The economic impact of ending unemployment benefits

I just read where one community will have 2,000 people lose their long-term unemployment benefits.

Assume, for the sake of argument, that these were minimum wage workers, working between 30 and 35 hours per week. The have been getting about $100 per week in unemployment benefits. Now, nothing.

That means they have, as a group, been spending about $200,000 per week in the local economy. Now, nothing.

Over the course of a year, $10,000,000 won’t be spent in local stores. But business owners won’t see a similar cut in their taxes. They’ll have to cut costs some other way, and the usual way is to reduce their workforce. This, in an area with a nearly 14% unemployment rate as it is.

And remember, unemployment benefits those who lost their job through no fault of their own. While those who just lost their benefits may have to pack up and leave, going whereever they can find work, the small businesses left behind will have to make do with $10,000,000 less this coming year.

Thanks, Congress.

35 thoughts on “The economic impact of ending unemployment benefits

  1. But business owners won’t see a similar cut in their taxes.

    Businesses only pay taxes on profits, in the first place. Another loser here will be the local tax base, with a drop in sales taxes and license fees, which, for businesses, are based on annual revenue, at least in my city. A ripple effect will be felt for the next year, at least.

    • A portion of the sales tax I collect (1% of my sales to be exact) is returned to the county I live in. Unemployment benefits, and SNAP, benefit not just the individual who receives them, but the entire community. If a business does well, both the owner and the employees have more dollars to spend in the community and the benefits spread to other businesses. Those benefit dollars prime the economic pump and the system runs a whole lot better than the discredited trickle down nonsense. We also get the added benefit of not having to watch our fellow humans starve in the street.

  2. As long as they aren’t getting something for nothing! After living the high life on that $100 per week, this will make them get jobs.

    It’s magic, I guess…

    • I just adore “something for nothing” arguments. I came very close to punching a young aquaintence who was going on about how Medicare is “free health care”. He seems to be utterly incapable of understanding that I still pay premiums, deductables, and co-pays over and above the investment I made during my working life and carrying additional coverage. I would print him out a copy of the outstanding bill from my most recent hospital stay but I have a feeling that he is so indoctrinated in right-wing ideology that he would probably ignore the evidence of his lying eyes.

      Sigh… If I had been thinking I would have just told him to get bent when he started bemoaning “the fact that people aren’t allowed to say Merry Christmas”. I don’t know where he shops (I suppose he might just make his girlfriend do all his shopping for him.) but I haven’t made it out of a store without being “Merry Christmased” in about three weeks. In fact, today was the first day that the most popular salutation has become “happy new year”.

  3. And, of course, no one in the “librul media” will dare to report that this will be a double hit against the economy. The money that is not paid out in unemployment benefits will cease flowing into the economy and at least some of these unfortunate people will be forced to seek other forms of public assistance that will come out of the general fund and will presumably result in a reduction of other public spending.

  4. But it is OBAMA’S fault, you see. And thats what these fuckers want. I am already hearing it from the low information idiots here. They keep voting in the Congressional Rep. OVERWHELMINGLY.

  5. Just days after Wisconsin Congressman Paul Ryan and Washington Senator Patty Murray cut a budget deal which cut the retirement benefits of America’s veterans, Chuck Wooten, Chief Master Sgt., USAF (Ret), received an email from Ryan begging him for an “emergency end of the year donation.”

    Veteran’s Facebook post to Paul Ryan goes viral

    • (Funny, you can’t copy and paste from that article.)

      The liberal Democrats are an enemy to the American people and our Nation.

      See, this deluded veteran has got it so wrong he actually believes his benefits are being cut because the Democrats want it that way, and Ryan didn’t fight hard enough to keep his benefits from cuts. Veterans benefits and rank-and-file military pay are the only parts of the DOD budget that Democrats want to increase, while reducing the rest of the appropriation the Pentagon receives.

      I find it hard to sympathize with anyone so gullible, even if he served the nation honorably.

    • I would appreciate this retiree’s comments more if he didn’t consider Democrats to be the enemy. The Democrats in the Senate have voted to protect veterans whereas the Republicans have been voting to cut veteran benefits.

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