May 7, 2009

It kills me when I see hopeful headlines like this: 'Jobless claims at lowest level since January'. That's because the vast majority of those in the media class don't understand how the unemployment system works - they've never had an extended experience with it.

When I see a headline like this, I think about a few things the headline writer probably didn't. The first one is, I automatically assume the figure will be revised upward next week, just like it's been every other time it's been unexpectedly low.

The second thing? Having lived through the last eight years of what the corporate media kept insisting was an economic "recovery," I'm familiar with one little sandtrap your chattering classes may have missed: If you didn't work steadily enough - that is, your previous employment or just-terminated employment didn't last long enough to cover the required "base year" fiscal quarters, you're not eligible for unemployment checks, and you probably didn't even bother to file a claim. It's happened to me, and I'm sure it's happening all over the country:

WASHINGTON - The number of U.S. workers filing new claims for jobless aid unexpectedly fell by 34,000 last week, sinking to the lowest level since late January, new Labor Department data showed on Thursday.

At the same time, a four-week average of new claims declined for a fourth straight week.

Initial claims for state unemployment insurance benefits dropped to a seasonally adjusted 601,000 in the week ended May 2 from a revised 635,000 the prior week, the Labor Department said.

Analysts polled by Reuters had forecast 635,000 new claims versus a previously reported count of 631,000 the week before.

Now, let's compare our patchwork system of state unemployment compensation requirements (I think in Texas you can get four weeks) to Europe's:

In Germany, losing his factory job didn't stop Alfred Butt from taking a Mediterranean vacation this winter. Thanks to generous jobless benefits, being out of work "hasn't changed my life that much," Mr. Butt says.

In the U.S., Dylan DeRoberts lost similar work -- but there's no seaside getaway for him. Instead, he's giving up life's little pleasures, like riding his snowmobile, because he lost his insurance, too. "I've learned to live at a new level," Mr. DeRoberts says.

Unemployment is taking a very different human toll on opposite sides of the Atlantic, which helps explain why Europe and the U.S. can't agree on how to attack the global recession. The U.S. is spending hundreds of billions of dollars -- including increased assistance to the unemployed -- to prop up the economy, and wants Europe to follow suit. But most of Western Europe already has a strong, if costly, social safety net, so governments feel less pressure to spend their way out of trouble.

The irony is that for years, Europe tried to rein in its own worker protections -- long considered a drag on growth in good times -- to emulate the faster-growing U.S. economy. Now the U.S. is moving toward a more European system.

The differing U.S. and European approaches toward worker protections can influence recovery prospects. Unemployment is similarly high, above 8% and rising, both in the U.S. and among the 16 European countries that use the euro currency. But Europe's high payroll taxes, along with restrictions on when and how companies can lay off workers, make employers slower to rehire when a recession ends.

That's one reason why economists expect the U.S. to stabilize faster than Europe. Last month the International Monetary Fund predicted that the euro-zone economy will keep shrinking next year, whereas the U.S. should bottom out by then.

Of course, this being the Wall Street Journal, the fact that so many unemployed U.S. citizens are now living in tents is mere collateral damage, and not worthy of comment. The falling salaries on Wall Street, on the other hand, are of grave concern to the people who matter!

For Mr. Butt, losing his job as a raw-materials buyer for a German auto-parts maker was a serious blow. But state benefits will replace the bulk of his salary until May 2010. And he still has full medical insurance under Germany's universal system.

Mr. DeRoberts, who lost his job at a Chrysler assembly plant in Belvidere, Ill., near Rockford, last year, saw his medical benefits expire several months later. He says he can't afford to pay the premiums on his own.

"It's scary being without insurance," Mr. DeRoberts says, but adds: "What do I give up? Food?"

Compare and contrast, people. Compare and contrast, and raise hell every time your elected representatives put the needs of corporations above the needs of working people.

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