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In Dissing Unemployment Insurance Extension, Cavuto And Guest Ignore CBO Analysis Of Its Stimulative Effects

Reported by Guest Blogger - December 9, 2010 -

By Brian

On the December 7, 2010 Your World, Stephen Moore of the Wall Street Journal spoke about the part of the tax cut deal that would extend jobless benefits for another 13 months. Neil Cavuto introduced him as "one of my favorite guests of allll time!" That was after a Fox News Alert announcing that the Labor Department had reported “a surge in job openings.” Cavuto framed the discussion by “asking, “Should Congress simply consider this” before it votes to extend unemployment insurance benefits. Guess what Moore thought?

Moore said, "What our research shows, that we published on Wall Street Journal editorial page, is very clear. When you extend unemployment benefits, you actually increase unemployment… People when they get benefits, they will wait until the benefits run out before they look for a job… I'm not sure how giving people (money) not to work saves jobs… If we saved 2 million jobs by increasing unemployment, then all we need is everybody to be on unemployment."

Here’s how unemployment benefits saves jobs:

By putting money in the pockets of needy families, who are strapped for resources and will spend every dollar on food, rent, gas and other necessities, unemployment compensation supports employment at supermarkets, gas stations, farms, trucking companies and apartment buildings. Almost every dollar paid in benefits is quickly spent at businesses, small and large, that use the money to pay their own employees.

Moore continued "She (Pelosi) said $2 of stimulus" (received for every dollar of benefits).

It's not just Pelosi, that's what the CBO says, too. As MSNBC reported, “The Congressional Budget Office says every $1 spent on unemployment benefits generates up to $1.90 in economic growth. The program is the most effective government policy for generating growth among 11 options the CBO has analyzed.”

Cavuto joked, "By that definition, then just give everyone jobless benefits!"

Moore added. "Increase them! …This is the worst feature of the bill… The problem with unemployment insurance is it makes not working pay… I'm not being cold hearted here."

“Well, you are being,” Cavuto joked.

Comment: Moore and Cavuto were both being cold hearted.



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