14 ms·

Obama's job aid plan - $10,000 to $13,000 in assistance for entrepreneurship

172 points by GBond 15y ago

becomevocal 15y ago
This seems really cool and all, but what are we talking about in terms of wait time and hurdles to jump through? Anyone know details? I've looked into and seen others go through grant processes and they are often terrible. Hope it isn't similar.
- maratd 15y ago
  This isn't a grant. It's a modification of the rules for unemployment insurance. It's a good change. It allows you to use unemployment insurance to pursue your own business for about half a year. Of course, for you to be eligible for unemployment insurance, you had to have been employed at some point and gotten fired. It's also a paltry sum. But, again, any movement in the right direction is a plus.
  - tibbon 15y ago
    Strange question, but couldn't you always do this? From my understanding, unemployment insurance only required that you take no/low salary from a company. You were still able to receive money from capital-gains/investments. Start a consulting firm/startup, pay yourself a $1 salary with stock options. Don't exercise these options for a long time (when you stop UE). I read the UE stuff time and time again in Massachusetts and kept looking for something to say that I couldn't do this but couldn't find anything that said so explicitly. I didn't end up doing consulting (just more learning/studying), but it would have worked and been legal right?
    - maratd 15y ago
      > Strange question, but couldn't you always do this? No. For you to receive unemployment insurance you must prove that you are actively seeking a job. I suppose you could have invested the time into looking for a job while spending the rest of it starting a business, but this will provide you with an explicit option to start your own business. That will encourage more people to do so.
      - tibbon 15y ago
        Right. Let's say I was searching for a job, but doing Rails work on the side (not a startup per-se, but you know... doing startupy like work). I could spent 1 day per week looking for a job, and 4 to 6 days a week coding for people. All the proceeds go into a consulting firm which I hold ownership of. But yes, it is good for this to be official now.
        ansy 15y ago
        If you do this you are probably violating the unemployment rules in your state[1]. If you reported this income with the unemployment office you will most likely have your benefits reduced or eliminated. But most people don't report this income and get away with "double dipping" which was heretofore not allowed. Technically if the government found out you did this they could penalize you retroactively. But this is a hassle and most people just get away with it unnoticed. Even more technically, some states will even deny unemployment benefits if you are working without pay such as in a startup situation (and you are honest enough to admit this). It's not about income or full utilization, it's are you working at all. The change in the law makes getting paid for self employment legal. Although if your self employment included revenue I assume it would still count against the amount you received from unemployment, again depending on your state. [1] http://career-advice.monster.com/salary-benefits/benefits-information/unemployment-benefits-part-time-work/article.aspx http://career-advice.monster.com/salary-benefits/benefits-in...
    - JayWilmont 15y ago
      Remember unemployment insurance rules vary depending on the state. New York State for example asks if you are employed, not if you are drawing a salary.
      - tibbon 15y ago
        True. Massachusetts asks your salary. If you're working a job that pays less than your UE benefits, then they make up the difference.
  - bricestacey 15y ago
    It's too bad that it's a modification of unemployment. I'd take this, but I have a job and it's next to impossible for me to be fired or laid off.
    - maratd 15y ago
      The amount in question is a paltry sum. If that's all that's stopping you from starting your own business, quit. Walk into a bank and ask for a loan. You can get an SBA backed loan for 10K with moderate to good credit and no collateral. You can also just get a credit card with a 10K limit and a 0% APR offer, and transfer the funds to your checking account. Of course, all of these mean taking on the risk personally ... but if you're not willing to do that, you really have no business running a business.
- nhebb 15y ago
  I'm not sure there are details yet. The stimulus / jobs plan has been proposed, but there is no bill written yet. It will be another ten days before Obama presents his plan on how to pay for the jobs plan, and the bill won't likely be written until after that. This is a great idea and would have helped me when I faced this situation 9 years ago. Following a layoff, I asked the unemployment office about this, and they said I must actively be looking for work. Still, I think the overall economic impact of this proposal is small potatoes compared to the overall jobs situation, but I guess every little bit helps.
jwb119 15y ago
About time. The policy of forcing a decision for laid off people between 1) sitting around doing nothing (i.e. "looking for a job") and being eligible for free money vs. 2) trying to start something which could have an an impact in not only getting that person back into a paying position but also on the economy as a whole (and thereby being ineligible for money) needed to end
- anamax 15y ago
  > The policy of forcing a decision for laid off people between 1) sitting around doing nothing (i.e. "looking for a job") and being eligible for free money vs. 2) trying to start something There was no such policy - there was no such "decision". The standards for "looking for a job" are/were low enough that one could be trying to start something at the same time. (I know - that's what I did.) While we like to talk about starting companies, ie we like startup porn, the vast majority of the long term unemployed won't start anything. More to the point, the folks who would are unaffected by this proposal, so there won't be any benefits received for the costs incurred. How do I know this? The folks who would start do start and are doing so already. (Yes, I read the SEA stats.)
