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Ed Schultz: Not Extending Unemployment Benefits Will Lead U.S. Into Third World

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» 51 comments

Ed Schultz wants to be clear. He is NOT running for office. But if he were a Senator, he “would be absolutely screaming in front of every camera (he) could find,” apparently to rally support for extending unemployment benefits. For if they aren’t extended, according to the MSNBC host, America is likely to become a third world country. Oh, annd he lays the blame at the feet of his compatriot Democrats. Say what?

The transcript of the strange, passionate and semi-unhinged rant follows this video clip (h/t Breitbart.tv):


I can tell you what the problem is, it’s with the Democratic party. It’s not just Ben Nelson who voted against extending unemployment benefits. it’s Harry Reid. I have never in my life seen a Senate Majority Leader all of sudden become so obscure and isolated.

Harry, you are blowing it, buddy. You’ve got t to get out there a fight for these folks. He could reinvent himself with his authority on this issue. and come out passionately f the American people in need. Grab the moral high ground because it is a moral issue and let the American people see just who the Republicans are…and they are on the wrong side of this issue again and again.

No, I’m not running. But if I were, if I was a Senator now, I would stand up and I would be absolutely screaming in front of every camera I could find. It is unconscionable what we are putting these Americans through. And I will tell you this. This is how third world countries get started when you started ignoring people. I can’t understand why the Democrats aren’t pounding on this. And i think it will cost them in the midterms if they don’t do something drastic about it.

Joining me now is Chuck Rocha, a union political consultant and the head of solidarity strategies. Chuck, if the congress and the white house, if they’re getting the same e-mails I’m getting and if they’re having the same conversations with Americans across the country that I had on a a seven city tour. I have ask, what in the hell are they doing? How can they ignore these Americans? Where this is going down the road of a third world country. This is the issue what we’re going to do with the unemployed. tell me if I’m wrong.

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  • Barney

    Ed Schultz proves once again to be the dumbest ass ever to be given a microphone. I actually listened to his show a few times…and all i can remember is “Jesus..they really had to scrape bottom to get this guy”.

    He has the vocabulary of a 9 year old…and the thought process of someone even younger

    …and this idiot has the #1 libtalk radio show??

    Frightening how stupid these people are.

  • tiredofbs

    You Mr.Shultz are “Third World” & so is your Network
    Lie much?

  • MichelleF

    …and this idiot has the #1 libtalk radio show??

    But really, that isn’t saying much.

    Consider me checked, Colby!

    ps, here’s more from Mr. Ed.:

    Now it pains me, this is not a compliment, it is an observation, Bush just always kept coming at us. And as a liberal, every time I turned around this guy was coming at me. Bush was always uptempo and Bush was always enthusiastic and I did, I guess it is a compliment, I did somewhat say, you know, that guy, he keeps going after it, whether it’s conviction or show time or whatever it is, however you want to view it. But President Obama in this commercial that Boehner put out left me with the impression, you know, I wouldn’t be surprised if this guy decides on his own he doesn’t want to run again.

    …I have a sense that he’s thinking, you know what, maybe this isn’t my gig. Maybe this is just a huge pain in the ass. Maybe, maybe I’m not the guy.

  • stoogedudes

    I agree that Congress needs to extend unemployment benefits to those unemployed. The notion that the unemployed are just lazy good-for-nothings who want the government to pay for everything for them is bullcrap. Those that receive unemployment are those that are actively looking for a job, ergo, they are not lazy. They are trying to look for a job; they WANT to work. Those that are lazy and don’t want to work don’t receive unemployment checks, or at least, they are not supposed to. Why not cut the wasteful spending that we are doing with pork barrel projects, and spend it on those who could really use the funds?

    With money going into the pockets of those looking for work, this means they have more money to spend on groceries for their family and clothing and other essential goods, which stimulates the economy because money is being spent at businesses. Without the extension of unemployment benefits, that means less money for those who really need it, which means less money being spent at businesses, which means less revenue, which means more layoffs, which means a double dip recession, which could potentially mean another Great Depression.

