Unemployment Accounts: A True “Benefit” for Most Oregonians


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By Christina Martin

Owning assets is a powerful key to getting ahead and staying ahead. Assets provide stability and allow individuals opportunities for investment. They also change the way people behave. According to research, people tend to think in longer time frames and to have more hope for the future once they acquire something significant that they can call their own.

Unfortunately, government safety nets help low-income citizens primarily through income transfers. These programs discourage people from building assets, penalizing participants who save too much.

This problem has begun to receive more attention in the U.S., but so far reforms have lacked innovation. In the meantime, other nations are blazing the trail. Chile’s innovative unemployment insurance system pairs a traditional unemployment insurance program with unemployment savings accounts. These accounts are similar to pairing a progressive health insurance plan with a health savings account. Not only does this system provide a safety net for workers, but it promotes better work search efforts and allows employees of all income levels a means of tax-deferred savings and access to the psychological transformation achieved when people acquire something they truly own.

Cascade Policy Institute’s new report demonstrates that nearly all Oregonians?even those with the fewest assets and the least education?would be better off with unemployment savings accounts than with our current unemployment insurance system. For more on the benefits of unemployment accounts for Oregon, visit www.cascadepolicy.org.

Christina Martin is Director of the Asset Ownership Project at Cascade Policy Institute, Oregon’s free market public policy research organization.

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