Tuesday, January 7, 2014
Extended unemployment benefits slow growth, hoax on working poor
http://www.foxnews.com/opinion/2014/01/06/extended-unemployment-benefits-slow-growth-hoax-on-working-poor/ Due 13 Jan 2014. What is the rationale of conservative economists for NOT extending unemployment benefits to 1.3 million Americans?? What are the backend costs of such a policy??
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ReplyDeleteConservative economists believe that not extending unemployment benefits 1.3 million Americans because it would slow growth and impose burdens on the rest of the population, or the poor. Also by implementing a policy to try and help the unemployed, it would cause an increase in taxes on everyone, even those who are currently barely making it by. Also by trying to increase benefits for the unemployed, funds from other factors such as roads and school would have to be lower, causing the GDP to fall. Overall, just by extending unemployment benefits, there will be more negative costs than positive ones.
DeleteInstead of reinstating unemployment benefits that are supposed to aid the unemployed, they are said to be "slowing growth" and "imposing burdens" on the poor. It's said that additional taxes to help out the unemployed would just make it worse for the poor working class. The back end costs of a policy to benefit the unemployed would hurt the ones who can barely pay their taxes to begin with. It looks like we are taxing the poor and the people receiving the money don't really have incentives to find real work.
ReplyDeleteAnother extension would make long-term benefits de facto permanent and create another entitlement. Republican leaders are correct to insist Democrats identify equivalent spending cuts or new sources of revenue. Cutting other outlays, for example on roads and schools, would have an even bigger negative impact on GDP and jobs than failing to again extend unemployment benefits, because some of the latter would not be spent but rather be used to pay down credit cards and other debt.
ReplyDeleteThe people who are with the benefiting of the unemployed believe that they are the strongest economic stimulus, because whatever money the unemployment gets they use it on necessities. But they are going off of the study that federal programs aren’t being cut or taxed upon in order to help support these benefits. By cutting other investing such as roads and schools, it will have an even bigger negative impact on the GDP and jobs. They working poor, if they wanted to keep their unemployment benefits, would have to be taxed which is a heavy burden when you factor in that they are barely getting by. A recent study by the non-partisan National Bureau of Economic Research indicated that the extended unemployment benefits caused most of the high unemployment after the Great Recession. By implementing these unemployment benefits, they are limiting job creation and incentives to work, which falls down to leaving a great burden on the working poor.
ReplyDeleteHow do you like them apples Mr. President?
ReplyDeleteObama has, for the longest time, ranted about making it the nation’s objective to help the working poor; and now we come to find out that Obama is screwing over the people he says need the most help.
The article explains that the re-installment of emergency unemployment benefits that Obama has been blindly urging, are posed to cause more negative than positive effects.
The article mentions that emergency unemployment benefits stall growth, hinder the creation of jobs and incentives for many well-educated Americans to work and place the greatest strains on the working poor. In addition, a study by the non-partisan National Bureau of Economic Research supports this idea, showing that extended unemployment benefits caused most of the persistently high unemployment after the Great Recession. I mean think about it…does it make sense for someone being paid to do nothing, to go out and find work for the same or even less pay?
Furthermore, the results of such a policy will only cause a lack of employed Americans, federal spending cuts, and a burden placed on the working poor.
This policy, put into action in order to help citizens during the Great Recession, will end up causing yet another financial crisis.
Extending unemployment benefits would mean higher taxes the employers will be paying, which adds to the cost of the business. When an employer faces higher tax rates, his immediate action would be to lower the wages for the workers. Reinstating emergency unemployment benefits would slow growth and impose unconscionable burdens on the working poor. By raising the cost to employers of hiring low wage workers, higher payroll taxes to finance benefits discourage employers from adding new jobs—especially in depressed areas. And extended benefits discourages workers from moving from high unemployment locations—for example coal mining communities in West Virginia—to more rapidly growing states—Texas and South Dakota where the oil and gas boom is driving growth.
ReplyDeleteConservative economists do not support an extension of unemployment benefits because they believe that in order for this country to begin to grow again it needs to end. After more than a year of recovery, the emergency that the country was once in is now over, conservative economists encourage that we now focus on growth . The extension of the unemployment benefits they believe are not allowing the country to move forward, in fact doing the opposite. Conservative economists make the point out that not funding schools and roads, have more of a negative impact on jobs and the national GDP than the cutting the extension of unemployment benefits.
