{"id":32295,"date":"2012-10-08T20:33:02","date_gmt":"2012-10-09T00:33:02","guid":{"rendered":"http:\/\/valorguardians.com\/blog\/?p=32295"},"modified":"2012-10-09T08:43:15","modified_gmt":"2012-10-09T12:43:15","slug":"federal-fiscal-follies-part-vb-unemployment-compensation-conclusion","status":"publish","type":"post","link":"https:\/\/www.azuse.cloud\/?p=32295","title":{"rendered":"Federal Fiscal Follies, Part Vb: Unemployment Compensation (Conclusion)"},"content":{"rendered":"

As I wrote previously<\/a>, one of the questionable programs on which the Federal government spends huge amounts of money is Unemployment Compensation (hereafter UC).\u00a0 As with many Federal programs, the original intent of UC was good \u2013 helping people who\u2019ve lost their job through no fault of their own with some temporary income while they look for another job.\u00a0 But as is so often the case with Federal good intentions, the road they now pave appears to have forked, and to no longer be the road we ought to travel.<\/p>\n

So let\u2019s look at some of the details of today\u2019s UC programs.\u00a0 It\u2019s rather complex, and hopefully I can give an overview of the current mis-mash of such programs \u2013 as well as point out some of the issues with them.<\/p>\n

I.\u00a0 Overview<\/strong><\/p>\n

Federal involvement in Unemployment Compensation started during Great Depression \u2013 just like food stamps and Social Security.\u00a0 The program was first authorized by the Social Security Act of 1935<\/a>; four years later, enabling legislation \u2013 the Federal Unemployment Tax Act, or FUTA, formalized the program and completed its structure.\u00a0 Yeah, this is yet another \u201cgood deal for America\u201d you can thank FDR for starting.<\/p>\n

A detailed overview of the current US UC system is given in CRS Report RL33362,<\/a> published roughly two weeks ago; much of the information in this section comes from this and the prior link.<\/p>\n

Virtually all employment in the US is now covered by UC.\u00a0 The employment currently exempted is self-employment (including sole proprietorships), plus certain agricultural labor and domestic work; work for relatives; work performed by patients in hospitals; selected student interns; selected alien farmworkers; selected seasonal camp workers; and railroad workers (who have their own unemployment program).\u00a0 It\u2019s estimated that 97% of workers in the US are covered under state UC programs, provided they have sufficient income and service.<\/p>\n

In simplest terms, the FUTA and Social Security Acts set up a program that currently imposes a 6% Federal payroll tax (current rate) on the first $7,000 of employee income, and provide guideline for qualifying state UC programs.\u00a0 This tax is paid by employers \u2013 employees do not and never have paid a cent out of pocket<\/span>.\u00a0 However, 5.4% of this Federal tax is waived if the state in which work is performed has a qualifying UC program; this reduces the effective FUTA rate 0.6%.\u00a0 All 53 \u201cstate\u201d programs currently in existence (DC, the US Virgin Islands, and Puerto Rico are treated as state programs for UC purposes).\u00a0 The net result is that the Federal tax component for UC is capped at $42 per employee per year \u2013 e.g., 0.6% of $7,000.\u00a0 This is used to pay for program administration costs and to help defray the cost of UC for a number of relatively small Federal UC programs (more about these later).<\/p>\n

As mentioned above, all US states plus DC, the USVI, and Puerto Rico have qualifying \u201cstate\u201d UC programs.\u00a0 These programs impose payroll taxes on employers as well (again, these taxes are imposed on employers only; employees pay nothing).\u00a0 Recepits for these taxes are used to pay benefits for basic UC (more on the rather bewildering array of types of UC programs later in this article). However, Federal law allows states great leeway in running their own program \u2013 so employer tax rates, the amount of employee income subject to taxation, and the amount of weekly UC benefits paid vary widely from state to state.<\/p>\n

Most states take employer history into account when setting state unemployment payroll tax rates.\u00a0 That is, employers with low employee turnover pay low rates, while those with high \u201cchargable\u201d turnover (essentially, anything except voluntary departures or firing for \u201csufficient cause\u201d) receive higher rates.\u00a0 Rates range from literally nothing (0%) for \u201cgood\u201d employers (multiple states) to 13.5% for \u201cbad\u201d employers (Maryland).\u00a0 New employers generally get assessed an initial, average rate.<\/p>\n

