- The Washington Times - Wednesday, July 21, 2010


As long as President Obama is committed to treating the symptoms - not the causes - of the economic malaise, recovery will remain elusive. No better example of this can be found than his regular insistence on extending unemployment benefits. The Senate complied with this desire yesterday by a vote of 59-39. With nearly two years’ worth of government assistance on offer, it looks like the economic doctors in the Democratic Party have only one prescription in their medical bag: spending.

Mr. Obama said as much in his weekly address Saturday when he claimed that unemployment benefits were the “most cost-effective” stimulus for the economy. “It puts money into the pockets of folks who not only need it most, but who also are most likely to spend it quickly,” the president asserted. “That boosts local economies. And that means jobs.”

Left unsaid was the impact of extracting $34 billion from the productive sector’s payrolls to fund the extension of unemployment benefits. That’s an amount sufficient for private companies to put 870,000 to work at the median U.S. income generating goods and services that would lift the economy as a whole. Mr. Obama also ignored the disincentive effect of paying people not to work. With each extension, the so-called insurance program becomes less and less “temporary” and closer to a typical welfare program intended to encourage permanent dependence on the government.

Most congressional Republicans fear the appearance of insensitivity to the plight of the unemployed and actually support an extension, but Democrats played politics with the bill. By refusing to abide by the “pay as you go” rule, the Obama administration and the Democratic congressional majority refused to scale back their excessive spending to underwrite the cost of the unemployment provisions. The majority also crammed as much pork as it could into the legislation’s 412 pages. According to the Congressional Budget Office, the extension and other goodies will add up to a grand total of $83.4 billion in additional outlays by 2020, on top of $50 billion in new taxes and other revenue generators.

Democrats need to kick this spending addiction that has, to date, created a $13.2 trillion debt. No nation can thrive on a policy of a debt-fueled redistribution of wealth from the active to the inactive. Only by reducing the crushing tax burden on individuals and businesses will the economy have the room it needs to grow and prosper.

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