CBO: Unemployment benefits might, or might not, stimulate economy

The Senate Democrats succeeded in breaking a "Republican logjam" over the extension of unemployment insurance benefits, following a typically disingenuous lobbying effort by Democrats and the White House.  Two arguments were presented: one, the Republicans are hard-hearted and care nothing for the unfortunate people put out of work by the failed policies of the past.  Secondly, unemployment benefits create jobs, so the Republicans are anti-small business.  The first argument is dishonest because Senate Republicans were not arguing against the extension of benefits, but only that they be funded by unspent Stimulus money, rather than further borrowing. The second argument made a media stir when Nancy Pelosi argued on July 1st that unemployment spending "is one of the biggest stimuluses to our economy. Economists will tell you this money is spent quickly. It injects demand into the economy, and is job creating." Pelosi was roundly criticized for...(Read Full Post)