Disappointing Jobs Report: Unemployment Remains at 9.6 Percent

Originally posted at Truth in Jobs.

As we’ve come to expect, yet another lackluster jobs report has been released. The highly anticipated Labor Department Jobs Report shows that only 151,000 jobs were added October. This slight increase in jobs was not enough to lower the official unemployment rate. For the third month in a row, the unemployment rate has been unchanged at 9.6 percent. Yet, this not even factor in the 1.2 million Americans who have altogether given up searching for a job. Additionally, roughly 18 percent of part-time workers are underemployed meaning they want full-time employment. The Labor Department chart below shows the painfully slow economic “recovery”:

Last week, the American people’s voices were heard at the ballot box. Many lawmakers who voted for big government schemes such as the $814 “stimulus” were booted out of office. This should come as no surprise. Back in February 2009, the Obama administration promised that the massive spending package would keep the unemployment rate below 8 percent. In late 2009, the unemployment rate reached double digits with the “stimulus” enacted and has hovered around 10 percent ever since.

Congress cannot create new purchasing power out of thin air. Every dime that was supposedly injected into the economy was first taken from taxpayers or borrowed out of the economy. Therefore, “stimulus” plans merely redistribute money and cannot create long-term economic growth. Obama’s misguided policies likely made the recession much worse by taking billions of dollars away from the productive private sector. In fact, a Truth in Jobs study found that 10 million jobs were not created in the private sector largely due to flawed “stimulus” plans.

The new jobs report also shows that the number of long term jobless—those jobless for 27 weeks or over—is unchanged at 6.2 million. On November 2nd, the unemployment extension that President Obama signed back in July will expire. Indiana unemployment offices are even hiring armed security out of concern how people might act when they have exhausted their unemployment benefits.

Currently, unemployed American workers can generally collect unemployment benefits for up to 99 weeks—about 2 years. On Wednesday, President Obama called on Congress to extend unemployment insurance during the upcoming lame duck session. He stated:

I think it makes sense for us to extend unemployment insurance because there are still a lot of folks out there hurting.

A CNN article predicts that an unemployment benefits extension will be one of Congress’ main objections once they return on November 15th. How much further does Obama wish to extend unemployment insurance? At what point is enough, enough?

It is true that many Americans are struggling to make ends meet. Polls show that the majority of Americans still feel the severe impact of the prolonged Great Recession. But we must account for the unintended consequences associated with excessive unemployment insurance. According to the Wall Street Journal,

Some workers agree that unemployment benefits make them less likely to take whatever job comes along, particularly when those jobs don’t pay much. Michael Hatchell, a 52-year-old mechanic in Lumberton, N.C., says he turned down more than a dozen offers during the 59 weeks he was unemployed, because they didn’t pay more than he was collecting in benefits.

Naturally, humans respond to incentives. As a result of excessive unemployment benefits, people may not be as proactive about searching for jobs or may become pickier on which they jobs they accept. The WSJ article says that despite high unemployment some firms “are getting an underwhelming response, and many are having trouble filling open positions.”

Most people are searching to find a job that pays comparable to their previous job. A study from CareerBuilder’s consulting firm Personified finds that 92 percent of unemployed people who are offered a job reject the opportunity mostly because the salary was too low. They may be able to get a job but not the most desirable job.

Even former White House economic adviser Larry Summers acknowledges that excessive unemployment insurance will increase the long-term jobless:

Unemployment insurance also extends the time a person stays off the job. Clark and I estimated that the existence of unemployment insurance almost doubles the number of unemployment spells lasting more than three months.

Ultimately, excessive unemployment benefits create a sense of dependency on the government. We should instead promote self-sufficiency and independence by encouraging work. Simultaneously, Congress should promote job growth by stopping the 2011 tax hikes that will likely force more Americans to rely on unemployment benefits for their source of income. These steps are crucial to reduce the high 9.6 unemployment rate that we still face.

Harsh Government Regulations Block Entrepreneurship

Have a great idea for a business? Not so fast. At nearly every step of the entrepreneurial process, the government imposes strict rules and regulations. Some regulations are so ridiculous that it discourages would-be entrepreneurships from even starting their business. For instance, in Texas it is legally required that computer repair technicians obtain an extraneous degree in criminal justice.  In Florida, it is illegal to work as an interior designer without proper government licensing. Even if the designer has a college degree in the field, performing interior design services without a license is punishable by up to a year in jail or $1,000 in fines.

