2,362 Millionaires Got Unemployment Benefits

There were 2,362 people who earned a million dollars or more in taxable income in 2009 and who also received federal unemployment benefits that year, according to a report by the Congressional Research Service.

In fact, these millionaires collectively raked in more than $20 million in unemployment benefits.

The Congressional Research Service report--Receipt of Unemployment Insurance by Higher-Income Unemployed Workers (“Millionaires”)--was published on Aug. 2 and was based on the most recent data available from the Internal Revenue Service.

“Among tax filers with AGI [Adjusted Gross Income] of $1 million or more, 2,840 reported receipt of unemployment benefit income in 2008 and 2,362 tax filers reported receipt of unemployment benefit income in 2009,” the CRS reported.

The CRS reported that millionaires received $20.8 million in federal unemployment benefits in 2009, up from $18.6 million in 2008. That averages out to $8,806 in unemployment benefits per millionaire.

Unemployment insurance is a joint federal-state program and is funded by a payroll tax assessed against all workers. In the four years preceding 2012, according to the Tax Foundation, the unemployment insurance system was in the red. "Between 2008 and 2011, $174 billion was paid in unemployment taxes while $450 billion was paid out in benefits, a gap of $276 billion," the Tax Foundation said.

Department of Labor regulations require that unemployment benefits must be paid to all unemployed workers regardless of their income.

"This requirement is based upon a 1964 U.S. Department of Laobr (DOL) decision that precludes states from means-testing to determine UC [unemployment compensation] eligibility," the CRS said in its report.

"Under this interpretation, federal law requires entitlement compensation to be determined from facts or causes related to the individuals state of unemployment," said CRS. "Thus, the DOL requires that states pay compensation for unemployment to all eligible beneficiaries regardless of their income level because individual or household income would not be considered to impact the fact or cause of unemployment."

In addition to the 2,362 people with adjusted gross incomes of $1 million or more who got unemployment benefits in 2009, there were also 8,335 people with incomes between $500,000 and $1 million who received benefits and 120,227 with incomes between $200,000 and $500,000 who received benefits.

On July 17, House Minority Leader Steny Hoyer said that unemployment benefits along with food stamps were the two most stimulative things the government could do for the economy.

"If you talk to economists, they will tell you there are two things that are the most stimulative that you can do--one’s unemployment insurance, the other’s food stamps, okay?” said Hoyer.

“Why is that?” Hoyer said. “Because those folks who receive those resources must spend them. And they’ll spend them almost upon receipt. Most economists with whom I talk believe that those with significant discretionary income, that that’s not the case.”

Not all humans.
It was common for college students working in the cafeteria to be given unemployment papers at the end of spring semester. Same for people in limited appointment government positions such as I held on several occasions.
I figured I knew the gig before I signed up for it, and it would be wrong to take “unemployment” money from those who actually lost their jobs.
I have known many people who did not understand that position, it is true, but I have also known many people with more honor who would be ashamed to take any money they did not earn.

It does not matter who you are or what you were earning - the program is for those who involuntarily lost their jobs and are seeking employment. Those who are not are cheating you and me - they are committing fraud. It is not a matter of the costs of processing - the whole integrity of the program gets threatened when folks, rich or poor, cheat. If you are a millionaire and lost your job and are looking for another job - then you are entitled. If you are a minimum wage worker who wanted to hang out on the beach all summer rather than work - you are not entitled. If you work “off the books” 16 hours a day caring for the disabled but claim unemployment, you are committing fraud. No excuses.

I didn’t say they were committing fraud or even doing anything wrong.

I was pointing out that means-testing would not be cost effective if the result only filters out two-thousand recipients.

If you are saying that these 2000 plus millionaires, assuming that they meet the requirements for collecting unemployment benefits, are entitled, then I totally agree. However, just because some abuse the system by collecting benefits they are not entitled to - does not legitimate others doing the same thing.
The rules should be enforced irrespective of how much a person earned or is worth.

People with seasonal jobs are not really unemployed in the traditional sense when the season ends, because they will resume working when the next season starts.

Unemployment benefits was not meant to fill in this gap. This is an area where some money could really be saved if the rules were modified.

I never did see the sense in it, especially for allowing those students to take two months off while paid, then return to their same position.
Perhaps it might be reasonable for an adult who was using the limited appointment position as a stop gap while seeking a real job, but the ever so helpful secretaries were always shoving you out the door with directions to the unemployment office in hand, regardless of the circumstances.

Ya’ think these beneficiaries paid into the system much???

In most states the answer would be "No" because unemployment insurance rates are very low relative to the amounts potentially paid out in an economic downturn. For instance, a company might pay 2% on the first $8,000 of salary, or about $160 per employee per year. So to cover 19 months of unemployment that employee needs to be employed for more than 20 years. Statistically speaking in the modern economy that just doesn't happen.

I agree that the rules are what they are, so the millionaires should get their payments, but really they are just transfer payments from the rest of us to them since we'll have to pay off those bonds sooner or later.

That kind of government "math" when applied to "insurance" programs is why we have trillion dollar deficits.

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