Are The Wealthy Abusing Government Aid?

Unemployment benefits for millionairesMany conservatives have accused unemployment insurance of creating a population of slacker, couch-bound stoners (several states have made drug tests a requirementof benefits). But an analysis by Bloomberg has found that the ultimate pinnacle of hard work and success -- millionaires -- raked in almost $80 million in jobless benefits during the recession.

At its 2010 peak, the country paid out $150 billion in unemployment benefits, according to the Congressional Budget Office. And $29.9 million of that went to millionaires, according to Bloomberg. That year, almost 3,200 households that reported an adjusted gross income of more than $1 million received unemployment benefits, with an average take of $12,600. That's 56 percent more than the $8,050 received by the average household filing for benefits, unsurprisingly so since jobless insurance is hitched to past salary.

Thirty-three households earning more than $10 million also got a helping hand from our jobless safety net, with an average haul of $11,455. A quarter of those millionaire homes getting benefits were in California, and a further 19 percent were in New York.

Is This An Abuse?
A 42-year-old waiting outside the unemployment office in Harlem, N.Y. was at first shocked when the Bloomberg reporter told him how many millionaires were also getting that weekly check. "I'm not a millionaire!" said Clark James. "But if you've paid taxes for it, why shouldn't you collect the money? And going from $1 million a year to $405 a week -- that's a big drop."

More:The Real Unemployment Rate Is Worse Than You Think

Unemployment insurance isn't means-tested, because it is an insurance, paid by employees and their employers with a cut to every paycheck. And the vast majority -- 68 percent -- of insurance payments go to households earning less than $50,000 a year, Bloomberg reported.

But even far more affluent Americans can end up in free fall when a livelihood is lost, especially since they likely have higher costs, such as private school tuitions. The film "Hard Times: Lost on Long Island" followed several families who suddenly lost a six-figure paycheck, and end up driving down to the church's food bank in a fancy sports car to pick up dinner.

But still, it can be hard to stomach the idea of millionaires cashing in on a system designed to keep the unfortunate afloat, especially as so many Americans brace for major sequester-related cuts to their unemployment checks.

Ultimately, however, it isn't millionaires, but the millions of middle and working class Americans, who are stretching the unemployment insurance system to breaking point. As Gary Burtless, a senior fellow at the Brookings Institution in Washington, pointed out to Bloomberg, just 0.035 percent of the 9.2 million Americans receiving jobless benefits in September 2010 made a million bucks that year.

And making millionaires ineligible for unemployment benefits would be an enormous undertaking. As the Congressional Research Service noted in a report last year: "The potential administrative costs [of disqualifying wealthier Americans from unemployment insurance] could outweigh the potential savings."

The Mega-Rich: Why I Still Work
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Are The Wealthy Abusing Government Aid?

Despite four decades of chairing or CEO-ing media companies, Alan Meckler, 65, has no plans to quit. Now CEO of media empire WebMediaBrands, and with a net worth of over $400 million, according to Forbes, why does one of the most successful media entrepreneurs of all time keep doing another day, another dollar?

He told Forbes it's "for posterity. Need to go out with another winner." 

When grandmother Joanne Gilberts won the lottery in 2007, scooping £1.1 million ($1.7 million) into her bank account, she decided to still return to her £6-an-hour job at a hospital laundry. 

"I know it might seem strange to some people but I've been working at the hospital for 21 years, and it is a big part of my life. I just wanted to get back to normality," she told the BBC. "...I'm determined to keep my feet on the ground and just wanted to put my life back on an even keel after all the excitement."

In 60 years, Rupert Murdoch has transformed an Australian news agency into a sprawling global media empire, and racked up a net worth of $9.4 billion in the process. And at 81, he remains on the offensive, with the modest ambitions of conquering the web.

"So long as I can stay mentally alert;-- inquiring, curious -- I want to keep going," he told Esquire." I love my wife and my children, but I don't want to sit around at home with them. We go on safaris and things like that. I can do that for a couple of weeks a year. I'm just not ready to stop, to die."

Al Davis, the coach, general manager, and owner of the Oakland Raiders for 50 years, who's bullishness ultimately led to the creation of the Super Bowl, reportedly said in 2007, at the age of 78, that he wouldn't retire until his team won two more of the Vince Lombardis. Unfortunately, he died first. But his franchise's motto lives on: "Just win, baby!"

Investor of legend Warren tax-me-and-my-rich-friends Buffett, 82, the second richest man in American (with a net worth of around $46 billion) has no plans to retire as chairman and CEO of Berkshire Hathaway Inc. Even a prostate cancer diagnosis last year failed to trip up his resolve.

The reason is simple. As he said at the 25th anniversary dinner of the Economic Club in Washington: "I'm having the time of my life!" 


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