The Unemployment Extension Issue

Art Laffer had a great article in the WSJ yesterday about the extension of unemployment benefits. Although I respect Mr. Laffer , I have to disagree with his article. His logic is sound, but the “paradigm” may be shifting on us in this current economic crisis. I will not go through the article. I will post it along with this essay for everyone to read. Basically, he is against all the extensions the federal government has provided.

My problem is I may be too close to the situation to be thoroughly objective. Here is some background. I was laid off from my contract position with Volvo Cars North America on October 31, 2008. Ford and Volvo had decided the experiment of Premier Automotive Group was a failure and Volvo would move back to NJ. Since I was a contract worker, I received no packages or benefits. I was, however, encouraged to apply for a permanent position with them in NJ. There were no guarantees of employment, but I could apply. We decided not to take the chance of moving to NJ just to be laid off, again.

Since I had a few months before my time was up, I started looking for work. The CA economy was in collapse, especially the automotive industry. Companies were moving out of state to avoid the unhealthy business climate that had emerged in CA. They were taking the good jobs with them. After we had cashed out our 401K and our savings, we decided my job prospects were not getting any better. We left CA for VA in July 2009. A year has now come and gone and I am still out of work.

You may ask, “Have I been looking?” Yes, I have. I have joined networking groups. I have looked at almost every job board on the net including state and local jobs. I took a seminar on finding a job. I have a new resume. In that time, I have had one phone interview and one offer to bag groceries part time at Kroger. There are more things I have tried, but I think you get the picture. I have stressed over the issue of what am I doing wrong. Am I lazy? I know there is always more I can do. I just am not sure what. I have a good education and twelve years experience at what I do.

I have been on unemployment since November 2008. I get $475 a week. That is no secret. You can look up state unemployment rates on the internet. It’s public knowledge. That comes out to about $10 an hour. So, for me to get another job, I would have to get at least $10 per hour plus enough to pay for child care for the twins. I have gotten two or three extensions. Right now, my benefits have been suspended until the Senate votes on it, again. I am very fortunate. Tammy has a good, steady, gainful job. I also get a small pension from the state of TN which I share with my brother. We are getting by. We are still not able to put anything aside for the future, but at least we can pay the bills.

That makes me better off than most people drawing unemployment. Some are the only wage earners. I have a FOAF (friend of a friend) who has been unemployed for over a year. His wife was recently laid off from her teaching position. They now have four kids and not income. Given the character and nature of my friend, these are not freeloaders. They are good, hard working people stuck in a bad situation.

The problem is businesses are not hiring. They are scared of what the Obama administration has in store for them. They see other industries nationalized and wonder if they are next. They are afraid of the tax cuts that are expiring at the end of the year. They have no trust in the government at this time. This lack of faith has them paralyzed by fear. Even the small businesses do not know what is about to happen.

Meanwhile, people are out of work. With an unemployment rate of 9.5% and a real unemployment rate of close to 15%, there are a lot of people out of work. Republican Senator Orin Hatch of Utah has likened these people to welfare recipients and should be drug tested. I will if you will Senator Hatch. Republican Representative Dean Heller of Nevada called them hobos. Remember congressmen, we are voters as well. The conservative in me feels we need to pull ourselves up by our own bootstraps. The husband and father in me feels he needs those extensions until the economy turns around and we get jobs. Mr. Laffer addresses these points in his article.

I do not have an answer. As long as we have a liberal Democrat President, liberal Democrat Congress, and a spineless Republican Party complaining, I do not see an end in sight. As Americans, we enjoy the freedom to succeed or fail on our own. But, when the government is holding the economy hostage, we do not stand a chance. Please remember to vote your conscious and your wallets in November. Look at what the candidates have done, not what they say.

God Bless America