Tuck: Unemployment benefits are ‘economic stimulus’



Like Gov. Bill Walker’s claim that an income tax will be an economic stimulus because taxes put money back into the economy, Rep. Chris Tuck has an idea about how to grow jobs: Increase unemployment benefits for those not working, and put automatic annual increases into the unemployment formula.

Tuck used the last five minutes of a House Majority press availability on Feb. 20 to tell reporters about HB 142, his bill that would increase unemployment benefits from an average of $375 per week to $510 per week.

That’s a 36 percent increase, and brings a typical unemployment benefit to $26,592 per year, up from $19,500.

“Alaska is one of the most seasonal states that there is. Whether it’s construction, mining, oil and gas, tourism, it’s very seasonal up here. And we need to be able to sustain families and communities, especially with the tough economic times right now, so we don’t have some of those skilled workforce leave the state of Alaska. So when things pick up they’re ready and available to go back to work.

“As I have gone through this, I googled the economic benefits of unemployment insurance. And I was surprised to learn that the Number one economic stimulus package for economic recovery is mass transportation projects, infrastructure. Number 2 is unemployment benefits.” – Rep. Chris Tuck

Tuck described how much better unemployment benefits were for stimulating the economy than, for instance, tax cuts.

“For every dollar that goes into unemployment benefits, there’s a return on investment of $1.68. When you … compare that to a tax cut, for every dollar in tax cut, that creates 10,000 jobs nationwide. For every dollar in unemployment increase, that’s 19,000 jobs. So it’s almost double that, due to the fact that when people are on unemployment, ….keeping money in the economy, keeping things flowing and keeping goods and services happening. Trying to maintain a good flowing economy,” Tuck said.

“So this is part of our economic stimulus that we’re trying to do for this State of Alaska. Trying  to help maintain property values. And that’s why this coalition was put together was to again, to save the economy and protect jobs.”

Tuck’s review of economic stimulus analyses is selective.  Some economists believe that making unemployment benefits more lucrative reduces the incentive for the unemployed to find or accept work, thus dampening and delaying an economic turnaround.

For reasons he did not explain, Tuck’s bill was pulled from the House calendar and sent back to Rules for work. Even more remarkable is that it has no fiscal impact. The fiscal note is 0 — meaning that it will cost the State of Alaska nothing to collect. That’s because it is a tax on the private sector, not the self-insured State of Alaska.

Read: HB 142.

HB 142 would be retroactive to Jan. 1. By the time it is signed into law, that would be a six month windfall for unemployed Alaskans and a significant and unexpected cost to employers.


  1. How stupid you are Rep. Tuck! Here we go the working supporting the unemployed. You want to make our society dependent on Government.
    I have an idea. Why don’t all you parasites figure out how to cut the budget, encourage business and let jobs not government run our great state.
    Oh I got it, your getting your next pay scale ready for YOU! 🙂

  2. If he had an economic brain . he would be dangerous, but not to worry, he is a true democrat, so will feed at the government table.

  3. Well, as long as he googled it! I wonder what he googled, probably ‘what liberal progressive talking points can I use to support my argument’. What kind of an idiot would think $1.00 spent on unemployment would equal $1.68, or that $1.00 of tax cuts is less than $1.00 of unemployment? I remember hearing the $1.00 = $1.68 talking point back when Obama was handing out his Obama bucks, it was just as stupid back then. If handing out cash for no reason improved the economy why aren’t there printing machines running around the clock in every city, town, and village across the country.

    But if google says so…

  4. What a dunderhead! Here’s a better idea… Get off your collective butts their Mr. & Ms. Legislator and actually do the people’s work. Create an environment and offer incentives for companies to create more jobs instead of constantly talking about taxing this, taxing that raiding the PFD and growing government.

  5. Employers pay 73% of the cost of unemployment benefits in Alaska. Hitting employers with a 36% increase causes small businesses hire fewer workers because they become more expensive. At the same time, unemployed workers who were actively searching for work when UI was $370 p/wk hold off longer at $510 p/wk. the result? Delayed economic recovery. Rep. Tuck and crew need to take the advice of the economists at our own university and invest this money in something that actually stimulates growth instead of retarding it.

  6. All I can say is “Representative Tuck must have gone to public (aka government) schools”. He actually got his economic training as a member of the Anchorage School Board–seems as if he learned well.

  7. Come on you guys! This is an Alaskan idea. This is magic. We screw the other guy and pass the savings on to you. Don’t you believe in magic? Don’t you believe in government? No government program can live up to the scrutiny you bloggers are employing, nor can the House Majority. If voters had your unrealistically high standards Chris Tuck would never win an election against anyone. Honestly – we screw the other guy and pass the savings on to you, and there is no more to it than that.

  8. I wonder if he’s related to fellow economic genius, Nancy Pelosi.
    I think it was in 2009 that she made the public proclamation that food stamps stimulate the economy.
    She is also famous for stating that the Congress had to pass Obama’s economic spending bill, because until they did 500,000,000 Americans would lose their jobs every month.

    Yes, Tuck and Pelosi seemed to have graduated from the same school of economics…..

  9. In the Front Page story of the Juneau Empire today Walker’s Revenue Commissioner explains that borrowing money today to pay oil tax credits, instead of paying cash, is a way to stimulate the economy. These people are nuts, or maybe just plain dishonest. Nothing in our economic outlook suggests borrowing to stimulate the economy, kicking the debt down the road and incurring interest payments and another credit rating downgrade in the bargain. Even John M. Keynes did not believe that states can borrow to stimulate an economy to later gain more in taxes than the debt service costs. Keynes believed that works for countries because countries have a central bank and economic input/output barriers (stopping or at least inhibiting leakage). I happen to believe it doesn’t work for anyone. What it does do is increase the problems for Walker’s successor, and in that respect it is one more Hail Mary re-election bid by Walker. Walker gets to spend the money today – the bond proceeds – and if he loses the election then so what (he would say). If he wins then it helps him make the case for lower PFDs and an income tax. Please write to the Senate Majority and tell them we must pay the amount due but we certainly should not borrow to do so. Sometimes we can be outsmarted, but let’s please make sure it isn’t dishonest idiots like Walker and Fisher outsmarting us!

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