ReplyDeleteIt seems to be like a cycle. President Obama wants to help those that are unemployed and the lowest stratum of the working class . Yet, by continuing to provide unemployment benefits, that same low income working class is paying taxes that they cant even really afford. The people who are out of work would earn more money than the unemployment benefits even by accepting lower job positions. But with unemployment benefits available, what is their incentive?
Although, it might seem like the right thing to do at the moment-- providing emergency unemployment, in the long run it will only stunt our recovery and growth.
Conservative economists are completely against the further extension of unemployment benefits. These economists believe that for the economy to grow after the Great Recession 55 months ago they need to basically end the unemployment benefit system currently in place. Their rationale is that expansion of unemployment benefits would cause more economic harm than good for their is no proposed plan for how to bring in money to give away. They believe an expansion in the unemployment system would push us backwards. The opportunity costs, such as less funding towards schools and roads, would be greater than the benefit gained from upping unemployment funds. These back-end costs are what make economic decisions imperfect. Its impossible for the president or anyone to find a medium that increases jobs on both spectrum's of income. Raising costs in one place only results in higher costs in another.
ReplyDeleteThe conservative economists do not support further extending unemployment benefits. They believe that it would "slow growth, limit jobs creation and incentives to work among many well-educated Americans and place the greatest burdens on the working poor." The backend costs of this policy would be that the working poor would be taxed in order to generate money for some people who aren't even looking for work and are living off the unemployment benefits.
ReplyDeleteThe extension of unemployment benefits would almost certainly mean that this spirit of providing benefits indefinitely would become permanent. In addition to this, extensive cuts would need to be made to other areas, for example roads and schools, in order to act as an economic bulwark to negate the economic harms of extended unemployment benefits. Conservatives argue, however, that the cuts needed to continue these extensions would actually harm the economy more than the benefits would help it, and thus it's nonsensical to pursue this economic policy. The back end costs to the current policy are a creation of a sort of complacency in the unemployed with the funds they are receiving, and thus not having any need or desire to find employment, thereby harming the economy by just receiving from the government and giving nothing back. Further, the additional taxes necessitated by an extension would hurt the poor.
ReplyDeleteThe conservative economists have made it clear that they are well on the opposing side to the extension of unemployment benefits. They hold this position with the rationale that in order to instate such benefits, extensive cuts would be made in other areas, an example being public education or transportation. The backend costs of the unemployment benefits are that the many people who are receiving them use them as a means of just getting by, therefore doing much less to help the economy because they do not necessarily give back to it. Also, the taxes that would be needed to continue giving out unemployment benefits take away from the poor, and thereby hurts the economy even more.
ReplyDeleteConservative economists are greatly against extending unemployment benefits. This would cause higher taxes for the employers, as well as lower wage for the employees. The conservative economists believe that this will limit the incentives to enter the workforce. In the end, the expansion of unemployment benefits would cause more harm than good. The backend costs of this policy would be that the lower class would have to start paying taxes, even though they can't afford to do so, in order to generate enough money to give out the unemployment benefits to those not looking hard enough for employment.
ReplyDeleteConservative economists believe that unemployment benefits will disproportionately burden the working poor. They also believe that spending increases fail to actually benefit the unemployed, because the taxes collected in order to finance these programs do not directly (or entirely) go towards the programs. Conservatives believe that even though though employers would be the ones paying the taxes necessary to finance these benefit programs, that this would lead to a decrease in the amount that employers pay their employees, which the article assumes are the working poor. According to the article, unduly long unemployment benefits take away the incentive for the unemployed to find jobs. That means that supply for jobs would be driven down by the lack of unemployed workers re-entering the market, driving up the market price of labor. That means that companies demand for jobs will go down because they have to pay more to their current employees. However, this disregards the fact that the market price of labor is far below the minimum wage that the working poor are already paid, and that a decrease in supply will not drastically affect the actual price, even if the market price rises there is very little chance that it will be driven above minimum wage. That means the conservative evaluation over-estimates the back end costs of a policy that will actually be very cost-effective in practice.
