Pulling the unemployment boost plug in Tennessee
With “Help Wanted” signs in Tennessee so thick that a person needs a chainsaw to cut through them, Gov. Bill Lee pulled the plug early on $300-a-week expanded federal government unemployment payments prompted by the COVID-19 pandemic. Not getting what they wanted, some Tennesseans took to the courts, filing lawsuits—predictably—against the governor and his labor commissioner to force the program’s resumption.
In May, Lee announced Tennessee would drop the federal unemployment boost in July, earlier than its scheduled September 6 end, some 18 months and two extensions after it was enacted. In a statement, Lee said, “We will no longer participate in federal pandemic unemployment programs because Tennesseans have access to more than 250,000 jobs in our state. Families, businesses, and our economy thrive when we focus on meaningful employment and move on from short-term, federal fixes.”
However, lawyer Gary Blackburn, handling the lawsuit for the plaintiffs, contends the early departure was wrong. As Nashville’s WSMV-TV reported on July 28, 2021, “The lawsuit claims that Tennesseans who are part of this class action lawsuit have suffered the loss of their benefits for three weeks and will continue to suffer until the court orders Lee and McCord to renew participation in the federal pandemic unemployment programs,” (at this writing, the case is continuing.)
Regardless of the lawsuit’s outcome, its subject puts a light on whether the program hurt businesses trying to find employees; the relationship between Tennesseans and government spending of taxpayers’ money; and the degree to which “free” benefits both help and burden all Americans. There is no such thing as free money: someone’s paying. The questions are who, and how much?
Today’s American thinking on government’s role is considerably different from that encapsulated by President John F. Kennedy in 1961, in his most famous inaugural speech line: “Ask not what your country can do for you, ask what you can do for your country.” Today, it often seems the reverse. The problem is that when it comes to government programs, Americans are concerned about the country’s debt, but support spending for programs they like. Reacting to this are politicians eager to win favor, office, and power.
What’s often lost in these arguments over government “compassion” is that much of what the government does, it can’t afford: the U.S. is in a difficult, if not desperate, financial situation. The extended unemployment compensation and other programs crafted to help people during the pandemic indeed helped many overcome short-term personal financial difficulties—at a huge cost that added to the U.S. national debt of nearly $30 trillion. The debt works out at present to nearly $85,000 owed per person—and growing every day. Want to see something really scary? If so, here are the Congressional Budget Office’s 2021 budget projections: “If current laws generally remain unchanged, the federal budget deficit will total $3.0 trillion and federal debt will reach 103 percent of GDP in fiscal year 2021.” That’s without proposed trillions (as of this writing) in more spending being argued in Congress.
This isn’t the government’s debt; it’s ours. The U.S. is living on a (seemingly) unlimited credit card. But things that can’t go on forever, won’t. When people become used to getting taxpayer-paid benefits and then can’t get them, then there will be real pain.
Lee’s decision to opt-out early from the unemployment compensation program was grounded in the fact that a couple of hundred thousand jobs are unfilled. Businesses complain about difficulties in finding workers. A few headlines: “Businesses deal with worker shortage,” WATE-TV, August 6; “Memphis employers struggle with worker shortage,” Memphis Commercial-Appeal, July 27; “After losing over 126,000 jobs last year, Tennessee’s tourism industry faces labor shortage as travel rebounds,” Chattanooga Times Free Press, June 17.
Did the higher benefits disincentivize employment? Studies and data abound on both sides, so take your pick. But common sense says that giving people more money while they weren’t working wasn’t exactly a carrot inducing them to find a job.
Lee’s decision was to motivate people to stop counting on government and find a job. For some, this would bring difficulty. For others, an incentive. There are jobs out there, maybe not the ones some people want, but jobs nevertheless. Perhaps the Rolling Stones said it best: “You can’t always get what you want, but if you try sometimes, you just might find, you get what you need.”