    I know there is a lot of spending going on and the deficit is sky high, but I would rather have my tax dollars going to help out families who are looking for a job than to build a statue of some historical figure at some park in New Hampshire or wherever.

    On this, I agree with Ed 100%.

  • Liberty Banned

    Wow…..

  • Liberty Banned

    Even Paul Krugman has admitted that welfare reduces someone motivation to actually get a job when compared to someone that does not get welfare.

  • MichelleF

    Stooge, I agree not all those on unemployment are lazy, but you’re delusional if you don’t think a LARGE % of those aren’t waiting til the benefits run out to actively look for work.

  • stoogedudes

    Not that I’m debating that, Michelle, but could you provide me with a link that shows this information? I just want to examine it for myself.

    Okay, a large percentage, maybe. But isn’t there a large percentage that are actively looking for work that could use the funds?

    Maybe what you say is true in good economic times, but because of our recent economic turmoil, there are millions who have lost jobs that have worked for years and years and who enjoy the work they did and really want to work and support their family. I understand the cynicism, but let’s not forget those who have been working for a long time.

  • Moderate

    Ed Schultz is a showman. He is trying to throw red meat to the poor and ignorant to get them inspired about Obama, to Schultz this is just part of his job because MSNBC has their wagon hitched to the Obama presidency.

  • MichelleF

    Not that I’m debating that, Michelle, but could you provide me with a link that shows this information? I just want to examine it for myself.

    Well, stooge, you were arguing the opposite, so perhaps you could provide a link.

  • http://www.facebook.com/people/Mark-Flinner/1438330220 Mark Flinner

    How long does our government give out unemployment benefits? Where is the money coming from?

  • Moderate

    “Not that I’m debating that, Michelle, but could you provide me with a link that shows this information?”

    Who needs a link we have all known people, especially in the construction industry, that will work a job then hang out at the cabin by the lake until unemployment checks run out.

  • NORBIT Jr.

    YOU BOOB ED!!
    They have the money to extend the benefits, Ed —THERE’S $400 BILLION LEFT IN THE SLUSH (STIMULUS) FUND!
    Your Democratic buddies don’t want to touch that, because they might have to pay-off their Public Employee Masters with it! –

    SGT. SHULTZ: I see Nothing! I hear Nothing!!!

  • http://www.facebook.com/people/Stephen-Hogan/179500970 Stephen Hogan

    Liberty Banned said:
    Even Paul Krugman has admitted that welfare reduces someone motivation to actually get a job when compared to someone that does not get welfare.

    This isn’t about welfare, this is about unemployment benefits.

    Unemployment benefits and food stamps are the most stimulative actions the government can take. If you give money to the people who desperately need it (the unemployed), it will be most definitely be spent, thereby increasing demand (which is what is sorely lacking in our economy). With more demand comes a need for more supply, leading to job creation.

    Unemployment isn’t a golden parachute, mind you. It’s only a small percentage of your former salary, with average payments at around $1200 dollars a month. That’s hardly enough to feed and raise a family, but it does provide a stable bottom for those that need it while they look for jobs.

  • NORBIT Jr.

    The Sarge having the #1 Libfest on the radio is akin to having the top-rated 8-track player today!

    Liberalism is imploding all over the world, and will be relegated to the proverbial “dustbin of history”.

    The only strategy they have now is to ramp up PLAYING the RACE-CARD!

  • http://www.facebook.com/people/Stephen-Hogan/179500970 Stephen Hogan

    Moderate said:
    “Not that I’m debating that, Michelle, but could you provide me with a link that shows this information?”

    Who needs a link we have all known people, especially in the construction industry, that will work a job then hang out at the cabin by the lake until unemployment checks run out.

    I hardly think that is representative of most people collecting unemployment.

  • http://www.facebook.com/people/Stephen-Hogan/179500970 Stephen Hogan

    Mark Flinner said:
    How long does our government give out unemployment benefits? Where is the money coming from?

    Under normal circumstances, it depends on the state. Most states provide unemployment for 6 months, since that usually the average length of unemployment. With the current economic conditions, unemployment benefits have been extended over 99 weeks for the people who have been unable to find jobs. It has actually provided a firmer ground for the economy.

