If you didn’t have to work for a living, would you?
Obviously, many Americans would answer with a resounding “no,” but Washington, DC can’t seem to figure it out. Reihan Salam has a Daily Beast piece about the “inconvenient truth” that doesn’t get enough mainstream discussion: “unemployment is higher in no small part because unemployment is more pleasant than it used to be.” Part of that has to do with increases in dual-income households, but government is also partly responsible:
Moreover, the welfare state is far more generous. Between 1981 and 2007, per capita spending on the federal welfare state increased by 77 percent, adjusted for inflation. Unemployment insurance has grown more generous. Over the last five years, the Pew study notes that unemployment insurance spending has gone from $33 billion to $168 billion. Half of that $168 billion in FY 2010 has gone to the long-term unemployed. This further helps cushion the blow, and it can allow an unemployed person to be somewhat choosier about her next job. While it’s certainly true that many workers have taken jobs that involve huge salary cuts, many others are holding out hope for a job that matches expectations in a sunnier labor market. This isn’t necessarily a bad thing for society. One can imagine workers using an extended spell of unemployment as an opportunity to gain new skills and to spend time with loved ones.
Simply put, unemployment benefits increase unemployment durations. There is some controversy as to why this is true, but there’s no getting around it. According to Michael Feroli, an economist at JP Morgan Chase, the extension of unemployment benefits has increased the measured unemployment rate by 1.5 percent.
Mulligan keeps a long-running list of employment-reducing policies that the Obama and Bush administrations have embraced, including a wide range of means-tested programs for student loans, mortgages, and health insurance premiums, minimum wage increases, and tax increases.
One of the major problems with modern economic debates is the failure to recognize the impact of incentives on human behavior. Human beings generally act in their perceived self-interest, and particularly tend to be attracted to the path of least resistance. Simply put, if Joe knows that life’s gonna get messy without a job, he’ll work harder to find one than he will if he knows he’ll be able to coast for a while with the aid of a government program (assuming he’s able-bodied and reasonably healthy). Economics can be complicated stuff, but this principle isn’t—it should be elementary to anyone with a basic grasp of human nature.
Issues of federalism and classical liberal theories of government aside, this is not necessarily an argument that government should never lend its citizens a helping hand, but it should at least teach us that such aid needs to have limits. As any good parent knows, self-sufficiency is an essential component of adulthood. It might seem modest enough to now and then say, “extend unemployment just another month” or support similar incremental changes to other government programs, but it can’t go on forever. Kind motives are fine and dandy, but the effects of perpetual dependence aren’t compassionate; they keep people in a form of bondage that denies their adulthood and prevents them from reaching their full potential.
Of course, say that in polite company and you’ll be pilloried as a heartless, greedy monster beholden to the rich, because the Left derives power from dependence and cultivates a culture of emotion-based decision making, rather than calm deliberation. But the Right should never be dissuaded from preaching common-sense personal responsibility. Like Ronald Reagan said:
Welfare’s purpose should be to eliminate, as far as possible, the need for its own existence.