REPLACE THE INSURANCE WITH PERSONAL UNEMPLOYMENT ACCOUNTS...:

More Trade and More Aid (MATTHEW J. SLAUGHTER and ROBERT Z. LAWRENCE, 6/08/11, NY Times)

Our proposal to resolve the trade impasse: more trade and more aid. More trade means that President Obama should immediately submit, and Congress should immediately ratify, the pending free-trade agreements. Colombia and Panama already enjoy unfettered access to our market, and South Korea has negotiated free-trade deals with the European Union and India; we cannot afford to fall behind.

More aid means Congress and the president should replace T.A.A. with a broader safety net that helps workers regardless of why they lost their jobs. Unemployment insurance, introduced in the early 1930s, has not really changed since then; it should be merged with T.A.A. Today, unemployed workers face challenges far greater than T.A.A. or unemployment insurance alone can address: getting matched with a new employer, often in a new industry; upgrading or learning new skills, often at reduced wages; and coping with lost benefits, especially health coverage.

A new American Adjustment Program should combine the best elements of unemployment insurance, T.A.A., and training programs authorized by the Workforce Investment Act. This approach would include a wage-loss insurance program for workers 45 and older, to speed their rehiring by supplementing their income if they take work at lower pay; helping workers receiving unemployment insurance to pay for coverage under Cobra (which allows workers who lose their jobs to keep group health benefits for limited periods); and enabling unemployed workers to make penalty-free withdrawals from savings accounts like 401(k)’s and I.R.A.’s to finance costs like occupational retraining and relocation.

...and that 45 year old worker would have wealth on hand designed for exactly the situation, instead of drawing down retirement savings..

Posted by oj at June 9, 2011 6:12 AM
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