American Unemployment Insurance Is a National Disgrace. It’s Time to Federalize It.
The slow, decades-long destruction of the US unemployment insurance system has resulted in more than just personal hardship for millions of workers — it has further weakened the fighting strength of the whole working class. The solution is to fully federalize it.
Unemployed workers in the United States collecting benefits at an unemployment office circa 1982 in New York. (PL Gould / Getty Images)
An idea whose time may be around the corner is the federalization of US Unemployment Insurance (UI). Currently, there are different programs in each state (plus DC), with different levels of benefits and administrative competence. In several states, such as North Carolina and Florida, the program has been hammered to a pulp, with recipiency rates sinking below 10 percent.
In theory, there is a benefit to each state choosing its preferred level of coverage, but in practice, federalism in this regard has been a failure. Overall, until the economic collapse in 2020, fewer than one-third of unemployed workers received benefits. The temporary, extraordinary increases under the Trump administration in 2020 are one sign of the inadequacy of the program. Not surprisingly, there is a malign racial cast to the program’s inadequacies.
By the most recent data, there are still almost 10 million unemployed. That number looks good compared to April of 2020, when it had reached a horrendous 23 million, but it looks very bad compared to pre-COVID levels of 6 or 7 million just a month or two prior.
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