  - JayWilmont 15y ago
    There is such a policy, at least in New York State. Any time spent on "self-employment" activities reduces the amount of unemployment insurance money you receive.
    - lurker14 15y ago
      all activities, or activities with associated revenue streams?
      - nknight 15y ago
        There are precedents for it being all activities. Particularly anything you're doing that would be in line with your usual profession, whether you're getting paid for it or not. The rules vary by state, though.
bsiemon 15y ago
I found the link for a list of unrelated things 2 paragraphs in quite jarring.
fredBuddemeyer 15y ago
genius. who needs voluntary transactions live venture capital or angels, what have they ever done? instead lets take money from everyone (if they don't like it we can lock them in a cage) and then give it to others who we decide are worthy.
- yellowbkpk 15y ago
  Outside of Silicon Valley (and a few other hot spots maybe) "voluntary transactions" aren't happening, so the government feels the need to step in.
  - anamax 15y ago
    Yes, govt feels the need to step in. The relevant question is whether said "step in" makes any sense. If there really are such wonderful opportunities, why aren't you funding them?
    - ori_b 15y ago
      I don't have enough cash on hand.
      - sneak 15y ago
        Interestingly enough, neither does the US government.
        natnat 15y ago
        The government can borrow money at negative interest rates. People are literally paying the U.S. government to take their money. It may have a large budget deficit, but the government has no shortage of cash.
        anamax 15y ago
        > The government can borrow money at negative interest rates. The feds are borrowing at less than the rate of inflation, but they're not borrowing at negative rates. Note that current interest rates don't accurately reflect the interest cost of borrowing because those loans will be rolled over a couple of times. Do you really think that the low interest rates will continue? More to the point, said borrowing has to be repaid. If the expected/likely additional tax revenue from this program is less than the amount spent, it's a bad deal.
jeremymcanally 15y ago
The ignorance displayed in the comments on that article is scary. It's quite obvious a lot of people have never been in the position to actually need this sort of aid before, so it's easy to knock everyone using it as "an illegal" or "lazy." Of course people will abuse this, too, just like they abuse the unemployment insurance we have now. But to me, the net positives that come out of this will outweigh the (probably minor) fraud that will happen. Adding benchmarks (e.g., you have to legally register a business, you have to prove some sort of business activity to a case worker, and so on) will keep a lot of the fraud out, even if they're token requirements.
- temphn 15y ago
  One word: Solyndra. After they just wasted another $535M of taxpayer money in crony capitalist payments, why do you think it's "ignorance" to evince strong opposition to these kind of attempts at meddling in the economy? VCs and angels fund selectively and with their own money. The govt funds politically and with other people's money. That selects for Chris Gronet and George Kaiser, not Mark Zuckerberg and Peter Thiel.
- TomOfTTB 15y ago
  First, who said "an illegal" or "lazy"? Searching the page I only find your comment using those terms. Second, "the system is already being abused so lets allow further abuse" isn't really a great argument. (For the record I'm actually in favor of this I just don't think your tone is necessary and I think it discourages anyone who might disagree)
  - mbesto 15y ago
    1. Read the comments on the actual article, not HN. 2. Unless you have another ingenious way to make unemployment money more efficient, I see it as a fairly decent argument.
  - sologoub 15y ago
    There is a comment from jmfay on there that talks about "illegals"...
  - 15y ago
talmand 15y ago
Then, if you become successful, you can be labeled as one of the hated rich and they'll put you out of business with crushing regulation and taxes. Excellent.
- danssig 15y ago
  "Crushing regulation and taxes" generally hits small businesses hardest.
  - talmand 15y ago
    According to descriptions of what "rich" seems to mean to most, small businesses are the largest part of that heavily disliked group. In the recent English riots the prevailing thought seemed to be that simply owning a business meant you were rich.
    - danssig 15y ago
      It's hard to imagine this being the case. When I think of "has way too much money" I think of big corporate fat cats. Never small business owners. I don't know anyone personally who sees small business as hated rich either. Perhaps this is some kind of cultural thing in the UK?
known 15y ago
US need a win-win proposition with Chindia
- DiabloD3 15y ago
  I know this is getting downmodded, but hes somewhat right. "Chindia" is draining our economy, by "draining our economy", I mean its destroying the people who actually do the work. For every job that is sent overseas, not only does it result in someone, an actual real person, losing their job, but a form of slave labor in a foreign country "hires" the replacement. If I was President, honestly, I would push for a 0.5% tariff on all goods and services from countries that are not considered first world countries. I may be unable to improve the conditions of slave laborers in foreign countries (especially China and India due to massively corrupt governments that are doing everything possible to widen the gap between the poor and the rich instead of closing it), but I don't have to support doing business with those who make this possible. 0.5% would result in hundreds of millions of dollars in recaptured revenue, which could be instead spent on trying to preserve jobs in the US instead of exporting them, but it would also be low enough that the consumer would not bear the brunt of this.
  - gte910h 15y ago
