL pipeline.  He said, “However many jobs might be generated by a Keystone pipeline … they’re going to be a lot fewer than the jobs that are created by extending the payroll tax cut and extending unemployment insurance”.

Undoubtedly, with statements like this it’s only a matter of time before government establishes an official Department of Disinformation.

Here are three real life experiences I’d like to share regarding unemployment benefits and/or public assistance. I personally know these people.  I’m purposely leaving out names and my relationship with each person and will be gender neutral in my references.

First Example

This person was fired from a job in the summer of 2011.  They filed for unemployment benefits and received 26 weeks of unemployment.  Recently, the person was offered a job making $12.50 per hour plus benefits.  They turned the job down for the following reasons.  First, they had 5 weeks left on their current unemployment and could file a 20 week extension (which would be automatically granted) once the original 26 weeks expired.  Secondly, they are paid $430 per week which is $10.75 hour (assuming a 40 hour work week).  The person said it wasn’t worth their time to work for such little difference and would rather not work and collect unemployment.

Second Example

The person has skills in the construction/home-improvement industry. They were laid off and collect unemployment.  The person has been offered jobs but has declined them.  Instead, they offered their skills to employers under the table at slightly lower than market rates and does not get any benefits.  The employer gets a highly skilled worker and pays less overall compensation (no taxes, no unemployment insurance, no workers compensation insurance, etc.).  The person receives untaxed earnings and collects unemployment checks to boot.

Third Example

This person is on food stamps and receives government provided medical coverage.  The person has interviewed for positions and has been offered more than one job.  Once the compensation and the cost for day care for their children are factored in they determined they are better off not working.  Their choice is to receive food stamps and government provided medical coverage instead of accepting a job.

In all three cases each person was offered at least one position that paid more than minimum wage and with benefits.  In all three cases they turned down the job offers because they knew they could continue to collect an unemployment check or continue indefinitely on government provided food stamps and medical coverage. Surely, there are many people collecting unemployment checks and working in some capacity receiving compensation under the table. 

By extending unemployment benefits to 99 weeks, the federal government disincentivizes people from finding a job.  Only the ruling class can look you in the eyes and honestly believe the lies spewing from their lips. 

Demonstrably, this illustrates the unintended consequences of government intervention.  People become accustom to government provided anything.  The recipients siren song is “more goodies for me, more goodies for free”.  These people are subservient to government.  Unemployment checks create dependency, not jobs.

Ask yourself this question. At election time will these people vote for the person (or Party) that promises to continue to provide these benefits or the person (or Party) that wants to reduce or eliminate these benefits?  In most cases they will vote for the person that promises the benefits.  And so, this completes the viscous cycle of the always insatiable government quest for more control and dominion in our lives.

I recently read an article that concisely and eloquently clarifies the mindset.  “[a]nd ensure the masses remain completely reliant on the establishment for their survival, forever tied to the rotting umbilical cord of a parasitic parent government.”   That pretty much sums it up!

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