Unemployment Insurance
Unemployment insurance was a critical part of President Franklin Delano Roosevelt’s New Deal, a lifesaver during a period defined by economic volatility, depressed wages, and record unemployment. Beginning in 1935 with the Social Security Act, short-term relief was provided for the unemployed to provide for their basic subsistence and maintain their purchasing power. Unemployment insurance generally lasts up to 26 weeks, although in the wake of the Great Recession the Obama Administation extended benefits to 99 weeks.
Cry Wolf Quotes
In all probability, however, compulsory unemployment insurance cannot be had without an amendment to the Constitution, probably both state and federal, as such a measure might be attacked on the grounds that it is confiscation of property without due process of law.
…this is no time to put additional burdens on employers and employees and State administrations. Recent legislation has created plenty of burdens without adding the one. It is an extremely dangerous time to discuss raising labor costs in the sense of labor costs per unit.
This bill will cause further migration from the farm areas to the industrial areas and will invite the transfer of workers from the class of those not gainfully employed in order to share in the unemployment benefits…Unemployment insurance, which in many instances places a premium on indolence, would unquestionably defeat this proposed plan of the administration to place workers in the areas of lower living costs and keep them gainfully employed.
Industrial corporations represent the principal source of livelihood of a very large percentage of our total population. Accordingly, any legislative program which impose unreasonable hardships on manufacturing industries will react to the detriment, directly or indirectly, of every taxpayer.
Evidence
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San Francisco Fed Finds Unemployment Insurance Doesn't Significantly Contribute to Unemployment Levels
Unemployment insurance doesn't encourage people to stay jobless.
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Moody’s Analytics Advocates Unemployment Insurance as Stimulus
For every $1 spent on unemployment benefits, GDP increases by $1.61.
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Congressional Budget Office Says Unemployment Benefits Have Strongest Stimulative Effect
Unemployment benefits make macroeconomic sense during a recession.
Backgrounders & Briefs
Unemployment Policy Brief: Shermer
By Elizabeth Tandy Shermer, PhD, February 2010
Unemployment insurance benefits – including their length, eligibility, and expense – are again in the spotlight. The arguments are hardly new.
