Unemployment Benefit Extension Blogging; Why Does George W. Bush Hate John McCain?

A crass political post...

Calculated Risk writes:

Calculated Risk: Unemployment Benefits Extended: An extension of unemployment benefits for 13 weeks was included in the war funding bill signed by President Bush today. This extension covers workers who used all their unemployment benefits between November 2006 and March 2009...

The rule of thumb, IIRC, is that the average duration of an unemployment spell increases by 1/4 of the increase in the duration of unemployment benefits. Thus a 13-week increase in unemployment insurance duration should increase the average unemployment spell by 3 weeks. With current mean unemployment spell duration at 17 weeks, and with roughly 2/3 of the unemployed eligible for UI, this would produce a 3/17 * 2/3 * 5.5% = 0.6% increase in the measured unemployment rate.

It seems to me likely that--whatever happens to the economy--George W. Bush has just produced four bad unemployment-rate headlines on the Saturdays August 2, September 6, and October 4. This cannot be news that John McCain is happy to hear.

Comments

[foo]

Surely, extending unemployment benefits is the right thing to do, in this economy ? Should't Bush be praised for doing this instead ?

[christofay]

On the other hand there is the job factory known as the birth/death model that is obfuscating our understanding of the present economy. Fictional jobs conservatively should be counted. How do we know that there isn't a boom in small construction company hiring? And there should be a surge in new boutique investment banks starting up through the summer and fall to help turn that into a bright ray of Republican sunshine as there is adequate supply of unemployed bankers to start those companies.

[Leila Abu-Saba]

It's nice of you and your friends to apply all those gearhead equations to the unemployment question, but what makes you think anybody in the Bush administration or the McCain campaign has the capacity to follow your argument?

These are the guys who went into Baghdad with no plan besides - invade - receive candy and flowers - leave.

These are the guys behind Enron, subprime mortgages, tax cuts for billionaires, ethanol, Katrina, etc and so forth - I don't have to enumerate.

If the New York Times picked up your post and made it a banner headline in 72 point type across the front page, with dumbed-down explanations and graphs to translate your equations for the math-challenged, Bush/McCain and Company still wouldn't get it or care.

Nice try though. I pretty much understand your comment (but not christofay's, but perhaps he might be snarking?) and I'm an English major. (who got a 4 on AP Calculus at age 16).

PS does the rule of thumb mean that most people don't look for work until 3/4 of the way through their unemployment bennies? Or that they look for work but time their new jobs for just after the bennies run out? I'm interested in the human story behind the equation.

[Robert Waldmann]

Runs in the family. George H W appears to have hated himself (or hated being President). I recall you shared you impression that he acting as if he wanted to lose when he extended unemployment benefits in 1992.

As to W, I don't think he cares much about anything except getting to 1/20/09 without facing defeat in Iraq and keeping his co-conspirators out of jail.

[bakho]

I disagree. Voters respond to the economy itself, not employment headlines. Voters most want protection against economic insecurity. The best income protection is a robust job market. If the job market sucks, the next best option is a good safety net, including extended unemployment benefits.

Unemployment rate ceased to be a good marker for voter content with the economy when the calculations were changed to exclude those that left the unemployment ranks because of discouragement. Discouraged ex-workers are just as likely to vote the bums out as the unemployed. Unemployment benefits change the distribution of the not-working between the unemployed and discouraged categories, but do not affect the total unemployed + discouraged. Unemployed workers receiving extended benefits may be less soured on the economy than discouraged workers whose unemployment benefits have expired.

Unemployment affects not only the unemployed themselves, but everyone in the support system for the unemployed (parents, spouses, relatives, friends) that have to use more of their income to supplement others. In this regard, extended unemployment benefits lessens the burden on the extended support network.d

[save_the_rustbelt]

After watching unemployment rates in a couple of states very closely for the past four years, I conclude that the numbers are pretty much hocus-pocus nonsense anyway.

And economists are so buried in statistics they have a very tenuous grip on reality.

And what Bakho said..............

[Barry]

I third. Right now the alleged unemployment rate would imply a hot and tight labor market, which isn't the case. Most people don't even know the unemployment rate, unless they're Bush supporters getting talking points from Fox News.

[Dirty Davey]

"These are the guys who went into Baghdad with no plan besides - invade - receive candy and flowers - leave."

Umm... I do not believe "leave" was ever a part of the plan.