Submerging Unemployment Insurance in Savings Account as a Way of Making UI More Difficult, Cumbersome

Neoconservative governance is hard to carry out.  For a group of people who have very little faith in the ability of the government to do things, implementing the things that the broad (neo)conservative movement wants the government to do is quite difficult.  Preventative war, indefinite occupation and rebuilding a country is very hard.   The mass incarceration of over 1% of our population, the surveillance of all overseas communications for potential terrorist ties, etc. are all expensive and difficult to figure out how to do properly.  These all are prone to failure and severe abuses in the execution and when they go wrong the consequences are huge.

Meanwhile, on the liberal side, income maintenance, as best observed in the 1935 Social Security Act, is easy.  Extremely so, and only getting easier.  It turns out that a governance program of “under conditions X someone should get a $Y dollars check” is very easy to carry out.  Cash transfer programs where income is taken in through taxes and then sent out to targeted individuals is highly efficient as a technical matter – Social Security’s administrative costs are in the range of of 0.9%, significantly below your favorite free-market, voluntary mutual fund.

Of course, like choosing who to preemptively invade or isolate from the population, choosing the X’s and $Y’s isn’t easy.  When should people be eligible for retire?  How long and at what level should the unemployed get insurance benefits?  What kind of aid should be available to families with dependent children?  What are the benefits and costs with a level of funding and the tax burden to go along with it?  But unlike conservative governance, once those decisions are made it is trivial to actually carry them out.

Our current unemployment insurance is both efficient as a technical, accounting matter and it is also highly efficient as a practical, lived-experience matter.  It is something that just works, existing in the background and kicking in as insurance when it is needed by people.  It isn’t a mental or technical burden that needs to be consistently fretted about by people who may use it someday.

One thing an “unemployment insurance savings account,” which we discussed the other day, would do in practice besides eliminating the insurance concept is make the experience of UI far more cumbersome.

Corey Robin wrote about this idea in relation to unemployment insurance accounts in his blog post One Less Bell to Answer:

…there is a deeper, more substantive, case to be made for a left approach to the economy. In the neoliberal utopia, all of us are forced to spend an inordinate amount of time keeping track of each and every facet of our economic lives. That, in fact, is the openly declared goal: once we are made more cognizant of our money, where it comes from and where it goes, neoliberals believe we’ll be more responsible in spending and investing it…

The dream is that we’d all have our gazillion individual accounts—one for retirement, one for sickness, one for unemployment, one for the kids, and so on, each connected to our employment, so that we understand that everything good in life depends upon our boss (and not the government)—and every day we’d check in to see how they’re doing, what needs attending to, what can be better invested elsewhere…In real (or at least our preferred) life, we do have other, better things to do…

What’s so astounding about Romney’s proposal—and the neoliberal worldview more generally—is that it would just add to this immense, and incredibly shitty, hassle of everyday life. One more account to keep track of, one more bell to answer. Why would anyone want to live like that? I sure as hell don’t know, but I think that’s the goal of the neoliberals: not just so that we’re more responsible with our money, but also so that we’re more consumed by it: so that we don’t have time for anything else. Especially anything, like politics, that would upset the social order as it is.

In talking with my wife Laura after I posted this, she commented that the whole neoliberal project was about outsourcing state functions onto the individual…But there’s a whole dimension of outsourcing that gets lost in this discussion. And that is what Laura was referring to: all the time and energy we as individuals now have to devote to doing the things that the state used to do for us. The right thinks of that as freedom—they hear the words “state is doing for you” and they imagine patients etherized on a table—but I think of it as tyranny. In fact, one of my FB friends wrote tonight to say, in response to this post, “Freedom is, in part, freedom from the tyranny of choice (as imposed by the market).” Indeed.

Great stuff.  I think this explanation also puts another puzzle piece for why people identify taking advantage of the “submerged state” as not using government services on the table.  Even if there are generous tax subsidies for all and matching for the poor in these unemployment insurance accounts it is still work done (and anxiety held?) by the individual in relationship to their personal budget and their boss, rather than work done by the government and insurance pooled among citizens.

I also need to read Randy Martin’s The Financialization of Daily Life. For those of you who have read it, how does this specialized attack on the New Deal safety net work with Martin’s thesis about everyone as their own CEO of their household?