    >If I was President, honestly, I would push for a 0.5% tariff on all goods and services from countries that are not considered first world countries. An alternate statement of that idea (which I'm not sure I agree with either), is a tariff on goods and service in the amounts required to bring the hourly foreign labor costs up to the US federal minimum wage with no exemptions.
    - DiabloD3 15y ago
      I was actually considering something similar. Instead, define "first world country" as a county who's median yearly pay is at least half of hours, recognizes basic human rights, recognizes democratic voting, and doesn't punish their population for speaking out against the government or any government sponsored religion (such as the Muslim religion in various middle eastern countries), and also recognizes the rights of women. As in, fellow countries that believe in life, liberty, and the pursuit of happiness. Attempting to tariff any harder can have extremely adverse effects. The rich wish to remain rich at all costs.
philiphodgen 15y ago
1. I run a business. Therefore I make jobs. Or don't. 2. If I fire an employee, a portion of the cost of that person's unemployment claims is charged back to me. The employer. It isn't government largesse that funds unemployment claims. It's me. 3. Will this program be yet another potential cost to me? Hard to tell from the PR and press-gab. We'll have to see the law and how it is implemented. Devil in the details, etc. 4. My payroll is suddenly $100K/year lighter than it was. Am I going to replace that guy with another full-timer? Fuck, no. Hello, independent contractors. 5. By the way. I pay 100% of the medical costs for all my employees.
- muhfuhkuh 15y ago
  "My payroll is suddenly $100K/year lighter than it was. Am I going to replace that guy with another full-timer? Fuck, no. Hello, independent contractors." From this country? That matters much more than whether they'd be contract or full-time.
  - philiphodgen 15y ago
    Absolutely from the U. S. and A. All of them.
- chopsueyar 15y ago
  If you fire an employee, why do you pay unemployment? I would understand if you laid them off, but firing? Also, if you are paying for their unemployment, why is unemployment being deducted from their paycheck too?
  - clarkevans 15y ago
    In most states it's quite difficult to prove that you fired for cause -- performance is quite subjective. Typically the employee needs to do something dramatic & harmful for you to deny unemployment.
    - roc 15y ago
GBond 15y ago
To me the true significance, more so than this money, is the milestone of the federal gov't finally recognizing "entrepreneur" as a third category of employment status and not just the unemployed/employed binary. Hopefully this leads to further help for folks starting a company (that will in-turn create more jobs when successful) like healthcare coverage. EDIT: This will also help with mainstream cultural and social acceptance. Less weird looks when explaining to Joe Shmoe your employment situation!
- dualogy 15y ago
  It will also help massively to "massage" unemployment figures in a positive spin by reclassifying a million or two of them as "entrepreneurs". (And hey, the debt ceiling can be raised indefinitely so no problem re costs. We finally arrived in The Future: the perpetuum mobile exists.)
DanielBMarkham 15y ago
I like the spin on this. Sounds like something that could be very useful. I must note, however, some phrases that set off my bullshit detector. >SEA participants were 19 times more likely than eligible non-participants to be self-employed Either I'm missing something or this says that people who are in a self-employed assistance plan are likely to be self-employed. Perhaps this is an editing error? >In Oregon, nearly half of the successful SEA entrepreneurs have each created an average of 2.63 new jobs Ok, but what kind of filter does "successful SEA entrepreneurs" imply? 1 in 100? 20%? Once again, the language is loose and circular. Money is not an answer to everything. In fact, funding at high levels can be the worst thing ever to happen to a good team in a startup. At small levels, like this, it perhaps can make a big difference. Perhaps. There is a great big giant humongous gap between something that sounds good in an editorial and something that actually does something useful. I'd want a lot more data on this before passing judgment one way or another.
- hugh3 15y ago
  There is a great big giant humongous gap between something that sounds good in an editorial and something that actually does something useful I am reminded of "politician's logic" from Yes Minister. 1. Something must be done. 2. This is something. 3. Therefore, we must do this.
- chc 15y ago
  With regards to the "more likely … to be self-employed": I think the problem is that "eligible non-participants" is kind of vague. If we take it to mean "people who tried to start their own business without help from the program," it makes more sense — the people in the program managed to stick with it 19 times more often than people who had to fully bootstrap their business.
hexis 15y ago
Starting a tech company is so cheap that funding should never be the bottleneck. If your idea is too expensive to start with a laptop and cheap hosting, think of another idea.
- hexagonc 15y ago
  You're only looking the smallest of expenses. It also depends on how far along you already are with the company. For any non-trivial idea that you're trying to implement from scratch, (especially if you're doing all the work yourself) you're going to want to be able to work on it full time, which means you have living expenses. Depending on where you live, those can be quite high. You might need to pay for training materials as well. There are also software licenses that might be required. I'm sure people with more experience can think of other costs. Hell, if you're just talking about iOS development then you might have to pay for devices, the Apple developer program and a Mac. Not saying these are insurmountable but not as inconsequential as you seem to be implying.
  - hexis 15y ago
