Unemployment Insurance

Unemployment Insurance

Unemployment insurance was a critical part of President Franklin Delano Roosevelt’s New Deal, a lifesaver during a period defined by economic volatility, depressed wages, and record unemployment.  Beginning in 1935 with the Social Security Act, short-term relief was provided for the unemployed to provide for their basic subsistence and maintain their purchasing power. Unemployment insurance generally lasts up to 26 weeks, although in the wake of the Great Recession the Obama Administation extended benefits to 99 weeks.

Cry Wolf Quotes

In all probability, however, compulsory unemployment insurance cannot be had without an amendment to the Constitution, probably both state and federal, as such a measure might be attacked on the grounds that it is confiscation of property without due process of law.

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Wall Street Journal editorial against unemployment insurance.
01/13/1933 | Full Details | Law(s): Unemployment Insurance

…we are going on the theory that it will create jobs. It will not. We shall create jobs only by giving confidence to people who are in a position to hire other people.

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Statement by the Merchants Association of New York, “Merchants Oppose Job Insurance Bills”, New York Times.
04/17/1934 | Full Details | Law(s): Unemployment Insurance

It would result in further and unnecessary intrusion of the Government into the domain of private enterprise, thus aggravating the hardships which have already been caused industry by extensive government regulations, restrictions, and competition.

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James L. Donnelly on Behalf of the Illinois Manufacturers Association, Testimony, House Committee on Ways and Means.
03/21/1934 | Full Details | Law(s): Unemployment Insurance

…no matter who pays the unemployment insurance bill in the first instance, it comes out of money available for wages and so is all paid by the workers in the long run. But like other indirect taxes, those who bear the burden do not realize in under such a scheme as the Wagner-Lewis bill proposes. If they did, they would be careful how it was spent and would raise objections if slackers and chiselers attempted to love off it. If they thought it was being paid by employers and by the State, many would be tempted to join the slacker and chiseler class. Any bill which purports to lay the whole burden on management (although it cannot be done) is doubly vicious in tendency.

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Editorial, Los Angeles Times.
04/03/1934 | Full Details | Law(s): Unemployment Insurance

Evidence

Backgrounders & Briefs

Unemployment Policy Brief: Shermer

By Elizabeth Tandy Shermer, PhD, February 2010

Unemployment insurance benefits – including  their length, eligibility, and expense – are again in the spotlight.  The arguments are hardly new.