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View Diary: The New Edition of the Chicago School of Economics (3 comments)

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    as linked.  The fellow seems to be making the fundamental mis-assumption that corporations fund health coverage for laid-off employees out of some goodness of their cold, corroded hearts.  We know that that isn't so.  Corporations fund this coverage because it's cheaper than some alternative, like paying government penalties and higher unemployment insurance contributions, or facing more suits for unfair termination, or simply dealing with greater resistance and retribution from those terminated.  Ultimately, though, they "lay off" or terminate employees because it's cheaper than keeping them on the payroll if they've been determined redundant, and while paying lower severance benefits might make that more profitable, it doesn't change the basic calculus that their salary has been declared a waste.  There really shouldn't be any great increase in layoffs due to health care payouts which primarily benefit the WORKERS.  Likewise he slips lightly over the effects of affordable coverage enabling workers to retire earlier (freeing up jobs for younger workers who need them), start their own businesses (increasing overall employment), or deliberately choose to leave a job without literally risking their lives.  All of these should contribute to a more favorable market for labor, albeit at some increased public cost (which has already been figured into budget estimates).  A more favorable labor-market, leading to lower unemployment, would ultimately pay for itself in higher tax receipts.  So frankly, if he knows what he's talking about he's being deliberately disingenuous.

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