    The money comes from our tax dollars, usually, but right now it’s being borrowed.

  • http://www.facebook.com/people/Stephen-Hogan/179500970 Stephen Hogan

    MichelleF said:
    Stooge, I agree not all those on unemployment are lazy, but you’re delusional if you don’t think a LARGE % of those aren’t waiting til the benefits run out to actively look for work.

    Maybe you are confusing unemployment with welfare?

    Unemployment doesn’t pay very much, at most it’s a percentage of your original salary. As I said earlier, it’s usually about $1200 a month. That’s not enough to live comfortably if you have a family, which most of these people do. Although I would agree there is a small percentage that would wait until they expire, I think there are far more many that are acting in good faith because they have families involved and they don’t want to have to decide between food and electricity next month.

  • MichelleF

    Maybe you are confusing unemployment with welfare?

    No I’m not.

  • http://www.facebook.com/people/Stephen-Hogan/179500970 Stephen Hogan

    MichelleF said:
    Maybe you are confusing unemployment with welfare?

    No I’m not.

    Well, regardless, I find it hard to believe that a large percentage of people are just holding out until unemployment runs out. Unemployment payments are really very meager.

    I guess I’ve never understood why some people are more concerned about the small percentage of people gaming the system than the huge percentage of people who benefit from the system honestly.

  • MichelleF

    Stephen, I understand what you are saying, but you need to consider the drain on the system. The $$ needed for such things doesn’t just appear out of nowhere. How long do you think the unemployed should get benfits for? The admin seems to be indicating the unemployment rate we are at now, is the new norm, so should they get them forever?

  • http://www.facebook.com/people/Stephen-Hogan/179500970 Stephen Hogan

    MichelleF said:
    Stephen, I understand what you are saying, but you need to consider the drain on the system. The $$ needed for such things doesn’t just appear out of nowhere. How long do you think the unemployed should get benfits for? The admin seems to be indicating the unemployment rate we are at now, is the new norm, so should they get them forever?

    I think that, in these economic conditions, unemployment should be paid out as long as the person receiving it can provide evidence they are actively in the job market. Sure, the money doesn’t ‘come out of nowhere’, but unemployment takes up a really small portion of our budget. Even where we are now economically, it’s less than a tenth of 1%. Unemployment really doesn’t have much of a drain at all and nearly all of that finds its way back into the system because all of the money gets spent, much of it in necessities.

    Unemployment is really one of the things really keeping demand, and by extension our economy, afloat. Without it, demand will collapse leading to a contraction of supply. This means more lay-offs, which mean less demand, etc. I understand the desire to reduce the deficit, but across-the-board austerity measures will sabotage any good the economy is experiencing. There are a ton of programs that could be cut, just don’t cut unemployment when more than a tenth of our workforce (and demand) are unemployed and need the benefits to keep their house and feed their family.

  • MichelleF

    There are a ton of programs that could be cut

    You’re right, but that’s not going to happen and we both know it.

  • Caryson

    Gimme an M…………M !
    Gimme an O…………O !
    Gimme an R…………R !
    Gimme an O…………O !
    Gimme an N…………N !

    Whats that Spell? Schultz! Whats that Spell? Schultz! Whats that Spell? Schultz!

    Yeah Ed Schultz !!!!!!

    Oh and Shultz, you should call your pal Nancy Pelosi and tell her Unemployment Checks do not create Jobs!

  • http://www.facebook.com/people/Stephen-Hogan/179500970 Stephen Hogan

    MichelleF said:
    There are a ton of programs that could be cut

    You’re right, but that’s not going to happen and we both know it.

    Yeah, I know. Unfortunately, both parties have a number of things they refuse to let go for ideology’s sake.

    Unemployment is one of our big economic crutches right now. If we knock it out, we’ll hit the ground and hard. Shultz was being hyperbolic, but the possibility of even worse economic conditions is quite real.

  • stoogedudes

    MichelleF said:
    There are a ton of programs that could be cut You’re right, but that’s not going to happen and we both know it.

