"They Demand Unemployment" - Biz Owner Shocked At Angry Response When She Tells Staff Their Paychecks Will Resume

Tyler Durden's Photo
by Tyler Durden
Friday, Apr 24, 2020 - 07:12 AM

A number of years ago, we first introduced the topic of a 'welfare cliff' at which more work was punished - i.e. the 'generosity' of the package of welfare benefits creates a perverse incentive not to work any harder...

As we wrote at the time, one of the tragedies of America today is that so many adults of sound mind and body do not support themselves and their families. It’s a tragedy not because they suffer material want; indeed, relatively few suffer so, because government assistance satisfies many of their material needs.

It’s tragic because one of the keys to human happiness is earned self-respect, which requires, as Charles Murray has written, making one’s own way in the world. The vast majority of poor people don’t want welfare; they don’t want handouts; they want a good job with which they can support themselves and their families comfortably.

The tragedy of the American welfare system is that it traps so many people in dependency on government, by hindering them from getting on and climbing up the job ladder, and thereby earning self-respect and happiness.

*  *  *

Our fear now, confirmed by excellent research from  Kathy Morris & Chris Kolmar at, is that the 'generosity' of the CARES Act (and the fact that politicians are loathed to remove any policy that could possibly make their voters upset) has the potential to create an entire new generation of welfare serfs, subsisting on significant welfare benefits with no incentive to 'get back to work', even after the lockdowns are lifted.

DoubleLine's CEO Jeff Gundlach appears to agree...

And now, as's Vivek Saxena details below,  a Washington State business owner faced backlash from her employees after she obtained a forgivable Paycheck Protection Program loan from the federal government that has allowed her to keep them fully paid through the coronavirus pandemic.

In an interview with CNBC this week, salon owner Jamie Black-Lewis of the Oasis Medspa & Salon in Woodinville and Amai Day Spa in Bothell said her employees were furious because they were already “making” more money being unemployed.

And the reason they were “making” more being unemployed was because of a Democrat-pushed provision that was added to the CARES Act.

The provision added “a flat $600 a week to the typical weekly benefits paid by one’s state,” CNBC reported. “Those traditional benefits, which vary widely between states, replaced about 40% of one’s prior wages.”

“The measure’s improved $600-a-week payments, which run through July, aim to boost that wage replacement rate to 100% for the average worker. But some, especially lower-wage workers, can come out ahead.

And that’s exactly what happened in Black-Lewis’s case, just as congressional Republicans had repeatedly warned.

It’s a windfall they see coming,” Black-Lewis said of the unemployment benefits her employees were slated to “earn.”

In their mind, I took it away. I couldn’t believe it. On what planet am I competing with unemployment?

“It was a firestorm of hatred about the situation,” Black-Lewis said.

On a planet that contains naive Democrats, no doubt …

Included among the many Republicans who spoke out last month against the inclusion of the Democrat-pushed provision were Sens. Rick Scott and Tim Scott.

“We have a virus and we know people can’t work for a variety of reasons,” Rick Scott said at the time.

We got to help them, but at the moment we go back to work, we cannot create an incentive not to work. We cannot be paying people more money on unemployment than they get paid in their job.”

[W]e cannot encourage people to make more in unemployment than in employment,” Tim Scott added.

“This legislation would not stop at 100 percent of your income. This legislation would allow people to make more in unemployment than in employment.”

In response to Republicans’ logical rebuttals, congressional Democrats and their left-wing media allies pounced with hysteria and smears:

As the repercussions of the Democrat-pushed measure were becoming more apparent a couple of weeks later in mid-April, Sen. Lindsey Graham warned that it needed to be fixed.

Here’s the problem: The unemployment benefits in South Carolina are $23/hour to be unemployed,” he said during an appearance on Fox News last week.

You’ve got a lot of small businesses trying to keep their employees on the payroll paying $16 and $17/hour. One program is undercutting the other. We’ve got to get that fixed.”

Watch via FNC’s “Fox & Friends” (disable your adblocker if the video doesn’t appear):

(Source: Fox News)

In response, again members of the left again pounced, with some even going so far as to accuse Graham of being a racist …


What happened to Black-Lewis clearly demonstrates that, as usual, the condescending left-wing elites screeching the loudest about “evil Republicans” were wrong AGAIN.

*  *  *

Welfare cliffs are of course not the only reason so many capable Americans languish in partial dependency on government assistance. Dreadful government schools in poor areas and systematic obstacles to getting a job, such as minimum wage laws and occupational licensing laws, are also to blame. But the perverse incentives of America’s welfare system really hurt, and the CARES Act may have been a serious tipping point.