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The jobless speak on extending their benefits
Protesters call for an extension of unemployment benefits and continued funding of job programs during a demonstration Dec. 3, 2010 in Chicago, Ill.
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Mitchell Hartman: Tomorrow we'll get the government's monthly jobs report. Long-term unemployment remains high. And so far, Congress has not voted to extend unemployment benefits beyond the New Year.
New Hampshire Public Radio's Dan Gorenstein went to an unemployment office in Concord.
Dan Gorenstein: You can see why extending benefits is such a tough question by talking with Joe.
Joe Giaquinta: Joe Giaquinta. G-I-A-Q-U-I-N-T-A.
Joe's been out of work for a while now.
Giaquinta: I started collecting in the end of August 2010.
With unemployment stuck at 9 percent, it's almost gospel: The longer you're out of work; the harder it'll be to shove your way back in. Which is why the guy who used to fix people's furnaces has expanded his search -- into the kitchen.
Giaquinta: But you know what? They are looking at my resume what I did for the past 23 years, they say, this guy doesn't know how to cook.
At this point, Joe is just about out of benefits.
University of Chicago economist Robert Shimer says giving people up to 99 weeks of benefits buys millions of Americans a mirage: The dream that they can recapture their old lives.
Robert Shimer: Unfortunately, there are a lot of workers who are not going to get jobs that looked like what they were getting before. They're workers who are going to take substantial and long-term wage cuts.
Shimer says workers like Joe need to adapt and get a new set of expectations. Not easy for a 55-year-old guy who used to make around $50,000 a year.
Giaquinta: You know, the kids are out of the house, but I still have a mortgage, and I have utilities and I have taxes and insurances, that's why I don't want to get stuck right now in that $9-an-hour job.
Some economists say not only do those benefits keep Joe and his wife in their home, that money helps drive the country's recovery. Critics argue the cash Joe gets every week would be better off in the hands of employers. Instead of paying into the unemployment system, companies would have more money to grow and hire more workers. Of course, ending those extensions means millions of people like Joe Giaquinta have to scramble.
Giaquinta: It's forget the career, it's survival right now. I am going to have to resort to the McDonald's, Lowe's or Home Depot.
If Joe doesn't get one of those jobs, he may just drop out of the labor market entirely. And Prof. Shimer says there's a cost to that too.
In Concord, N.H., I'm Dan Gorenstein for Marketplace.
HOST: Tomorrow, Dan brings us the voices of workers at the unemployment office.
Pres Obama's belief that unemp benefits enable the economy is operating in fantasy land: if no real economic production is occurring (only borrowed spending) then the benefits of continued in-the-hole borrowing/spending only delays paying the piper. Real benefit comes from actual "net production"....not just circular economics. If his logic was so "real" then just hire all the unemployed to be gov't workers.....maybe he just wants an entoto government ( and is envious of the chicoms ?).
There are now over seven billion people on this planet and the market dictates that when there are a lot of apples, apples are cheap. So with the glut of labor globally, if the USA doesn’t protect its financial borders, Americans are subject to the lowest common denominator of cheap labor. Think of it this way, when you build a canal to promote trade, you install locks and gates to equalize the levels and trade moves in both directions. If you open all the gates, you have a waterfall. It is time to revisit the warnings of Ross Perot. I see only two paths to bringing jobs back to the US, protect our financial borders or eliminate the minimum wage to let the American worker compete with global labor. How low can you go?
The American worker was scammed, yes scammed. The promoters of cheap labor (free trade) used our pride against us and told us that the American worker was the most productive in the world and had nothing to fear. Free trade would bring us more jobs. They forgot to tell us that the robber barons who imported cheap labor to build their empires in the 19th century now had the transportation and communications technology to export the work to cheap labor and lax regulations.
I don’t blame the corporations. Their only job is to make money. It is government’s job to protect the welfare of its citizens. Government should set the rules of the financial game to make it profitable to promote national interests and expensive not to. And jobs are in the national interest.
Nearly 14 million people are pursuing just over 3 Million open positions, with skills and geographic mismatches. That alone is an argument to extend UI benefits.
As for claims that people are loafing on UI ... obviously, someone airs their peeves before doing simple research (hint: search engine) to find that you get 25% or less of your previous wage if you are dismissed for no fault of your own (i.e., you can't quit voluntarily to get UI). If you are a high wage earner, over a cap of (e.g., in Oregon) say $94,000 then your payout is less than 25%. And it's taxable.
