The latest Bloomberg Businessweek features U.S. Treasury Secretary Jack Lew’s thoughts about the proposed extension of federal extended unemployment benefits.
What about the Senate’s refusal to extend unemployment benefits?
Well, I hope we’re not done with the debate. Unemployment benefits being extended is very important. If you look at the unemployment statistics, we’ve seen kind of a fork in the road, where the short-term unemployment rate is approaching historical levels and the long-term rate is staying quite high. It’s not because people don’t want to work. Once you’re out of the workforce for more than a couple of weeks, couple of months, it’s harder to get back in. People who are trying to find a job in an economy where it’s challenging need extended benefits. But the ultimate goal is not giving people long-term unemployment insurance. The ultimate goal is getting people back to work.
Once you’re out of the work force for a while — “a couple of weeks, couple of months” — it’s harder to get back in. So the next words that come to mind involve the need to pay people to continue staying out of the work force? Beyond the several months they’ve already been collecting unemployment benefits from their home states? Perhaps Mr. Lew should consult Paul Krugman for an alternate theory about the impact of paying people not to work — Krugman the textbook-writing economist, that is, not Krugman the shill for Keynesian drivel.