Wall Street Journal Revives Conservative Notion That Social Insurance Breeds Laziness

Blog ››› ››› ALAN PYKE

Holman JenkinsIn a column for the The Wall Street Journal, Holman Jenkins claimed that unemployment insurance and Social Security disability payments encourage recipients to "leav[e] it to someone else to be productive,"   a claim that economic research and data prove incorrect.

According to Jenkins, "our massive expansion of unemployment and disability subsidies over the past four years" is discouraging the people   who would otherwise build the technologies that "will save us from the Soylent Green solution to an aging society."

Conservatives arguing that these benefits make people lazy is nothing new, but their claims are still incorrect and unsupported by data. With disability payments, the argument is laughable on its face; people collect disability because they are unable to work. It is the disability, not the payments for it, that prevents these people from contributing to the labor supply. Social Security Administration data show the average disabled worker in the program receives less than $14,000 per year, $9,000 below the poverty line and an unlikely incentive for the malingerers Jenkins is looking to scapegoat. And as Media Matters has noted, the eligibility criteria for disability benefits programs are stringent, and the upward trend in the number of disability recipients dates to a Reagan-era liberalization of the program.

Jenkins is on similarly untenable ground when it comes to unemployment insurance. Conservatives frequently cite economist Larry Katz to argue that unemployment insurance begets unemployment -- but Katz himself has said that his work isn't applicable in today's economy. Other research also indicates that UI spending doesn't substantially increase unemployment. Meanwhile, the stimulative effect of unemployment insurance on the economy is well established. And since the Department of Labor data show the average UI recipient gets just $300 per week, before taxes, conservatives making this claim are saying that many Americans would rather live on less than $16,000 a year than work a shovel-- or in Jenkins' case, than build a robot.

Finally, if Jenkins is concerned about the amount of labor Americans are willing to supply, he need not be. Based on a monthly survey known as JOLTS -- the Job Openings and Labor Turnover Survey -- the Bureau of Labor Statistics calculates the ratio of unemployed persons per job opening. The latest report found 3.3 unemployed Americans for every open job as of October. Even prior to the recession (shown with gray shading in BLS's chart below) the ratio was above 1.

Source: Bureau of Labor Statistics

Posted In
Economy, Jobs, Wages, & Unemployment, Social Security
Network/Outlet
Wall Street Journal
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Holman Jenkins
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