Multimillionaires Collecting Millions in Jobless Benefits

With the Republican Study Committee, (think: conservative House members) saying that they still wanted $100 billion in spending reductions as per the GOP's campaign pledges, what will they make of a move to cut unemployment benefits for millionaires? In a written statement explaining why he supports the bill introduced yesterday, Senator Tom Coburn (R-OK) said, "Ending this practice will save nearly $100 million and correct a gross injustice against the millions of Americans who are out of work. Congress should pass this bill without delay. If there was ever a common sense spending cut, this is it."

Unemployment insurance for somebody who earns over $1 million a year? That's right, the way the system currently works, they qualify, too. So the safety net provides for people who pull down a million or two -- or even ten million dollars in a year -- did you know that? Here's the scoop from TheHill.com:

"As many as 2,840 households who have reported an income of $1 million or more on their tax returns were paid a total of $18.6 million in unemployment benefits in 2008, according to Internal Revenue Service figures.

This included more than 800 earning over $2 million and 17 with incomes exceeding $10 million. In all, multimillionaires were paid $5.2 million in jobless benefits..."

Vicki Needham at

Now I don't know about you, but I expect anybody who pulls down a 7-or-8-digit income to have acquired some assets and set some of it aside. If you're having trouble making payments on the Lamborghini or Bugatti maybe you could trade it in for something that gets a little better mileage, like a Lexus hybrid, and stop going to restaurants that don't have prices on the menu, until you get your cash-flow going in a positive direction. Mooching off the government at that level is just plain abusing the system even if it's technically legal - for now.

I applaud U.S. Senators Tom Coburn (R-OK), Mark Udall (D-CO), and Jon Tester (D-MT) for being willing to take on the injustice. I hope this bill passes both houses of Congress swiftly.

Thomas Hayes is an entrepreneur, former Democratic Campaign Manager, strategist, journalist, and photographer who contributes regularly to a host of web sites on topics ranging from economics and politics to culture and community. You can follow him as @kabiu on twitter.

Tom Hayes: Another glimmer of hope for the economy

The health care sector continues to add jobs so investor confidence during the past month led the monthly Economic Recovery Reality Index (ERRI) up a modest 4.76 points over July numbers to 16.03 for August. Unemployment dipped slightly and the increase in the number of “discouraged” workers slowed, according to the U.S. Bureau of Labor Statistics - but as with prior economic recessions and depressions employment changes are once again trailing the other economic indicators:

The small ERRI gain shows Wall Street's optimism hasn't yet reached most other streets; it will take some time for average Americans to feel - or believe - that this long subtle assault that started with obscure financial "devices" has eased and real recovery has begun. The problem, we know now, was not sub-prime lending, which can and does help people, but aggressive and deliberately predatory sub-prime lending from companies and CEOs who thought they were immune to the risks in an essentially unregulated environment.

The ERRI uses a hypothetical, indexed fund (similar in some ways to a mutual fund) to measure investor confidence across nearly a dozen sectors of the economy, but until jobs and wages show sustained improvements you won't see it move back closer to (or above) the 100 mark no matter how fast stock prices drive the stock/investment component higher.

"Equity investments are volatile, particularly when not carefully diversified and monitored; the ERRI would have shown even less improvement had closing prices from even a day sooner been utilized in the calculations (since that would have reduced the 'ERRI fund' improvement.)"

The modest gain in the August ERRI figures reflect both equity prices as of the close of the NYSE on Friday, August 7th and data released in the monthly update/estimate from the Department of Labor earlier the same day combined using a new calculation. Without the on-going hiring in health care and the slight turn-around in unemployment rate even the robust gains in various stock markets would not have had much impact on the index.

U.S. unemployment hits 16-year high: 7.2% - Los Angeles Times

More at Los Angeles Times: “Reporting from Washington -- The nation's unemployment rate soared to its highest level in 16 years last month, reaching an eye-popping 7.2% as businesses slashed their payrolls by 524,000 jobs in December, the government reported today.

All together, 2.6 million jobs were lost in 2008 -- 75% of them in the last four months -- and 11.1 million workers are now unemployed, the Labor Department said. And that's not counting millions more who have reluctantly taken part-time work instead of full-time jobs or have become so discouraged they stopped looking for a new job.”

U.S. Loses 533,000 Jobs in Biggest Drop Since 1974 - NYTimes.com

U.S. Loses 533,000 Jobs in Biggest Drop Since 1974 - NYTimes.com: “The nation’s employers cut 533,000 jobs in November, the Bureau of Labor Statistics reported Friday.

Not since December 1974, toward the end of a severe recession, have so many jobs disappeared in a single month — and the current recession, far from ending, appears to be just gathering steam.”

California Unemployment Insurance Fund Going Broke - Economy Failing

It's one thing to have people out of work and drawing unemployment, but it's more terrible to be in a position where that unemployment insurance fund is running out of money.

According to the San Francisco Chronicle today the California unemployment insurance fund is running out of money and will have to borrow from the Federal Government for the first time since the 1930s.  The projected deficit for 2009 is $1.6 billion.  

To make matters worse, not just California but 18 other states may find their unemployment insurance funds in deficit, including New York, Ohio, Michigan and Missouri.   

Jobless Rates Soar-Employers Trim Jobs For 8 Months In A Row

The unemployment rate soared to a nearly five-year high in August, topping 6 percent. The unemployment rate at 6.1% is up from 5.7% in July and 4.7% a year ago.

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