Holes in the Safety Net

I had breakfast with a friend of mine this morning.  He and I have different viewpoints on many subjects.  One area of pointed discussion we had today concerned the “safety net” programs we have in place.

I’ve read and heard about politicians who are against Unemployment Insurance because they believe it will encourage a welfare state.  They’ve said that collecting unemployment will lead to an entire class of citizens who will be forever attached to the government.  To a point, I can agree with this.  If we allow people to become too accustomed on someone else taking care of them, that can lead to a situation where we have too many people not doing enough and drain the government of the funds it needs.  The idea that UI can encourage a welfare class does have its place, but that place is far different than the one we are in as a nation right now.

Unemployment Insurance (UI) was originally a program that started in Wisconsin in the 1930’s. The program was created to help people who were unemployed by no fault of their own  continue to buy food and pay other living expenses until they were employed again.  During times of low unemployment, the fund would grow because more people would be paying into the program than using it, and when times were difficult it would act as a stimulus to help keep families in their homes and local businesses open because the money would more than likely be spent rather than saved.  We are currently in a very difficult situation concerning the economy and jobs.  We have record high levels of unemployment and what has been called a “jobless recovery”, where employers are flush with cash but not hiring new workers.  So even though we are coming out of the recession, the job market hasn’t rebounded yet.  Some analysts say that it will be well into 2011 before the job market recovers, but what about now?  We have millions of people currently out of work through no fault of their own and are in need of assistance, yet there are politicians that want to cut or even remove UI.  But what those politicians and people who are against UI don’t understand is just how stimulative to the economy UI can be.

For example if you are currently unemployed and with no other source of income, what UI should allow you to do is keep your home, pay your bills, and buy food.  It’s usually much less than the income you made while employed, so most if not all of the UI received will be spent and the majority of it should be spent in the local economy.  That spending will help keep local businesses open which should keep more people from become unemployed.  In a down-turn economy, it is far too easy to see a situation when lots of people are unemployed, and when they’re unemployed their spending slows, which in turn means more businesses are closed and more people are unemployed because no one is buying.

It’s been said that money spent in UI is one of the most economic stimulative programs available to the government.  For every dollar that is spent in UI, it generates nearly a dollar and sixty of economic effect.  The recently passed tax cut plan between President Obama and the Republicans does have some money set aside for UI, but only to continue the payouts that are currently in progress.  What it doesn’t do, that I feel it really should of, is extend the number of weeks of UI.  There are many people who are near the end of their UI or have run out.  Those people are no longer contributing to their local economies and are in threat of losing (or have already lost) their homes or are an ever greater strain on the local governments and other safety nets such as food banks.  While there are some people who are content to live off the largesse of others, a lot of people out there really want to work and do want to contribute.  The outrage from conservatives that UI and other such programs encourage a welfare state it not true of everyone.

As an example, I will mention…myself.

I was gainfully employed for over eighteen years with a local newspaper.  I went to work every day, paid my taxes, and was a productive member of society.  A little over two years ago, I was laid off because of the economic situation as well as the long term decline in newspaper readership.  I was given a severance package and went right out job hunting.  After working for so many years I just couldn’t sit around and do nothing.  I had to work again.  It didn’t matter to me that I had UI and could draw on it.  I wanted to work.  After searching for a while with no success, I went to a local technical school to gain new career skills and refresh older ones.  Once I graduated I went out looking again, and have still been unable to find work.  Even though I have done all this and haven’t sat back with my hand out, I am still called “lazy” and a “welfare cheat”, even to my face.

Some may say that I am one of the few who acts and feels this way, but I found many other people at job fairs and when I was going to school who were in the same situation and feeling the same things I was feeling.  I honestly think that the ones who only want a hand out are few and far between, but when they are found out they make the most noise and get the most attention.

If the safety nets we have in place either fail or disappear, it could make the recovery we are seeing now evaporate, see the economy fall back into a recession, or even into a depression.  Unemployment Insurance is one assistance program that actually does work and it does on many levels of the economy.

A lot of the safety net programs that we have today came about through the New Deal.  At that time, just like now, the United States was going through a difficult period of economic depression and job loss.  The programs that were a part of the New Deal helped us find our way out of that period of darkness.  We accomplished this by giving a hand up to those who needed it and extending that help until they could help themselves.

There is a quote from Benjamin Franklin during the signing of the Declaration of Independence that in my mind sums it all up…

We must all hang together, or assuredly we shall all hang separately.

Have our concerns for each other not only as human beings but as citizens of this country changed so much over the years, that we are unwilling to help those who are in need of help?

 

F