Monday, March 1, 2010

Jim Bunning is Right to Block Unemployment Extension in Senate Filibuster (sorta)


Senator Jim Bunning (R-KY) is taking some major criticism for blocking the U.S. Senate's attempt to extend unemployment benefits for another 30 days. Reports The Huffington Post
(via Memeorandum)
:

"On Monday, the Kentucky Republican once again prevented a vote on a bill that would extend eligibility for enhanced unemployment benefits and subsidized health insurance for laid-off workers by 30 days."

The move by Senator Bunning has created a sharp backlash from Democrats and Republicans, scathing critiques from the establishment and Internet media, and prompted some questions from journalists, one of whom the Kentucky Senator reportedly gave "the finger" to.

UPDATE (Mar. 2):
Bunning, Reid to make deal. Developing...

There are a number of important points to make here:

1) Bunning is right. Jim Bunning's reason for blocking the extension of unemployment benefits is absolutely well-founded. He is asking the question we should ask of every appropriation: where is the money coming from to pay for it?

He doesn't oppose the unemployment extension, he is simply insisting that we pay for it with unspent money from 2008's appalling financial bailout package- money that would go to financial corporations if we don't give it to struggling Americans like Bunning suggests. Really terrible of him, huh?

2) Bunning is wrong. Megan McArdle is correct to ask, "If Bunning wants to hold up something, how about finding some useless defense appropriations to complain about?" Bunning isn't so fiscally responsible when it come to the military-industrial complex, is he?

But I also have to say that I'm tired of hearing welfare statists and warfare statists pretend to be fiscally responsible by complaining about the other's spending. I for one would like to see some fiscal sanity across the board.

Not that I'm calling McArdle a welfare statist by the way, but she is confused if she thinks that unemployment benefits are a kind of economic stimulus, as she asserts in the article linked to above. (You'll see why I say that in item six below...)

3) Bunning isn't the only one holding up the unemployment extension. To read the criticisms, you'd think that Jim Bunning and his damned stubbornness alone are keeping the American people from getting a much-needed unemployment extension this month. Just scroll back up and click on some of those Memeorandum links- you'll see.

One even says, "Sen. Bunning Single-handedly Causes 2,000 Federal Worker Furloughs." Um... what about the rest of the Senate? None of them are being stubborn at all by refusing to consider Bunning's request to fund the unemployment benefits with leftover money from the 2008 financial bailout bill? Why isn't anyone angry at them? They're holding things up too.

Oh yeah- and Jim Bunning isn't even really filibustering.

4) Why do people need the unemployment extension in the first place? While it feels good to direct a little partisan outrage in Jim Bunning's direction for his "refusal" to help out struggling, working class Americans, it would be more helpful to think about why they're struggling in the first place and to be angry at the people who caused that. Seriously.

I'm not a heartless libertarian who doesn't care about the struggle of working class Americans. I do care about it deeply, and I share it. I just graduated from college this December in the middle of one of the worst job markets our country has seen. I was also laid off from my job this last summer as a server at a steakhouse (go figure that people don't seem to be going out for steak as often these days). So believe me, I know what it means to get hit by the recession and I care.

I care so much in fact, that I'd like to figure out what caused all of this in the first place, and I'd prefer to be more angry at the people who put Americans out of their jobs than at Jim Bunning for insisting on paying for their unemployment extension with money that will otherwise go to financial corporations (you know instead of just running up the already suicidal deficit and/or hogging up even more of the credit market by issuing bonds, both of which would ironically hurt job growth).

5) No, seriously. Why? The reason people need an unemployment extension is because they're unemployed. The reason people are unemployed is because there aren't enough jobs. The reason why they're aren't enough jobs is because rent-seeking behavior by unions and complicit legislators at multiple levels of government have driven jobs overseas and reduced the total quantity of labor demanded by employers.

Furthermore, the economic "boom" fueled by the Fed's artificial expansion of the monetary and credit supply stimulated an artificially increased demand for things like housing construction, which in turn artificially pushed their prices upward. This resulted in a misallocation of capital to its least productive uses as investors sought to make returns on the "booming" real estate market. When the credit markets naturally and inevitably corrected themselves, housing prices plummeted and all that capital was destroyed with little productive value to show for it and no sustainable jobs created in the process.

Today Democrats are angry at Jim Bunning for holding up the Senate in a debate over how to fund an emergency 30-day unemployment extension. Today I'm angry at Democrats for supporting the policies that lost people jobs in the first place. (And don't worry- I'm angry at Republicans too.)

