Senior Democratic officials on Capitol Hill and in the White House say that the media and Republicans are mistaken to assume that the stimulus measures were included as mere bargaining chips. In fact, the Democrats say, they’re important building blocks for President Barack Obama’s second term in office.
. . . .
The specific measures — extension of unemployment insurance benefits ($30 billion) and the payroll tax cut ($115 billion), infrastructure spending ($50 billion to $75 billion), and a series of other tax cut extenders ($27 billion) — hardly constitute a robust stimulus package, particularly considering all the spending cuts likely to surround them in any final deal. Yet top Democrats view these measures, drawn from the president’s proposed American Jobs Act, as an essential component of that deal.
“Our approach must be ‘first, do no harm’ to the recovery,” Sen. Chuck Schumer (D-N.Y.) told The Huffington Post. “That means extending emergency unemployment benefits and, if not preserving the payroll tax cut, then replacing it with something that gives similar help to middle-class families.”
Pardon me while I go scream into a pillow.
OK, I’m back.
Look: if you want to argue for extending unemployment benefits, be my guest. Such benefits depress the job market but help out those down on their luck (as well as others). It’s a trade-off.
Just don’t pretend it’s not a trade-off, that’s all. Because it is.
P.S. The link goes to EconTalk, a podcast by Russ Roberts that I have become a fan of. The link is well worth a listen, for a serious and nonpartisan examination of how rule changes such as extending unemployment benefits are almost certainly responsible for a higher rate of unemployment.
More economic literacy, please.