Millionaires on Unemployment? There Must Be a Better Way

millionaireWhen future historians tell the tale of the worst economic slowdown since the Great Depression, they will have plenty of stories about how people persevered against great odds. And it's not just the average working stiff who had it bad. Even the millionaires among us suffered, apparently.

According to Bloomberg News, data from the IRS shows that 2,840 households reporting at least $1 million in income on their tax returns that year also collected a total of $18.6 million in unemployment benefits in 2008. There were 806 taxpayers with incomes over $2 million and 17 with incomes in excess of $10 million collecting benefits. Data from 2009 was not available but odds are that the figures haven't changed much, given how the economy continues to struggle to rebound.

The problems of a bunch of unemployed millionaires probably will not elicit much sympathy from most Americans, who surveys show continue to be worried about their financial futures. Wealthy people, though, have their share of troubles too. As The Wall Street Journal noted Friday, many wealthy home sellers are slashing the prices of their estates in order to unload them.

As debate over the Bush tax cuts heats up, the plight of the downtrodden wealthy is becoming more visible. President Obama favors letting the cuts lapse for those people who earn over $250,000. Republicans don't want them to lapse when they expire at the end of the year. Some economists, including Alan Greenspan and David Stockman, have argued that the U.S. economy is in such dire straights with a deficit topping $1 trillion that it can't afford to cut anyone's taxes. Stockman estimates the Bush tax cuts costs $300 billion a year. The rich, some experts argue, don't need the help.

"Recently released Census data confirm that the wealthy are back on track after suffering only minor setbacks," according to a statement issued today by the liberal Center for American Progress. "Incomes fell across the board from 2007, before the recession began, to 2008. Everyone took a hit, from the poorest quintile to the richest. But that's where the shared pain ends. From 2008 to 2009 almost everyone's income continued to fall except the rich. The richest 5% of Americans saw their average income rise last year by $1,800."

To be sure, wealthy people are entitled to receive unemployment. Some even demand it. New Jersey Education Commissioner Brett Schundler, who retired from Wall Street, told the media that he insisted that Gov. Chris Christie fire him after a row over a botched federal education funding request so he could collect benefits. It can't be for the money. Benefits average $300 a week.

Like those in the middle class, the wealthy may argue that they should reap the benefits of the taxes they have paid over the years. But the U.S. economy is in such bad shape that the government must change the way that it doles out expensive entitlement programs such as unemployment. Budget deficits in 46 states equal $112 billion for the fiscal year ending next June, thanks in part to the costs of assisting the jobless. States pay for the first 26 weeks of unemployment.

Giving aid to those who are wealthy but entitled leaves less for the poor and needy. There has to be a better way.

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Paul

Some stockbroker is laid off in December, goes on unemployment until June, collecting $300 a week. Then he finds a job, and stops collecting unemployment. Frankly, I think we have bigger fish to fry. I think we'd waste more money trying to stop this than it costs to just let it happen.

October 07 2010 at 10:35 AM Report abuse rate up rate down Reply
godblshu

I am not wealthy, but I am a CPA who prepares tax returns for wealthy people. These people pay nearly all income taxes, including unemployment taxes for themselves in their business. So why should they not be able to collect unemployment. The answer is that they should. The problem with the writer of this article and many Americans is that they want something somebody else earned and paid for and saved, and don't want to earn it or save it for themselves.

October 05 2010 at 1:06 PM Report abuse -1 rate up rate down Reply
1 reply to godblshu's comment
jongarrett2009

people who earn a million dollars have no reason or excuse for collecting unemployment. in some states like NY, we dont pay into unemployment so you are not "entitled" to anything. a millionaire collecting unemployment is just plain greed, which is one of the reasons our country is broke now !

October 07 2010 at 10:01 AM Report abuse rate up rate down Reply
godblshu

I am not wealthy, but I am a CPA who prepares tax returns for wealthy people. These people pay nearly all income taxes, including unemployment taxes for themselves in their business. So why should they not be able to collect unemployment. The answer is that they should. The problem with the writer of this article and many Americans is that they want something somebody else earned and paid for and saved, and don't want to earn it or save it for themselves.

October 05 2010 at 1:06 PM Report abuse rate up rate down Reply
cpottger

So sorry but entitlements that were legitimately earned did not cause the problem However entitlements and reducing them are necessary to fiscal health. The fact is that the collective mismanagemnt of our financial resourses have brought us to the brink of financial collapse and things may very well get worse.

October 04 2010 at 10:03 PM Report abuse rate up rate down Reply
CAE5877

If you millionaires don't know what to do with your spare time, do volunteer work. Contact your local county volunteer coordinator, I am sure they will give you a list of volunteer work/activities for you to partake in. There are children who need help in learning how to read/write and some that don't know English here in USA. Besides, you can use your volunteer time as a deduction on your income taxes. If volunteer work is not for you, join Elderhostel (a not-for-profit educational travel organization); it is a great way to meet new people in your age group and learn about how people live in other countries.

