Chris Saxman: Cold Fusion Friday

Okay – this is a REALLY cold Cold Fusion Friday – but this too shall pass.

Just filled up the Avis rental out here in Phoenix (temps in the *gasp* 40s!) and unleaded regular was $3.23 a gallon. I am little more concerned about the upward trend of the the gas prices than the downward trend of the air temps. We expect winter weather in winter, but we really like to talk about it. Unlike gas prices – but that will end when it hits $3.50 a gallon nationally around Memorial Day. It will be talked about. A lot.

So – Unemployment Insurance. The purpose of unemployment insurance is to provide income to those workers who are laid off through no fault of their own. While it clearly helps people pay their bills during difficult times, are we as a society getting our money’s worth? What is our value add from this system?

Given that in the Commonwealth of Virginia, in the calendar year 2010, we will have taken in and disbursed approximately $1.7 billion in direct payments to those who qualify for UI. Let’s write that out…1,700,000,000 dollars. That’s a lot of money and it comes, ultimately, from you.

I believe that we need to stop subsidizing unemployment and use UI payments to subsidize employment instead. While many will criticize this out of the gate as being a way for companies to exploit workers, please understand that my primary purpose in this is total value add for our country. The biggest problem with UI is that it pays people not to work, not to be productive and to be of value. We cannot subsidize the erosion of the human dignity that is associated with work.

If we reversed the system and had people using that UI paycheck as a enticement for employers to supplement that with a negotiated pay on top of the UI check, the person would be employed and productive and actually generating more money for the economy. Would it rescue the economy? No, the numbers are not that dynamic, but it would, far more importantly, rescue the person whose dignity is slowly eroding with every passing day in which they apply for jobs and are rejected.

Are there jobs to be had? Yes. But many employers are reluctant to hire because of the costs associated with each new hire. One of those costs is paying into the UI program – so that new hire is much more expensive than the salary, health care and other fringe benefits. Why not use the UI system to help employers hire people with their own money?

If we can reform welfare as we did in the 1990s, we can certainly reform this system to the benefit of society one unemployed person at a time. How do we accomplish this? We must change federal and state laws to allow the states to become the laboratories of innovation and let the states get creative.

Here’s how I envision a program working. Laid off worker goes into a company and says that he/she was recently laid off and is eligible to receive $350 a week, net of taxes, but must work 35 hours a week to earn it. The employer may choose to hire this person and offer them more money which would be negotiated by the two parties to their mutual benefit. The original UI benefit expires as is written in current law so that the worker and employer are assured of that primary source of income. Then as that term expires, the worker would hopefully have shown long term value to the employer and would be able to continue on as a full time employee. If not, the employer would have earned more money, would have been a more productive citizen, and would have more skills and basic self dignity than if they had been paid to not work at all.

If you have any thoughts on this idea, please feel free to share them.

On to the situation in Egypt. From conversations I have had with folks about the revolution in Egypt, the first thing on people’s minds is the effect it has on oil/gas prices.

We, as a nation, must become energy independent. We cannot have our economy subject to the situations of other countries.

I really don’t know much about Egypt nor will pretend to other than to say that whatever happens there should not impact how much we pay at the pump.

As a segue into to the Super Bowl, imagine if the Packers let the Steelers call their defensive plays 70% of the time and the Steelers won the game. Okay, as a life long Steeler fan that’s a great visual; however, it’s so ridiculous on its face, right?

Well, that’s our energy policy wrapped in the Sphinx of the NFL. (note Egypt reference). I know – it’s not great but I tried. Anyway, the Packers are favored slightly in this game and should be – they are peaking and Rodgers is H. O. T red hot right now.

These games come down to turnovers and field position. The Steeler special teams concern me especially on kickoff coverage. Both teams will want to see if they can establish the run and neither will be able to – so look for a second half barn burner with the Steelers winning 35-31.

Until next week when Cold Fusion Friday will reflect more on Egypt and the 100th anniversary of Ronald Wilson Reagan’s birth, have a great weekend and Go Steelers! HERE WE GO STEELERS! HERE WE GO!

Column by Chris Saxman


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