In yet another example of the intentionally deceptive news perverters at Fox News, the Fox Nation website has posted a headline article that deliberately misrepresents reality with this headline: WH Senior Advisor: Unemployment Stimulates the Economy.
That would be a remarkably stupid comment if anyone had actually said it. What Valerie Jarrett actually said was that…
“Even though we had a terrible economic crisis three years ago, throughout our country many people were suffering before the last three years, particularly in the black community. And so we need to make sure that we continue to support that important safety net. It not only is good for the family, but it’s good for the economy. People who receive that unemployment check go out and spend it and help stimulate the economy, so that’s healthy as well.“
So what Jarrett was talking about was the stimulative effect of unemployment insurance, not unemployment. And her views on continuing to support Americans struggling in this difficult economic environment are consistent with most economists who recognize that funds received in the form of unemployment checks are quickly spent in the communities of the beneficiary, creating an economic stimulus.
“Many analysts, including the Congressional Budget Office as well as [Moody’s Mark] Zandi, have found that in a weak economy, UI and refundable tax credits — and other measures that put money into the hands of hard-pressed individuals and families who will spend it — have a significantly larger impact on economic activity and job creation than tax cuts primarily benefiting high-income individuals, who are likely to save a large amount of any increase in income they receive. In the Moody’s Analytics model, extending unemployment insurance benefits generates $1.60 of additional GDP for each dollar of budgetary cost, while a permanent extension of all of the Bush-era income tax cuts generates only 35 cents in economic activity per dollar of cost.”
The Fox Nationalists frequently lie about the economic benefits of aid to working class Americans, but this intentional misrepresentation of Jarrett’s remarks is even more dishonest than their routine dishonesty. I’m sure they are very proud of themselves.
how could anyone of any political affiliation see this and decide to keep watching their junk “news” products. I guess some people enjoy having their intelligence insulted.
you read my mind, Mike. I was wondering if one of Mark’s critics would attempt to defend that rather stinky bomb of a misleading headline, if any FOX supporter would be foolish enough to try.
Stay tuned, eh?
I must admit, he picks some good ones – although he’s kind of a big tattle tale, but if you’re looking for something like that, he does well.
I don’t know who these people are who put out such misleading stats but it seems they have created their own reality.
OK, here goes. Let’s Joe is making $50,000 a year. Let’s deduct 20% for taxes. It could be higher or lower but not by much. That leaves him with $40,000 to spend. Assuming he has a mortgage, life insurance, auto insurance, car payment, high gasoline payment and any other number of financial obligations.
Maybe he saves or invest some as well.
Now, all of a sudden Joe is out of work. He applies for UI. The state gives him, let’s say $240 a week with no taxes deducted(although he will have to pay when he files his taxes).
That comes to $12,580 a year.
$40,000 or $12,580? Hmmmm. Looks to me like he would be spending less while out of work. That must be the new Obama math everyone is talking about.
@Dave: Obviously the man in your example would prefer the job and the $50k per year. But that’s not the point of the article. The base assumption is that his $50k per year job has disappeared. So the new comparison is between your $240 week figure and ZERO. Nobody wants to live off $240 per week (or whatever the amount is), but he’ll spend more with that than with zero per week.
Aargh. You beat me to it. 😉
I don’t care how many ways you want to spin it, it is still a negative for the economy because the man is not getting less income. He didn’t start at zero. He started at $50,000.
in which Dave attempts a comeback. It’s so weak he would have been better off not bothering.
PS Who cares that he doesn’t care?
You probably need to stay away from the grownups.
Dave does a non-sequitur.
Are you f***ing serious? Nobody is comparing being unemployed to being employed. Obviously anyone would prefer a job (although many on your side think every unemployed person is just lazy).
This is a comparison between being unemployed with UI or without UI. Try to keep up, Dave.
Great minds think alike, eh?
“This is a comparison between being unemployed with UI or without UI.”
Where does it say that in the article?
Even using your distorted logic, the economy still loses.
in which Dave attempts projection. Distorted logic is all he’s got.
To be fair, there is no comparison between being employed and being unemployed either, an issue that you alone brought into the conversation.
The article is about FOX misinformation, if you’re going to bring in an unrelated perspective, you can’t b!tch about others doing the same.
Who are these “many” you speak of? Can you name 25,000 of them? Didn’t think so.
he forgot to rest his case.
Dave, don’t bother, these folks also think all conservatives are racist, heartless, homophobic and about any other negative thing you can think of. Division and hate is the name of the game here.
when a con speaks for “these folks,” you know hilarious wrongness will follow.
Awwww. Isn’t that cute. The little troll is out again.
non-specific comebacks always miss their mark.
I have conservative friends with whom I disagree, but I don’t think they are racist or homophobic.
Sammy, I believe you, but here on this site and when watching liberal commentators like those on MSNBC – that’s exactly how conservatives are described.
