Unemployment: “Ass-high bonus” – brilliant or absurd idea?

Pro: An attempt that costs us nothing

1000 euros for every unemployed person who finally goes to work. It’s a miracle that it’s taken this long for this idea to be shredded in what we call “political discourse.”

Of course, the long-term unemployed should only receive the bonus, officially “start-up financing”, if they have already worked for more than twelve months in a job subject to social insurance contributions. This is what it says in the growth package that the coalition decided on in the summer. In the cabinet. Together. Now everyone is leaving the field. So far, so traffic light.

The Chancellor distances himself “because I believe we were all born to work.” The labor minister blames the economics minister. SPD Prime Minister Manuela Schwesig thinks “these 1,000 euros don’t work at all.” You also have to think about those “who get up in the morning, drive to production, work as single parents.” For CSU General Martin Huber, the bonus is “sheer mockery”, CDU General Carsten Linnemann finds it “absurd”.

Absurd? The opposite is true.

Using money to encourage people to work is of course a completely crazy idea. But perhaps the exact opposite is also true.

Germany is not coming out of recession, our economy is shrinking. The labor shortage is considered one of the biggest obstacles to growth. The amount of hours not worked halves the growth potential, experts warn. In short: it would be better if we worked more. Or more would work.

The labor market researcher Enzo Weber has investigated why it is so difficult to persuade the unemployed to do so. Apparently this is less due to the amount of citizens’ money than to the transfer withdrawal rate. To put it simply, it often makes little economic sense for transfer recipients to increase their working hours because other benefits such as housing benefit or child allowance are no longer available – the bottom line is that more work leaves less money. This would require an additional incentive. A bonus perhaps?

Would unemployment be cheaper?

FDP finance expert Frank Schäffler also believes that this is absurd; social spending would explode anyway. But would it be cheaper if people remained unemployed?

Let’s do the math briefly: At the current standard rate of 563 euros, an unemployed person receives 6,756 euros in citizen’s benefit per year. If he went to work instead, the welfare state would save almost 5,700 euros despite the bonus.

There would also be more income, because those who work pay not only taxes but also social security contributions – for pension, unemployment, health and nursing care insurance. And even Schwesig’s single parents in production would benefit from this. Because the more contributors, the smaller the contributions. More net from gross. For a change, that wouldn’t be a hollow liberal slogan, but rather justice in practice. Of course, one would have to make the effort to explain it to her and all the other doubters.

By the way, the traffic light has just decided on tougher sanctions for those who refuse to work. Even if practice shows that coercion rarely leads to success. What speaks against trying the opposite? In reality, it costs us: nothing.

Jan Rosenkranz

Cons: It requires pressure and no bills

A thought experiment: Suppose you were to offer your constantly paddling children a bonus of ten euros if they skipped using their smartphone for a week. It should be immediately clear to most parents: This can’t work. Ten euros is not a useful therapeutic tool that young people can use to free themselves from digital dependency. And what would come next? Increase the dose every week?

Money is not a useful therapeutic agent

It would be better if you did everything you could to help the kids realize that your life will be better if you overcome your nomophony (know: “no mobile phobia”). You will be less likely to suffer from sleep disorders, depression and dementia as you age. You will be mentally and physically fitter, eat healthier and be more successful at school and work. That’s what science promises.

A similar thought experiment could be carried out with Robert Habeck’s proposal to reward the almost one million long-term unemployed with 1,000 euros if they take on a job subject to social security contributions for at least a year. The problem: This doesn’t help a large number of them. You are too weak for this option. Many have psychological problems, are alcoholic, and have suffered strokes of fate. Thousands of euros are of no use to you in 365 days. They need help to recover and become fit for work – a complicated, never-ending task for a welfare state.

Those who refuse to perform need pressure, not certificates

The others, those who refuse benefits, have made their lives based on the transfer payments. The state dough is enough for them, they lack any intrinsic motivation to get started professionally or even to further their education. They also do not accept any civic duties and certainly do not allow their socially financed supposed freedom to be bought with a thousand euros.

The sick need help. The objectors need pressure. It must be made very clear to them that they are obliged to cooperate in order to get off the transfer benefits and find a long-term job that requires insurance. The reward for the effort is a higher income that improves their standard of living and a functioning, tax-financed state that takes care of its members in all matters.

A thank you from Berlin in the form of 1000 euros from the social security fund would send a completely wrong signal to those refusing benefits. You could just as easily offer your constantly paddling children an even more sophisticated smartphone if they take a 365-day digital break.

Rolf Herbert Peters