ReplyDeleteThe reinstating unemployment benefits that are supposed to aid the unemployed, they are said to be "slowing growth" and "imposing burdens" on the poor. The extension of the unemployment benefits they believe are not allowing the country to move forward, in fact doing the opposite. The opportunity costs, such as less funding towards schools and roads, would be greater than the benefit gained from upping unemployment funds.
ReplyDeleteThese back-end costs are what make economic decisions imperfect. Further, the additional taxes necessitated by an extension would hurt the poor.
Conservative economists do not wish to extend unemployment benefits to nearly 1.3 million Americans. These unemployment benefits are said to be slowing growth and imposing burdens on the low class. More negative effects are said to occur with extended unemployment benefits than good ones. Advocates argue those benefits provide the strongest economic stimulus, because the unemployed spend whatever money they receive on necessities. The backend costs of such a policy are that the middle class will have to work harder and pay higher taxes, and that those who use unemployment will have more of an incentive not to find employment, as they will be receiving more money.
ReplyDelete-Anita Pizzirani (Pizza)
Period: 1
Conservative economists believe that it would be counterproductive to extend unemployment benefits to the poor. One of their hypotheses is that since, in many cases, people receive more from unemployment benefits than they would from a minimum wage job, they will have no incentive for going out and looking for jobs. Other opponents point out that giving to this cause will take away from the budgets for infrastructure and education, which would hinder society as a whole(especially with education being one of the best ways to fight poverty.)
ReplyDeleteConservative Economists believe in Not extending unemployment benefits to the millions unemployed because they believe that it would slow the growth of the economy and burden the poor. The backhanded costs of extending this policy is more detrimental than good, because doing so it is creating a counterproductive society. For example there becomes no incentive to go out and look for a job especially when you can collect unemployment.
ReplyDeleteThe rationale of conservative economists for not extending unemployment benefits
ReplyDeleteto 1.3 million Americans is slowing growth and posing a burden on the working
poor. To fund the benefits, taxes, and cutting of funding would have to be made
in order to fund the taxes. These cute of funding would be made on roads and
schools. This would also have a negative impact on GDP and jobs. Fox News states
that by raising the cost for employers to hire people, it will discourage them
from doing so, which will raise unemployment, especially in depressed areas. By
continuing to provide unemployment benefits, that same low income working class
is paying taxes that they can't even really afford to pay.
This comment has been removed by the author.
ReplyDeleteJeremy PJanuary 13, 2014 at 7:47 AM
ReplyDeleteThe extension of unemployment benefits would translate to higher taxes that the employers will be paying, essentially adding to the cost of the business. Higher taxes translate to lower wages for the workers. Reinstating emergency unemployment benefits would slow growth and impose unconscionable burdens on the working poor. By raising the cost to employers of hiring low wage workers, higher payroll taxes to finance benefits discourage employers from adding new jobs—especially in depressed areas. Extended benefits discourages workers from moving from high unemployment location to more rapidly growing states where the oil and gas boom is driving growth.
Conservatives argue that additional benefits could slow growth and discourage Americans from seeking employment in growing industries and in growing states. It is also argued that more benefits would require an increase in taxes which would make it more difficult for businesses to higher more low wage workers and that these taxes would squeeze low earning workers even more. This policy to reduce benefits would reduce the amount of money the unemployed would have to spend.
ReplyDeleteConservative economists are against extending unemployment benefits to 1.3 million Americans because they think it would slow growth and impose unconscionable burdens on the working poor. There are no taxes to raise the revenue that would make up for these benefits and that would slow down the economy or cause other programs to be cut in its place. Cutting spending for things like roads and taxes would have a worse impact on the economy that not extending unemployment benefits would be. They also claim it would not speed up the economy as much as expected because when the unemployed people receive these payments, they do not spend on consumer goods that add to the GDP, but instead to pay off credit cards or existing debt. Because unemployment benefits are financed through payroll taxes, low income workers would be paid a smaller amount by their employers who would have to shoulder the tax. The backend costs of such a policy include more unemployment. Because employers have less money to pay out workers, they reduce wages and hire less people, which creates more unemployment.
ReplyDelete