The system is also not designed for a flexible economy like ours in which some employees move from job to job for short periods, and are therefore ineligible for unemployment compensation when they are faced with a protracted spell without work.
To remedy such problems we need a very different model, perhaps establishing individual unemployment savings accounts over which employees would exercise direct control when they lose their jobs, or putting in place financial incentives for employers to hire and train the long-term unemployed. One thing is certain: While we cannot rebuild our flawed system overnight, we are surely not required to borrow the funds to pay for it. In spending $56.5 billion to extend benefits, the deal is sacrificing the bedrock Republican principle that new expenditures be paid for with offsetting budget cuts.
President Obama has reason to celebrate. The deal delivers short-term economic stimulus, and it does so at the very time he wants it most, before the 2012 elections. But the long term health of our great engine of prosperity will remain very much in doubt. To the twin inevitabilities of death and taxes, we may now have to add persistent high unemployment.
To recap, President Romney cares about the unemployed, but wants you to set up your own nest egg to cover your own ass in case you get fired, money the banks will be happy to take from you to play Big Casino games. He also would rather see you out of work and broke than have to add one cent to the deficit, and accepts persistent high unemployment as inevitable and sees Americans going to a series of part-time temporary contractor jobs with no benefits and no eligibility for unemployment insurance.
Translation: the multi-millionaire businessman says you're on your own, America. Don't expect a damn thing from anyone. You want health or unemployment insurance or retirement? Better scrimp and save now. You're just a worker bee. If you worked hard enough to deserve money, you'd have it.
What a charming and altogether way too probable future.
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President Romney cares about the unemployed, but wants you to set up your own nest egg to cover your own ass in case you get fired...
No, I don't think that's what he said. What he said was "...perhaps establishing individual unemployment savings accounts over which employees would exercise direct control when they lose their jobs"
The first does not equal the second. In most states you can only claim unemployment if you lost your job due to layoff or other termination cue to causes your own, and in certain cases where you have to quit because of illness or family crisis. (From WikiAnswers)
Under the current system, you have no coverage if you get fired. Getting fired carries with it the implication that it was a) for cause and b) your fault. In the system proposed in the soundbyte from Mitt Romney, you would get your coverage regardless of whose fault your termination was or why it happened.
I would think that would be a good thing. Unless, of course, you would rather trust the government that enabled the banks to play Big Casino Games.
who's going to save up enough money in an individual UI account to keep afloat for a year? it's a lousy fucking idea in this economy unless you're some miserable libertarian scumbag who had your sense of human decency surgically removed after you finished reading "atlas shrugged".
I'm all for personal responsibility there Asariel, but Romney seems to want a plan where the employers are off the hook for paying taxes into the unemployment benefit system altogether.
Who guarantees these accounts? Are they FDIC insured? Can they be used for other reasons? Is he suggesting employers and employees set aside this account money like 401(k) matching works now (for the companies that still match 401(k)s)? Are they portable? Do they roll over or is it use it or lose it?
Lots of devil in those details. I'd like to hear more.
teadoust said: "who's going to save up enough money in an individual UI account to keep afloat for a year? it's a lousy fucking idea in this economy unless you're some miserable libertarian scumbag who had your sense of human decency surgically removed after you finished reading "atlas shrugged"."
An interesting question, teadoust. Who could do that?
I'll use Ohio as an example, since I live in that state. To be eligible for UI in Ohio, you must have an average gross weekly wage of at least $213. You receive one-half of that average weekly salary as UI benefit. with a maximum of $375 (for 0 qualifying dependents), $456 (for 1-2 qualifying dependents) or $508 (for 3+ qualifying dependents).
Here's some actual numbers to illustrate. Let's look at someone earning $30,000 per year, which works out to an average of $576.92 per week. That person's UI benefit in Ohio would be $288.46.
Let's assume that this person saves 6.2% of his gross income in this hypothetical account (which is what Federal Unemployment Tax rate), and it earns an APY of 1.164% (the average for Ohio, according to rates@banks.com). Assuming no employer match, this person has saved $1870.51 in one year and $3762.55 in two years. That comes out to about 6.5 weeks of benefits after one year and 13 weeks after two years. After 5 years - the average length of employment at a single given job, according to the BLS - this person has saved $9570.25, or about 33 weeks of benefits.
Remember: this is assuming a 6.2% savings rate (which is not unreasonable at all) at a 1.164% APY.
Your response to this will probably be to call me a "heartless libertarian scumbag" again. Nevertheless, although I will acknowledge that this does not provide the same duration of benefits as the current UI system, I will say it makes far more sense. Particularly if the US government were to encourage employer matching through tax credits (we do it now to encourage prompt payment of the federal unemployment tax, so why not).
Also, in terms of "human decency", why would it be indecent to give the individual control over their own money? (And yes, I have been unemployed. And yes, I have been on UI. So don't bother throwing that at me, because I would still rather be under this system.)
Who guarantees these accounts? Are they FDIC insured? Can they be used for other reasons? Is he suggesting employers and employees set aside this account money like 401(k) matching works now (for the companies that still match 401(k)s)? Are they portable? Do they roll over or is it use it or lose it?
Lots of devil in those details. I'd like to hear more.
True, that. I am in full agreement, despite my hypothetical support for this as a concept.
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