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The unemployment benefits debate, Part IV

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By Michelle Malkin  •  May 11, 2010 11:24 AM

You’ll recall the far Left attacks on me last summer when I had the audacity on ABC’s This Week to discuss government unemployment benefits and the effect that endless extensions have on reducing the incentive to seek a job.

We revisited the subject in March during the Senate debate over the jobless benefits extension package protested by retiring GOP Sen. Jim Bunning.

And again when the Atlanta Journal Constitution’s Cynthia Tucker resurrected her emotional objections to basic economic facts, which even NYTimes columnist Paul Krugman acknowledged:

The AJC’s Cynthia Tucker blogged today about a testy exchange we had last summer on ABC’s “This Week” regarding government unemployment benefits and the effect that endless extensions have on reducing the incentive to seek a job. Once again, she mistakes standard economic arguments for moral judgments: “Does the right really believe the unemployed are lazy?”

What offended Tucker’s sensibilities was the blunt manner in which I summed up taxpayer-subsidized inducements: “If you put enough government cheese in front of people, they are just going to keep eating it.”

As I said in August and reiterated last week during the Bunning Senate floor showdown, the question is where do we draw the line? There is no such thing as a “temporary” entitlement in Washington and there are precious few politicians willing to challenge the permanent, ever-expanding Nanny State (quoting from the WaPo article: “under multiple extensions enacted by the federal government in response to the downturn, workers can collect the payments for as long as 99 weeks in states with the highest unemployment rates — the longest period since the program’s inception.”)

None other than Paul Krugman of the Fishwrap of Record acknowledges that generous unemployment benefits reduce the incentive to seek jobs.

As he put it exactly:

“Everyone agrees that really generous unemployment benefits, by reducing the incentive to seek jobs, can raise the NAIRU” [the minimum rate of unemployment consistent with a stable inflation rate].

Which brings us to today’s story in the Detroit News about landscapers unable to find workers because…they’d rather collect unemployment benefits than take a job:

In a state with the nation’s highest jobless rate, landscaping companies are finding some job applicants are rejecting work offers so they can continue collecting unemployment benefits.

It is unclear whether this trend is affecting other seasonal industries. But the fact that some seasonal landscaping workers choose to stay home and collect a check from the state, rather than work outside for a full week and spend money for gas, taxes and other expenses, raises questions about whether extended unemployment benefits give the jobless an incentive to avoid work.

Members of the Michigan Nursery and Landscape Association “have told me that they have a lot of people applying but that when they actually talk to them, it turns out that they’re on unemployment and not looking for work,” said Amy Frankmann, the group’s executive director. “It is starting to make things difficult.”

Chris Pompeo, vice president of operations for Landscape America in Warren, said he has had about a dozen offers declined. One applicant, who had eight weeks to go until his state unemployment benefits ran out, asked for a deferred start date.

“It’s like, you’ve got to be kidding me,” Pompeo said. “It’s frustrating. It’s honestly something I’ve never seen before. They say, ‘Oh, OK,’ like I surprised them by offering them a job.”

Some job applicants are asking to be paid in cash so they can collect unemployment illegally, said Gayle Younglove, vice president at Outdoor Experts Inc. in Romulus.

“Unfortunately, we feel the economy is promoting more and more people and companies to play the system and get paid or collect cash money so they don’t have to pay taxes,” Younglove said.

No doubt such decisions are being made across the country. And with Democrats pushing for yet another massive unemployment benefits extension, there’s no end in sight:

Congress faces a crush of votes on big-ticket items before the Memorial Day recess, setting up a debate on deficits less than six months before the November elections.

Democratic leaders are looking in the next three weeks to send President Barack Obama a slew of measures that cost more than $200 billion, including a multiyear extension of unemployment benefits, an extension of expiring tax provisions and Medicare doctor payments totaling $180 billion and a $33 billion Afghanistan war supplemental bill…

…The unemployment benefits program, which provides someone with up to 99 weeks of jobless benefits, has received two monthlong extensions in the past two months. It is unclear how much the next extension designed to last for the rest of this year will cost, but the price tag is expected to be in the tens of billions.

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