On Unemployment

On Unemployment

I have heard a lot of discussion in the media about unemployment, the extension thereof and persons receiving Unemployment Insurance benefits. Many of those speaking seem to have made certain fundamental errors in their description of the program. I, of course, have chosen to go 'Ad Fontes', or 'To The Sources' to obtain the information to refute these misstatements.

First, let us look at what the benefits are. They are Unemployment Insurance. Like medical insurance, homeowners insurance, auto insurance, social security insurance, renters insurance, or business insurance. That means a premium is paid, and the beneficiary HAS EARNED these payments. It is not charity. It is not welfare. It is not a dole. It is a benefit the individual worker has earned by working. They are for the purpose of assisting an individual beneficiary to recover from a casualty that was no fault of their own.

From the Florida state unemployment benefit rights handbook available here.

The Unemployment Compensation Program –
What it is. What it is not.
The Unemployment Compensation Program:
• Provides temporary, partial wage replacement benefits to qualified
workers who are unemployed through no fault of their own;
• Supports economic stability for employers who depend on consumer
spending;
• Is funded solely by employers who pay federal and state unemployment compensation taxes; and
• Is provided at no cost to the workers who receive the benefits.

The Unemployment Compensation Program is not:
• Social Security;
• An automatic entitlement;
• A loan;
• Based on need;
• Intended to fully replace your previous income; or
• Funded by any deductions from wages you have earned.

Income Taxes
Unemployment compensation benefits are fully taxable, if you are required to file a tax return.
Contact the Internal Revenue Service toll-free at 1-800-829-1040 if you have questions on your tax
liability.
You have two options concerning income taxes. You may request that income tax:
Option 1: NOT be withheld, or
Option 2: be withheld.
If you choose to withhold income tax, we will withhold 10 percent of your Weekly Benefit Amount.

I will now address these statements in detail.

The Unemployment Compensation Program

Compensation is the key word here. Compensation is only given to make up for a perceived wrong. While an employer may be (in terms of business ethics - an oxymoron) right in terminating an individual due to a reduction in profit, it is a wrong in terms of social and spiritual ethics. You have impoverished this person. This person is no longer capable of supporting themselves in our society. They now earn no money. As an aside, an employee at my former employer at the time the lay offs were made sent a message to our CEO that rather than performing a 15% layoff of personell at the bottom, he (our CEO) cut everyones pay from the top down by 10% and cut the hours of hourly employees by an additional 10% until the economic crisis ended. Our CEO's response was 'I don't want to do that'. Not 'I can't', not 'that won't work', but 'I won't'. So to ensure that he and the other individuals at the top would continue to receive their six figure salaries, we at the bottom were discarded like so many used condoms.

• Provides temporary, partial wage replacement benefits to qualified workers who are unemployed through no fault of their own

Temporary means the support is not for the lifetime of the individual, unlike for example a Senatorial or Congressional pension. Check the office of congressional budget and finance webpage for more details on this. Partial means that the individual (in Florida) receives 1/2 of their average weekly gross pay up to $275.00, an amount equal to $6.88 an hour for a 40 hour week. Wage replacement means that individuals receiving these benefits were working prior to their job loss. Unemployed through no fault of their own means they were not fired due to being late, uncooperative, lazy, or any other legitimate reason for termination.

• Supports economic stability for employers who depend on consumer spending

Contrary to statements made by many conservative pundits, Unemployment Insurance benefits are not a drain on the economy, they allow economic activity to continue without the massive disruptions that were the result of the Great Depression.

• Is funded solely by employers who pay federal and state unemployment compensation taxes

Look at that word in italics up there (the italics are mine). Solely. This means, in my case, that my employers for the last 29 years have been paying these premiums. The employers of the 83- 90% of Americans who are still working are continuing to pay these taxes. If 9 out of 10 Americans are still working, WHERE THE HELL IS THE GODS DAMNED MONEY !?.

• Is provided at no cost to the workers who receive the benefits.

At no cost to the worker means we were not required to pay into this. We are already considered to be paying into this by generating profit for our employers.

The Unemployment Compensation Program is not:

• Social Security

Which is another form of insurance for workers who have grown too old to continue their former employment.

• An automatic entitlement

Once again, it is something that is earned, and is only paid when the worker is not at fault in their loss of employment.

• A loan

It does not require repayment, because it has been earned.

• Based on need

Thus, as it is not need based, it is not welfare, unlike the BILLIONS of dollars passed out by our congress to the major financial institutions that got us in this mess to begin with.

• Intended to fully replace your previous income;

And it does not. Not even close. $6.88 an hour, remember?

• Funded by any deductions from wages you have earned.

Such as, oh I don't know, taxes?

Income Taxes

Unemployment compensation benefits are fully taxable, if you are required to file a tax return.

This refers to the fact that the federal government, in its infinite mercy, has decided that those making less than $850 a year with less than $300 of that coming from invstments are exempt from federal withholding. This, for a forty hour work week amounts to $.41 per hour. Personally, I cannot think of anyone in this country making forty-one cents an hour, unless it is an illegal alien.

Contact the Internal Revenue Service toll-free at 1-800-829-1040 if you have questions on your tax liability.
You have two options concerning income taxes. You may request that income tax:
Option 1: NOT be withheld, or
Option 2: be withheld.
If you choose to withhold income tax, we will withhold 10 percent of your Weekly Benefit Amount.

Here is another good point. Another typical pundit quote is 'The American taxpayer is tired of paying for Unemployment Benefits'. The only 'American taxpayer' who should be paying for unemployment benefits is Corporate America. Remember? The guys who got us into this mess by bad investments, massive outsourcing, layoffs, plant closures, lying to investors, corporate raiding, hiring of illegal aliens, union busting, golden parachutes, and the purchase of products from countries using child labor, slave labor, and having pay rates of a few dollars (if that) a day.

Also, this means that the people receiving Unemployment Insurance benefits are taxpayers.

I will freely discuss any issues or percieved inaccuracies in this statement, however anonymous comments will be ignored.

SV

aka Joseph F. Wilke