6) Unemployment benefits are bad for the economy and hurt the people they purport to help. Period. This is an empirically verifiable fact. There's no arguing with it. The chair of Belmont University's prestigious Department of Entrepreneurship, Dr. Jeff Cornwall has all the details here:

"Koellinger and Minniti's analysis showed that increasing unemployment benefits by 0.1 percent of GDP reduces the share of entrepreneurs in the population by roughly 3%. The USA currently spends about 0.3% of GDP on unemployment benefits and 7.7% of the adult population are currently in the process of starting a new business. If the government were to decide raising unemployment benefits to 0.4% of GDP, the rate of entrepreneurs would decrease from roughly 7.7% to 7.4%. Although that may not sound like a big number, given a population of 200 million, it would mean a loss of 600,000 start-ups. On average, every new entrepreneur employs 2 other people. Hence, an additional 1,200,000 jobs would be lost - which is roughly the adult population of Houston. These are lower bound estimates that do not take other indirect effects of unemployment benefits on the number of jobs into account, such as established firms hiring less because of decreased sales or higher social security costs."

21 comments:

Teresa said...

In this particular case it looks like Sen. Bunning is standing on principle. The Democrats passed the Pay-as-You-Go Bill and it was signed into law last month and he is holding the Democrats feet to the fire on this one. It wouldn't be hard to fund this bill using the leftover stimulus funds so it wouldn't add to the deficit. If the Democrats use tricks to bypass PAYGO, what was the point of passing it?

Skip said...

As to point #6, I actually used my unemployment benefits to start a new business, although I realize I must be in a tiny minority.

runwit said...

I think that all of this unemployment money being spent is foolish, but obviously we need something. I think what we need is a better platform, and since wall street seams to be in charge, we need to get out country back from the banks. The biggest problem is that you don't have the right platform. The role model is to give and give, you give $293.00 which is the average unemployment check,could you live that, on less than $300 a week? Why would we create a system that collapses on it self? So who hit the pause button any way?

Anonymous said...

That's right. We do not need to give those lazy, greedy, liberals any help. We are spending 750 billion dollars for defense.A triilion dollars for the wars that we will never win,Billions on the war on drugs that we will never win,and now we have a an idiot who is at least the equal of Sarah Palin. So, if you are like me- 75, out of work since 2008 and I have college and law school in my background, I have three batttle stars for the 18 months I spent in Korea (Hey Jimbo-remember that war? It was in the papers) and I have sent out at least 150 resumes and gotten 4 interviews and now I am ashamed because some conservative think tank, in an article written by two people who HAVE JOBS are telling me that people who get unemployment will not want to find a job because the $249 a week that I get in UI is so much better than any job I can get.And where was Jim B. when the Bushies spent all tht billions for space wars for something that never worked.Is Jim B. a little senile?
Or is he just another Repub showing how cruel and inhuman and stupid he and his party are..

Rational Nation USA said...

Bunning is precisely correct on principal.

Rather than increase the debt shift unspent money from the bailout package to cover the additional unemployment benefits that few argue is needed during these tough economic times.

A reasonable proposal that ought to be given serious consideration by thinking legislators.

However, those that wish to continue increasing the size of government prefer to just spend more rather than to spend intelligently.

Anonymous said...

Anonymous, I agree!!!! I am so pissed that I have to deal with a Government check, that by the way is usually not put into my bank on time. Why? Because the so called workers at the DOL are not keying in the data when turned in, which causes me to show up at that office every week to sit for hours (taking away from job hunting) so that "they" can keep a job...if we didn't show up, they would be out of work! Hmmmmm! Besides that, I too am an educated person, still seeking training to move into an industry where the jobs are. I too am not only embarrassed to have to receive such low income, that every time I go to that place I feel like I am in a "welfare office", I feel like I'm begging, that in my lifetime I have made more money than the average DOL worker there and they talk to you any kind of way or that they can never answer a general question for you, that I am barely able to make ends meet, if that! But also I am embarrassed to say that I live in a country where there is even a question about helping their own people survive due to the countries own mistakes! And they wonder why there is so much crime now, if they stop DOL payments what the Hell are people going to do, then what will Jim B. say then?? How will people feed their children, stay in their homes....oh yeah thats right we have "Welfare". I see Tent Cities starting to pop up everywhere, soon!

Anonymous said...

EDD WELFARE has become the new dependency for a bunch of lazy and whinning Obongo lovers.

Anonymous said...

