Thursday, August 11, 2011

Obama's Idiot Economics: Extending Unemployment Insurance Creates Jobs

On the 8th of this month, Obama gave a speech whereby he claimed that extending unemployment insurance would create jobs, (Click to See the Video). Then, today, the President's spokesperson, Jay Carney, reiterated that claim by saying that extending unemployment benefits would actually create a million new jobs (Click here to See that Video). But, this is not a new idea for any Democrat. Just last year, that wizard of economics, Nancy Pelosi, said exactly the same thing (Click to See that Video).

By implication, Pelosi, Carney, and the President seem to be saying that unemployment is a good thing. In fact, one could deduce that if every American lost their job, millions of new jobs would be created; simply thanks to unemployment insurance. That's not Keynesian economics. In fact, it's not even Voodoo economics. It's just plain "Idiot" economics.

Our economy is 70% driven by consumer spending. When someone loses their job and goes on unemployment insurance, at the very minimum, half their previous income is just completely gone from any consumer spending activity. If anything, this loss of consumer spending will have a ripple effect in causing even more job losses. It certainly doesn't create any new jobs (except, of course, more and more government "union" jobs to handle all the new and continued unemployment claims). The only real benefit that unemployment insurance has to the "overall" economy is that it slows down the ripple effect so that unemployment doesn't completely spiral out of control by feeding on itself.

With that, you can now understand why this President and the Democrats can't get this economy growing again!

1 comment:

George O. said...

George, well said. I heard Carney's testy response to the WSJ reporter earlier today in disbelief. It's obvious that the White House is clueless about the economy.