Sen. Tom Coburn, R-Okla., has cobbled together a bipartisan group of senators to push a money-saving measure that would bar million-dollar earners from collecting unemployment insurance. As Coburn’s staff describes it:
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This legislation would stop payments those earning at least $1 million. States could still pay unemployment benefits to millionaires using state funds if they so choose, but no federal funds could be spent for those payments. We simply cannot justify or afford to borrow more money or tax low-income, middle class and even well-off workers to provide payment to unemployment benefits to jobless millionaires.
Believe it or not, nearly 3,000 million-dollar earners applied for unemployment in 2008 and reaped $18 million in benefits.
From a fiscal perspective, this is a great idea. One conceptual problem is that in theory, employees and employers pay for unemployment insurance — at least, as long as we are going to accept the idea that it really is “insurance.” But that certainly ceases to be the case when the federal government extends benefits for long periods of time — like the current 99 weeks.