    I agree, and I think it’s a shame. But what programs should be cut? Because the programs that a conservative like you, Michelle, thinks should be cut is probably something that a liberal like me and Stephen thinks should say, and vice versa.

    I am sure a large number of unemployed wait until their benefits run out to find work, but why should we punish those that use this program the right way? Is there a way to find out who is scamming the system so we can stop them and make the system more efficient?

    This is a discussion this country needs to have and have calmly and reasonably.

    Caryson said:
    Gimme an M…………M !Gimme an O…………O !Gimme an R…………R !Gimme an O…………O !Gimme an N…………N ! Whats that Spell? Schultz! Whats that Spell? Schultz! Whats that Spell? Schultz! Yeah Ed Schultz !!!!!! Oh and Shultz, you should call your pal Nancy Pelosi and tell her Unemployment Checks do not create Jobs!

    I thought this discussion was going just fine, until I read that.

  • stoogedudes

    Looks like just as I was typing my last comment, Stephen was typing his and we basically said the same thing…just want to make sure you knew I wasn’t copying you, Stephen.

  • http://www.facebook.com/people/Stephen-Hogan/179500970 Stephen Hogan

    stoogedudes said:
    Looks like just as I was typing my last comment, Stephen was typing his and we basically said the same thing…just want to make sure you knew I wasn’t copying you, Stephen.

    LOL, It’s all good :)

  • notsofast

    Ed, I look forward to you collecting unemployment you insufferable gas bag.

  • notsofast

    And Ed, guess who is exacerbating unemployment? Your God, BHO!

    Obama Presides Over Most Jobs Lost Since 1940
    By Julia A. Seymour
    Business & Media Institute
    1/8/2010 11:03:00 AM

    Unemployment shot up in 2009 from 7.7 percent in January to 10.1 percent in October before settling at 10 percent in December. Behind those percentages were more than 4.1 million people who lost their jobs during the year. According to data from the Bureau of Labor Statistics, that’s the most job losses in a year since 1940. (BLS could only provide data from 1940-2009)”

    Biden: We Can’t Recover All the Jobs Lost

    Vice President Joe Biden gave a stark assessment of the economy today, telling an audience of supporters, “there’s no possibility to restore 8 million jobs lost in the Great Recession.”
    Appearing at a fundraiser with Sen. Russ Feingold (D-Wisc.) in Milwaukee, the vice president remarked that by the time he and President Obama took office in 2008, the gross domestic product had shrunk and hundreds of thousands of jobs had been lost.”

    June 2010 job loses – 125,000

  • juan

    Who is Ed Schultz?

  • Patrick Henry

    Stephen, you stated:
    “Unemployment benefits and food stamps are the most stimulative actions the government can take. If you give money to the people who desperately need it (the unemployed), it will be most definitely be spent, thereby increasing demand (which is what is sorely lacking in our economy). With more demand comes a need for more supply, leading to job creation.Unemployment benefits and food stamps are the most stimulative actions the government can take. If you give money to the people who desperately need it (the unemployed), it will be most definitely be spent, thereby increasing demand (which is what is sorely lacking in our economy). With more demand comes a need for more supply, leading to job creation.”
    I disagree with you on this point. The money being spent by the unemployed comes from the pockets of the people that are employed, who would have spent the money themselves. There is no positive effect on the economy, just a different group spending the money.

  • http://www.heartland.org/environmentandclimate-news.org/ClimateConference4 Just Tex

    I’m very surprised that anyone is still watching this guy.

    Could it be his new & improved ~All Comedy~ format, is really helping to turn things around?!

    You tell me. Here’s the new promo:

    http://tinyurl.com/2892oc3

  • valkyrie101

    Today’s unemployment is a function of globalization and the men that profit from manufacturing in Asia. Those profits must be taxed via corporate or even an import tax. The American laborer can not compete with laborers in other countries who will work in unsafe or squalid conditions, for a peanut wage. Nor can we compete with products that flood our market which are manufactured at very low cost in Asia. And that is what they sell at our favorite stores, Lowes, Walmart, Home Depot, and that is the real reason the small American businessman can not compete and boards up his storefront.

