It’s come to pass: Workers prefer windfall over wages


Lindsey Graham warned it would happen if the coronavirus emergency stimulus package became law – and it has.

Over the five weeks ending April 18, more than 26 million Americans filed jobless claims – or roughly 16% of the U.S. workforce, according to Fox News. Anticipating the onslaught of unemployment claims, Congress passed Federal Pandemic Unemployment Compensation in late March as part of the $2 trillion CARES Act. But when Republican Senator Lindsey Graham (South Carolina) read it, he thought the numbers were a misprint.

In addition to regula unemployment compensation, which is generally 50% of a worker’s salary when employed, the government was now adding another $600 a week. That amounts to an extra $31,000 a year – meaning that those people making less than $62,000 annually would be making more not to work than to stay employed. Leading up to the vote, Graham offered this insight:

Graham: “You’re literally incentivizing taking people out of the workforce at a time when we need critical infrastructure supplied for the workers …. You want to destroy what’s left of the economy? Pass it the way it’s written. If you want to help people, give them their wages – but don’t pay them more not to work.”

Now we hear of a salon owner in Washington who applied for and received the promised, forgivable loan so she could keep her staff employed. But when Jamie Black-Lewis called her almost three dozen employees to share the good news, she reported to CNBC she was greeted with “a firestorm of hatred.” It turns out her salon workers preferred to take the government’s money – drawing this reaction from the salon owner:

Black-Lewis: “I couldn’t believe it. On what planet am I competing with unemployment?”

Rachel Greszler of The Heritage Foundation says it’s happening quite frequently.

“It’s coming from both sides,” she explains. “Workers see this as an opportunity to choose to become unemployed – and … employers are seeing this as a way that they cannot have to keep paying their own costs and their workers will be made better off as well.”

Greszler says while the extra unemployment compensation may have been well-intentioned, it’s going to cost the country a ton of money in the long run.

“We find that it will increase unemployment by 13.9 million people beyond what otherwise would have lost their jobs, and also reduce total output by an additional $955 billion to $1.49 trillion,” she notes.

In a piece written ten days ago, Greszler suggested lawmakers should replace the $600 bonus unemployment compensation with a cap equal to 100% of an employee’s previous earnings and tighten eligibility rules to eliminate “unintended manipulation and abuse.”

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Copyright OneNewsNow.com. Reprinted with permission.


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