    If you need living expenses, save up. If you live somewhere too expensive, move. "If your idea is too expensive to start with a laptop and cheap hosting, think of another idea." Sorry to be somewhat flip, but starting a tech company isn't complex, it's just difficult. These start-up costs are the easy part and if you can't solve them on your own, then a 10K infusion from the government isn't going to help you solve the actually difficult problems down the road.
    - nitrogen 15y ago
      Suppose you're working on a product that is time sensitive. In other words, if you don't start full time on it three months ago, you'll be too late to market. Also suppose that you see this opportunity while you're a student. Finally, consider that skilled programmers tend to be concentrated in high cost of living areas. In that case, you never had the opportunity to save up and you probably need to be where the potential cofounders and employees are, so you've no choice but to look for funding.
protomyth 15y ago
Is this just PR releases or is the full text of the bill out? After the pre-press on the health care bill versus actually reading the thing, I really want to see the actual text (and the follow-up rule making).
- jbooth 15y ago
  The bill's been sent to congress this morning, if you can't find it on their website yet, you'll be able to soon. (Haven't gone looking myself).
  - protomyth 15y ago
    isn't there yet - hope they put it up sometime tonight
    - protomyth 15y ago
      here is a link: http://www.whitehouse.gov/the-press-office/2011/09/12/message-president-congress-sectional-analysis-and-text-american-jobs-act http://www.whitehouse.gov/the-press-office/2011/09/12/messag...
sliverstorm 15y ago
In essence, the president’s plan will create a guaranteed source of startup capital... Is that necessarily a good thing? I was under the impression the whole "trial-by-fire" of a business plan looking for funding was a valuable testing grounds for the business-to-be.
- stc 15y ago
  Well you still get to do that when your $10,000 runs out.
  - hugh3 15y ago
    At which point you've already wasted $10,000 of someone else's money. There's also the good ol' sunk cost fallacy. The longer you've spent working on your dumb business plan, the less likely you are to change it to a smart business plan.
rada 15y ago
Whoa, the article is ageist, and proud of it. Though this program is geared toward people of all ages, young people are the best suited to maximize its advantages. Older generations tend to have families and other financial obligations, making it more difficult for them to transition into the roles of entrepreneurs. I am married with a young child, and my salary covers all of my family's expenses, so my husband doesn't have the pressure to get cashflow-positive out of the gate. Contrast that with my younger, single self, when I burned through the start-up capital in a matter of months and had to take consulting gigs just to stay afloat on office expenses. Young people can more easily adapt to less expensive lifestyles. Young people care a lot more about what others think, the very foundation of "expensive lifestyles". Further, young people have access to a wide range of resources, such as Income Based Repayment (IBR), SCORE, Startup America, [...] IBR is a student loan repayment program, nothing to do with entrepreneurship. SCORE is open to all small businesses (and a waste of time, in my experience). Startup America targets young companies, not young people. And so on...
- deleted 15y ago
  [deleted]
- bentlegen 15y ago
  > Young people care a lot more about what others think, the very foundation of "expensive lifestyles". Speaking of ageist ...
  - natnat 15y ago
    Young people tend to be single, which means they have a lot more at stake in terms of public image than married people do.
- ajross 15y ago
  I read those statements as demographic, not judgemental. A median 40-something does indeed tend to have a family, more financial obligations, a more expensive lifestyle, etc... Those are just presented as facts, and while I don't have the statistics handy they jive pretty well with my 39-year-old intuition. Nothing is saying entrepreneurship is impossible for the middle-aged, just that it's harder.
americandesi333 15y ago
Seems like there are some states that have this program in place- Delaware, Maine, Maryland, New Jersey, New York, Oregon and Pennsylvania. http://workforcesecurity.doleta.gov/unemploy/self.asp http://workforcesecurity.doleta.gov/unemploy/self.asp Unfortunately, not California
guelo 15y ago
Who cares about these proposals? They might be good ideas but the Republican House is never going to pass this.
delinquentme 15y ago
where the hell is the TLDR? i just want a place to submit an idea and prototypes and get cash ....
pythoning 15y ago
This article does not mention that in order to qualify for unemployment insurance you have to have worked for a certain period of time and then been laid off. This program will not help a college graduate (or dropout) that wants to start a business right away. It's a great program, but unemployment should be expanded to include people who are first time entrepreneurs that have never had a job and been laid off.
donnaware 15y ago
I don't want to sound synical here, but I know a lot of people already using unemployment as seed money to try to do their start up idea sort of "off the record". If you make it legal or OK to admit it (since it is already happening a fair amount) perhaps it would make the unemployment number more accurately reflect people really looking for a job. But I could be looking at it from a perspective that is not common since I know more people trying to get their idea going than the average perhaps.
teyc 15y ago
incidentally this has been done in Australia under the auspices of NEIS apparently over the past 20 years (link to monthly success story here: http://www.nna.asn.au/success-stories http://www.nna.asn.au/success-stories ) On top of it, there is a layer of mentoring as well: To be eligible for the NEIS Small Business Course, you must be in receipt of a Benefit and must have a Jobseeker ID Number. http://www.becnorthside.com.au/index.php?option=com_content&view=article&id=60&Itemid=68 http://www.becnorthside.com.au/index.php?option=com_content&...

