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Comment by lapetitejort | Hacker News Reader

Good for them. It's called unemployment insurance for a reason. I could pay my whole life for the insurance and never cash in. If given the opportunity, I would extract every cent out of it I can. I would rather slowly look for a job than jump at the first mediocre/underpaying opportunity.

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It’s called that, but the federal government is printing that money for the additional payout and there is no premium for the insured parties to pay.

So, yeah, this isn’t actually a form of insurance.

The premium is paid by employers for each W2 employee. It's a cost of hiring W2 workers that you could argue ultimately falls on those workers as well, as a 1099 worker could negotiate a higher income in exchange for the employer not having to pay for those sorts of benefits.

This isn’t true anymore. Premiums cover a small fraction of unemployment benefits during Covid.

Firstly, the additional federal dollars are paid for by the federal government, not the states. That is printed money.

Secondly, the federal government also paid large portions of unemployment in assistance to the states - something it also did in 2008.

To call it "insurance", you need to at least imagine how the accounting and risk management might work if it were like a car/homeowners/term-life insurance policy.

First of all, do the payments alone support the program, or does it need cash infusions from taxes or money supply increases? How much would the premiums be if it was self-supporting?

Second, are those making higher premium payments (when you also account for the money infusions) at proportionally higher risk of payouts? What factors should be considered in the premium payment?

You're thinking like a business not a government/essential service. Unemployment, like a lot of services, could be designed or mandated to break even or turn a profit but whether or not that would work or result in the system failing is another question.

The capacity for a government to run essential services at a loss is a long standing component from even the US founding fathers. Hamilton wanted to adopt all debt from the colonies as a way to consolidate credit, unite the colonies financially, and put stock into the federal government with power to manage the nations debt vs individual states. Jefferson was against the policy but it (and other Hamilton drafted plans like a central bank) were approved through compromise.

The parent compared it to insurance, not me. To call it insurance invites comaprison to traditional insurance.

Sure, it can run at a loss. Maybe that's a public service. But I asked some questions that merit an answer if you want to call it insurance rather than, say, social security or something.

This is not normal UI. The flat supplement ($300/wk, it's a substantial number) puts the wages above most entry-level jobs.

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