The amount of income subject to taxation also varies, from the first $7,000 of each employee\u2019s wages (minimum allowable) in California and Puerto Rico to the first $38,800 of each employee\u2019s wages (Hawaii).\u00a0 Thus an employer may thus pay literally anywhere between $0 per employee (several states) and $3,043.60 (MN) per employee in state unemployment payroll taxes in addition to Federal FUTA taxes.<\/p>\n

Federal and state unemployment payroll taxes go to unemployment trust funds managed by the US Treasury on the behalf of the states.\u00a0 Deposits to these funds are counted as income for the Federal government when received, and payments from the funds are counted as Federal outlays.\u00a0 State funds are used to pay for state UC costs; Federal funds pay for program administration and a few smallish Federal UC programs, most notably for former Federal employees (civilian and military) who are eligible for UC based on leaving Federal employment.\u00a0 States may \u201coverdraw\u201d their accounts by borrowing funds from the Federal government during times of economic hardship.\u00a0 Such borrowing is by law to be repaid with interest, but currently interest payments are suspended.<\/p>\n

UC benefits vary widely from state to state.\u00a0 The actual amount received is loosely based on salary history during the \u201cbase period\u201d for calculation of UC benefits, but is capped at a maximum value which varies by state.\u00a0 Basic UC ranges from a low-end minimum of $5\/week in Hawaii for a low-income unemployed former worker with no dependents to a maximum of $653\/week for a high-income unemployed former worker with no dependents in Massachusetts.\u00a0 Some states increase benefits paid based on having dependents; some don\u2019t.\u00a0 The maximum benefit nationwide for a high income unemployed former worker with maximum dependents is also in Massachusetts and is $979\/week.\u00a0 This is the equivalent of a job paying more than $50,000 a year, or of work at roughly $24.40 an hour.<\/p>\n

Although Massachusettes is the most generous UC state in terms of maximum possible benefits, it\u2019s not alone in being relatively generous with maximum UC benefits.\u00a0 Nearly half of US states and territories (26\/53) pay max UC for unemployed former workers without dependents at a weekly rate of over $1,600 monthly, and 15 pay max UC at a weekly rate equating to over $2,000\/mo \u2013 or roughly the equivalent of $12\/hour work.<\/p>\n

A person qualifies for UC by working a specified amount of time and\/or earning a specified amount during what is called the \u201cbase period\u201d.\u00a0 Most states use the first 4 of the previous 5 completed calendar quarters as their base period; however, states are allowed to use alternate periods, and some states do. States also require one to have substantial earnings within each quarter during the base period, to work a certain number of hours during each quarter, or both in order to be eligible for UC.\u00a0 Specific qualifications vary widely from state to state.\u00a0 In general, one qualifies under the rules of work location vice state of current residence.\u00a0 I believe ex-military generally qualify under the rules for their Home of Record, but I may be in error on this point.\u00a0 Relocation after losing a job doesn\u2019t change this.<\/p>\n

II.\u00a0 The Various UC programs<\/strong><\/p>\n

There are several different UC programs currently in effect or which have just recently ended.\u00a0 A detailed overview is provided in the CRS Report cited above.\u00a0 However, here is the “short version” concerning each.<\/p>\n

Basic UC<\/span>.\u00a0 Basic UC is paid by state-run UC programs.\u00a0 Benefits are paid with receipts from state unemployment payroll taxes.\u00a0 Technically, payments are from state unemployment trust fund accounts managed by the US Treasury on behalf of the states; these accounts are funded by deposits of state payroll taxes or by borrowing from the Federal government if\/when exhausted.\u00a0 The duration of these programs are generally 26 weeks; a few states have shorter durations, while 2 states pay basic UC benefits for a bit longer (28 and 30 weeks in MT and MA, respectively).\u00a0 The only cost to the Federal government for these programs is the cost of program administration.\u00a0 When exhausted, the benefits determined here are currently continued in one of two other Federal UC programs:\u00a0 EUB08 and EB.<\/p>\n