Often, compulsory licensing is used to restrict competition in a marketplace. Well-funded industry cartels lobby for strict licensing requirements that make it difficult for newcomers to sell their competing product or service. These harsh licensing laws are harmful to both entrepreneurs and consumers. Would-be entrepreneurs who cannot afford the high cost of licensing will not have the opportunity to operate their business. As a result, there will be fewer employment opportunities and consumers will be forced to pay higher prices for goods and services with less variety.

With unemployment at a high 9.6 percent, we must strive to get rid of unnecessary burdens faced by job creators. As the video “Why Can’t Chuck Get His Business Off the Ground” from the Institute for Justice shows, some would-be entrepreneurs simply give up due to these harsh regulations that limit competition in the market place.

 

CEOs: Obama’s Policies Are Deterring Job Growth

Originally posted at Truth in Jobs.

The current economic downturn is far from over. For the past 14 consecutive months, the unemployment rate has remained above 9.5 percent. The new claims for unemployment insurance rose to a higher-than-expected 459,000 last week.

While every American has been affected by the recession, young people have been hit the hardest. The teenage unemployment rate remains the highest at 26 percent. For African American youths, nearly half of those actively searching for jobs are unemployed. This does not include the many teenagers that are willing to work but have given up searching for jobs. The MarketWatch graph below shows that youth employment has fallen in the past decade:

Individuals who begin working as teenagers are put at a considerable advantage. Studies have shown that people who do not start working as teenagers will ultimately suffer from longer periods of unemployment and lower wages in the future. Since many teenagers are struggling to find an entry-level job to gain experience and skills, some have referred to them as the “lost generation.”

So why have employers been so reluctant to hire new workers? According to some top CEOs, the Obama administration policies will punish them if they create a new job. If government raises the cost of businesses by imposing steep taxes and regulations, many companies have no choice but to lay off workers to stay in business.

Last month, Former White House Chief of Staff Rahm Emanuel asked a CEO of a large company:

“How come you guys aren’t hiring more?”

The CEO responded by saying:

“I know you’re paid to do the president’s bidding, but I’m paid to answer to shareholders and a board of directors and your health-care plan is costing me $1.5 billion, your tax increases another $1 billion, and regulation another half a billion. So I might have to lay off people rather than hire them.”

In the Wall Street Journal, one of the co-founders of Home Depot, Ken Langone, tells President Obama to “stop bashing business.” He states:

“If we tried to start Home Depot today, under the kind of onerous regulatory controls that you have advocated, it’s a stone cold certainty that our business would never get off the ground, much less thrive. Rules against providing stock options would have prevented us from incentivizing worthy employees in the start-up phase—never mind the incredibly high cost of regulatory compliance overall and mandatory health insurance.”

A recent poll showed that half of CEOs did not anticipate hiring any new employees in the next year. Businesses are uncertain whether or not they can afford to hire new employees with threats of massive change, like the cap and trade bill. With the largest tax hike in history in just 77 days, unemployment levels are expected to increase even further. To boost hiring, Congress should instead promote policies that cut taxes and regulations on job creators.

Unemployment Likely Increased to 9.7 Percent in September

Originally posted at FreedomWorks.org.

On Friday, the Labor Department will release the last monthly jobs report before the midterm elections. Economists have already predicted that it won’t bring good news for the US economy. According to 62 economists surveyed by Bloomberg news,

Unemployment climbed to 9.7 percent from 9.6 percent in August…The data may also show companies added 77,000 workers to payrolls, and total hiring stagnated.

If their predictions are accurate, this will be the longest span of elevated joblessness since monthly records began in 1948. Recently, the National Bureau of Economic Recovery (NBER) announced that the numbers show that the recession was over in June 2009:

In determining that a trough occurred in June 2009, the committee did not conclude that economic conditions since that month have been favorable or that the economy has returned to operating at normal capacity. Rather, the committee determined only that the recession ended and a recovery began in that month.

However, the mild “recovery” last summer only occurred since the federal government artificially increased GDP by moving borrowed money into those quarters. As we’ve seen, it was impossible to sustain the “recovery” since money was borrowed from another place and time. Sooner or later, the artificial GDP growth had to subside.

Northwestern University economic professor and NBER committee chairman Robert J. Gordon states that:

the amount of unemployment we’ve already got and the slowness of recovery lead to predictions that we could have 9-plus percent unemployment even through the next presidential election.

