Roll Call: Latest News on Capitol Hill, Congress, Politics and Elections
April 18, 2014

Republicans’ “Callous” Crusade Against Unemployment Benefits

Calling Republicans’ policy to end the extension of unemployment benefits, “a perfect marriage of callousness — a complete lack of empathy for the unfortunate — with bad economics,” Paul Krugman makes the case that it “is an especially clear example of superficially plausible but wrong economic ideas being dangerous for evil.”

“The view of most labor economists now is that unemployment benefits have only a modest negative effect on job search — and in today’s economy have no negative effect at all on overall employment. On the contrary, unemployment benefits help create jobs, and cutting those benefits would depress the economy as a whole.”

“The point is that employment in today’s American economy is limited by demand, not supply. Businesses aren’t failing to hire because they can’t find willing workers; they’re failing to hire because they can’t find enough customers. And slashing unemployment benefits — which would have the side effect of reducing incomes and hence consumer spending — would just make the situation worse.”

  • http://foundersfollies.blogspot.com/ Chredon

    Demand-side ‘Trickle-up’ economics beats trickle down every day.

    It doesn’t matter how much money you put into the hands of corporate boards. They aren’t going to hire new workers until their demand is more than they can meet with their current work force. But if you give benefits to, and provide jobs for, those who are currently unemployed or under-employed, that money will turn into greater demand – spurring more hiring, and greater demand, and more hiring – a self-reinforcing virtuous cycle of economic improvement.

  • ralph_indianapolis

    Rand is speaking to his team party folks

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