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Thursday, April 22, 2010

Paying People Not To Work

Is it the strategy of the Democratic Party to keep the unemployment rate artificially high to keep people dependent on government?

One of the dirty little secrets about Ed Rendell that The Pittsburgh Tribune-Review wants you to know about.

From a recent editorial:
Perverse payday

Pennsylvania's jobless rate -- with more than 200,000 residents out of work since 2007 -- isn't helped by a struggling unemployment compensation fund that gives the jobless less incentive to find work.

Rather than blindly providing handouts, the state should be doing more to encourage individual responsibility.

As detailed in an analysis by Elizabeth Bryan, a research associate with the Commonwealth Foundation, Pennsylvania is second only to California -- with three times the population -- in what it pays in unemployment benefits. The percentage of unemployed Pennsylvanians receiving benefits (69 percent) is the highest of any state in the nation.

Which explains why Pennsylvania's unemployment compensation fund is in trouble: The state last year borrowed more than $2 billion from the feds to keep it solvent. It pays up to $75 million each week in benefits.

Continuing this cycle helps no one. But giving workers a stake in their unemployment compensation does. One way is through unemployment insurance savings accounts, which employees pay into. The less the worker uses, the more he has to roll into retirement savings.

Extending paydays for the jobless hinders both the unemployed and the state that gets stuck with the tab.

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