EUB08<\/span>.\u00a0 Since 2008, the Federal government has also authorized Extended Unemployment Benefits (EUB08) to be paid (EUB were also authorized under various other expired extended unemployment benefits programs in the past, so the acronym EUB08 is generally used to refer to the current program).\u00a0 EUB08 is paid for by the Federal government.\u00a0\u00a0 Current legislation allows this program to extend benefits from week 27 to as long as week 79 of continuous UC, depending on local economic conditions.\u00a0 This program has been modified repeatedly by Congress, and is currently set to expire at the end of 2012.<\/p>\n

EB<\/span>.\u00a0 A Federal Extended Benefits (EB) program is also authorized.\u00a0 This program is also tied to local economic conditions.\u00a0 Cost for this program is theoretically split 50\/50 by state and Federal governments.\u00a0 However, currently the requirement for state 50% contribution is suspended, so at present the Federal government is paying 100% of the cost of the EB program.\u00a0 The EB program provides a 13 to 20 week extension of UC benefits.<\/p>\n

FAC<\/span>.\u00a0 Federal Additional Compensation (FAC) was a Federal UC program begun under PL 111-5 and which expired on May 29, 2010.\u00a0 It added additional $25\/week to all UC payments received which began prior to it’s sunset.\u00a0 It was last paid in 2011 to those qualifying before its expiration date, and is no longer paid.\u00a0 However, during its lifetime it paid approximately $20.1 billion in additional UC to those already receiving UC benefits.<\/p>\n

Other UC Programs<\/span>.\u00a0 UCX, is a program that pays for UC\u00a0 for ex-military personnel who ETS.\u00a0 UCFE is a program that pays for UC for Federal employees who are laid off involuntarily.\u00a0 Disaster Unemployment Assistance, or DUA, is a program that provides UC to persons affected by major disasters who would not otherwise qualify for UC.\u00a0 UC benefits are also paid to a relative handful of former workers under the Trade Adjustment Act or Readjustment Trade Assistance Adjustment program also exist.\u00a0 All of these programs are Federally-funded, and are relatively minor in scope.<\/p>\n

Railroad workers also have a separate UC program; however, that program is completely separate from other UC programs and is not discussed here.<\/p>\n

Sorting through all of the above, current eligibility for continuous UC benefits under all programs can last up to 99 weeks, or nearly 2 years,<\/em> in areas of high unemployment.\u00a0 This total may be extended further if Congress decides to do so.\u00a0 However, absent Congressional action the EUB08 program will expire at the end of 2012, significantly reducing the duration of UC available.<\/p>\n

UC benefits are considered fully taxable for Federal tax purposes, except for the year 2009.\u00a0 During that year only, first $2,400 in annual benefits were exempted from Federal taxation.\u00a0 I don\u2019t know precisely how UC is treated for state taxes (and I don\u2019t have time to research all 53 different programs), but since it\u2019s Federally taxable I\u2019d guess most states also regard UC as taxable income.<\/p>\n

III.\u00a0 The Numbers<\/strong><\/p>\n

UC Costs.<\/strong><\/p>\n

Most people have no idea how much the Federal and state governments pay in UC.\u00a0 From 2008 to present, the cost has greatly exceed the cost of the Federal food stamps program.<\/p>\n

For 2010, total amount spent to administer the UC program, including benefits paid, was $156.3 billion.\u00a0 Although this is the most recent \u201cworst-case\u201d in terms of costs, it\u2019s also illustrative of what can be expected under similar programs in the future during bad economic times.<\/p>\n

Revenues from unemployment taxes (Federal and state) were $44.7 billion.\u00a0 All taxes and UC expenses go through Federal unemployment accounts and show up on the Federal budget as incomes and expenditures.\u00a0 Therefore, the net \u201chit\u201d to the Federal budget for UC during 2010 was $111.6 billion.<\/p>\n

In 2010, UC program costs were broken down as follows:<\/p>\n

(a)\u00a0 A total of $5.5 billion was spent in administrative costs, or about 3.5% of the total.\u00a0 For a program of this size spread over 53 states and territories, that\u2019s not too bad.<\/p>\n

