Unintended Consequences of Unemployment Benefits

by Ryan Young on July 8, 2010 · 3 comments

in Economy, Employment

This letter of mine ran in today’s New York Times in response to Paul Krugman’s July 4 column.

To the Editor:
Paul Krugman is at a loss to explain why some people oppose extending unemployment benefits. One reason people hold such an opinion is that when government subsidizes something, there tends to be more of it.
The more government subsidizes unemployment, the more people will indulge in it for longer periods of time.
Ryan Young
Washington, July 6, 2010
The writer is a journalism fellow at the Competitive Enterprise Institute.

Tagged as: New York Times, ny times, Paul Krugman, subsidies, unemployment, unemployment benefits, unintended consequences

{ 3 comments }

Barbara Severin July 8, 2010 at 11:31 am: As someone who has been "indulging" in unemployment for some time now, I have time to think of government subsidies and what they create. If the government didn't subsidize out-sourcing through its corporate tax policies, would we have as much unemployment as we do? And then, would I be indulging in a good job?
Can you comprehend the vast majority of the unemployed would rather be working? Do you think it's fun to go from earning $1000/week to $300/week? Indulge me with a job, sir.
Sue July 10, 2010 at 2:48 pm: As a former beneficiary of unemployment benefits, I am honest enough to say that despite the loss of income, when money is free and time is all mine, it is much easier to NOT go out hard looking for a job. It becomes the 'just get by' mentality. Maybe it's because I'm female, and I don't have that same 'provider' drive as men do. Maybe it's because my loss of income (cut in half when I lost my job) wasn't as bad as some, who are now earning a quarter of their income. Regardless, when you give someone something for free, whether their a child or adult, it makes it much easier to take it for granted, and not appreciate it as you would when you put effort and sweat into earning it. It's a basic truth, common sense. My sister is on unemployment after losing her job of 27 years. She's been on for almost a year. She has not made every effort to get a job. Cut off the funding and see how many people start swallowing their pride and take a job at less pay, just to get back to work.
stephen July 11, 2010 at 11:08 pm: So when the government subsidizes housing, there's more housing?