172 points by GBond 15y ago

This seems really cool and all, but what are we talking about in terms of wait time and hurdles to jump through? Anyone know details? I've looked into and seen others go through grant processes and they are often terrible. Hope it isn't similar.

maratd 15y ago
This isn't a grant. It's a modification of the rules for unemployment insurance. It's a good change. It allows you to use unemployment insurance to pursue your own business for about half a year. Of course, for you to be eligible for unemployment insurance, you had to have been employed at some point and gotten fired. It's also a paltry sum. But, again, any movement in the right direction is a plus.
- tibbon 15y ago
  Strange question, but couldn't you always do this? From my understanding, unemployment insurance only required that you take no/low salary from a company. You were still able to receive money from capital-gains/investments. Start a consulting firm/startup, pay yourself a $1 salary with stock options. Don't exercise these options for a long time (when you stop UE). I read the UE stuff time and time again in Massachusetts and kept looking for something to say that I couldn't do this but couldn't find anything that said so explicitly. I didn't end up doing consulting (just more learning/studying), but it would have worked and been legal right?
  - maratd 15y ago
    > Strange question, but couldn't you always do this? No. For you to receive unemployment insurance you must prove that you are actively seeking a job. I suppose you could have invested the time into looking for a job while spending the rest of it starting a business, but this will provide you with an explicit option to start your own business. That will encourage more people to do so.
    - tibbon 15y ago
      Right. Let's say I was searching for a job, but doing Rails work on the side (not a startup per-se, but you know... doing startupy like work). I could spent 1 day per week looking for a job, and 4 to 6 days a week coding for people. All the proceeds go into a consulting firm which I hold ownership of. But yes, it is good for this to be official now.
      - ansy 15y ago
        If you do this you are probably violating the unemployment rules in your state[1]. If you reported this income with the unemployment office you will most likely have your benefits reduced or eliminated. But most people don't report this income and get away with "double dipping" which was heretofore not allowed. Technically if the government found out you did this they could penalize you retroactively. But this is a hassle and most people just get away with it unnoticed. Even more technically, some states will even deny unemployment benefits if you are working without pay such as in a startup situation (and you are honest enough to admit this). It's not about income or full utilization, it's are you working at all. The change in the law makes getting paid for self employment legal. Although if your self employment included revenue I assume it would still count against the amount you received from unemployment, again depending on your state. [1] http://career-advice.monster.com/salary-benefits/benefits-information/unemployment-benefits-part-time-work/article.aspx http://career-advice.monster.com/salary-benefits/benefits-in...
  - JayWilmont 15y ago
    Remember unemployment insurance rules vary depending on the state. New York State for example asks if you are employed, not if you are drawing a salary.
    - tibbon 15y ago
      True. Massachusetts asks your salary. If you're working a job that pays less than your UE benefits, then they make up the difference.
- bricestacey 15y ago
  It's too bad that it's a modification of unemployment. I'd take this, but I have a job and it's next to impossible for me to be fired or laid off.
  - maratd 15y ago
    The amount in question is a paltry sum. If that's all that's stopping you from starting your own business, quit. Walk into a bank and ask for a loan. You can get an SBA backed loan for 10K with moderate to good credit and no collateral. You can also just get a credit card with a 10K limit and a 0% APR offer, and transfer the funds to your checking account. Of course, all of these mean taking on the risk personally ... but if you're not willing to do that, you really have no business running a business.
nhebb 15y ago
I'm not sure there are details yet. The stimulus / jobs plan has been proposed, but there is no bill written yet. It will be another ten days before Obama presents his plan on how to pay for the jobs plan, and the bill won't likely be written until after that. This is a great idea and would have helped me when I faced this situation 9 years ago. Following a layoff, I asked the unemployment office about this, and they said I must actively be looking for work. Still, I think the overall economic impact of this proposal is small potatoes compared to the overall jobs situation, but I guess every little bit helps.

jwb119 15y ago

About time. The policy of forcing a decision for laid off people between 1) sitting around doing nothing (i.e. "looking for a job") and being eligible for free money vs. 2) trying to start something which could have an an impact in not only getting that person back into a paying position but also on the economy as a whole (and thereby being ineligible for money) needed to end

anamax 15y ago
> The policy of forcing a decision for laid off people between 1) sitting around doing nothing (i.e. "looking for a job") and being eligible for free money vs. 2) trying to start something There was no such policy - there was no such "decision". The standards for "looking for a job" are/were low enough that one could be trying to start something at the same time. (I know - that's what I did.) While we like to talk about starting companies, ie we like startup porn, the vast majority of the long term unemployed won't start anything. More to the point, the folks who would are unaffected by this proposal, so there won't be any benefits received for the costs incurred. How do I know this? The folks who would start do start and are doing so already. (Yes, I read the SEA stats.)
- JayWilmont 15y ago
  There is such a policy, at least in New York State. Any time spent on "self-employment" activities reduces the amount of unemployment insurance money you receive.
  - lurker14 15y ago
    all activities, or activities with associated revenue streams?
    - nknight 15y ago
      There are precedents for it being all activities. Particularly anything you're doing that would be in line with your usual profession, whether you're getting paid for it or not. The rules vary by state, though.