(b)\u00a0 Of the outlays, standard UC benefits \u2013 of which states still are responsible for 100% of the cost \u2013 were paid totaling $63.0 billion.\u00a0 The benefits paid came from state unemployment trust fund accounts maintained by the Treasury to receive unemployment payroll tax revenues and reimburse states for their portions of UC payments.\u00a0 Since these exceeded the total revenue from state UC taxes by $24.7 billion, that means states borrowed nearly $25 billion from the Federal government to pay UC benefits.\u00a0 The Federal government thus paid out nearly 80% of the total cost of UC benefits paid during 2010 \u2013 though it theoretically will eventually get $25 billion back when the states pay back what they borrowed.\u00a0 However, that will be with little or no interest; interest payments are currently suspended.<\/p>\n

(c)\u00a0 EUC08 UC payments (only paid to those who\u2019ve been out of work long enough to exhaust their normal UC benefits) in 2010 totaled $72.1 billion.<\/p>\n

(d)\u00a0 EC payments (paid to those who\u2019ve exhausted both normal UC and EUC08 benefits) in 2010 totaled $8.0 billion<\/p>\n

(e)\u00a0 Payments under the now-expired FAC program in 2010 totaled $11.7 billion during the first part of 2010 (program ended 29 May 2010, but people drawing FAC on that date continued to draw FAC until their UC benefits under all programs were exhausted).<\/p>\n

(f) UFE\/UCX ($1.3 billion) and Trade programs (TAA\/RTAA, $0.2 billion) complete the picture.\u00a0 No DUA UC was paid in 2010, and none appears to have been paid since DUA authority for Hurricane Katrina ended.<\/p>\n

How Many Recipients?<\/strong><\/p>\n

While data probably exists, I didn’t find a good source of precisely how many people by year received UC.\u00a0 So I decided to do a bit of ballpark estimation to determine a lower bound on that number.<\/p>\n

That number turns out to be\u00a0 pretty big.<\/p>\n

2010 was the “high water mark” for recent UC.\u00a0 That year, a large number of persons received UC. \u00a0The weekly average appears to have been at least 9 million individuals receiving UC.\u00a0 While persons might move from one UC program to another during the year (and thus be counted more than once), many more received basic UC for only part of the year.\u00a0 Therefore,\u00a0 it appears likely that the 9.0 million per week average is an under-estimate, and that more individuals received benefits on average each week than that during 2010.<\/p>\n

(a)\u00a0 Basic UC<\/span>.\u00a0 In July 2012, the average duration of basic UC was 17.4 weeks \u2013 roughly 1\/3 of a calendar year \u2013 and the average benefit (nationwide) was $299\/week.\u00a0 Using these numbers for 2010 (they are assumed to be relatively close to comparable numbers from 2010) yields a total number of persons receiving standard UC of approximately 12.16 million individuals.\u00a0 However, even if 26 weeks of basic UC is assumed for everyone, this still equates to approximately 8.1 million individuals receiving basic UC during 2010.<\/p>\n

(b)\u00a0 EUC08<\/span>, paid to those who\u2019ve exhausted basic UC benefits, yields a weekly average of approx 4.64 million individuals receiving EUC08 benefits.<\/p>\n

(c)\u00a0 EB<\/span>, paid to those who\u2019ve exhausted both basic UC and EUC08, was paid to a weekly average of approximately 510,000 persons.<\/p>\n

(d)\u00a0 FAC<\/span>, paid to anyone who started drawing UC prior to 29 May 2010, was paid to a weekly average 9.0 million.\u00a0 This provides a lower bound on the average number of persons receiving UC weekly in the USA, as anyone who qualified for UC on\/after 31 May 2010 would not receive FAC.<\/p>\n

(e)\u00a0 UCX\/UCFE<\/span> (83,000 weekly average) and TAA\/RTAA<\/span> (11,000 weekly average) complete the picture.\u00a0 No DUA appears to have been paid during 2010.<\/p>\n

