N&O Continues to Slay Straw Men

The N&O continues to avoid meaningful dialogue with its plea for extended unemployment benefits. Instead, they continue the intellectually lazy and disingenuous argumentative tactic of inventing a false narrative and assigning it to their opponent, and then arguing against what they just invented. I wrote about this commonly used tactic by the left before, and it is tantamount to admission that they are incapable of addressing the actual arguments of their ideological opponents.

Specifically, here is how the N&O describes the mindset of those opposing extending unemployment benefits:

Specifically, tea partyers don’t like a federal program that extended unemployment benefits for the long-term unemployed. The anti-attitude was that people were goofing off and not looking for work because they could stay on the unemployment compensation dole.

Please.

There is mountains of research and articles articulating the case of the perverse incentives that unemployment benefits create – all available at the fingertips of the N&O writers. But they choose to ignore it because they can not argue against it.

Specifically, the attitude is not that people on unemployment benefits are “goofing off and not looking for work,” but rather the UI benefits impact their decision-making. With weekly benefits of, say, $300 per week, these folks respond predictably and rationally by holding out for work opportunities that would not only pay more than $300 per week, but that paid significantly enough more than that amount to make the marginal increase in benefits worth sacrificing 40 hours worth of leisure for. This creates what many refer to as a “reservation wage”, that is a wage that people will hold out for as long as they continue to receive UI benefits. People are more selective and hold out longer waiting for the ‘right’ opportunity than they would absent the benefits. This is a perfectly rational and expected response – not ‘goofing off’ as the N&O would say.

Moreover, employers recognize the “reservation wage” of potential labor suppliers, and thus demand less labor. The higher the price of a good, the lower will be the demand.

So the extended UI benefits result in not only labor suppliers withholding their services to a greater degree than they otherwise would, but demanders of labor are willing to “purchase” less labor due to UI benefits inflating the going wage rate. Job creation suffers.

This is not a well-hidden or brand new argument. Google “reservation wage and unemployment benefits” and there are 371,000 results.

But the N&O writers can’t be bothered with the actual research and arguments made by the other side.

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