bsiemon 15y ago

I found the link for a list of unrelated things 2 paragraphs in quite jarring.

fredBuddemeyer 15y ago

genius. who needs voluntary transactions live venture capital or angels, what have they ever done? instead lets take money from everyone (if they don't like it we can lock them in a cage) and then give it to others who we decide are worthy.

yellowbkpk 15y ago
Outside of Silicon Valley (and a few other hot spots maybe) "voluntary transactions" aren't happening, so the government feels the need to step in.
- anamax 15y ago
  Yes, govt feels the need to step in. The relevant question is whether said "step in" makes any sense. If there really are such wonderful opportunities, why aren't you funding them?
  - ori_b 15y ago
    I don't have enough cash on hand.
    - sneak 15y ago
      Interestingly enough, neither does the US government.
      - natnat 15y ago
        The government can borrow money at negative interest rates. People are literally paying the U.S. government to take their money. It may have a large budget deficit, but the government has no shortage of cash.
        anamax 15y ago
        > The government can borrow money at negative interest rates. The feds are borrowing at less than the rate of inflation, but they're not borrowing at negative rates. Note that current interest rates don't accurately reflect the interest cost of borrowing because those loans will be rolled over a couple of times. Do you really think that the low interest rates will continue? More to the point, said borrowing has to be repaid. If the expected/likely additional tax revenue from this program is less than the amount spent, it's a bad deal.

jeremymcanally 15y ago

The ignorance displayed in the comments on that article is scary. It's quite obvious a lot of people have never been in the position to actually need this sort of aid before, so it's easy to knock everyone using it as "an illegal" or "lazy." Of course people will abuse this, too, just like they abuse the unemployment insurance we have now. But to me, the net positives that come out of this will outweigh the (probably minor) fraud that will happen. Adding benchmarks (e.g., you have to legally register a business, you have to prove some sort of business activity to a case worker, and so on) will keep a lot of the fraud out, even if they're token requirements.

temphn 15y ago
One word: Solyndra. After they just wasted another $535M of taxpayer money in crony capitalist payments, why do you think it's "ignorance" to evince strong opposition to these kind of attempts at meddling in the economy? VCs and angels fund selectively and with their own money. The govt funds politically and with other people's money. That selects for Chris Gronet and George Kaiser, not Mark Zuckerberg and Peter Thiel.
TomOfTTB 15y ago
First, who said "an illegal" or "lazy"? Searching the page I only find your comment using those terms. Second, "the system is already being abused so lets allow further abuse" isn't really a great argument. (For the record I'm actually in favor of this I just don't think your tone is necessary and I think it discourages anyone who might disagree)
- mbesto 15y ago
  1. Read the comments on the actual article, not HN. 2. Unless you have another ingenious way to make unemployment money more efficient, I see it as a fairly decent argument.
- sologoub 15y ago
  There is a comment from jmfay on there that talks about "illegals"...
- 15y ago

talmand 15y ago

Then, if you become successful, you can be labeled as one of the hated rich and they'll put you out of business with crushing regulation and taxes. Excellent.

danssig 15y ago
"Crushing regulation and taxes" generally hits small businesses hardest.
- talmand 15y ago
  According to descriptions of what "rich" seems to mean to most, small businesses are the largest part of that heavily disliked group. In the recent English riots the prevailing thought seemed to be that simply owning a business meant you were rich.
  - danssig 15y ago
    It's hard to imagine this being the case. When I think of "has way too much money" I think of big corporate fat cats. Never small business owners. I don't know anyone personally who sees small business as hated rich either. Perhaps this is some kind of cultural thing in the UK?

known 15y ago

US need a win-win proposition with Chindia

DiabloD3 15y ago
I know this is getting downmodded, but hes somewhat right. "Chindia" is draining our economy, by "draining our economy", I mean its destroying the people who actually do the work. For every job that is sent overseas, not only does it result in someone, an actual real person, losing their job, but a form of slave labor in a foreign country "hires" the replacement. If I was President, honestly, I would push for a 0.5% tariff on all goods and services from countries that are not considered first world countries. I may be unable to improve the conditions of slave laborers in foreign countries (especially China and India due to massively corrupt governments that are doing everything possible to widen the gap between the poor and the rich instead of closing it), but I don't have to support doing business with those who make this possible. 0.5% would result in hundreds of millions of dollars in recaptured revenue, which could be instead spent on trying to preserve jobs in the US instead of exporting them, but it would also be low enough that the consumer would not bear the brunt of this.
- gte910h 15y ago
  >If I was President, honestly, I would push for a 0.5% tariff on all goods and services from countries that are not considered first world countries. An alternate statement of that idea (which I'm not sure I agree with either), is a tariff on goods and service in the amounts required to bring the hourly foreign labor costs up to the US federal minimum wage with no exemptions.
  - DiabloD3 15y ago
    I was actually considering something similar. Instead, define "first world country" as a county who's median yearly pay is at least half of hours, recognizes basic human rights, recognizes democratic voting, and doesn't punish their population for speaking out against the government or any government sponsored religion (such as the Muslim religion in various middle eastern countries), and also recognizes the rights of women. As in, fellow countries that believe in life, liberty, and the pursuit of happiness. Attempting to tariff any harder can have extremely adverse effects. The rich wish to remain rich at all costs.