Since June 2009, the economy has lost more jobs than it has gained. A New York Times chart shows that job growth has stagnated in the past 15 months:

Furthermore, NBER committee chairman Robert J. Gordon says that:

what’s really unique about this recession is the amount of unemployment in combination with the slowness of the recovery. That’s just not happened before. We had a sharp recession followed by a sharp recovery in the 1980s.

In the 1980’s, the economy quickly recovered due to President Reagan’s plan which cut taxes by 25 percent over three years. In the midst of the recession, Reagan stated in 1981:

This is the time for a new beginning. I ask you now to put aside any feelings of frustration or helplessness about our political institutions and join me in this dramatic but responsible plan to reduce the enormous burden of federal taxation on you and your family.

The Washington Times chart below shows the economic recovery directly related to these tax cuts:

As shown in the chart, the Reagan tax cuts boosted GDP and job growth for many years to come. It’s no wonder that the economy has yet to have a lasting recovery from the current recession. To the contrary, the Obama administration plans to do the opposite by significantly raising taxes on families and small businesses on January 1st. The uncertainty over the looming tax hikes has affected businesses decision to hire new employees. The highly-anticipated September jobs report is likely to be even more proof that Obama’s “stimulus” packages cannot bring sustainable economy recovery.

Los Angeles Government Creates Only 55 Jobs with $111 Million “Stimulus”

Originally posted at FreedomWorks.org.

The late Noble Prize winning economist Milton Friedman once stated:

When a man spends his own money to buy something for himself, he is very careful about how much he spends and how he spends it…And when a man spends someone else’s money on someone else, he doesn’t care how much he spends or what he spends it on. And that’s government for you.

Milton Friedman’s words ring true for the $814 billion government “stimulus” passed in February 2009. The city of Los Angeles is a prime example of government recklessly spending these “stimulus” funds. According to City Controller of Los Angeles Wendy Greuel:

LADOT [Los Angeles Department of Public Works] has been awarded $40.8 million and created or retained 9 jobs, though they are expected to create 26 jobs overall. Overall, the Departments have received $111 million in federal stimulus funds out of the $594 million the City has been awarded so far and created or retained 54.46 jobs.

In other words, it has cost taxpayers a whopping $2 million to create or “save” a single job.  Wendy Greuel who is disappointed in the jobs numbers claims that “the City needs to do a better job expediting the process and creating jobs.” Even if the Los Angeles government unlikely meets their goal of creating 264 jobs, the price tag would still be over $400,000 per job.

Politicians cannot “give” us anything without first taking from someone else. Every dime of the $814 “stimulus” was either taking away from taxpayers or borrowed out of the economy. As Milton Friedman noted, individuals tend to spend their money wiser than government does. Therefore, the real key to economic growth is through the private sector.

 So why not allow taxpayers to keep more of their money to stimulate the economy by wisely purchasing goods and services that they desire? Even though Los Angeles’ government spent $111 million creating jobs, this had barely any positive effect on unemployment. In fact, Los Angeles’ unemployment rate has increased by over 2 percentage points to 12 percent since the “stimulus” was enacted. We are unable to visibly see the abundance of jobs that were likely not created due to “stimulus” spending. Imagine how many jobs could potentially be created if taxpayers had their hard earned $111 million in their pockets instead. To be sure, the private sector would likely create significantly more than 55 jobs as a result.

Today, President Obama stated that “we’ve got the most dynamic free-market economy in the world. And that has to be preserved.” At the same time, Obama is pushing for yet another massive $50 billion government “stimulus” package that will likely be mismanaged. In order to truly preserve our free-market economy, we cannot allow another “stimulus” boondoggle to pass. The best solution to boost job growth is to get government out of the way to allow free people to voluntary exchange goods and services without harmful government interference.

America Needs to Take One Lesson from Cuba: Cut the Bureaucracy

Currently in Cuba, more than 85 percent of their 5.5 million workers are government bureaucrats. Even Fidel Castro recently acknowledged that this rate was unsustainable by stating that “the Cuban model doesn’t even works for us anymore.” Therefore, Cuba will cut 500,000 government jobs in the next six months to help fix its nearly bankrupt economy. According to Cuba’s official labor union, “Our state cannot and should not continue maintaining companies, productive entities and services with inflated payrolls and losses that damage our economy and result counterproductive, create bad habits and distort workers’ conduct.”