  • http://www.facebook.com/people/Ed-Durffee/1311278663 Ed Durffee

    So some feel there is little or no fraud in Welfare or UnEnployment. How much is a little and why are we allowing it? Yes, we could afford to take care of many more needy people IF Liberals would get of their ass and police their give away programs. The problem many of us have now days is the out of control money spending by an out of control congress, WHO by the way do need all the votes they can get this Nov to keep the shirts they are wearing. AND guess where those votes will come from they HOPE.. Yes from those they throw the money at, regardless of the fact EVERYONE Knows there is no money to throw. What we have done is mortgage this Great Country and we are on the Brink of having to hand over the title to China. So you want to hand out more give aways, lets see if the great Chinese Gov will honor cheaters and liers and thieves like Obama is doing. Personally, I am looking at moving back to a third world country, its safer and more livable than what Obama is now handing us. So Please, keep on spending, there is a tomorrow. You really dont want to be in this world on that day.

  • http://www.facebook.com/people/Stephen-Hogan/179500970 Stephen Hogan

    Patrick Henry said:
    Stephen, you stated:
    “Unemployment benefits and food stamps are the most stimulative actions the government can take. If you give money to the people who desperately need it (the unemployed), it will be most definitely be spent, thereby increasing demand (which is what is sorely lacking in our economy). With more demand comes a need for more supply, leading to job creation.Unemployment benefits and food stamps are the most stimulative actions the government can take. If you give money to the people who desperately need it (the unemployed), it will be most definitely be spent, thereby increasing demand (which is what is sorely lacking in our economy). With more demand comes a need for more supply, leading to job creation.”
    I disagree with you on this point. The money being spent by the unemployed comes from the pockets of the people that are employed, who would have spent the money themselves. There is no positive effect on the economy, just a different group spending the money.

    Actually, that’s not true. It does have a stimulative effect. Anything that stimulates demand (basically spending) stimulates the economy. Sure, the people who had the money at first could have spent it, or they could have saved it, which is more likely given the current economic conditions. And that’s part of the problem, there is no guarantee that it will be spent. However, giving the money to people who desperately need it will guarantee that it will be spent, and given that unemployment payments are pretty small, nearly all of it will be spent.

    This is actually pretty well recognized. A study by Moody’sEconomy.com in 2008 indicated that food stamps generate $1.73 dollars for the economy for every $1.00 spent. Unemployment benefits generate $1.64 dollars for the economy for every dollar spent.

    Here is the results chart:

    http://img.photobucket.com/albums/v675/bord_du_rasoir/cnn-20090127lg.jpg
    Here is the report itself:

    http://www.economy.com/mark-zandi/documents/assissing-the-impact-of-the-fiscal-stimulus.pdf

    It’s pretty basic supply-and-demand economics. When demand is low, you do what you can to increase it in order to maintain the size of the supply. The more demand, the more supply. That means more jobs.

  • http://www.facebook.com/people/Stephen-Hogan/179500970 Stephen Hogan

    @Patrick

    Here’s the paragraph detailing the effects of unemployment insurance:

    “Extending UI and expanding food stamps are the most effective ways to prime the economy’s pump. A $1 increase in UI benefits generates an estimated $1.64 in near-term GDP; increasing food stamp payments by $1 boosts GDP by $1.73 (see table). People who receive these benefits are very hardpressed and will spend any financial aid they receive within a few weeks. These programs are also already operating, and a benefit increase can be quickly delivered to recipients.

    The benefit of extending unemployment insurance goes beyond simply providing financial aid for the jobless, to more broadly shoring up household confidence. Nothing is more psychologically debilitating, even to those still employed, than watching unemployed friends and relatives lose benefits. The slump in consumer confidence in late 1991, after the 1990-1991 recession, may very well have been due in part to the first Bush administration’s initial opposition to extending UI benefits for hundreds of thousands of workers. The administration ultimately acceded and benefits were extended, but only after confidence had waned. The fledgling recovery sputtered and the political damage extended through the 1992 presidential election.”

