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by didibus 1806 days ago
Unemployment is not funded by your income or sales tax, there is a levy taken from employers as people are working.

> The U.S. Department of Labor’s Unemployment Insurance program is funded through unemployment insurance taxes paid by employers and collected by the state and federal government. The taxes are part of the often-discussed payroll taxes all employers pay

And in order to claim from it, you must have had enough contribution to it yourself, indirectly through your prior employers.

The amount you receive from it is then proportional to how much you've indirectly contributed to it.

Edit: Okay, to be fair there is a small amount that is indirectly paid from taxpayer, that's because employers who pay on time get a small tax break themselves, so indirectly it means the government budget will need to ask more of other taxpayers since those employers get a small break:

> Employers pay federal taxes of 6 percent on the first $7,000 in annual income earned by every employee. Employers who pay on time get a tax break at 5.4 percent

But this is pretty minimal, and it's in the form of a tax deduction.

Edit2: Also, at a higher level, it isn't unreasonable to argue that technological advancement and the overall increase in production efficiency and productivity gains could go towards allowing a certain amount of people not to work at all, and others to work less. You just need to change your perspective from thinking that people are motivated to work only from loss, and that actually a lot of people would be motivated to work from gains. For example, instead of thinking people only work in order not to starve, you can start to think people would work in order to afford better quality food. Or that instead of working for not getting rained on, people would be motivated to work for affording a much bigger home with a bigger tv, and a pool.

You can tell that many people are actually motivated to work for these added gains, look at how many rich millionaires and billionaires still work full work weeks.

So for this, the question would be, did we make enough progress in efficiency and productivity that we could have all work be motivated from gains, and no longer need any of it be motivated from loss?

This system can then be constantly adjusted to the current levels of efficiency and productivity and what it can afford.

So the idea is you'd see how much of the negative incentives you can eliminate for work.

Can we avoid having anyone forced to work because if they didn't they would die? Can we avoid having anyone forced to work because if they didn't they'd be homeless? Etc.

Obviously, I'm Canadian, and so you'll see that I'm biased in this model, since it's somewhat the Canadian model. But I'll give an example of the tuning, because you can tune this to quite the granular levels if needed. Universal healthcare for example is a way to say: Can we avoid having anyone forced to work because if they didn't they would die from disease or injury or old age? And the granular tuning allows us to even do things like make it dependent on the specific disease, injury, etc. You can do that by tweaking what gets covered and to what extent. Maybe we can't afford to treat fully people to really expensive treatment, and so these people would still be forced to find ways to pay for it and thus work. Etc.

1 comments

The problem is the extra federal payment on top of state UI and the extended benefit period. Those aren’t connected to income or employer unemployment insurance premiums.
Aren't those only temporary emergency Covid relief funds put in place in order to limit the impact on the economy and hope to restart it?
Yes. They are the subject of this thread because they are a significant portion of the unemployment lower-to-middle income employees receive. They are worth discussing because, as you note, part of their goal is to avoid a protracted economic recovery, but they are having a counterproductive side effect.