philiphodgen 15y ago

1. I run a business. Therefore I make jobs. Or don't. 2. If I fire an employee, a portion of the cost of that person's unemployment claims is charged back to me. The employer. It isn't government largesse that funds unemployment claims. It's me. 3. Will this program be yet another potential cost to me? Hard to tell from the PR and press-gab. We'll have to see the law and how it is implemented. Devil in the details, etc. 4. My payroll is suddenly $100K/year lighter than it was. Am I going to replace that guy with another full-timer? Fuck, no. Hello, independent contractors. 5. By the way. I pay 100% of the medical costs for all my employees.

muhfuhkuh 15y ago
"My payroll is suddenly $100K/year lighter than it was. Am I going to replace that guy with another full-timer? Fuck, no. Hello, independent contractors." From this country? That matters much more than whether they'd be contract or full-time.
- philiphodgen 15y ago
  Absolutely from the U. S. and A. All of them.
chopsueyar 15y ago
If you fire an employee, why do you pay unemployment? I would understand if you laid them off, but firing? Also, if you are paying for their unemployment, why is unemployment being deducted from their paycheck too?
- clarkevans 15y ago
  In most states it's quite difficult to prove that you fired for cause -- performance is quite subjective. Typically the employee needs to do something dramatic & harmful for you to deny unemployment.
  - roc 15y ago

GBond 15y ago

To me the true significance, more so than this money, is the milestone of the federal gov't finally recognizing "entrepreneur" as a third category of employment status and not just the unemployed/employed binary. Hopefully this leads to further help for folks starting a company (that will in-turn create more jobs when successful) like healthcare coverage. EDIT: This will also help with mainstream cultural and social acceptance. Less weird looks when explaining to Joe Shmoe your employment situation!

dualogy 15y ago
It will also help massively to "massage" unemployment figures in a positive spin by reclassifying a million or two of them as "entrepreneurs". (And hey, the debt ceiling can be raised indefinitely so no problem re costs. We finally arrived in The Future: the perpetuum mobile exists.)

DanielBMarkham 15y ago

I like the spin on this. Sounds like something that could be very useful. I must note, however, some phrases that set off my bullshit detector. >SEA participants were 19 times more likely than eligible non-participants to be self-employed Either I'm missing something or this says that people who are in a self-employed assistance plan are likely to be self-employed. Perhaps this is an editing error? >In Oregon, nearly half of the successful SEA entrepreneurs have each created an average of 2.63 new jobs Ok, but what kind of filter does "successful SEA entrepreneurs" imply? 1 in 100? 20%? Once again, the language is loose and circular. Money is not an answer to everything. In fact, funding at high levels can be the worst thing ever to happen to a good team in a startup. At small levels, like this, it perhaps can make a big difference. Perhaps. There is a great big giant humongous gap between something that sounds good in an editorial and something that actually does something useful. I'd want a lot more data on this before passing judgment one way or another.

hugh3 15y ago
There is a great big giant humongous gap between something that sounds good in an editorial and something that actually does something useful I am reminded of "politician's logic" from Yes Minister. 1. Something must be done. 2. This is something. 3. Therefore, we must do this.
chc 15y ago
With regards to the "more likely … to be self-employed": I think the problem is that "eligible non-participants" is kind of vague. If we take it to mean "people who tried to start their own business without help from the program," it makes more sense — the people in the program managed to stick with it 19 times more often than people who had to fully bootstrap their business.

hexis 15y ago

Starting a tech company is so cheap that funding should never be the bottleneck. If your idea is too expensive to start with a laptop and cheap hosting, think of another idea.

hexagonc 15y ago
You're only looking the smallest of expenses. It also depends on how far along you already are with the company. For any non-trivial idea that you're trying to implement from scratch, (especially if you're doing all the work yourself) you're going to want to be able to work on it full time, which means you have living expenses. Depending on where you live, those can be quite high. You might need to pay for training materials as well. There are also software licenses that might be required. I'm sure people with more experience can think of other costs. Hell, if you're just talking about iOS development then you might have to pay for devices, the Apple developer program and a Mac. Not saying these are insurmountable but not as inconsequential as you seem to be implying.
- hexis 15y ago
  If you need living expenses, save up. If you live somewhere too expensive, move. "If your idea is too expensive to start with a laptop and cheap hosting, think of another idea." Sorry to be somewhat flip, but starting a tech company isn't complex, it's just difficult. These start-up costs are the easy part and if you can't solve them on your own, then a 10K infusion from the government isn't going to help you solve the actually difficult problems down the road.
  - nitrogen 15y ago
    Suppose you're working on a product that is time sensitive. In other words, if you don't start full time on it three months ago, you'll be too late to market. Also suppose that you see this opportunity while you're a student. Finally, consider that skilled programmers tend to be concentrated in high cost of living areas. In that case, you never had the opportunity to save up and you probably need to be where the potential cofounders and employees are, so you've no choice but to look for funding.