It’s unfortunate that the Obama administration has not learned this vital lesson. In the United States, one in every six jobs—22.5 million—is a government job. Since the start of the recession, public sector employment has increased by 590,000 while the private sector has lost 7.9 million jobs. It’s hard to believe that Cuba is correcting its mistakes while the United States is escalating its financial problems by adding even more bureaucrats. As Cato Institute Dan Mitchell states “Obama wants more people in the wagon and fewer people pulling the wagon.” If the current trends continue, the wagon—the representation of the economy—will be impossible to move forward. As the Heritage Foundation chart below shows, the gap between government and private sector jobs has rapidly grown:

Furthermore, taxpayers in the private sector cannot afford to pay federal bureaucrats their bloated salaries. With benefits included, the average federal government employee is paid $123,049 while the average private sector receives $61,051 annually. After adjusting for inflation, federal employee wages increased 36.9 percent while private sector wages rose only 8.8 percent since 2000.

Some claim that government bureaucrats deserve to be paid twice the salaries of private sector workers since they have attained more education. According to Paul Krugman, it’s an “apples and oranges comparison.” However, the Heritage Foundation has conducted a new study that carefully accounts for education and skills differences between government and private sector employees. The results:

While federal employees do earn more partially because they are more skilled than the average private sector worker, controlling for skills does not eliminate the federal pay premium. Depending on the methodology employed, the average federal employee receives as much as 22 percent more in wages than an equally skilled private sector worker. Including both wages and benefits, overpaying federal workers costs taxpayers approximately $40–50 billion per year.

America needs to take one lesson from Cuba. America must also take strives to cut needless government bureaucrats and their padded paychecks.  The rapid expansion of government employees jeopardizes America’s future economic growth. We must stop these harmful trends before it’s too late.

White House Economist Adviser: “Recovery Summer” Wasn’t Actually About Jobs

Originally posted at FreedomWorks.org.

Remember back in June when the Obama administration promised the American people a “Recovery Summer?” Vice President Joe Biden assured us that “some time in the next couple of months we’re going to be creating between 250,000 jobs a month and 500,000 jobs a month.” To the contrary, the economy has lost 283,000 net jobs this summer.  As we’ve come to expect, the Obama administration economic forecasts were dead wrong.

Unfortunately, the Obama administration refuses to admit that the “stimulus” has repeatedly proven to fail by its own measures. Recently, a reporter asked Obama whether or not he regretted calling it a “Recovery Summer.” Unsurprisingly, Obama failed to face economic reality by stating: “I don’t regret the notion that we are moving forward because of the steps that we’ve taken.” How exactly are we moving forward? Between June and August, the unemployment rate has increased .1 percent to 9.6 percent.

All signs point to the fact that the “stimulus” has made the economy worse than it otherwise would be. Last week, Austin Goolsbee took over as the Chair of the Council of Economic Advisers after Christina Romer left her position. Goolsbee who now has the impossible task of defending the flawed “stimulus”, claims that we simply misunderstood the term “Recovery Summer.” According to Goolsbee, the “Summer Recovery” was supposedly a reference to the “stimulus” but not job growth. He states:

The vice president was talking about the Summer of Recovery in reference to the recovery act — that you would see the creation of a series of infrastructure and other projects ramping up over the summer, and you did see that.

Wasn’t investing more money into these infrastructure projects suppose to lead to a “Recovery Summer?” Thus far, $275 billion of the massive $814 billion “stimulus” has been spent in grants, contracts and loans. The projects created are easy to visibly see due to propaganda “stimulus” road signs that cost taxpayers up to $10,000 each. However, in a chart by Mercatus Center Senior Research Fellow Vernonique de Rugy, increased “stimulus” spending has certainly not boosted job growth:

According to Vernonique de Rugy:

With a few exceptions, the data show little correlation between the level of unemployment and stimulus spending. In fact, the opposite is true. The federal government has given far fewer stimulus dollars to states with high unemployment than it has to states with low unemployment.

This evidence is more reason to believe that Obama’s proposed $50 billion “stimulus” plan to create infrastructure projects will not create net new jobs. Instead, it will destroy jobs by taking away money from the productive private sector to fund mostly wasteful pet projects. The key to truly stimulating the economy is to create jobs by allowing taxpayers to keep more of their hard earned money to save, donate or spend on goods and services that they personally desire. Until Congress stops these “stimulus” plans that actually increase unemployment, we may be facing the “autumn of wreckage.”

