Eric Bolling and all those folks living the high life of unemployment

Blog ››› ››› JEREMY HOLDEN

While criticizing a proposal to extend unemployment insurance and tax credits to subsidize health insurance for the unemployed, Fox News' Eric Bolling appeared to suggest that a large number of unemployed workers are staying on the dole in order to take advantage of the generous government gravy train.

Guest hosting on Fox News' Your World, Bolling and Christian Dorsey of the Economic Policy Institute discussed provisions EPI would like to see included in a jobs bill. "We encourage and support the idea that you renew your commitments to unemployment insurance, extending the subsidies for COBRA health insurance," Dorsey said.

COBRA -- the Consolidated Omnibus Budget Reconciliation Act -- provides a mechanism for displaced workers to purchase insurance by paying both their and their former employer's portion of the premium. A provision in the 2009 stimulus legislation established a tax credit for insurers to offset 65 percent of that premium, a provision that was set to expire at the end of 2009; in December, Congress extended the tax credit through the end of this month.

It should be noted that unemployment benefits provide among the strongest "fiscal bang for the buck" of any form of economic stimulus, as economist Mark Zandi demonstrated in 2008 congressional testimony. Dorsey explained:

DORSEY: That money is going to be spent. People who are on unemployment are stretched to the limit, and they spend those dollars in the private sector on goods and services. So that will create jobs in the private sector.

Nevertheless, Bolling was not impressed:

BOLLING: Had you told me that some of the tax credits, or the payroll tax holidays were a good thing, I probably would have agreed with you, but when you tell me that another entitlement program -- allowing someone to stay out of work for longer -- and you tell me that's a job creator, I'm just going to have to disagree with you.

Come again? Unemployment insurance and tax credits for COBRA coverage allow people to remain out of work longer?

Bolling's criticism does not just argue in favor of tax cuts over spending to stimulate the economy; it betrays a worldview where the 9.7-percent unemployment rate includes a mass of workers living the high life of unemployment.

How does Bolling's construct account for the fact that only 6 percent of those in the unemployed population are voluntary job leavers -- a figure that's actually down in the past year -- compared to 62 percent who are on temporary or permanent layoff? What share of the 9.3 million workers who are on temporary or permanent involuntary unemployment does Bolling suppose choose to remain so because they simply can't pass up the lucrative windfall offered through unemployment benefits?

Bolling's criticism of extending unemployment benefits does more than expose an apparent preference for tax cuts over spending to stimulate economic growth and combat unemployment; it demonstrates a complete lack of understanding of the problem.

Posted In
Economy, Jobs, Wages, & Unemployment
Fox News Channel
Eric Bolling
Your World w/ Neil Cavuto
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