Paid Not to Work
Kerby Anderson
If you take a political science class, your professor will probably talk about how often government policies have unintended consequences. We have before us right now a perfect example of that. But let me hasten to add that unintended consequences don’t always mean unexpected consequences. A number of US senators saw this coming, but Congress did not listen.
Jamie Black-Lewis owns two spas in Washington state. Although her businesses were closed, she was ecstatic that she qualified for two small-business loans through the Paycheck Protection Program. She was eager to share the good news with her employees. They did not take it as good news. She said there was a “firestorm of hatred about the situation.” They calculated they would make more by not working, considering that the CARES Act added an additional $600 a week benefit to their existing unemployment benefits.
Kurt Huffman, owner of restaurants in Portland, Oregon, had to lay off hundreds of workers. But he was able to adapt with takeout and delivery. He needed to hire back some of his employees. It didn’t go well, and so he did the math. A starting wage for a line cook is about $640 a week. Oregon’s unemployment offers about $416 per week. But the additional $600 federal bonus means that same worker would make $1,016. Why would anyone take a pay cut to go back to work?
This doesn’t mean that workers are lazy. They are just making rational decisions based on the economic incentives created by Congress. A number of Republican senators like Ben Sasse, Lindsey Graham, Tim Scott, and Rick Scott saw this coming. When they raised a concern about the bill in Congress becoming a disincentive to work, they were criticized in the media and voted down in Congress.
When you pay people more not to work, what do you expect? The unintended consequence is that people will stay home and make more money.
Listen to this Viewpoint
Viewpoints
View All
Birth Rate Effects
Last month, Jim Geraghty wrote about the “Five Non-Debt Problems That the U.S. Government is Largely Ignoring.” Most of those problems resulted from the decline in the U.S. birth rate. He documents ho...
Sounding Smart
How have we come — seemingly so quickly — to the place where Marxists and Islamists are reshaping the Democratic primaries?
Take Action
View All
Protect Privacy Against Flock Cameras
Flock cameras are everywhere. While one camera is a tool, the more than 100,000 AI-powered cameras now posted around our nation are a new layer of dig...
Support the Safeguarding Women from Chemical Abortion Act
The abortion pill harms women and kills unborn children. Congress must act.