Sunday, November 28, 2010

Somebody drive Rush to the unemployment office, please...

Small businesses rely on customers. 
Customers are people who have money.
If customers are unemployed, unemployment compensation is where they get their money.
If customers have no money, and they don't buy, small businesses go under because they have no customers.

Sounds like it would be sensible to extend unemployment benefits, yes?  I mean, a lot of people would be buying their groceries and paying their bills as best they can with their benefits, so the money goes right into the economy. 

Well, people in Congress don't think extending unemployment benefits are worthwhile:

" [First] there are five unemployed people for every job opening — a profound scarcity of jobs. Two, federal benefits average $290 a week, about half of what the typical family spends on basics and hardly enough to dissuade someone from working. Three, as unemployment has deepened, benefits have become less generous. Earlier this year, lawmakers ended a subsidy to help unemployed workers pay for health insurance and dropped an extra $25 a week that had been added to benefits by last year’s stimulus law.
Other opponents would have you believe that the nation cannot afford to keep paying unemployment benefits: a yearlong extension would cost about $60 billion. The truth is, we cannot afford not to. The nation has never ended federal benefits when unemployment is as high as it is now, and for good reason: Without jobs, there is inadequate spending, and that means ever fewer jobs. A wide range of private and government studies show that unemployment benefits combat that vicious cycle by ensuring that families can buy the basics.

Nor do jobless benefits bust the budget. Just the opposite. They do not add to dangerous long-term deficits because the spending is temporary. And because they support spending and jobs, they contribute powerfully to the economic growth that is vital for a healthy budget. Extending the Bush high-end tax cuts would be budget busting, because they are likely to endure, adding $700 billion to the deficit over 10 years. Tax cuts for the rich provide virtually no economic stimulus, because affluent people tend to save their bounty.

Ignoring facts and logic, several Republicans have said that any benefit extension must be paid for with spending cuts elsewhere. That would, in effect, be giving with one hand while taking away with the other. It is not only cruel, but foolish, because it would reduce the economic boost that benefits would provide"."

If only we had real economists advising the Prez, we might get somewhere, if he stopped with the bipartisan bovine excrement and listened.