  • orionantares

    Patrick Henry said:
    I disagree with you on this point. The money being spent by the unemployed comes from the pockets of the people that are employed, who would have spent the money themselves. There is no positive effect on the economy, just a different group spending the money.

    Well you could look at that another way, those people could end up having to pay even more when they have to deal with an increase in crime that normally results from desperation for people that can’t find enough money to survive through legal channels.

    MichelleF said:
    There are a ton of programs that could be cut

    You’re right, but that’s not going to happen and we both know it.

    Some programs could benefit from fixing up waste and some programs could just be eliminated but right now the only program that could have waste cut and actually make a REAL difference in our debt would be the military. Our military is spread out so thin around the world and the cost of keeping it that way is so high that we really can’t bring our spending under control until we address our overtaxed military. There is no reason that we should be spending so much to be the world’s police force in the name of “keeping America safe” when the cost of it is basically us slowly selling off our country, piece by piece, to all the other countries that we’re so worried about, particularly China.

  • atreyue

    Stephen, yet we’re not seeing more jobs or a significantly better economy and this isn’t the first unemployment extension on the table. I know that I am going to ultimately be taxed more to account for all this spending. Every time more is announced, I save more to plan for the future. There are jobs out there, but some people don’t want them because they pay less than the jobs they lost and they’d have to give up some of the stuff they “own” if they took a paycut. Businesses don’t want to create new jobs when they know their taxes will need to increased to account for all the spending the government is doing as well. Buying groceries and doing all the day-to-day spending that you and some economists claim stimulates the economy doesn’t create jobs. If you think about it logically, it’s almost always far more economical to over overtime to your staff than hire a new employee. The cost of insurances you have to pay is higher than time and a half to existing employees.

  • RichS

    “valkyrie101 says:
    July 9, 2010 at 1:50 pm valkyrie101(Quote)
    1 0
    Today’s unemployment is a function of globalization and the men that profit from manufacturing in Asia. Those profits must be taxed via corporate or even an import tax. The American laborer can not compete with laborers in other countries who will work in unsafe or squalid conditions, for a peanut wage. Nor can we compete with products that flood our market which are manufactured at very low cost in Asia. And that is what they sell at our favorite stores, Lowes, Walmart, Home Depot, and that is the real reason the small American businessman can not compete and boards up his storefront.”

    Hey, you are really on to something here! Maybe we could find two guys named Smoot and Hawley to put together a tariff bil and then that would fix the problem, the way it did in 1930.

  • atreyue

    orionantares said:
    Well you could look at that another way, those people could end up having to pay even more when they have to deal with an increase in crime that normally results from desperation for people that can’t find enough money to survive through legal channels.

    If people took the lowing-paying jobs that unemployment allows them to avoid, they wouldn’t have to turn to a life of crime. I don’t think there are really too many Jean Valjeans out there…

    orionantares said:
    Our military is spread out so thin around the world and the cost of keeping it that way is so high that we really can’t bring our spending under control until we address our overtaxed military. There is no reason that we should be spending so much to be the world’s police force in the name of “keeping America safe” when the cost of it is basically us slowly selling off our country, piece by piece, to all the other countries that we’re so worried about, particularly China.

    I totally agree. The first thing we should do is immediately dissolve our 90-odd percent involvement with the UN peacekeeping forces. Then steadily withdraw our troops from all countries we don’t have sovereignty over.

  • http://www.facebook.com/people/Stephen-Hogan/179500970 Stephen Hogan

    atreyue said:
    Stephen, yet we’re not seeing more jobs or a significantly better economy and this isn’t the first unemployment extension on the table. I know that I am going to ultimately be taxed more to account for all this spending. Every time more is announced, I save more to plan for the future.

    That’s because unemployment is keeping us balanced at the moment. Jobs aren’t necessarily being created, but they are being kept. However, if the millions who are unemployed lose their benefits, those jobs will be lost.

    atreyue said:
    There are jobs out there, but some people don’t want them because they pay less than the jobs they lost and they’d have to give up some of the stuff they “own” if they took a paycut.

