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Thread: Millionaires Collecting Unemployment?

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    Elite Member celeb_2006's Avatar
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    Default Millionaires Collecting Unemployment?

    millionaires-collecting-unemployment: Personal Finance News from Yahoo! Finance

    If you were making $1 million per year or more, but lost your job, would you file an unemployment claim? Nearly 3,000 American millionaires would have answered "yes" to this question in 2008, according to an article by Ryan J. Donmoyer at Bloomberg. IRS data shows that a whopping 2,840 households earning at least $1 million in 2008 also filed for government unemployment payments that year. There are two sort of immediate questions that arise from this fact: what were they thinking, and should this be allowed?

    What They Were Thinking?

    To non-millionaires it might seem absurd that people who had such a staggering income recently would turn to the government for help after losing their jobs. But it shouldn't. First, most wealthy people didn't become that way by accident. They tend to be pretty savvy about money. So if the law entitles them to collect unemployment when laid off, then they aren't the type to turn down free money. Only a fool would do that.

    Moreover, for many millionaires, they might see their layoff as the one time they can finally get back some of the hundreds of thousands or millions of dollars they've paid in taxes over the years. Many tax credits don't apply to them, if they're phased out for people with income above a certain threshold. They may as well cash in this once, just for principle's sake. After all, once they get back to a high paying job, they will have to revert back to paying the government a lot and getting little in return.

    Should This Be Allowed?

    Unemployment benefits are actually a type of insurance. And just like other kinds of insurance, it is paid out regardless of how much money you make. In this case, however, it's important to remember that the insurance payments to households that had a high-income are not directly proportional to their previous compensation. Most states have a very low unemployment payment ceiling. In New York State, for example, anyone making more than around $42,000 is paid a maximum of $405 per week — which would add up to an income rate of just $21,060 per year.

    So those who enjoyed an ultra-high income can't benefit more from unemployment payments than middle or lower-class Americans. As the Bloomberg article says, these millionaires only took in $5.2 million in unemployment payments in 2008, out of the $43.7 billion total. That's just 0.012%.

    The government could certainly pass a law that disqualifies anyone who made more than a certain income during the year from collecting unemployment. And in this case it would have saved the government about $5 million. That's something, but this is a pretty tiny amount of money in the grand scheme of government budgets. A handful of millionaires who are enjoying what's likely a short stint of receiving government assistance hardly characterizes a serious problem so vital to the nation that it should be at the top of Congress' priorities.

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    Elite Member sputnik's Avatar
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    i'll probably get flamed but i don't have a problem with this. in fact, a friend of mine's husband, who had a very good banking job in europe, lost his job when his bank was sold. he was making very good money (not millions but definitely in the hundreds of thousands) and when he lost his job, he started collecting unemployment. it's his right. he paid into it for years, why shouldn't he be entitled to the same protection as someone who made less money?
    and no, i'm not some right-wing nutjob. i believe in taxes, high taxes, and in high-income people paying more than others. but that doesn't mean that if they lose their jobs they don't get to enjoy the same benefits as anyone else.
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    Elite Member greysfang's Avatar
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    Sorry, but this whole article is bullshit. Everyone pays into the unemployment fund from jump. Its your money and it sure as hell isn't charity or welfare to withdraw it if you lose your job, millionaire or minimum wager.
    FUCK YOU AND GIVE ME MY GODDAMN VENTI TWO PUMP LIGHT WHIP MOCHA YOU COCKSUCKING WHORE BEFORE I PUNCH YOU IN THE MOUTH. I just get unpleasant in my car. - Deej

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    Elite Member lurkur's Avatar
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    Are they taking it because they need it or just because it is there and they can? I wouldn't necessarily have a problem if they actually needed it. There are people out there who really need the help, and there isn't going to be money left in the unemployment funds if they are used to fluff up non-working millionaire bank accounts.