protomyth 15y ago

Is this just PR releases or is the full text of the bill out? After the pre-press on the health care bill versus actually reading the thing, I really want to see the actual text (and the follow-up rule making).

jbooth 15y ago
The bill's been sent to congress this morning, if you can't find it on their website yet, you'll be able to soon. (Haven't gone looking myself).
- protomyth 15y ago
  isn't there yet - hope they put it up sometime tonight
  - protomyth 15y ago
    here is a link: http://www.whitehouse.gov/the-press-office/2011/09/12/message-president-congress-sectional-analysis-and-text-american-jobs-act http://www.whitehouse.gov/the-press-office/2011/09/12/messag...

sliverstorm 15y ago

In essence, the president’s plan will create a guaranteed source of startup capital... Is that necessarily a good thing? I was under the impression the whole "trial-by-fire" of a business plan looking for funding was a valuable testing grounds for the business-to-be.

stc 15y ago
Well you still get to do that when your $10,000 runs out.
- hugh3 15y ago
  At which point you've already wasted $10,000 of someone else's money. There's also the good ol' sunk cost fallacy. The longer you've spent working on your dumb business plan, the less likely you are to change it to a smart business plan.

rada 15y ago

Whoa, the article is ageist, and proud of it. Though this program is geared toward people of all ages, young people are the best suited to maximize its advantages. Older generations tend to have families and other financial obligations, making it more difficult for them to transition into the roles of entrepreneurs. I am married with a young child, and my salary covers all of my family's expenses, so my husband doesn't have the pressure to get cashflow-positive out of the gate. Contrast that with my younger, single self, when I burned through the start-up capital in a matter of months and had to take consulting gigs just to stay afloat on office expenses. Young people can more easily adapt to less expensive lifestyles. Young people care a lot more about what others think, the very foundation of "expensive lifestyles". Further, young people have access to a wide range of resources, such as Income Based Repayment (IBR), SCORE, Startup America, [...] IBR is a student loan repayment program, nothing to do with entrepreneurship. SCORE is open to all small businesses (and a waste of time, in my experience). Startup America targets young companies, not young people. And so on...

deleted 15y ago
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bentlegen 15y ago
> Young people care a lot more about what others think, the very foundation of "expensive lifestyles". Speaking of ageist ...
- natnat 15y ago
  Young people tend to be single, which means they have a lot more at stake in terms of public image than married people do.
ajross 15y ago
I read those statements as demographic, not judgemental. A median 40-something does indeed tend to have a family, more financial obligations, a more expensive lifestyle, etc... Those are just presented as facts, and while I don't have the statistics handy they jive pretty well with my 39-year-old intuition. Nothing is saying entrepreneurship is impossible for the middle-aged, just that it's harder.

americandesi333 15y ago

Seems like there are some states that have this program in place- Delaware, Maine, Maryland, New Jersey, New York, Oregon and Pennsylvania. http://workforcesecurity.doleta.gov/unemploy/self.asp http://workforcesecurity.doleta.gov/unemploy/self.asp Unfortunately, not California

guelo 15y ago

Who cares about these proposals? They might be good ideas but the Republican House is never going to pass this.

delinquentme 15y ago

where the hell is the TLDR? i just want a place to submit an idea and prototypes and get cash ....

pythoning 15y ago

This article does not mention that in order to qualify for unemployment insurance you have to have worked for a certain period of time and then been laid off. This program will not help a college graduate (or dropout) that wants to start a business right away. It's a great program, but unemployment should be expanded to include people who are first time entrepreneurs that have never had a job and been laid off.

donnaware 15y ago

I don't want to sound synical here, but I know a lot of people already using unemployment as seed money to try to do their start up idea sort of "off the record". If you make it legal or OK to admit it (since it is already happening a fair amount) perhaps it would make the unemployment number more accurately reflect people really looking for a job. But I could be looking at it from a perspective that is not common since I know more people trying to get their idea going than the average perhaps.

teyc 15y ago

incidentally this has been done in Australia under the auspices of NEIS apparently over the past 20 years (link to monthly success story here: http://www.nna.asn.au/success-stories http://www.nna.asn.au/success-stories ) On top of it, there is a layer of mentoring as well: To be eligible for the NEIS Small Business Course, you must be in receipt of a Benefit and must have a Jobseeker ID Number. http://www.becnorthside.com.au/index.php?option=com_content&view=article&id=60&Itemid=68 http://www.becnorthside.com.au/index.php?option=com_content&...