    That’s a generalizing assumption that I know is not always the case. In fact, it’s hardly the case. After being unemployed for more than 6 months, any job starts to look appealing, regardless how much they pay. A very close family member of mine lost his job at a recording studio (where he was making a pretty fair sum) and resorted to delivering pizzas full-time for minimum wage while still looking for a job. Because any income is better than none. He’s actually moved out of the house he’s owned for 15 years and is now living in a house owned by his father-in-law.

    atreyue said:
    Businesses don’t want to create new jobs when they know their taxes will need to increased to account for all the spending the government is doing as well.

    I’m not sure what this means. Are you saying that businesses are actively not hiring because they are afraid of taxes? That doesn’t make much sense.

    atreyue said:
    Buying groceries and doing all the day-to-day spending that you and some economists claim stimulates the economy doesn’t create jobs.

    Actually, it does. More demand in a grocery store necessitates more jobs at the grocery store. More demand for products found at the grocery store necessitates more jobs at the facilities where the products are produced. These jobs, in turn, further increase demand due to recently available income which, in turn, further increases the supply base. It really is that simple.

    atreyue said:
    If you think about it logically, it’s almost always far more economical to over overtime to your staff than hire a new employee.

    Well, that only works when a business can afford to pay over-time, which isn’t too often these days. In fact, many businesses have stopped allowing for over-time and have gotten to the point of furloughing employees rather than firing them.

  • Patrick Henry

    Stephen, you make some good points, but check out this aricle by Art Laffer in yesterday’s WSJ: http://online.wsj.com/article/SB10001424052748704862404575351301788376276.html.

  • http://www.facebook.com/people/Stephen-Hogan/179500970 Stephen Hogan

    Patrick Henry said:
    Stephen, you make some good points, but check out this aricle by Art Laffer in yesterday’s WSJ: http://online.wsj.com/article/SB10001424052748704862404575351301788376276.html.

    Thanks for the article and I appreciate the cordial discussion. I feel better about our country when we don’t see each other as members of opposite teams, but rather members of the same team with different philosophies.

    In regards to the article, Laffer is making the assumption that unemployment benefits are zero-sum, which has been empirically been shown to be false. His entire argument is based on the assumption that employed people would spend the money at the same rate as unemployed people. That’s simply not true. Unemployed people are not spending. They are not spending because they do not have an income. If you give them a temporary income that pays just enough for basic survival, all of the money will be spent. More likely than not, people who are employed are saving up extra income in case they get laid off or just to weather this economic storm. This means their spending of income is not guaranteed like it is for the unemployed.

    A tax holiday may be a nice idea, but it won’t do much to create jobs. The people who are not spending, the unemployed, won’t benefit much from a tax holiday because they are unemployed and many have lost their property. With such a large percentage of the population still unable to spend, growth of demand is truncated. Although businesses will be saving money, without demand there will be nothing to encourage them to create jobs.

  • atreyue

    Stephen Hogan said:
    That’s because unemployment is keeping us balanced at the moment. Jobs aren’t necessarily being created, but they are being kept. However, if the millions who are unemployed lose their benefits, those jobs will be lost.

    Stephen Hogan said:
    atreyue said:
    Businesses don’t want to create new jobs when they know their taxes will need to increased to account for all the spending the government is doing as well.

    I’m not sure what this means. Are you saying that businesses are actively not hiring because they are afraid of taxes? That doesn’t make much sense.

    Because they see increased taxes on the horizon (and possible increased healthcare costs), they start to budget for that by making as many cuts as they can now while still making a profit. The easiest way to do that is to fire as many employees as possible. In other words, responsible businesses don’t act too differently from responsible people. They evaluate the situation and budget accordingly. I think if the government really wants businesses to feel enough confidence to attempt growth, it has to stop spending. Everyone who cares knows that the government doesn’t have any money of its own, it just appropriates the money of private citizens and private business to pay for its ‘spending’.

    Stephen Hogan said:
    That’s a generalizing assumption that I know is not always the case. In fact, it’s hardly the case. After being unemployed for more than 6 months, any job starts to look appealing, regardless how much they pay.

