And people thought Sarah Palin was dumb......

[Loki]

It is much more common for the a household to live paycheck-to-paycheck than it is to have three months saved up, and unemployment only pays half of what you previously made. I'm sure there are exceptions to that, but for many unemployed people, there is no other source of money.

I think we're saying the same thing.
Jobs aren't being created because unemployment if anything just allows the bare necessities to be purchased.
The jobs being sustained are those in the supply chain of those bare necessities.
Because no additional money is being spent on anything else jobs in other sectors are not being sustained and definitely no other jobs are being created as a result of unemployment income being received.

 

[The Ghost of Blue Edwards]

I could be wrong but how does unemployment benefits create jobs?

Because otherwise unemployed people wouldn't have any money, and if they didn't have money they wouldn't be spending any, and if they aren't spending any money then it lowers the profits of the businesses they would otherwise spend money at, and when businesses make lower profits they start laying people off and the cycle begins again.

Do you understand now?

 

[VINYLONE]

Because otherwise unemployed people wouldn't have any money, and if they didn't have money they wouldn't be spending any, and if they aren't spending any money then it lowers the profits of the businesses they would otherwise spend money at, and when businesses make lower profits they start laying people off and the cycle begins again.

Do you understand now?

Dude. Seriously, that's wrong.

 

[The Ghost of Blue Edwards]

Does anybody in the leadership of this country understand economics?

https://www.youtube.com/watch?v=WUAG3Fqz56s

Seriously, what is the problem here? If you cut unemployment benefits you're only going to increase the supply of labor in an already oversaturated market and make finding a job that much harder. The government should be focused on creating DEMAND for labor, not on increasing the SUPPLY of labor. Do you, Mr. Duck Rodgers, understand basic economics?

 

[The Ghost of Blue Edwards]

I think I am not being clear enough.

I'm not saying people with unemployment benefits are buying more/better goods. I'm saying they're buying the same goods they would buy without unemployment benefits. It's just that they're not tapping into savings or selling stuff to pay for them.

But you're right... in politics truth need not apply

You think most unemployed people have savings to tap into or assets to sell? Are we living on the same planet here?

 

[Loki]

Whether employed or unemployed a person has basic bare necessities they need to purchase to exist. They have food they need to eat at the very least. They were spending money on food when they were employed and they are spending money on food when they are unemployed. When they are employed they have more disposable income and that is what allows them to spend money on things beyond the bare necessities and that is what CREATES jobs. But by spending money on things they were spending money on when they were employed that does nothing more than SUSTAIN jobs that were already working to provide those bare necessities. Employment checks are not large enough for these people to spend money on anything other than the bare necessities. So how is an unemployment check creating jobs? It doesn't help the economy expand. It doesn't allow someone to go and spend some money on something they want rather than what they need.

A certain amount of the economy is based on the necessities and that is simply being sustained. Growth comes when people are able to prosper and become more affluent than they were before. I don't think unemployment checks assist in economic expansion. I think they just help sustain some of the jobs and possibly minimize retraction. That is why I disagree with Pelosi. She is advertising unemployment checks as a way to create jobs when it seems to me that no new jobs are being created. Existing jobs are just being sustained.

But that's just my point of view.

 

[The Ghost of Blue Edwards]

Somebody sent me repuation that said "Seriously, you're wrong. He's right. Deal with It."

You can either:

A. kindly explain yourself.
B. Go **** yourself.

I'm an economics major (although only a sophomore one) so I would looove to debate you on the merits of this argument. I may be wrong, but if you don't prove it I will assume I am right and that you are a failure.

 

[The Ghost of Blue Edwards]

Whether employed or unemployed a person has basic bare necessities they need to purchase to exist. They have food they need to eat at the very least. They were spending money on food when they were employed and they are spending money on food when they are unemployed. When they are employed they have more disposable income and that is what allows them to spend money on things beyond the bare necessities and that is what CREATES jobs. But by spending money on things they were spending money on when they were employed that does nothing more than SUSTAIN jobs that were already working to provide those bare necessities. Employment checks are not large enough for these people to spend money on anything other than the bare necessities. So how is an unemployment check creating jobs? It doesn't help the economy expand. It doesn't allow someone to go and spend some money on something they want rather than what they need.

A certain amount of the economy is based on the necessities and that is simply being sustained. Growth comes when people are able to prosper and become more affluent than they were before. I don't think unemployment checks assist in economic expansion. I think they just help sustain some of the jobs and possibly minimize retraction. That is why I disagree with Pelosi. She is advertising unemployment checks as a way to create jobs when it seems to me that no new jobs are being created. Existing jobs are just being sustained.

But that's just my point of view.

It's a really good debate.

I can see quite easily how one can make the argument that government subsidizies can create jobs. You give people money they didn't have before, they spend it and increase the level of aggregate demand, thereby raising the profits of firms and giving the firm an incentive to hire more workers to satisfy the greater demand.

The argument against it of course is that it is simply a transfer of wealth from wealthier taxpayers to the government and then to the poorer taxpayers. So the main difference we see is in what sector of the economy demand has been raised in based on where the wealth is transferred to. In the case that the wealth is not transferred from the wealthy taxpayer, demand will stay high or increase in high value real estate, luxury goods, etc... In the case that the goverment retains the wealth, demand will increase for energy, transportation, and defense firms. If the wealth is transferred to the poorer taxpayers we will see increased demand for basic commodities and consumer goods.

So the question becomes: Where should the government be attempting to stimulate or retain demand during a recession? Luxury goods, basic commodities, or defense contracting?

 

[Realjazz]

From a macroeconomic view if the government puts additional money into the economy, at some point that will create some economic growth and jobs as a result. I didn't listen to Pelosi's comments, I don't have much of a stomach for the woman so I don't know if she is referring to additional unemployment benefits or just sustaining what was already provided. If there are additional funds going out then she is correct and you should see some job growth.

This is a classic example of liberal vs conservative thinking. A liberal wants to stimulate the economy by providing additional money to an unemployed person. A conservative may argue that a better way to stimulate the economy is to provide a tax cut to business owners so they can afford to hire another person.