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

There is probably no greater need at the present time than for opportunity of employment. Through a long period in our country both law and public opinion reflected the universal approval and the good will felt toward those capable of giving employment to men and women who needed jobs. Yet, the imposition of this tax would be a complete reversal of that attitude. It would indicate either that employment is held undesirable and should be discouraged, or else it could properly be considered as an attempt to penalize unemployment.

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Merwin K. Hary, New York, NY, President, New York State Economic Council, Testimony, House Committee on Ways and Means.
03/21/1934 | Full Details | Law(s): Unemployment Insurance

…to impose this burden at this time, when industry is just struggling to get on its feet, is going to still further retard the very recovery which is necessary to create these reserves. That is the basis of our opposition to these provisions.

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P. H. Gadsden, President Chamber of Commerce, Philadelphia, Testimony, House Committee on Ways and Means.
03/21/1934 | Full Details | Law(s): Unemployment Insurance

[The bill] tends to retard the increase of pay rolls, because of the absorption of this amount of money for taxation purposes; it retards the increase of employment also. It is a permanent tax, with no limit, regardless of economic conditions in general or of the individual company. In other words, it may be the last straw, as I said before, that puts this company over the line into bankruptcy.

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Frank H. Willard, Worcester, MA, President, Graton & Knight Manufacturing Co., Testimony, House Committee on Ways and Means.
03/21/1934 | Full Details | Law(s): Unemployment Insurance

Industrial corporations represent the principal source of livelihood of a very large percentage of our total population. Accordingly, any legislative program which impose unreasonable hardships on manufacturing industries will react to the detriment, directly or indirectly, of every taxpayer.

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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

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.