Minority Leader Boehner’s Proposed Job Creation Plan

Originally posted on FreedomWorks.org.

On Monday, President Obama took yet another swipe at those who oppose his government expansion policies:

When it comes to just about everything we’ve done to strengthen our middle class, to rebuild our economy, almost every Republican in Congress says no…If I said the sky was blue, they say no. If I said fish live in the sea, they’d say no… Their slogan is ‘No we can’t.’

Of course, these lawmakers do not vote “no” out of spite. Certainly, there are a multitude of perfectly good reasons on why many lawmakers reject harmful legislation proposed by Democratic leaders. By voting “no” on unconstitutional bills, these lawmakers are essentially saying “yes” to freedom and prosperity.

Vice President Joe Biden has claimed that “we all know what John Boehner and his Republican colleagues are against…I don’t know what they are for.” However, the Democratic leadership has ignored alternative proposals by failing to bring Republican sponsored bills to the floor.

This morning on ABC’s Good Morning America, House Minority Leader John Boehner made two clear economic proposals. First, Boehner urged Congress to pass a bill that would cut government spending back to 2008 levels. Secondly, he proposed a two-year freeze on all current tax rates which would stop the job-killing 2011 tax hikes.

These proposals are quickly gaining endorsements from Congressmen including from Paul Ryan (R-WI) who stated that:

Just yesterday, the President’s recently departed budget director joined the growing chorus of Republicans, Democrats, and respected economists in opposition to the looming tax hikes set to hit an economy that simply cannot afford it.  We also cannot afford Washington’s reckless spending spree, which is why Leader Boehner is exactly right to match his call to freeze taxes at their current rates with a proposal to cut and cap spending for the coming fiscal year.

Paul Ryan is referencing President Obama’s former Budget Director Peter Orzag’s New York Times column where he states that:

In the face of the dueling deficits, the best approach is a compromise: extend the tax cuts for two years and then end them altogether…Higher taxes now would crimp consumer spending, further depressing the already inadequate demand for what firms are capable of producing at full tilt.

House Republicans are more likely to vote “yes” for these fiscally responsible proposals that rein in our national debt. Voting “no” on all irresponsible spending bills that are not authorized by the Constitution is nothing to be ashamed of. Let’s hope that the Democratic leadership finally listens to the wise proposals offered by other party members.

Despite Obama’s Promise of “Recovery Summer”, 54,000 Jobs Lost in August

Originally posted at TruthinJobs.com.

The American people were told by the Obama administration that this would be the “summer of recovery.” Joe Biden notoriously claimed that “you’re going to see, come the spring, net increase in jobs every month.” Thus far, the economy has lost a total of 283,000 jobs this summer alone. The latest Labor Department’s report reveals that the US lost 54,000 jobs in the month of August. The unemployment rate rose to 9.6 percent from 9.5 percent in July. Back in January 2009, the Obama administration predicted that without the “stimulus” the unemployment rate would rise 9.5 percent. Even by the Obama administration’s original measures, the “stimulus” has made the economy even worse.

Last week, the Congressional Budget Office released a report claiming that the $814 billion “stimulus” had created or saved up to 3.3 million jobs last quarter and lowered the unemployment rate by 1.8 percent. Of course, this comes to a shock to the 14.9 million people currently jobless. Where are all the jobs that the “stimulus” supposedly created?

The Congressional Budget Office’s report used the discredited Keynesian multiplier to make these false claims. This Keynesian model ignores the actual state of the economy. Instead, it claims that for every dollar the government spends, the GDP will be increased by more than a dollar. In short, the discredited multiplier irrationally  says that the more money the government spends, the more jobs will be made.

Therefore, the Keynesian model would conclude that the “stimulus” created jobs no matter what. Unlike the model suggests the “stimulus” did not inject new money into the economy.  The money to pay for the $814 “stimulus” was first taken away from taxpayers or borrowed out of the economy. Since the “stimulus” only transferred money from one group to another, it is impossible to justify that it created new net jobs.

To be fair, the “stimulus” likely created some new jobs. It is easy to see new workers being hired for federal “stimulus” projects. However, the evidence is clear that the “stimulus” destroyed more potential jobs than it created. The Keynesian multiplier fails to factor in the 10 million jobs that were not created in the private sector due to “stimulus” spending.