What we need to do as American's is create the jobs necessary to get people back to work. But until that happens there is no reason why Sen. Bunning should have been so foolish. Not only is he cutting off the unemployed, but he has held up transportation highway construction jobs, screwed the doctors who are prepared to cut off those on medicare and medicaid, and he has projected himself as a heartless ass. Buy American, boycott Walmart and places that only sell Chinese product's and look for products made by American working hands!

LoneWolfArcher said...

I am for Bunning on this one. Sorry, but if you have been out of work that long, even in this economy, then something is wrong.

Anonymous said...

Stop paying a million a day for a war that we won't win at least back in vietnam days they knew when to pull out and 1/2 vietnamese are doing nails and cooking in USA now anyway so why do these politicians especially Bunning who supports (along with Bush) throwing money into this war so our poor young men can get their legs and arms blown off (and who takes care of them when they get home?) and they can give themselves a raise in their already fat paychecks but are so frugile when it comes to the measley unemployment checks for the hardworking heart of America people!!!

Anonymous said...

Who is Bunning to say whether or not people should receive their extended unemployment, these Amercians have paid for this unemployment in their weekly paychecks so who are they to say no!! Here's a thought why don't we have all the Senators and Congressmen pay into social security as we do and relinqish their government pension, let Governor Christi straighten them out on how much to put in their pockets vs the American peoples pockets.

Daniel said...

This is not the right vote for Bunning to take a stand on. The deficit hawks will have their day, but 1.2 million Americans feel VERY personal about this:

http://bit.ly/9rMSdl

Bruce Flitt said...

Interesting

W. E. Messamore said...

Teresa- you make a fantastic point.

Skip- Good on you, bloke!

Runwit- You cut right to the crux of the matter. Wall Street is in charge, and we do have to get our country back from the banks. More specifically, we need to liberate it from the oppressive Corporate Banking-Congress complex, that two-headed monster which profits from our misery.

A good start would be a Fed Audit so we can see how far and wide the tentacles reach.

Anon 1: Did you even read my post? I slammed Bunning for his hypocrisy on defense spending above, and I regularly rail against our many failed and expensive wars ("on terror" and on drugs) at this blog. Where were the conservative think tanks when Bush ran up his deficits, you ask? Right here: (http://bit.ly/ds0vmX). Now please pay attention and read this blog. You might find I agree with a lot of what you believe, and hopefully you'll see that I'm not cruel, heartless, or a hack.

RaNaUSA- You've diagnosed the problem. More spending instead of more intelligent spending.

Anon 2: I must apologize for not having a clue what your comment means. Are you being sarcastic? Sincere? I can't really tell. But I do appreciate your commenting!

Anon 3: I don't think people who need unemployment benefits are lazy or free-riding. I think they are genuinely suffering and mostly victims of our misguided government's policies over recent decades. I hurt for them. I wish they all had jobs and I think they would if we had governed a little smarter in our recent history.

Anon 4: I agree that Bunning has picked the wrong hill to die on. As for the protectionism you express at the end of your comment, I have to say that such a policy actually creates a net loss of value and productivity to our economy. Free trade between consenting parties always creates more, not less value.

LoneWolfArcher- I agree that something is wrong, but not with those people. Something is wrong with our labor and capital markets. If we fix those, then honest, hardworking Americans will be able to find jobs.

Anon 5: I always love a good anti-war rant. Keep up the enthusiasm and stay vocal. We're going to eventually bring some sanity to our foreign policy. One way or another. But it takes people like you and me.

Anon 6: Bunning isn't saying the unemployed shouldn't get their extension. He's saying that Wall Street should pay for it (sorta) instead of taxpayers.

Daniel: I think they'll get their extension. At worst, it will come retroactively very soon if it has to. The question is how we'll pay for it. But again, I agree that he's taking a stand in the wrong place. To make it worse, he's behaving like a real jack ass about it.

Bruce: Thanks!

Anonymous said...

How could one senitor have so much control? Something is wrong with our government, if it allows one guy, "out of touch with reality" to effect millions of Americans. Bunning doesn't get it, because he's not unemployed and has a fat paycheck coming in each month. The government got us into this mess and that is why so many people are unemployed. The government has no problems sending money to other countries when they need help, but when it comes to taking care of our own, that's unheard of. We all paid into unemployment when we worked. Maybe we should get the money from AIG!

Anonymous said...

Hang on--other stories have said that Reid agreed to let Bunning's proposal for funding come up for a vote. And then Bunning refused to take yes for an answer, because he didn't think the vote would go his way. Not exactly a principled stand, considering the consequences.

B Pliska said...