The average number for persons receiving UC weekly in 2010 thus very likely was in excess of 9,000,000 individuals.<\/p>\n

IV.\u00a0 UC Myths, Realities, and Inanities<\/strong><\/p>\n

Well, why is all this so bad?\u00a0 Because it’s often administered under nonsensical state rules and subject to abuse.\u00a0 Let’s look at some of the common myths and inanities regarding UC.<\/p>\n

a.\u00a0 \u201cUC is insurance!\u201d\u00a0 No, it is not<\/strong><\/em>.\u00a0 UC is a payroll-tax funded income-transfer payment received from the government because it\u2019s an entitlement someone qualified to receive.\u00a0 The income to be transferred comes from either employers or Federal taxpayers; it goes to the recently unemployed.\u00a0 The qualifications are (1) that an individual worked a set amount of time and\/or had a minimum amount of earnings, and (2) that their employer \u2013 not the individual \u2013 paid unemployment taxes based on their employment history and the fact that the individual was working.\u00a0 There is no insurance policy or individual \u201cunemployment insurance\u201d account; no one paid premiums (taxes are not premiums); you had no option of declining coverage; and you have no contractual right to any payments.\u00a0 Unemployment taxes go into a common pool; benefits are paid from that pool based on a formula defined by law.\u00a0 If the state wants to terminate or change the program tomorrow, they can elect do so by changing state law. \u00a0Recipients have no recourse if that happens.<\/p>\n

b. \u201cI paid for it!\u201d\u00a0 If you are an employee – no, you didn\u2019t.\u00a0 Your employer<\/strong><\/em> paid for it.\u00a0 UC is financed through payroll taxes paid by your employer \u2013 not by you.\u00a0 You didn\u2019t pay a dime.\u00a0 And your employer also got to deduct those payroll taxes from gross income as a cost of doing business, thereby lowering the employer\u2019s overall taxes paid to both Federal and state on any profits made.<\/p>\n

c.\u00a0 \u201cIt\u2019s a Federal program!\u201d\u00a0 Yes and no.\u00a0 Technically, the Federal government runs a program and sets guidelines, and collects a small (0.6% of the first $7000 in wages per employee, or a maximum of $42 per employee per year).\u00a0 This Federal tax is used to set up a \u201cfund of last resort\u201d and to pay program administration costs.\u00a0 However, Federal law only encourages states to participate in a qualifying program and established broad guidelines; it doesn\u2019t prescribe much in the way of specifics. And the guidelines under the Federal program are very broad, and give much latitude to the states as to what they can do.\u00a0 All 53 \u201cstate\u201d UC programs have been found to be qualifying programs.\u00a0 But there are no uniform qualifications.\u00a0 As noted above, qualifications vary from state to state.<\/p>\n

d. \u00a0\u201cYou\u2019re not eligible to get UC if you\u2019re fired.\u201d\u00a0 The correct answer is \u2013 that depends.<\/a>\u00a0 States have great leeway in interpreting this point.\u00a0 Someone fired because of criminal activity, a pattern of significant violations of company policy, conduct that is against his employer\u2019s interests, or other serious misconduct probably will be ruled ineligible by their state.\u00a0 But someone who is fired for poor performance, inability to do the job probably, a history of tardiness, inability to adapt to a changed job, etc . . . . , will be eligible for UC in many if not most states.\u00a0 Being fired is not an automatic bar from receipt of UC.\u00a0<\/em>And when it’s a bar, it’s often only a temporary disqualification.<\/p>\n

e.\u00a0 \u201cYou\u2019re not eligible if you voluntarily quit your job.\u201d\u00a0 Not true.<\/em>\u00a0 The correct answer is that you might or might not be.<\/a>\u00a0 Here, states also have great latitude.\u00a0 Someone who merely quits because they don\u2019t like their job or their boss probably will be determined to have left voluntarily and won\u2019t be eligible; ditto for someone who voluntarily retires.\u00a0 But someone who quits for other reasons \u2013 like health, need to care for an ill relative, a major change in working conditions, or is deemed to have suffered a \u201cconstructive termination\u201d (essentially, they left under conditions that forced them to leave) or due to domestic violence-related issues may well be eligible for UC even if they voluntarily quit. \u00a0And in many states if you quit one job with \u201creasonable expectation of employment elsewhere\u201d and that new job falls through \u2013 you\u2019re eligible.\u00a0 In fact, since 1991 ex-military get a huge break here since by Federal law voluntary ETS is no longer considered voluntary job departure<\/a> (some states did prior to 1991).<\/p>\n

