Work-while-unemployed program is no panacea


http://www.washingtonpost.com/politics/georgia-jobs-program-that-has-intrigued-obama-has-flaws/2011/09/04/gIQAGGox7J_story.html?wpisrc=nl_headlines

Georgia and New Hampshire have programs where the unemployed are matched with companies for “training on the job” without pay but still collecting benefits. There have been some modest results. Georgia gives an additional stipend to the trainees. New Hampshire does not.

The article points out at two problems besides the fact that results have been scant.

1. It is costly. It creates another government department to administer and monitor the program.

2. Fraud. Some employers use the trainees as free labor without any intention of hiring anybody.

Furthermore, if program does not meet definition of training but is rather plain work, it would be illegal for having people working under minimum wage.

I believe I have a more serious objection: It is a distraction. Employers will not hire until demand increases and demand will not increase until people have more money and feel more confident to spend it. Let’s focus on the fundamental causes of our economic decline and not on marginal, and  ineffective, remedies. Bottom line: the majority owes too much and earns too little.

President Obama is interested in the plan.

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