This statement is inaccurate and wrong: "The reason why they're aren't enough jobs is because rent-seeking behavior by unions and complicit legislators at multiple levels of government have driven jobs overseas and reduced the total quantity of labor demanded by employers."

What has driven jobs oversees is the previous 12 years of mostly Republican rule allowed for massive deregulations, resulting in companies sending jobs oversees to in order save overhead. Had regulations held, thousands of jobs would have stayed in the US and the companies would simply have not made as much profit, but America would have been the better for it as a whole. It was simple attack on the middle class began by Clinton and NAFTA and extended to the extreme by Bush. To blame Unions in one sentence and in the other say "I'm not a heartless libertarian who doesn't care about the struggle of working class Americans. I do care about it deeply, and I share it.", is hypocrisy of the highest order. You need to get your priorities in line. The United States of America is built on the backs of the middle class, and don't you ever forget it.

Anonymous said...

please read this:
http://www.sfreporter.com/stories/born_poor/5339/all/

thanks, V

W. E. Messamore said...

Starting after my previous comment...

Anon 1: You wrote, "Maybe we should get the money from AIG!" That's- actually what Jim Bunning is essentially fighting to make happen. Maybe you agree with him more than you think?

Anon 2: I'm not sure what you mean. Doesn't it make him more principled (or at least not less principled) that he is committed to making sure that the unemployment extension gets funded, and not simply willing to let that principle die with the symbolic gesture of bringing it to a vote he knows will fail? PS: I'm not saying he's principled in general. As I've written over and over above, Bunning is picking the wrong hill to die on and should have been this stubborn about Bush's military budget.

B Pliska: Can you tell me what policies specifically that you're referring to when you say that the GOP deregulated the economy massively? And furthermore, I'm confused because I typically think of regulations as creating overhead, not a lack of regulations. So your statement that deregulation pushed jobs overseas so companies could save on overhead confuses me.

As for your concern for the welfare of the middle class, I can only reiterate that I share it fervently, and that my opposition to unions doesn't preclude that concern. I would actually assert that unions are extremely harmful, not helpful to working class interests. Unions represent a coercive monopoly on the labor market, which extorts higher wages for its members at the expense of everyone who loses their jobs when the total quantity of labor demanded necessarily decreases (all other things being equal).

Robert N. Lee said...

Hi. I bet I'm much older than you, have a resume and career track record from hell. And I was laid off a year or so ago, and have had to survive on unemployment and what work I could scrape up, since.

So I just dropped by to say good luck growing up and shaking off your disgusting beliefs. It'll probably start happening around the first time you can't find work, no matter how badass your CV is, and have to go on unemployment.

But I get it: that'll never happen to you.

Talk to me in twenty years.

W. E. Messamore said...

Robert: Did you actually read my article before commenting on it and attacking my beliefs? I don't think you did, because if you had, you would have read how I got laid off last year too. And how I graduated from college this December in a terrible job market... yes the cruel heartless guy that wrote this article is struggling to get a job right this moment. So your prediction that I would shed my beliefs once I struggled to find work is already wrong, because I'm already struggling and I haven't shed those beliefs.

You and I are not so different, and I think if we had a coffee or beer together and talked about it, you'd find that we agree on much. I feel deeply for the struggle of working class Americans. I'm outraged at how they've been exploited by the government and by corporate thieves. I'd like to see our government do something about it and pass reforms that will fix this problem and get us out of this terrible rut.

In the article above I simply:

1) Point out a fact- that Bunning doesn't oppose the unemployment extension, he just wants to fund it with unspent stimulus money- which is actually pretty sensible. What's disgusting about pointing this out?

2) Criticized Bunning for his hypocrisy when it comes to defense spending. Is this what you find disgusting about my beliefs?

3) Pointed out that if getting these benefits out were really all that important to Senate Democrats, they could just agree to pay for the benefits instead of printing even more money and/or hogging up even more credit (which are both policies that HURT working class and poor Americans, and stifle job growth).

4) Note that people who are truly concerned for the welfare of the working class might start by being outraged that they are unemployed in the first place and try to determine why.

5) I explain that our recent economic troubles were caused by an artificial expansion of the monetary supply (among other things)...

6) I show how unemployment benefits actually hurt job creation, because again- my chief concern is getting working class Americans jobs. Not because I'm heartless and don't them to have anything... but actually because I care very much and want them to have more.

Now if you disagree with some or all of the above fine, but please at least read and try to understand it before pigeon-holing me as a cruel, Rand-worshiping prick. I'll do you the same courtesy if you decide to stick around and read more here at THL. I just don't see what is so offensive about my opinions here.

-Wes

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