Weekly Briefing

Help wanted

Ambitious state lawmaker in need of coherent opinions to replace rambling attack on the unemployed

State Representative Dale Folwell is one of the more candidly ambitious members of the General Assembly. This is not a knock on Folwell; it’s merely a statement of fact that the veteran Forsyth County Republican would undoubtedly concede. Folwell makes no bones about his desire to move up the political pecking order. He’s run for state Treasurer, currently serves as House Speaker Pro Tem and is now making noises about running for Lieutenant Governor. Good for him.

When the Democrats were running the General Assembly, Folwell often sought ways to engage those with whom he generally disagreed in an effort to separate himself from the pack. Since the Republicans gained a legislative majority in 2011, however, Folwell seems to have felt freer to be himself.

Whether he’s pushing legislation designed to intimidate immigrant parents from lawfully enrolling their children in the public schools, working to repeal the Racial Justice Act or, perhaps most notoriously, sponsoring a press conference in which so-called ministers spewed anti-LGBT hate speech, Folwell has dispelled all notions that he is anything other than a totally committed soldier for the far right.

Attacking the unemployed

This week, Rep. Folwell provided further confirmation of his true (and remarkably extreme) beliefs when he distributed an odd little essay he chose to entitle “Help Wanted.” In it, the lawmaker held forth in a rather jumbled fashion on the issue of unemployment insurance and his apparent belief that such benefits – particularly the extended benefits that have been made available to some of the long-term unemployed during the economic downturn – are responsible for what ails our economy.

At least, that seems to be what he’s saying. Save for an initial section in which he laments the rising unemployment rate, here are the principal “highlights” of the letter:

“The Stimulus distorted the purpose of unemployment benefits. People who lose their jobs through no fault of their own deserve help bridging the gap to new opportunity. No system should encourage people not to work. Now unemployment debt threatens the very people who create jobs in our economy, business owners.

This single example lays open the danger of excessive government spending. Extended unemployment benefits are stealing the initiative of business owners and their employees. Worse yet, it discourages the unemployed from returning to work.

Folwell concludes by calling attention to an opinion piece in which the Wall Street mogul, Charles Schwab makes grand claims about all the jobs his investment company has allegedly created in the U.S. economy. According to Folwell:

“Good government policy empowers people like Charles Schwab and every other entrepreneur to risk their money and well-being to chase down a dream. The Constitution calls entrepreneurism the ‘pursuit of happiness.’

The current unemployment insurance system steals the initiative of out-of-work North Carolinians and makes it harder to create jobs or even keep existing ones. In a future email, we will detail how the cycle of increasing unemployment benefits threatens job creators. The 4th Quarter of 2011 may deal a deathblow to many small businesses and nonprofits in the state, because they are burdened with the responsibility to repay North Carolina’s unemployment debt to Uncle Sam.”

You can read Folwell’s entire piece by clicking here.

Say what?

It’s always a little risky to impute things to people who don’t express their views very clearly, but it seems to fair to distill Folwell’s argument down to the following key points:

  • By extending federal unemployment benefits beyond their ordinary time limit during the depths of the Great Recession, the federal and state governments encouraged workers to become fat and lazy and to lose their entrepreneurial spirit.
  • The extension of benefits also caused North Carolina’s to go in debt to the federal government – a fact which is going to lead, ultimately, to a tax increase on employers that will drive many of them out of business.
  • Thomas Jefferson, James Madison and the other Founding Fathers would have loved Charles Schwab. Giant, profitable corporations were their idea of the embodiment of “happiness.”

In other words, what Rep. Folwell is attempting to give voice to in his less-than-artful manner is the same old far-right nonsense that’s been repeated by princes and plutocrats and their lackeys forever: Social insurance programs make for lazy workers and force hard-working business owners to pay all sorts of debilitating taxes. Moreover, since corporate profits are the essence of the American experiment, we should eliminate or greatly limit all such programs.

But, of course, as even a moment’s thoughtful reflection confirms, Folwell’s arguments are utterly without merit. Here are just a few of the many reasons why:

1. Hundreds of thousands of North Carolina workers aren’t unemployed because some of them drew extended unemployment benefits. They’re unemployed because there are not enough jobs and because they aren’t properly trained for the ones that exist. North Carolina needs to add 515,000 jobs to reach pre-recession employment levels. No amount of hunger-driven “entrepreneurial spirit” is going to solve that problem.

2. Does Folwell think that the workers in high unemployment counties like Caldwell and Edgcombe are lazier than workers in counties with lower rates like Orange and Durham? Is he saying his constituents in Forsyth are lazier than the workers in Wake? Apparently.

3. In 2010, the average stay on unemployment was 18.2 weeks. Just three years earlier when the unemployment rate in North Carolina was 4.5%, the average stay was 13.9 weeks. In 2000 when the rate was 3.6%, the average stay was 9.2 weeks. Noticing a pattern here? Clearly, Folwell is confusing causes and results.

4. Folwell’s claims are scandalously insulting. Does he understand that the average unemployment benefit is $298 per week or 38.6% of the average pre-job loss wage? Does he understand that this represents only about 32% of a basic budget for a family of three? Does he understand that the vast majority of unemployed workers are not collecting regular unemployment benefits?

5. Perhaps most importantly, Folwell completely ignores the fact that unemployment insurance does more than merely keep families out of poverty (3.2 million Americans in 2010 alone); unemployment benefits pump billions of dollars into the economy that wouldn’t otherwise be there. Just imagine where North Carolina would be now without the $14.2 billion in benefits that have been paid out over the last few of years. If he’s really curious, he might want to ask the liberal do-gooders at the corporate giant Moody’s, who calculated that every $1 spent in unemployment benefits generates $1.64 in economic activity.

6. As for taxes, the hard truth is that North Carolina unemployment taxes were kept quite low (indeed the rate was 0.0% for many, many employers) for decades. Part of the reason the state has had to borrow money from the feds during recent years has been that it probably acceded to the demands of the business lobby for too long in this regard. Having said this, it’s not at all clear whether or exactly when taxes will rise on employers or, if they do, whether it will be all that burdensome. Certainly, no business is going to be dealt a “death blow.”

Going forward

Sadly, for all its incoherence, Folwell’s little missive seems likely to be a harbinger of an impending conservative attack on unemployment insurance that will be designed to slash benefits and make them harder to obtain. Let’s hope average North Carolinians see through this mean-spirited and counter-productive assault on an essential public program and give lawmakers the “help” they need to remember that there are responsible ways to address the challenges confronting our unemployment insurance system.

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