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PUNISHING THE JOBLESS

There was a time when everyone took it for granted that unemployment insurance, which normally terminates after 26 weeks, would be extended in times of persistent joblessness. It was, most people agreed, the decent thing to do.

But that was then. Today, American workers face the worst job market since the Great Depression, with five job seekers for every job opening, with the average spell of unemployment now at 35 weeks. Yet the Senate went home for the holiday weekend without extending benefits. How was that possible?

The answer is that we're facing a coalition of the heartless, the clueless and the confused.

By the heartless, I mean Republicans who have made the cynical calculation that blocking anything President Barack Obama tries to do - including, or perhaps especially, anything that might alleviate the nation's economic pain - improves their chances in the midterm elections. They're out there, and make up a large share of the GOP caucus.

By the clueless I mean people like Sharron Angle, the Republican candidate for senator from Nevada, who has repeatedly insisted that the unemployed are deliberately choosing to stay jobless, so that they can keep collecting benefits.

But there are also, one hopes, at least a few political players who are honestly misinformed about what unemployment benefits do - who believe, for example, that Sen. Jon Kyl, R-Ariz., was making sense when he declared that extending benefits would make unemployment worse, because "continuing to pay people unemployment compensation is a disincentive for them to seek new work." So let's talk about why that belief is dead wrong.

Do unemployment benefits reduce the incentive to seek work? Yes: Workers receiving unemployment benefits aren't quite as desperate as workers without benefits, and are likely to be slightly more choosy about accepting new jobs. The operative word here is "slightly." Recent economic research suggests that the effect of unemployment benefits on worker behavior is much weaker than was previously believed. Still, it's a real effect when the economy is doing well.

But it's an effect that is completely irrelevant to our current situation. When the economy is booming, and lack of sufficient willing workers is limiting growth, generous unemployment benefits may keep employment lower than it would have been otherwise. But as you may have noticed, right now the economy isn't booming. Cutting off benefits to the unemployed will make them even more desperate for work - but they can't take jobs that aren't there.

One main reason there aren't enough jobs is weak consumer demand. Helping the unemployed, by putting money in the pockets of people who badly need it, helps support consumer spending. And unlike, say, large infrastructure projects, aid to the unemployed creates jobs quickly - while allowing that aid to lapse is a recipe for even weaker job growth, not in the distant future, but over the next few months.

But won't extending unemployment benefits worsen the budget deficit? Yes, slightly - but penny-pinching in the midst of a severely depressed economy is no way to deal with our long-run budget problems. And penny-pinching at the expense of the unemployed is cruel as well as misguided.

So, is there any chance these arguments will get through? Not, I fear, to Republicans: "It is difficult to get a man to understand something," said Upton Sinclair, "when his salary" - or, in this case, his hope of retaking Congress - "depends upon his not understanding it." But there are also centrist Democrats who have bought into the arguments against helping the unemployed. It's up to them to step back, realize that they have been misled - and do the right thing by passing extended benefits.

© 2010 New York Times News Service

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