[Guest post by DRJ]
Speaker Nancy Pelosi says unemployment benefits stimulate the economy:
PELOSI: “Now let me say that unemployment insurance — we talk about it as a safety net and the rest. This is one of the biggest stimuluses (I know, not a word) to our economy. Economists will tell you this money is spent quickly, it injects demand into the economy. It creates jobs faster than almost any other initiative you can name. Because, again, it is money needed for families to survive, and it is spent.
So it has a double benefit, it helps those who have lost their jobs, but it is also a job-creator. It is impossible to think of a situation where we would have a country that would say we’re not going to have unemployment benefits, and the only people who want them are people who don’t want jobs. That’s just so contrary to what our country is about, and I reject that misrepresentation of the motivation for people to be on unemployment insurance.”
This Ezra Klein post explains why liberals want direct government spending like unemployment benefits. It’s satisfying because you are providing help to specific people and it gives more immediate bang for the buck.
Unemployment benefits stimulate the economy if the alternative is jobless people who have no money to buy food and other necessities. On the other hand, unemployment benefits aren’t as good for the economy as people paying for what they need with income earned from jobs. But what if the jobs are lower-paying or equal pay to unemployment benefits, leading recipients to choose unemployment benefits? What should society encourage in that situation?
That issue doesn’t seem to be on liberals’ radar, and conservatives are portrayed as heartless and judgmental for raising it.