employment insurance

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“The government should fix it” is a common refrain when people encounter a problem in society. Governments happily oblige because it means more votes for politicians and more work for bureaucrats. Governments themselves also undertake a number of things from encouraging Canadians to be more active, to propping up domestic industries, to trying to create jobs. But can government really deliver? Evidence suggests the answer is a resounding no.


2:00AM
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Imagine a world where your car insurance company charges everybody the same premium; the premium doesn’t depend on your driving record or the number of claims you make. Nor does the premium depend on your age or other characteristics that increase your risk of getting into an accident.

Such a system seems absurd because it benefits bad drivers at the expense of good drivers. But this is exactly how Canada’s employment insurance (EI) program operates.