The “stimulus” merely takes away money from productive citizens—who likely would have used this money to create new jobs— to fund typically unprofitable and unproductive projects. For instance, the “stimulus” included over $700,000 to develop joke telling robots and $3.4 million to construct tunnels to allow only turtles to cross underneath a Florida road. While some taxpayers may not be able to afford the high price of a Blackberry smart phone, the “stimulus” gave $1 million worth of tax-funded smart phones to smokers to help them quit their habit.

On Wednesday, Council of Economic Advisers Chairman Christina Romer claimed that she doesn’t “fully understand why firms cut production as much as they did or why they cut labor so much more than they normally would.” The reason is clear—high taxation deters job growth. Businesses are discouraged from hiring new employees since they are uncertain on how complicated legislation such as ObamaCare, the government overhaul of the financial services rules and the proposed cap and trade tax scheme will affect their costs. As House Minority Leader John Boehner said in a released statement:

We will not solve our fiscal challenges until we cut spending and have real economic growth – and we won’t have real economic growth if we keep raising taxes on small businesses.

With the largest tax hike in history just four months away, taxes on two-thirds of small businesses will increase by 13 percent. Unless we change course by cutting taxes for all Americans and rejecting more proposed “stimulus” plans, future job reports will likely be even more dismal.

ACTUALLY NANCY PELOSI, UNEMPLOYMENT BENEFITS DO NOT CREATE NET NEW JOBS

Originally posted on August 25, 2010 on FreedomWorks’ website.

Last month, Speaker of the House Nancy Pelosi claimed that unemployment benefits “creates jobs faster than almost any other initiative you can name.” PolitiZoid has created an animated video of Nancy Pelosi’s foolish speech on the “stimulus” of unemployment benefits.

Following Nancy Pelosi’s logic, she should be thrilled to hear that the number of first-time filers for unemployment insurance rose to 500,000 last week—the highest in nine months. However, paying more people not to work will not stimulate the economy or create any jobs. As Arthur Laffer explainsin his Wall Street Journal column,

The flaw in their logic is that when it comes to higher unemployment benefits or any other stimulus spending, the resources given to the unemployed have to be taken from someone else….While the unemployed may spend more as a result of higher unemployment benefits, those people from whom the resources are taken will spend less. In an economy, the income effects from a transfer payment always sum to zero. Quite simply, there is no stimulus from higher unemployment benefits.

Unlike the private sector, government is unable to foster economic growth since it does not have any wealth of its own. Nancy Pelosi who claimed that “we could slip back and have another recession” if Congress didn’t pass an unpaid $34 billion unemployment insurance bill, fails to acknowledge the danger of excessive unemployment benefits.

Currently, unemployed American workers can generally collect unemployment benefits for up to 99 weeks—about 2 years. But how much further is Nancy Pelosi willing to extend these unemployment benefits? At what point is enough, enough?

Naturally, humans respond to incentives. As a result of excessive unemployment benefits, people may not be as proactive about searching for jobs or may become pickier on which they jobs they accept.  Even White House economic adviser Larry Summers acknowledges that excessive unemployment insurances will increase the long-term jobless:

Unemployment insurance also extends the time a person stays off the job. Clark and I estimated that the existence of unemployment insurance almost doubles the number of unemployment spells lasting more than three months.

Take for example Denmark whose citizens use to collect unemployment benefits for up to four years. Of course, being laid off from a job is terrible news. Although, it sure lessens the blow to know that the nanny state will provide you generous unemployment benefits for the next four years of your life.

However, in June, Denmark’s government due to a budget crisis revealed that they would be cutting unemployment benefits back to 2 years. Denmark’s unemployment chart below shows how responsive people were to the changes in unemployment benefits:

According to the New York Times,

It shows that between 2005-7, the number of people who got jobs during their four years of benefits — the green line – rose at the beginning before dropping sharply, then spiked as benefits were about to run out, only to plummet after. The red line shows similar behavior in 1998, when Denmark’s benefit period was five years.

Steen Bocian, a chief economist at Danske Bank, asserts that:

it shows that people are not seeking all the jobs they could get, but just the jobs they would like to have.

As expected, Speaker of the House Nancy Pelosi irrationally believes that paying people not to work somehow creates jobs. As shown in Denmark, excessive unemployment benefits give people less incentives to actively search for a job. Be on the lookout for Nancy Pelosi to pass yet another deficit increasing unemployment insurance extension during a Lame Duck Session that will add  billions our unsustainable national debt while not creating net new jobs.