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Millionaires on unemployment

By Judy Martel · Bankrate.com
Monday, October 8, 2012
Posted: 6 am ET

Working Americans pay for unemployment insurance, so should there be an income cap on who can claim it? The Congressional Research Service reported that 2,362 households with an annual income of $1 million or more received unemployment assistance in 2009, causing some lawmakers to erupt in outrage.

Sen. Tom Coburn, R-Okla., wrote to Bloomberg: "Sending millionaires unemployment checks is a case study in out-of-control spending. Providing welfare to the wealthy undermines the program for those who need it most while burdening future generations with senseless debt."

The report says the millionaire households receiving unemployment represent 0.02 percent to 0.03 percent of all taxpayers who report receiving it. In addition to the millionaire households, more than 120,000 households with incomes between $200,000 and $500,000 claimed unemployment in 2009 and more than 825,000 households earning between $100,000 and $200,000 claimed it.

At issue for Congress is the extension of unemployment benefits "at a time when the federal government and the states face serious budget constraints," according to the report. In the second quarter of this year, more than 4.6 million people filed initial unemployment claims and 1.1 million people saw their benefits run out.

In February 2009, Congress expanded the time period states could pay unemployment benefits, from 26 weeks to a maximum of 99 weeks. In the fiscal year that just ended Sept. 30, the federal deficit is projected to be $1.1 trillion, leaving lawmakers scrambling for reductions. One idea is to restrict or eliminate unemployment benefits to high-income earners.

Do you agree with some members of Congress that one way to reduce the deficit is to eliminate unemployment benefits for high-income earners? And at what income level would you draw the line?

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October 10, 2012 at 7:27 pm

Its confusing to all when you have a enraged headline that isn't backed up by the story. "Millionaires on unemployment" implies that anyone with a million in savings (or net worth) might be receiving unemployment upon layoff. The story however goes on to say that "2,362 households with an annual income of $1 million or more received unemployment assistance".
Big difference

October 09, 2012 at 11:43 pm

I would like to see this in a poll format. Like, what percentage of people feel that unemployment should be means tested?

This just seems like another redistribution of wealth. Most millionaires do not need unemployment but it’s the principle. If their employer paid the premium then they should get the benefit.