Businesses Hiring Fewer Workers Thanks To Expanded Unemployment Benefits In Stimulus Bill

Proof • November 23, 2009

Again and again liberals have insisted that one of the best ways to help with America’s unemployment problem is to expand unemployment benefits. In fact, expanded unemployment benefits were part of the “stimulus” spending spree that was supposed to create more jobs.
Throughout critics such as myself have pointed out that making it easier to be unemployed at the expense of the people who we want to be doing the hiring was hardly a way to fix unemployment. And it turns out we were right:

WASHINGTON – As if small businesses needed another reason not to hire, consider their latest financial burden: The cost of rising unemployment itself.
Employers already are squeezed by tight credit, rising health care costs, wary consumers and a higher minimum wage. Now, the surging jobless rate is imposing another cost. It’s forcing higher state taxes on companies to pay for unemployment insurance claims.
Some employers say the extra costs make them less likely to hire. That could be a worrisome sign for the economic recovery, because small businesses create about 60 percent of new jobs. Other employers say they’ll cut or freeze pay.

Here’s the key part:

Federal law requires states to build up unemployment insurance trust funds in good times so they can pay benefits during downturns. The idea is to avoid having to raise taxes or cut benefits in a recession.
But the severity of this recession has bankrupted many states’ trust funds and forced them to borrow from the federal government. States eventually must pay back the loans. Otherwise, the federal government can raise taxes on their businesses.

The thing is, the federal government (as I already alluded to) put an expansion of unemployment benefits in the stimulus bill. And just recently Congress passed another expansion of unemployment benefits.
These expansions aren’t mentioned in the article, but they happened and now businesses – who, again, we want to be hiring these unemployed people – are paying the cost.

Tags: Asshats, Domestic Issues, Politics

http://Array sayanything-12

Link?
sayanything-203

My friend “Donny Baseball” has explained that more than anything it is the Obama administration’s war on business, profits, and ultimately free-market capitalism itself, that is causing the US business community to limit its expansion and investment here in the US and focus instead on the opportunities in overseas markets. Here are just a few of his comments:

http://crossmolina.blogspot.com/2009/11/finallybig-time-ceo-washington-is.html

http://crossmolina.blogspot.com/2009/11/one-more-timewhy-we-have-10.html

http://crossmolina.blogspot.com/2009/07/job-market-vigilantes.html

http://crossmolina.blogspot.com/2009/04/american-business-has-buyers-remorse.html

http://crossmolina.blogspot.com/2009/05/obama-opens-another-front-in-war-on.html

http://crossmolina.blogspot.com/2009/02/kudlow-nails-it-obama-is-waging-war-on.html

Nor are his observations unsupported:

http://pajamasmedia.com/blog/whether-or-not-obama-focuses-on-economy-it-gets-worse/

http://biggovernment.com/2009/10/24/obama-vs-the-american-businessman/

As David Farr, CEO of Emerson Electric put it recently:

My job is to grow that top line, grow my earnings, grow my cash flow and grow my returns to the shareholders. My job is not to shrink and roll over for the U.S. government.
djer

Hey, Goon you wanna check the vote on the expansion of unemployment benefits. it was 98-0. I wonder how many of those 98 yea votes were from your conservative buddies.
edh

I think you made a couple of mistakes in this post.

1) The feds funded the EXTENSION of normal unemployment benefits with the stimulus. Since those extensions of benefits are federally funded they aren’t directly charged to employer accounts the way regular benefits affect the employer’s “experience rating.”

2.) Employer accounts have been hard hit by higher normal claims, which is expected in downturns if there have been layoofs.

3.) The real scandal is the degree to which employer accounts were drained in “good times.” The old saying in govt is “don’t kill the job” and in the Unemployment Insurance “business” paying out benefits is the way to keep the job going. This not only pertains to unjustified claims made against employers by their employees, but massive “solvency assessments” levied against employer accounts. Solvency assessments are charges made against employer accounts, not for benefits claimed by former employees of the employer, but by the state Unemployment Dept for their reckless spending on unmeritorious claims. These solvency assessments are huge in some states.
Quo Vadis

Republican States? Like California? The state that where the vast majority of people live in the democrat-controlled Bay Area and L.A.? Just because a state has a Republican (rino) governor does not make it a ‘republican run state’.
al reasin

Yes btex. If a state took the money they also had to change their laws such as to give unemployment to part time workers. So besides the longer duration, the states have to add the part time workers. That was a main cause of the red states refusing the money.

The Pelosi and Reid healthcare bills add uninsured below a certain pay level to Medicaid which increases the burden on states. And private insurance premiums are taxed in most states, so those that move to government care will not pay a tax to the states. More lost income for the states. Ah, those unintended consequences can kill you.
Al Reasin

Overheard in MD before the recent increased duration of unemployment payments; why should I look for a job when I can get unemployment.
ontheright

That doesn’t make it right? All politicians are slime and 2010 can’t get here soon enough…
TriciaNC

It was stuck in a defense bill. A DEFENSE BILL. It was also held up by Republicans to try to get this out of there but since CONGRESS IS RUN by DEMOCRATS it didn’t have a chance.

