Thursday, July 8, 2010

Should Unemployment Benefits Be Extended Again?

Arthur Laffer explains here why additional unemployment benefits will not lower the unemployment rate and won't speed our recovery from the recession --- a recession the federal government caused in the first place.  He writes,
the resources given to the unemployed have to be taken from someone else. There isn't a "tooth fairy," or as my former colleague Milton Friedman repeated time and again, "there ain't no such thing as a free lunch." The government doesn't create resources. It redistributes them.  
Yes, of course.  But isn't it just plain mean to deny unemployed workers another extension of benefits?

Which is meaner: taking Peter's bread to help Paul remain a bit picky about getting back to work, or making it clear to Paul that if he wants to eat he will need to work, even if it isn't a job he'd like?

"But there aren't any jobs," say the Democrats.  Of course there are jobs; they just aren't the jobs the unemployed think they should have.  But for the sake of argument, let's suppose there really aren't ANY jobs to be had.  What then?

I know this will strike many readers as absurd, but what about creating one's own job? " Impossible," you say?  It's hardly impossible, though it's certainly old school.  What in the world would all these unemployed folks do if they found themselves on an island with no one around to give them a job?

If the federal government really wants to get serious about reducing unemployment and stimulating the economy, then Congress should repeal most of the massive volumes of regulations and taxes that make it ever-more expensive for entrepreneurs to offer others a job.

Once again, why is that we are in a recession in the first place? What will end the recession in the second place?  In case you have forgotten, or never read about it in the first place, read this.

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