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    Elite Member Brookie's Avatar
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    Probably had to let one nanny go and sell one of the Beemers just to get by.
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    Elite Member WhoAmI's Avatar
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    I thought unemployment benefits were something that employers paid--they pay a tax that goes into a pool, then the laid-off people get money from this pool. This is not tax money employees have paid that they're getting back.

    Or am I totally misunderstanding that?

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    Elite Member sputnik's Avatar
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    i think it depends on the country but where i've lived it's something everyone pays into.
    I'm open to everything. When you start to criticise the times you live in, your time is over. - Karl Lagerfeld

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    Elite Member WhoAmI's Avatar
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    Ok, according to the Wikipedia God, in the US, taxes are indeed paid by employers, not employees, to fund the system. The taxes are paid (by the employer) to the state, and the state administers the program that pays them out. If the state runs out of money, the Federal government lends them money to make it up, but the loan must be repaid to the Feds with interest.

    Individuals do not pay into an unemployment pool that they draw from, so they're not getting back money they paid into the system.

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    Elite Member sputnik's Avatar
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    well, it's still part of the benefits any employee gets by being employed, whether they make a lot of money or not.
    if an employer also provides health insurance, should the guy making a really good salary not use it and pay his own medical expenses just because he makes a lot of money? of course not.
    the fact is, unemployment is a benefit employees are entitled to, regardless of salary. if you lose your job, it's there to help you until you find another job so that you don't spend all of your savings.
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    Elite Member Brookie's Avatar
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    I personally find this reprehensible. Just because you CAN doesn't mean you SHOULD. A millionaire collecting unemployment - while so many others in this country go without? What a fucking crock. We really are morally and ethically bankrupt.
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    Elite Member sputnik's Avatar
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    should millionaires pay to send their kids to public school too - just because they can?
    unemployment isn't a luxury. it's a right for those who have lost their jobs, regardless of salary. it is NOT charity.
    i don't understand that attitude. in europe this wouldn't even be an issue. if you lose your job, you are entitled to a certain percentage of your salary for x amount of months (duration and percentage vary according to country). it's the law. and no one thinks that a doctor who loses his/her job and then collects his entitlement is morally or ethically bankrupt.
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    Elite Member greysfang's Avatar
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    Quote Originally Posted by WhoAmI View Post
    Ok, according to the Wikipedia God, in the US, taxes are indeed paid by employers, not employees, to fund the system. The taxes are paid (by the employer) to the state, and the state administers the program that pays them out. If the state runs out of money, the Federal government lends them money to make it up, but the loan must be repaid to the Feds with interest.

    Individuals do not pay into an unemployment pool that they draw from, so they're not getting back money they paid into the system.

    You're wrong. Employers figure out what you're worth and deduct unemployment taxes from the salary they offer you. SO yes, we do pay for it.
    FUCK YOU AND GIVE ME MY GODDAMN VENTI TWO PUMP LIGHT WHIP MOCHA YOU COCKSUCKING WHORE BEFORE I PUNCH YOU IN THE MOUTH. I just get unpleasant in my car. - Deej

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    Elite Member WhoAmI's Avatar
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    I don't really have any strong feelings about this one way or another. Just trying to clarify where the money is coming from in the US.

    I'm sure employers have to pay additional/higher taxes in the years following high unemployment to build the fund back up, but they can probably deduct a lot of what they pay, so . . .

    Ugh. So complicated.

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    Elite Member Sarzy's Avatar
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    Quote Originally Posted by Brookie View Post
    I personally find this reprehensible. Just because you CAN doesn't mean you SHOULD. A millionaire collecting unemployment - while so many others in this country go without? What a fucking crock. We really are morally and ethically bankrupt.
    I agree. I think it's ridiculous.

  15. #15
    Elite Member WhoAmI's Avatar
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    Quote Originally Posted by greysfang View Post
    You're wrong. Employers figure out what you're worth and deduct unemployment taxes from the salary they offer you. SO yes, we do pay for it.
    But it doesn't come out of your paycheck, does it? You're saying that they just offer you a lower salary from the beginning to cover their costs?

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