Current law provides 99 weeks of unemployment benefits. Research on search efforts of the unemployed concludes that interest in looking for a job is relatively dormant until the last four weeks before unemployment compensation runs out. The benefits run as high $ 30,000 annually in some states (New Jersey, for example). Why work?
Senator Jim Bunning of Kentucky, who is retiring this year and not running for re-election, is currently filibustering a bill to "temporarily" extend long term unemployment benefits. Bunning says the money should come out of the Stimulus Act and not be a new addition to the deficit. Bunning is right. But, he is also right that long term unemployment benefits are a bad idea. It is a subsidy to the unemployed and whatever you subsidize you will get more of. Two years is enough for unemployment benefits. Beyond that, you are simply creating a new welfare entitlement.
