Tuesday, September 6, 2011

The 9.1

This Thursday President Obama will address the nation and tell of how the government will tackle our whopping 9.1% unemployment rate… From what I gather, there may be yet another plan to extend benefits in the works…

Rudimentary economic theory teaches that you get what you pay for… In essence, if you pay for unemployment, you get unemployment… Not to suggest that we shouldn’t assist our fellow citizens in need, but I can’t help but wonder (per my observation below) if too large a percentage of recipients aren’t abusing the system.

The problem being, as Milton Friedman pointed out;

“When you spend someone else’s money on someone else (which would be every government program) you have no incentive to economize and no incentive for quality…”

The 9.1

I personally know of exactly 5 individuals who have received unemployment benefits over the past year. Here are their true stories:

1. A woman who’s now permanently housewifing, who refers to her unemployment checks as her Macy’s money…

2. The Giant’s fan my son met at the gym who says “at 2,500/month it’s not worth going back to work.” He brags of watching his premium MLB channels all day long.

3. A young man I play basketball with who works 9 months for the state and takes 3 months unemployment benefit every single year, and “absolutely loves it”…

4. A guy who claims he could get a job in a heartbeat, who, when he worked, outspokenly resented those who exploited the system, yet now confesses to be loving life as one of the 9.1, with no intent whatsoever to get a job till his benefits expire (if ever)…

5. A gentleman who accepted benefits just long enough to get his real estate license, who now works full time…

So then, empirical evidence (my study) suggests 80% of the 9.1 are abusing the system… And that unemployment benefits clearly inspire unemployment…

I suspect (hope) this isn't the norm, that surely the majority are using their unemployment benefit to tide them over as they diligently look for work, or, like #5, learn a new trade… I just can’t prove it…


  1. Hi Marty,
    The unemployment checks are nothing but welfare. I know a guy who collected unemployment for over two years and he still isn't working.He isn't killing himself to find work. He is living with his parents who supply everything for him. Why should he work.

  2. Hi Hans,
    Yep... this seems to be the general consensus among people I know... I hope this is simply a case of you-only-hear-about-the-bad-ones and that taxpayer $ by the billions isn't, as you say, "nothing but welfare"... In any event, benefits are clearly way too easy to qualify for...

  3. No Free Lunch! If you receive an "unemployment" subsidy, you should be required to use some or all of it for a re-education program or work related assistance. If not then the you should be placed in a job for 4 to 6 hours a day leaving you time to search for a permeant job. If you don't want to part of a productive society, then move to Europe and and be part of the new homeless society.

  4. @tony - that is an interesting idea. Instead of handing them a check for nothing, have them do community service type work for pay. They will be much more inclined to look for a better job on their time off instead of vegging on the couch.

  5. Hi M,
    Unemployment benfits should be very short-term, such as a maximum of 3 months. Its very frustrating how many people just do not want to work.

  6. What you wrote so true. I know couple of people like this living it up without working

  7. I have to represent the con in this debate. I agree with the idea people shouldn't collect something for nothing -- just like the welfare system. But we can't just stop there in our thinking. With money and power should come responsibility -- perhaps we who have been industrious and fortunate should think of more positive ways to help those less fortunate. Does anyone have better answers to unemployment (and welfare) services?
    At least these people in your examples are most likely spending the money they receive, which does help business owners.
    Personally I have received unemployment twice in my lifetime and both times I felt like I "worked" for it. In order to qualify I had to appeal my claim and to continue there were a minimum number of applications and interviews per week. However, I am an honest person and maybe these people who love being on unemployment don't care how they get it!
    In reality you can't force people to be moral but we can try to help.

  8. I'm afraid, from what I'm told, benefits are much easier to receive than when you applied... The argument that unemployment checks are stimulus to the economy doesn't seem to find support in the statistics... I suspect the lack of production from the unemployed more than offsets their spending habits... A popular congresswoman recently stated "those unemployment checks are the best form of stimulus".... In her way of thinking, I guess we'd be much better off then at 90% unemployment (since it's "the best form of stimulus")... The benefit is there for people who want to work... We just need to police it better...