f.\u00a0 \u201cYou\u2019re not eligible if you\u2019re a student.\u201d\u00a0 Not necessarily the case. <\/em>Many states allow students to receive UC<\/a>.\u00a0 Several do so without significant restriction.<\/p>\n

g.\u00a0 \u201cYou\u2019re not eligible if you\u2019re retired.\u201d\u00a0 Again:\u00a0 not necessarily the case.<\/em>\u00a0 Most states allow Social Security recipients to receive UC<\/a>.\u00a0 And in over half the states, receipt of a pension in general only disqualifies you from receipt of UC if that pension is based on work occurring in whole or in part during the base period<\/a>.\u00a0 In those states, a pension is not considered\u00a0 with respect to UC claims if those claims are based on losing subsequent post-retirement employment with another employer.<\/p>\n

h. \u00a0\u201cYou have to take any job offered \u2013 if you don\u2019t, you lose your benefits.\u201d\u00a0 This is absolute bull<\/strong>.\u00a0<\/em> At least initially, an out-of-work employee is required to take only \u201csuitable employment\u201d when offered; employment considered \u201cunsuitable\u201d may be refused without loss of UC benefits.\u00a0 Individual states determine what is and is not\u00a0\u201csuitable employment\u201d for people receiving UC.\u00a0 And some of the definitions of what may be turned down as \u201cunsuitable employment\u201d are absolutely asinine.<\/p>\n

Here are some examples of truly IMO asinine stuff regarding the definitions of \u201csuitable employment\u201d and UC benefits.<\/p>\n

Example 1<\/span>: \u00a0A guy or gal in Michigan is a plant manager for a large manufacturing company and is earning $140,000 a year plus benefits.\u00a0 After 5 years employment, the plant closes \u2013 and they’re out of work.\u00a0 After collecting UC for 8 weeks, the individual is offered an identical position in the same business by a smaller company, managing a much smaller but otherwise similar plant \u2013 at $97,500 a year plus comparable benefits.\u00a0 The commute is considerably shorter than to his former job.\u00a0 The individual turns the offer down, and the job is filled the same day by the #2 candidate.<\/p>\n

Boy, what a dumbass!\u00a0 Just lost UC benefits for declining suitable work, right?<\/p>\n

Wrong.\u00a0 In Michigan, during the first half (10 weeks, since Michigan only provides 20 weeks of basic UC benefits) of your basic UC benefits, you don\u2019t have to accept a job paying less than 70% of what you previously made<\/a>.\u00a0 During that period, any job paying less than 70% of your former salary is not considered \u201csuitable employment\u201d.\u00a0 However, had the offer occurred 3 or 4 weeks later \u2013 e.g., during week 11 or 12 of receiving UC \u2013 the offer would<\/span><\/span> have been considered suitable employment (rules change at the half-way point).\u00a0 Declining the offer at 11 or 12 weeks would indeed cost the individual UC eligibility.<\/p>\n

Makes a lot of sense, eh?<\/p>\n

Example 2<\/span>:\u00a0\u00a0 A guy or gal in Massachusetts works as a research chemist\u00a0 for a \u201cgreen\u201d company developing environmentally-friendly pest control products at a salary of $150,000 a year.\u00a0 The employer goes belly-up, and the individual is out of work for 13 weeks and draws $653\/week in UC (I\u2019m assuming $150k a year qualifies for max UC in MA).\u00a0 The individual is offered a similar job (developing pesticides) with a chemical company at exactly their old salary.\u00a0 Benefits are comparable and the job is a 10 min walk from home.\u00a0 They turn the offer down.\u00a0 They just screwed up and blew their receipt of UC, right?<\/p>\n