Were faced with defunding our troops or pass it….in other words blackmailed for the life of my son and many other sons & daughters fighting overseas.
sayanything-4204

Thats the one repeatable of Liberal economics at work….unintented consequenses. In a philosophy based on Keyesnism, which like Liberalism, and all the ‘ism’s has been proven to fail every time its tried.

the repeating habit of Keyenism was to not to have to let the cost of labor correct in a correction ie protect the Unions. Wilson & FDR tried it & some historians attribute as a big cause to the great depression. Obama’s on the same prescription

The whole idea of Keynesian stimulus, he explained, was to cause inflation…which would reduce the real price of labor. In a modern democracy, politics prevents wages from falling. But in a correction, if wages don’t fall people don’t get jobs. Keynes’ didn’t mention it, but the only reason his stimulus works is because it pulls the wool over the eyes of the working classes – reducing their wages by inflation so employers can afford to hire them again. Ergo, no inflation…no recovery in the job market. No recovery in the job market…no recovery in the economy.

And when your cost of labor is exponentially higher than the rest of the world you get the Big Auto fiasco.

The whole idea of a correction is to let the cost of labor correct itself to market levels. When the cost of labor corrects wala you get business hireing
drjohn

Democrats are to jobs what bicycles are to ducks.
djer

Actually, that wasn’t what I was implying Rob. Neither were stupid ideas, Rob. The “partisan jab” was clearly indicating to Goon that he should also thank his conservative buddies as well since the vote for extending unemployment benefits was overwhelmingly supported by both parties. I thought that was pretty clear, Rob.
sayanything-106

Thankyou democrats.
Imacircusmidget

Dino wrote: “The state in the worst fiscal shape is republican-led Arizona.”

Hey Dino….come to Michigan and say that.
cjkcjk

To drjohn: I’d say more like shotguns to ducks.
Koblog

You should see what’s going on here in So. California.

Today a guy told me his employer just closed shop and moved the business to Florida.

My sister told me her friend’s business did also just closed and took off.

My wife’s employer is hurting because people can see that the recently increased California state sales tax (now at 9.75% !) is easily avoided via internet purchases, often with free shipping.

Capital flees to where it is wanted. California raised income taxes 10%, yet is now $21 BILLION in debt and tax revenues have decreased.

The more the state squeezes business and consumers, the less they spend… or they leave altogether. In spite of raising taxes, tax revenue decreases. Productive people leave or figure out how to avoid the state ripoff of their productivity.

47% of Americans pay no income tax. The federal government is $14 TRILLION dollars in debt with an annual deficit of $1.4 trillion for as far as Obama’s eye can see…and he can see a very long distance indeed.

We are going John Galt: productive people are going on strike. The government is starving. All they can do is print more money.
btex

Better check your facts, the states were force to raise the unemployment payments with the Stimulus money and continue them at a higher rate. This forced businesses to pay higher taxes to cover the payments.
sayanything-4416

The state in the worst fiscal shape is republican-led Arizona.
sayanything-2483

It will take a while to recover from Napolitano’s incompetence, just as it will take time to recover from Obama’s.
In keeping with your record of being wrong, California is #1
redstone357

That is because the Federal government will not do one of the only things it is mandated to do and that is protect the borders. Arizona would be fine were it not for the economic burden illegal mexicans are putting on it.
sayanything-1317

All states are doing bad.

Since Republican states would be included under all states…Republican states are doing bad,

Thus this is somehow a partisan issue again.

Yaaaawn.
sayanything-81

Interesting you blame the fed here when you quote a block indicating that the state’s inabilities to operate on budget led to this fed intervention. Huh.
sayanything-2361

It’s become a sin tax on hiring employees. Yay.
sayanything-4416

This story from Oct. 08 says AZ:

http://images.businessweek.com/ss/08/12/1218_shortfall_states/2.htm

This story from June 09 says Nevada: http://www.cnbc.com/id/31191092?slide=13

AZ had dropped to 4th. NY 2nd, Alaska 3rd. CA is 6th.

In any case, the republican states aren’t doing well either.
http://sayanythingblog.com robport

Well, fewer than the votes from your liberal buddies.

But you agree that expanding unemployment benefits and raising the minimum wage were really stupid ideas, right? Is that what you’re implying with your partisan jab?
sayanything-4808

And Rob spinning back kicks djer into a sticky bit of logic…

Nice.
sayanything-4808

Princess Leia’s comments to Grand Moff Tarkin are always instructive.

The more you tighten your grip, Tarkin, the more star systems will slip through your fingers.

The more the government squeezes human endeavor, the more the humans being squeezed will seek to escape it to other jurisdictions, the more they will regard its rules with contempt and ignore them, the more they will drive towards guerrilla war with it, and the less will be their loyalty to it.

If you wanted a prescription for increasing illegal activity, making people turn a blind eye to the law and ethics, for making them question their dedication to their nation and see themselves as free agents at large, this sort of thing is it.

They are essentially helping to destroy the patriotism of the people and that is something that cannot be easily remade.
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Businesses Hiring Fewer Workers Thanks To Expanded Unemployment Benefits In Stimulus Bill

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