October 04 2010 at 2:48 AM Report abuse rate up rate down Reply
CAE5877

It is no wonder why I still can't find a job after being unemployed for over three and a half years. The rich millionaires have jobs even though they don't need to work. All of you millionaires that are still working, you need to get some financial counseling and make some alterations with your investments so you can retire NOW and not later.

October 04 2010 at 2:11 AM Report abuse -1 rate up rate down Reply
Duane

They (we) are required by law to pay into the system and as such are entitled to any benefits from it. Perhaps States should revise their statutes to exempt people from paying into the system if they exceed a certain income level, how about that, or do you think they should pay for something they can't have?

October 03 2010 at 11:33 PM Report abuse +1 rate up rate down Reply
det11131

First, let me state that I am a triple dipper, I have SS, military and civil service retirement. I am not ashamed of these retirements, I earned them all, many times at the risk of my life. That being said, it is time for this country to WAKE UP, we can not continue spending like there is no tomorrow. There are dozens of programs that need to be completely stopped, dozens more need much better oversight. It might even cost me, but we need to means test social security and unemployment payments. This goes against my belief that if you paid into insurance, you should get paid. If we will stop paying people to have babies, stop housing and feeding people who WILL NOT work, stop paying disability to people because they are so FAT they can not walk, etc, we would be in a better financial position.

October 03 2010 at 10:59 PM Report abuse +2 rate up rate down Reply
2 replies to det11131's comment
audiolaw

Thank goodness that you didn't mention anything really terrible, like cutting farm subsidies we pay to millionaires who live in New York penthouses and who refuse to work because they inherited the right to farm subsidies and are, therefore, not interested in working. Thank goodness you didn't suggest cuts in no-bid contracts for military supplies - we certainly don't need competition and lower prices for supplies consumed in our colonial wars. No, you did good by sticking to the script- pretend that people "won't work" instead of 'can't find work', which is the reality for more that 12% of our workforce (the real numbers, not the fairytale, downplayed numbers of the Labor Dept.)

October 04 2010 at 1:40 AM Report abuse +1 rate up rate down Reply
cpottger

I believe we must tie the pay of those whom govern us to a pay for performance test. If we end the year in the red all they get minimum wage. How can this Great Nation be in such bad shape with all these brilliant Ivy League minds at the helm. Common sense is uncommon.

October 04 2010 at 10:10 PM Report abuse rate up rate down Reply
dollibug

This article is a really interesting article....and I will explain as to why I think it is....I worked for a company for over 14 years....got carpal tunnel in right hand from doing so much computer work....filed a worker's comp claim...which was approved and accepted....I kept working though after I had surgery...although I did have to wear a wrist brace for a while....almost a year and a half later...I started having problems with the left hand...needed surgery on this and 2 days after I had surgery...I got laid off....as the company was cutting back...so I got caught between a rock and a hard place...I did file worker's comp claim for the left hand...and it was denied...I did get a severance package at lay off...I got an attorney and he screwed up the paperwork on the claim...I was trying to recover and ended up and was not able to go back to work...I have since had 3 hand surgeries on each hand. I fought the worker's comp claim for over 4 years...the odd thing about this is that the company I worked for has paid several attorneys all this time who continue to fight me on this claim. Worker's comp is there to protect people who get hurt at work and are no longer to work. I went for years without drawing a dime from anyone. I was caught between a rock and a hard spot....I filed for SSD and eventually got approved for it...I received an award for a reduced amount since someone reported that I was received a worker's comp check also...it took me over a year to get this straightened out...and then it was reported to the IRS that I was received a worker's comp payment which screwed up the taxes....I am still in the process of trying to get this fixed....as the IRS wants to collect the taxes that supposedly I owe on this money that I never received... This is AMERICA and our system is badly broken....in every aspect of every department that the government is a part of...it is really sad that people can not get help when they need it the most. There are rules and regulations and processes in places....but no one who knows how to enforce them....it is like the judicial system also...there are all sorts of laws which are in place but attorneys have the ability to twist and tweak them so....and actually get by with what they do...but most of the time...laws are not followed...it just looks that way.... This needs to stop...so I find this article funny...that millionaires can draw unemployment....sure....they are entitled to it....as I was entitled to worker's compensation also....the only difference is...I truly needed it and did not get it...the millionaires...truly did not need it....but got it....and we have to remember....THIS IS AMERICA....the RICH GET RICHER...and the POOR GET POORER....

October 03 2010 at 10:13 PM Report abuse rate up rate down Reply
kit11760

They should be fined if they make more than $500,000 a year . Now I have heard everything . Dumb dumb dumb LOL

October 03 2010 at 10:12 PM Report abuse -1 rate up rate down Reply