PHOENIX-President George W. Bush, who is in Arizona promoting policy initiatives aimed at improving job growth, has received praise for a key unemployment insurance reform proposal from economist William B. Conerly, author of a new Goldwater Institute report to be released Monday, January 26.
In a December 16 meeting with policymakers and members of the local press, Dr. Conerly urged Arizona's congressional delegation to support reforms along the lines of the president's New Balance proposal, which would eliminate the federal unemployment insurance (UI) tax and give states more flexibility in the use of administrative funds. Conerly suggested that the reform would help Arizona refocus its UI administrative policies to promote work. In other states, administrators have encouraged rapid reemployment and saved their states money in benefits payments by having more face-to-face contact with UI recipients and by setting up job-search seminars. In 2000, Arizona businesses paid $127 million in federal UI taxes for the administration of UI benefits, but got back only $51 million.
Conerly has also argued that Congress should allow states to receive waivers for experiments with alternative systems. As an example, Conerly points to Chile, which has created a system of individual unemployment insurance accounts. "For the American unemployed worker, going back to work means giving up a free benefit," Conerly writes. "For the Chilean unemployed worker, going back to work means more money saved for future bouts of unemployment, or more money rolled into his retirement account."
The report, Getting Back to Work: Reforming Unemployment Insurance to Increase Employment, will be released Monday and posted online here.
Author Contact: William B. Conerly, Ph.D., Conerly Consulting, LLC, (503) 598-2096
Goldwater Contact: Satya Thallam, Fiscal Policy Analyst, Goldwater Institute, (602) 462-5000 x 228
Press Contact: Tom Jenney, Director of Communications, Goldwater Institute, (602) 712-1257