Coming Republican Governors’ Crisis on Unemployment and Benefits

Citizen Wealth Financial Justice

unemployment crisis Danziger cartoonNew Orleans When governments do not support full access to the programs that support citizen wealth, the entire community suffers and pays the price, not just the family.

Michael Siemienas, speaking for SuperValu (owner of Save-A-Lot which is only a couple of blocks from my house) hit on this point in a Times’ piece saying on the coming crisis in the collapse of benefit payments to the unemployed, that “Regardless of why people have less money to spend, it affects all retailers in all industries.”  Wayne Vroman, and economist at the Urban Institute, hit the nail on the head even harder in the same article estimating that every $1 paid in unemployment benefits generated $2 in economic benefits.  Furthermore, as I documented in my book, Citizen Wealth, money received in such benefit payments invariably stays in the local community where the unemployed live, making the payments targeted in ways that have a multiple impact.

In short whether you have a job or not, you need to care if all of a sudden your neighbors are getting the back of a hand on their benefits, rather than a hand up from them.  Congress has now approved a final extension of jobless benefits which terminate at the end of this year.  Tragically the number of people receiving the benefits vastly exceeds the level of job growth, so no matter what the right might pretend, there simply are not enough jobs out there to allow everyone who needs and wants to work to in fact find work.

In Florida the Times’ Motoko Rich notes that 476,000 people are collecting unemployment and only 11, 200 jobs were added last year.  In Michigan he notes that 40,000 jobs have come on line since over the last 12 months or so, but 267,000 are collecting benefits.

Note this well, almost 20% of personal income in the USA is coming from government payments of one sort or another, including unemployment payments, adding up to $2.3 trillion in 2010, an increase of $600 billion over 2009.  If you don’t think this recession is fricking horrendous, you are either insane or drug-addled!

Looking at the chart compiled from Bureau of Labor Statistics and other sources, it was amazing to see that the states where benefit payments are the largest percentage of personal income for the citizens, ranging from 21.2 % to 28% at the top, how many of those states have Republican governors, yet they are oblivious about biting the hands that feed them and the hands stretched out for help.  Look at this:

West Virginia                         28.0                 Democrat

Mississippi                             26.2                 Republican

Kentucky                                24.8                 Democrat

Arkansas                                 24.5                 Republican

Maine                                      23.8                 Republican

South Carolina                        23.4                 Republican

Alabama                                 23.4                 Republican

Michigan                                23.2                 Republican

New Mexico                           22.7                 Republican

Ohio                                        22.0                 Republican

Tennessee                               21.8                 Republican

Arizona                                   21.2                 Republican

So of the top 12 states depending for the citizens’ lifeblood on government payments to their people, 10 of them are governed now by Republicans!

Either the Republicans and the right are going to have to strap up and make unemployment and the whole package a major part of their program, or this recession will start sinking a lot of ships in a lot of states.