OK, let’s start again, from the beginning:
The White House official clearly meant that unemployment benefits stimulate the economy, which seeing as they represent money and money spent, where otherwise there would be none, then yes only a stubborn argumentative fool would deny it, unemployment benefits have a stimulative effect on the economy.
And the liars and dissemblers at Fox News, they did what they love to do, and purposely misrepresented the official’s remarks to appear to be that unemployment stimulates the economy, which of course is so counter-intuitive and apparently idiotic, that only a Fox News fool would ever believe it.
And so where’s the error in what I wrote, because I claim it’s perfectly accurate and true as written.
How does it stimulate the economy when one day a man is netting $40,000 a year and the next he is netting $12,000 a year. He is spending less money than previously. Therefore less money is going into the economy.
If he started from zero dollars that would work. But he does not start from zero dollars.
Dave, do you eat bricks for breakfast? How many times do we have to explain to you that we ARE starting from zero, if we make the BASE ASSUMPTION that the person in your scenario has ALREADY lost his job? Of course, everyone would prefer that he not have lost his job in the first place. But the assumption here is that these people are unemployed. So, giving them some amount of UI benefits has some stimulus effect.
You call it assumption. An assumption is merely a guess. This is not even close.
Fact. Man spends $40,000 one year. Man spends $12,000 the next year. This is not an assumption nor a guess. This is fact.
Explain how he starts from zero.
Holy crap Dave! She is talking about people who are otherwise unemployed! Not comparing the employed to the unemployed. Sheesh!
I have not compared the unemployed with the employed either.
Basic math is a rather easy concept. Try it sometime.
Dave, you HAVE compared the employed to the unemployed. Your “man spending $40k” is employed. Your “man spending $12k” is unemployed.
“People who receive unemployment checks stimulate the economy.” That was the quote. So, basic logic would dictate (assumption, not a guess) that these people are UNEMPLOYED. They cannot be compared to an employed person’s impact on the economy.
When I wrote that only a stubborn argumentative fool would deny that unemployment benefits have a stimulative effect on the economy, I only lacked an actual case or real world example, in order to prove it.
Thank you Dave.
I am having an honest discussion. Your deep seated hate fro all things Fox will not allow you to have the same
discussion.
You still haven’t proved it. Because you can’t.
Honest eh? Look what you posted above about not comparing the unemplyed with the employed….then compare that to your FIRST post.
No comparison?
You really don’t get it, do you?
OK, here goes. Most people who collect UI will do so as soon as possible after losing a job. If they receive a severance, they have to wait until that is used up.
If they decide to wait 1 week, or 2 weeks or a month before collectinig UI they still end up receiving less money that they had previously. Therefore there is no stimulation of the economy.
Now, go away.
Hey guys, Dave is either unwilling or unable to have an honest discussion. Much like the GOP regulars that wrote the headline above for Fox Nation.
And notice that the wingers who commented here completely ignored the actual topic which is the dishonesty of Fox Nation and how they twisted Valerie Jarrett’s words.
Well Mark, your topics are specfic to Fox News and Fox Nation – neither of which I read or watch – so I don’t care. Plus you make the faulty assumption that most conservatives use Fox News for their information or need it to tell them how to think. And you say so many outrageous things it’s hard to ignore.
Something is better than nothing. End of my argument.
Oh man…that’s embarrassing, I can’t believe I missed it.
The headline is misleading for sure, but not surprising. That isn’t any different than many headlines these days on all kinds of subjects, not just political in nature.
However, it does not negate the ludicrous “spin” Ms. Jarrett is trying to put on how unemployment benefits are actually a good thing for the economy. There’s no question unemployment helps the guy who lost his job on an individual level for a given period of time. But at some point, there are diminishing returns, even for him.
Unemployment is a stopgap for people who have lost their jobs while they look for a new job. Except for extended benefits from the Feds, these benefits are insurance proceeds for which premium was paid by the recipients.
Somehow unemployment benefits are economic stimulus; tax reduction that translates to earners keeping more of their money to spend or invest is not stimulus. That is spun as a drag on the economic recovery. So you can say FOX’s headline is misleading, but FOX hasn’t cornered the market, that’s for sure.
First of all, I’d like to thank you for making a reasoned argument that actually addresses the subject of this article. While I disagree with some of your points, I hope that some of the others who comment here will take note of your example of what an honest dialogue looks like.
Now, to the point, UI does more than benefit the recipient. It also puts money in the hands of someone who will spend it, which does have a stimulative impact on the economy.
As for tax reductions, they may or may not have a stimulative effect, depending on who receives them. Middle-class taxpayers are far more likely to recirculate that money than the wealthy, who deposit it into savings accounts that have no stimulative benefit.
Finally, I totally agree that misleading headlines are a bipartisan activity.