What Does Unemployment Insurance Have to Do with the Farm Bill? Good Question.

Remember the farm bill?  That $1 trillion piece of legislation that ties food stamps to agriculture policy?  It’s not going to pass this year, but it’s going to resurface next year.  And Democrats have found a way to throw unemployment insurance (UI) in the mix.

They are planning to use the passage of the farm bill as leverage to ensure UI gets reauthorized, an effort being initiated by Rep. Chris Van Hollen (D-MD).

There are two problems with this picture.

First, it’s logrolling on top of logrolling, the bad Washington practice of using bad public policy as leverage for unrelated bad public policy in another bill.

Second, all of the policies in question are harmful to taxpayers and will increase our $17 trillion debt.

Congress has failed to end the unholy alliance between food stamps and agriculture policy, thereby precluding the possibility of reforming either of them.  The fact that there are giveaways in the farm bill for underwear, flatulence, and manure is a testament to that.  It is chock-full of subsidies that wealthy farmers don’t need.  Food stamp spending has doubled twice since 2000.

Unemployment insurance has been extended 13 times since 2008 and costs taxpayers $25 billion per year.  Democrats often argue that unemployment insurance benefits both the economy and the unemployed.

But as the Heritage Foundation has testified in the past, it’s not that simple.  UI benefits can have negative effects on some workers:

Unemployment benefits reduce the incentive and the pressure to find a new job by making it less costly to remain without work. Consequently, workers with UI benefits look for new jobs less rigorously than do workers without them. 

Extending unemployment benefits for too long can hinder future investments, job creation, and the economy, thereby reducing employment opportunities:

As the government borrows more and more from savers, the ability of private individuals to make the investments they need to make may be hindered.

We have yet to see how this will play out, but what is clear now is both the farm bill and unemployment insurance need changes and reforms, and passing them will harm the economy and taxpayers.


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