And you get what you punish less!

When I first saw Michael Moore’s film “Roger and Me”, my primary reaction was not what Mr. Moore intended.  “Roger and Me” was a documentary on how the closing of the GM plant in Flint, Michigan several years before devastated the city.  The running joke in the movie was Moore’s continuous failed attempts to talk to Roger Smith, the president of General Motors.   This was laced around various stories of local residents whose lives were turned upside down.  I am sure Moore meant to make people sympathize with the town residents and hate General Motors.  While I did sympathize somewhat with the residents, my main reaction was wondering why these people all stayed in Flint rather than move to someplace with better opportunities?

This question is relevant now as the president and congress debate over extending unemployment benefits yet one more time.  The president wants us to feel sympathy for the long-term unemployed and he wants to paint anybody who opposes the extension as being heartless and cruel.   Unemployment insurance was designed to be a short-term program, to help people get back on their feet after they lose their job.  The big question is does extending unemployment benefits indefinitely contribute to unemployment?

North Dakota has about a 2% unemployment rate.  Why do people stay where jobs are scarce instead of moving to North Dakota where jobs are plentiful?  There are many reasons.  People have friends and family where they are and they don’t want to move.  Their former job may have been specialized and not available in North Dakota.  North Dakota is not usually on anybody’s 10 most fun places to live list.  At some point though, when people get desperate enough, they might just move and follow the opportunity and move to North Dakota.  Maybe if the person gets desperate enough, he/she will stop waiting for the high paying job like he/she used to have and will take an assistant manager job at McDonalds.  Sometimes desperation is what makes people do what is necessary to move on in life, to make the difficult choices.  Extending unemployment insurance delays the need to make the difficult choices.

The most common argument against this is that people don’t choose to be unemployed.  Unemployment is not pleasant.  I am not claiming that is is pleasant.  I am claiming that by reducing the unpleasantness of long-term employment, we are making it less unpleasant than alternatives such as relocation or taking less desirable jobs.  In the short-term it makes sense to give people time to re-group and re-plan.  At some point though, it becomes obvious that what people are doing isn’t working.  By enabling it, we reinforce it.  We are rewarding people for making the bad choice of continuing down a failing path.

Is that compassion?  I don’t think so.