    And what you’re saying is not a generalized assumption? Using my own sample set of people whom I personally know, 9 of my friends are unemployed. 7 of them are professing how happy they are to sit back and collect their checks while only applying for jobs that pay at least what they currently make for as long as they can. We both know that your family member is the exception to the rule. We are paying for a lot of people to continue to live beyond their means and pretending that we can afford to do whatever we want through and endless cycle of credit & debt. This whole model of stimulating the economy is inherently flawed because no matter how it’s dressed up or rationalized, it’s simply taking out more debt to make payments on the debt already outstanding. At any level, that is not a financially sound idea. As anyone in America should be able to tell you, interest is a bitch.

    Stephen Hogan said:
    Well, that only works when a business can afford to pay over-time, which isn’t too often these days. In fact, many businesses have stopped allowing for over-time and have gotten to the point of furloughing employees rather than firing them.

    My point is that it’s always cheaper to provide overtime than hire a new employee. The government can’t create jobs that will actually stimulate the economy. It can only appropriate supply and force demand. Any force acting within the market that isn’t subject to the rules of the market will cause destabilization and the eventual collapse of the market.

  • Patrick Henry

    Stephen, I appreciate the courtesy you show as well. I a still not convinced about unemployment stimulating the economy that much, but you have a very good argument against Laffer’s zero-sum theory.

  • http://www.facebook.com/people/Stephen-Hogan/179500970 Stephen Hogan

    Patrick Henry said:
    Stephen, I appreciate the courtesy you show as well. I a still not convinced about unemployment stimulating the economy that much, but you have a very good argument against Laffer’s zero-sum theory.

    Thanks! I appreciate it. I figured that you may not be convinced but I certainly enjoyed the conversation.

    @Atreyue

    Thanks for the conversation, as well. You bring up good points and I’d engage further, but it’s been a hot and long day.

  • NORBIT

    Dems have 2/3 of the Slush Fund (stimulus, lol) Package left, but refuse to use that! – DEMOCRATS ARE DENYING UNEMPLOYMENT BENEFITS!

  • felixw

    Hey, Ed, if you are so worried about the unemployed, why do you keep on beating up on the only people and companies in a position to create jobs? You are your buddies in D.C. are the reason the US is becoming more like a Third World country. And you are so obsessed by class envy, that you will never allow the simple steps necessary to spur economic growth and job creation.

  • maxine

    Here’s a scenario. A friend of mine was laid off amongst a few others at her emloyment. She was told that she was a good worker and they hated to have to do this and that she would be one of the first to be called back.

    She is currently on unemployment compensation but actively looking for work. She interviewed at several places. One of her friends said they could get her an interview where they worked. They were looking to fill a spot in their office. She was interviewed and not called back. Someone with less qualifications and experience was hired. Her friend heard through the grapevine that the reason my friend was passed up was that 1) she was overly qualified. 2) Since she would be taking a big pay cut, this place was pretty certain that if she got called back to her past employment she would go and leave them stuck with that opening again. 3) They wanted someone they were relatively sure would stay in that position for a longer duration. You have to think this is not an isolated case. I know several people on UI. They want to work but there is very little being offered out there. They are looking at working 2 or 3 min wage jobs and still some will not make the the same income. I am one of the lucky ones that is employed with the gov’t and is pretty safe in keeping it. Although there is great possibility I can be transferred in a 500 mile radius. And there has been many where I work that have been already. I am rather high on the seniority list, so hopefully I will be spared. But it’s not a guarantee. Will I go if I have to. Not much choice in not doing so. 3 of them worked in a factory setting. Sales were down so they had to go. You guys blame some of it on the illegals taking jobs from Americans. That is partially true but on the same hand, how many large companies take their business overseas to cut costs? And other smaller businesses DO hire illegals because it’s cheap labor. It’s cost effective in the end. Common sense dictates. Some of you think things are cut and dry, black or white, yes or no. There is so much grey.

  • maxine

    P.S. If they are able to get 2 or 3 jobs, that is 1 or 2 separate people not filling the others.

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