Wrong.\u00a0 Massachusetts allows declining otherwise-qualifying work for \u201cecological objections\u201d<\/a> without loss of UC benefits.<\/p>\n

Example 3<\/span>:\u00a0 The next week, the same person in Massachusetts is offered a job developing effective environmentally- and human-friendly pesticide products for use on military uniforms at Natick Labs as a SME at $150,000 a year.\u00a0 The individual turns that down, too.\u00a0 Just screwed the pooch, right?<\/p>\n

No.\u00a0 Turning down what would otherwise be suitable employment because it\u2019s defense-related is also allowable in MA.\u00a0 You retain your entitlement to UC in that case.<\/p>\n

Example 4<\/span>:\u00a0 Two weeks later, the same person in MA is offered a job working for an eco-friendly company doing the exact same thing they were previously employed doing.\u00a0 The prospective employer has no DoD connections whatsoever.\u00a0 But it\u2019s a 30 min drive away in the countryside, and would require driving to work 30 min each way vice taking the bus, riding a bicycle, or warlking (no public transport is available to the new job’s location, and it\u2019s too far to bike or walk).\u00a0 The last job was a 1 hour bus ride away from home. The individual turns it down.\u00a0 They screwed up and lost their UC, right?<\/p>\n

No.\u00a0 MA also allows refusing a job without loss of UC benefits if the worker previously used public transportation to get to\/from work and public transportation is not available to\/from the new job site.<\/p>\n

i.\u00a0 \u201cRich folks can\u2019t get unemployment \u2013 it\u2019s only for poor working stiffs.\u201d\u00a0 One can argue the merits of whether or not UC should be means or assets tested, like Medicaid.\u00a0 However, currently UC is not means tested whatsoever. And as my first article on UC noted,\u00a0 2,362 persons living in households having a taxable<\/em> income of $1M or more<\/a> received UC in 2009.<\/p>\n

i.\u00a0 \u201cUC is\u00a0 something I earned while working!\u201d\u00a0 Actually – no, you didn\u2019t.\u00a0 Unlike a pension or other type of defined-benefit retirement, UC is not a deferred compensation payment earned through service with an employer.\u00a0 Rather, UC is a tax-funded, state-run public assistance program.\u00a0 Like any other public assistance program, a recipient qualifies simply by meeting statutory qualifications.\u00a0 In the case of UC, those qualifications are generally earning a specified amount of money and\/or working a given number of hours during a specified period of time while working for a qualifying employer.\u00a0 If you meet the statutory qualifications, you qualify.\u00a0 Period.<\/p>\n

V.\u00a0 Conclusion.<\/strong><\/p>\n

Perhaps UC was indeed set up for \u201cgood intentions\u201d.\u00a0 But it’s morphed significantly between 1939 and today.\u00a0 And I\u2019m not sure the road those good intentions pave today is exactly leading where we really want to go as a nation any longer.<\/p>\n

Helping people for a short period when they lost their job through no fault of their own is one thing.\u00a0 However, IMO paying people UC for nearly 2 years – in rare cases, at the rate equivalent to that of a $50k a year job – seems way out of line and inconsistent with a free-market economy.<\/p>\n","protected":false},"excerpt":{"rendered":"

As I wrote previously, one of the questionable programs on which the Federal government spends huge … Federal Fiscal Follies, Part Vb: Unemployment Compensation (Conclusion)<\/span>Read more<\/a><\/p>\n","protected":false},"author":623,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[],"class_list":["post-32295","post","type-post","status-publish","format-standard","hentry","category-economy"],"_links":{"self":[{"href":"https:\/\/www.azuse.cloud\/index.php?rest_route=\/wp\/v2\/posts\/32295","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.azuse.cloud\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.azuse.cloud\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.azuse.cloud\/index.php?rest_route=\/wp\/v2\/users\/623"}],"replies":[{"embeddable":true,"href":"https:\/\/www.azuse.cloud\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=32295"}],"version-history":[{"count":0,"href":"https:\/\/www.azuse.cloud\/index.php?rest_route=\/wp\/v2\/posts\/32295\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.azuse.cloud\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=32295"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.azuse.cloud\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=32295"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.azuse.cloud\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=32295"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}