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1 Unemployment Insurance: Trends and Issues 1 (1982)

handle is hein.tera/unintriss0001 and id is 1 raw text is: UNEMPLOYMENT INSURANCE TRENDS AND ISSUES This is a summary of an 88-page study by the above title prepared by Tax Founda- tion. The study (Research Publication No. 35) is available at $5 per copy from Tax Foundation, 1875 Connecticut Avenue, N.W, Washington, D.C. 20009. Sweeping changes, especially during the 1970s, have transformed the U.S. unemployment insurance system into an entity radically different from the system which many considered so revolutionary when it was introduced some 46 years ago. Like other institutions, the unemployment compensation program has changed with the times, generally--at least until quite recently--in a direction of increasing liberalization. Federal laws have expanded mandatory coverage to include virtu- ally all salaried workers and have offered lengthened benefit periods. State laws affecting aspects of the program subject to state determination have been revised frequently, both in re- sponse to changes in Federal law and to changing economic and political circumstances. While no program of such broad scope, and with so many ramifications, is without flaws--and critics--the record of the U.S. unemployment insurance system throughout most of its exis- tence has generally been salutary. Millions of jobless workers have received temporary financial assistance to tide them over periods of unemployment while searching for other work. Employ- ers finance the program through payroll taxes, and the unem- ployed worker can view the benefits received as something he has earned, rather than as a matter of welfare. Despite its long-term history of effectiveness, the system during the 1970s at times seemed to be teetering on the brink of bankruptcy. In some respects it was hostage to its previous generosity. Both the Federal government and many states found it necessary to borrow to meet their UI commitments because they had failed to anticipate the financial claims the program would generate and to set aside sufficient funds in advance. A few examples illustrate the problem:

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