Unconfused wrote:

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This post relates a letter to the editor in today's H.A. and a post from John Galt. So where are quality workers? http://www.hattiesburgamerican.com/apps/pbcs.dll/article?AID=/20060402/OPINION03/604020317/1014 "We cannot find and hire quality, competent individuals with a desire to actually work.  The problem? Well let's see: Checks from the Federal Emergency Management Agency, Red Cross checks, unemployment checks, insurance checks, private organization hand-outs, and on and on. " On another thread John Galt wrote: Unconfused, Thanks for a thoughtful reply to my comments.  I don't have the time right now to respond at length; I'll simply say that the percentage of unwed mothers has skyrocketed since the 1960s; the rates of people imprisoned has skyrocketed since the 1960s; the rates of people addicted to drugs has skyrocketed since the 1960s; the percentage of the budget devoted to various entitlement programs has skyrocketed since the 1960s; and the percentage of state support for colleges and universities has steadily declined in the aftermath of all these other changes.  I do think there are cause-and-effect relationships here.  (By the way, many of these developments were foreseen by people as long ago as the 1960s.)     

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Unconfused-

I read and liked your earlier posts. John and Cossack and other "conservatives" on this board (whatever that means) seem to think of workers in terms of "employees" solely, rather than the labor part of the market that exist within our economic system. I know very few individuals who would decline work in favor of the public dole, but I do see them in my line of work (usually folks with serious mental illnesses or multiple serious medical problems). However, most of these individuals have floated in and out the the labor market as part of their history. I have also run into a couple of drug addicts trying to scam the system--but this individuals are largely unemployable until clean (and would be a bigger burden to business, should an HR director be foolish enough to hire such a person). With these caveats, these folks are in the minority of the labor pool, and these types have existed throughout time. But the general laws of supply and demand apply to labor markets, and if the benefits of social programs outweight income and benefits, one would see an increase in folks on the dole (the vague construct of "individual responsibility" is perhaps less important and less parsimonious than a straightforward market driven conceptualization for predicting aggregate labor pools).  

John says that various social indices have "skyrocketed." It's really a mixed bag, and these outcomes are somewhat independent and multi-determined. Drug use waxes and wanes, as do measures of criminality. Perhaps the most salient, homicide, is on the decline. Imprisonment rates have increased secondary to the Rockefellar experiment--the lock 'em up and throw away the key model. Most states, including Mississippi, have re-thought this model recently for a variety of reasons-primarily cost and ineffectiveness (and the fact that prison is a breeding ground for additional crime).

I doubt that unemployment insurance is a great incentive to unemployment (and the worker and business contribute to this program, so it is more of a hybrid entitlement, if an entitlement at all).

Rather than an all or nothing approach or thought (e.g., "welfare" breeds irresponsibilty and other social ills, a taxpayer should not be responsible for someone not currently paying taxes, and these programs should be eliminated at all costs anyway), a better approach might be to have incremental adjustments in existing administrative conditions based on data (whether minimum wage, weeks of unemployment eligibility, tax structures, sentencing guidelines and so on) as market and social conditions change (a la the Fed). But politicians on both sides of the aisle rarely operate based on data, and tend to make decisions based on the preservation of their own power. Massive changes are riskier and can come out (in general) on the positive (New Deal; Voting Rights Act; Clinton's Budget in his third year of his first term; Marshall plan; Nixon opening China) or negative (Johnson's Great Society; Kennedy's policy in SE Asia; Reagan's deficit spending; NAFTA; Iran-Contra) side of the ledger. 

Well-that should be enough thoughts to keep y'all going for awhile.       

http://www.whitehousedrugpolicy.gov/publications/factsht/druguse/index.html

Figure 1 is particularly interesting.  Maybe Nancy Reagan wasn't so naive after all.

Unconfused wrote:

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John, I (and I sure others) find it difficult to have a discussion when you post links to web sites.  If you want a discussion I suggest you reply of "Godless Liberal", or my post, or make a particular statement.  Sorry I just don't have time to study that many sites before posting. 

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Cossack wrote:

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Godless Liberal writes, I doubt that unemployment insurance is a great incentive to unemployment (and the worker and business contribute to this program, so it is more of a hybrid entitlement, if an entitlement at all). In your post, you make many assertions. While many of your assertions are inconsistent with the facts, I will focus on one for this post. Having been a consultant to a states that were making changes in its unemployment compensation system, I can assure you that the facts do not back up your statement. A generous UI program does increase unemployment. People respond to incentives and to disincentives on the margin. If you increase the size of the unemployment check per week, some people will change their behavior based on the increase. The majority of people will not. For every percentage point it increases, additional people will take advantage of the system. Also, in most state systems, the tax is on the employer. It is the employer who is experience rated. That is, the money paid out to laid-off employees of that employer affects the UI tax rate of the employer and the amount of UI taxes the employers pays. All systems have a degree of cross subsidization where employers who have not have claims filed against them subsidize employers who do have claims filed against them (seasonal employers often benefit from being subsidized). Finally, UI is an entitlement.

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I agree with many of your statements (for example, that increased UI benefits will slighlty increase the number of folks who take advantange of unemployment insurance). That is my point exactly. And you served as a consultant to tweak a system as I suggested (rather than abolish it). But, can you show me data that labor markets today, in general, are more affected by unemployment insurance rates than other classic factors? Can you provide data that unemployment rates are affected by a full percentage point, give or take, by the unemployment compensation system in one state compared to another today?

UI is in an entitlement in the sense that Medicare and SS are entitlements. But not in the sense that John is thinking of entitlements (never employed welfare Queens having babies to increase a check).

Are you in favor of eliminating (not tweaking) SS, Medicare, and UI?   

:Cossack wrote:

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 SS and UI have a relationship between working and receiving benefits, albeit with a great deal of cross subsidization. Both require that one participates in the work force. Medicade, welfare and certain other subsidies basically require that you be alive.

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