The White House announced late Monday it had reached an agreement with Republicans to extend the current tax rates — also known as the Bush era tax cuts — for two years. To reach that compromise, Republicans agreed to extend unemployment benefits.
Under the agreement — which displeased Congressional Democrats who wanted President Barack Obama to stand against tax cuts for those making more than $250,000 a year —unemployment benefits would remain in effect through the end of 2011 for workers who have been laid off for more than 26 weeks and less than 99 weeks.
In agreeing to extend unemployment benefits, Republicans made a bad deal. Unemployment benefits are paid by businesses as a tax. Money is confiscated from businesses through a Federal tax and distributed by State governments to unemployed workers, many of whom have passed up job opportunities that paid less than they wanted to earn. And many of those workers have given up their job search altogether, favoring instead the “free” money that continues to come their way.
Benjamin Franklin knew that providing for the poor would not help them out of poverty. In a letter he wrote May 9, 1753, Franklin said:
“Repeal that [welfare] law, and you will soon see a change in their manners. St. Monday and St. Tuesday, will soon cease to be holidays. Six days shalt thou labor, though one of the old commandments long treated as out of date, will again be looked upon as a respectable precept; industry will increase, and with it plenty among the lower people; their circumstances will mend, and more will be done for their happiness by inuring them to provide for themselves, than could be done by dividing all your estates among them.”
And in On the Price of Corn and Management of the Poor in November, 1766, Franklin wrote:
“I am for doing good to the poor, but I differ in opinion of the means. I think the best way of doing good to the poor, is not making them easy in poverty, but leading or driving them out of it. In my youth I traveled much, and I observed in different countries, that the more public provisions were made for the poor, the less they provided for themselves, and of course became poorer. And, on the contrary, the less was done for them, the more they did for themselves, and became richer.”