Getting To Work

Last November, President Bush signed a bill extending unemployment benefits. And it looks like he may do it again. At the top of the agenda for congressional Democrats is another extension of unemployment benefits. Economist Walter Williams once said compassionate economic policy requires dispassionate analysis. Well, these unemployment bills may sound compassionate, but they're sorely lacking in dispassionate analysis. The rationale for extending unemployment benefits is obvious. In a recession, it may take people longer than usual to find work--which means they need government assistance longer. But if we look at recent history, that argument falls flat. American experienced an even deeper recession in 1982-1983. The jobless rate then was 35 percent higher than it is now. Still the government didn't extend unemployment benefits. And when the recession was over, the economy soared. It led to the longest peace-time recovery in history, creating some 20 million new jobs. The lesson is that even in a deep recession, we have to be careful how we tamper with the economy. Some measures can actually postpone the recovery. And extending unemployment benefits is one of them. Here's why. To give more money to the unemployed, the government must first take it from somewhere else--either from taxes or from bank loans. Either way channels money away from private enterprise, where it can be used to produce goods and services, and transfers it to people who at the moment are not producing. The result: less production, a longer recession. But there's more. Extending unemployment benefits actually increases unemployment. As long as people can look to government to carry them along, they have less incentive to get out there and find a job--any job. The fact is, there are millions of job openings that go unfilled across the country today. Unemployed people often refuse to consider jobs that would reduce their salary or require them to retrain for a new field. And as long as they receive unemployment benefits, they can continue waiting for the Perfect Job--while existing jobs go begging. It undercuts the motivation to take any honest work that happens to be at hand. The underlying problem here is ethical. Too many Americans think society owes them support. As Jack Eckerd and I wrote in our book Why America Doesn't Work, the work ethic has given way to an ethic of entitlement. As Christians, we ought to take a lesson from the early church, which made work a requirement. As the apostle Paul wrote, "If a man will not work, let him not eat." It was no excuse if someone couldn't find work he enjoyed. Work in itself was seen as a positive good. We do have a responsibility to help the unemployed. And it's good for government to put a safety net in place for people who lose their jobs. But the safety net should not turn into a hammock, where people take a prolonged vacation at others' expense. After a reasonable period, the unemployed should be required to take whatever work is available. Any honest work has dignity--certainly more dignity than living off the earnings of others.

02/4/92