Sen. Marshall: Unemployment benefits are fueling worker shortage

Senator Roger Marshall (R-KS) joined Yahoo Finance to discuss why he believes additional unemployment benefits need to end.

Video Transcript

SEANA SMITH: President Biden meeting earlier today with congressional leaders this morning, republican leaders, saying that they told President Biden that they were drawing a quote "red line" on raising taxes to fund President Biden's infrastructure proposal. So let's talk a little bit more about that and other big events going on down in DC. We want to bring in Senator Roger Marshall. And we're also joined by Yahoo Finance's DC reporter Jessica Smith. Senator Marshall, it's great to have you here on Yahoo Finance.

Let's just start with the infrastructure plan. I guess taking a step back more broadly speaking, for your state, for your constituents, what do you think is critical to be included in this plan?

ROGER MARSHALL: Well, I think we always start off with roads and bridges, waterways, we need some railroad infrastructure done, and high speed internet. I think those are traditional infrastructure projects that all of us can agree upon. And then beyond that's when we start losing folks. So I think those are great places to start.

JESSICA SMITH: Jessica Smith here. What do you think the best way is to pay for that if republicans are against tax hikes and we're seeing the White House against user fees? How do you bridge that gap?

ROGER MARSHALL: Well, I think number one is we can go back and repurpose some of the dollars we've already spent. So we borrowed $2 trillion from our grandchildren back in January. So why not use that money for the people that that need it the most, the people are going to be using it for the next two decades? The economy is really coming back strong in Kansas and most of the nation, great GDP numbers, unemployment's down. We have eight million open jobs across the country right now.

So I really think repurposing those dollars would be number one. And then number two would be some type of a user's fee. I think that traditionally people think about paying for infrastructure with those people who are using it.

- Behind the scenes on Capitol Hill, when you talk to your colleagues, to democrats, where is the compromise going to be?

ROGER MARSHALL: Well, I think number one is how much money are we going to borrow from our grandchildren, and number two, what are we going to spend it on. So I think that we've suggested-- we're for a $600 billion infrastructure package. We'd rather repurpose some of those that were used before when some people were hesitant on the strength of this economy. And then I think the opportunity on a user's fee. So we kind of-- they want a $2 trillion very broad based infrastructure using the term infrastructure very generously really focused on a green New Deal and raising people's taxes. So hopefully we can find a spot closer to that $600 billion.

JESSICA SMITH: Hi, Senator. Switching gears a little bit to your proposal that you laid out this week to phase out the enhanced unemployment benefits. We're already seeing some states drop out of those enhanced benefits. What do you say to critics who say this move is premature?

ROGER MARSHALL: Well, I think that they haven't been out and talked to the people. The first time I sat down with Senator Bob Dole to talk about a serious challenge, he said, well, go back to the people of Kansas. And they'll tell you the answer. I've talked to thousands of business owners over the past several months. I think we've done 23 or 24 town halls. The number one impediment to this economy right now is getting people back to work. We've got the virus under control, we're approaching herd immunity, so many great things happening. But we can't get people to go back to work.

So we're paying people right now about $20 an hour to stay home, $40,000 a year if you have two people drawing that unemployment, that's $80,000 a year that we're paying people not to work. So again, I mentioned earlier, eight million open jobs right now. So that's step one. But I also want to have a heart here and say, look I know there's still some people with challenges going on. So we would take away the $300 a week federal supplement, still leave them with the $500. But we need to talk a little bit about getting kids back in school.

Once upon a time, I was in residency working 100 hours a week as an obstetrician, my wife working 12 hours a day as a nurse in an intensive care unit. And child care is one of the toughest things we've ever had to deal with. So if the kids are back in school, child care issues, let's try to address those. But at the same time, this extra $300 a week is keeping people from going back to work.

SEANA SMITH: You know what Senator? It's interesting because Deutsche Bank, they were out with a chart. They were going through the labor numbers that we got out on Friday. And they have a chart that I want to pull up on the screen right now. And it shows that job gains actually outperformed at lower wages. And it really suggested the opposite of what you were saying, that unemployment benefits likely was not the driver of weakness. I'm curious just to get your take on this. As we can see, there is a massive uptick in the number of low wage jobs. And we actually saw quite the opposite in the higher wage employment numbers.

ROGER MARSHALL: Well, I haven't broken down this particular graph. But I can tell you that if you would go out and interview 100 business owners, whether they're small business owners, medium, or large, they're going to talk about their problems getting people to come back to work. I can think of a woman who owns a company. What they do is they help people with disabilities. So she has about 200 employees. She's missing 70 folks. I talked to a hotel owner, a person that owns five or seven hotels. They had to turn down business. They had turned down a conference because they can't get people to come back to work.

I'm not sure where those figures come. Typically those are probably a month behind what I see out there in the real world. But I'm telling you, we can't get people to come back to work. Eight million open jobs. I mean, what do you say about that?

- I repeat that, sir. I interrupted you.

ROGER MARSHALL: I said eight million jobs are open right now. The highest number we've ever seen. I think that's just the glaring bright lights that I'm seeing right now, eight million open jobs.

- There was in 2013 though, small business employers we're talking about the fact that they couldn't get enough people. And that was 2013. There was no pandemic. And there was no $300 extra from the federal government. What's different now? It was the same situation. Couldn't get enough people to work.

ROGER MARSHALL: No, you're right. The biggest challenge before the epidemic was a lack of people for the jobs we have. It is that simple. But this has made it worse. That's the difference is this extra $300 has made it worse. So it was a problem. It continues to be a problem. And a part of it is making sure that we have the right training for the jobs that we do have. I know in Kansas that we have just incredible community colleges and technical colleges.

The average graduate from those programs start off at a salary more than the folks from the four year universities do. Now don't get me wrong. I'm a university graduate myself and blessed to get to go to medical school. But right now, the jobs that we have open in Kansas are a lot of those technical degree opportunities.

- Hey, real quick. When we talk about that issue about the $300, if the problem was this in 2013, why not just raise wages? Shouldn't these small business owners be raising wages to attract people back into work?

ROGER MARSHALL: And that's absolutely what's happening. Again, going back to those small business owners I was talking to, several of them have raised wages about 20% from pre-COVID levels as well. So wages are coming up. We had some great wage growth in 2017, '18, '19 as well. But even more so right now. So the market is dictating that because of the labor shortage. But we're still paying too much from the federal government. We're rewarding people to not work.

Let me just say this. I know we're out of time probably. But giving a person a job brings dignity, fulfillment, gives us purpose in life. We've got the biggest mental health challenge this country has ever had. Being at a job that helps take care of yourself, your family, contribute to the community, that's what's going to help people's mental health as well.

JESSICA SMITH: Senator, I'm curious what you think of the idea of automatic triggers. Senator Wyden has proposed that, for example. So tying those enhanced unemployment benefits to economic conditions on the ground. So you avoid of these political debates about this. What do you think about that type of idea?

ROGER MARSHALL: The devil's always in the details. I'd be willing to look at it. I'm always a little bit concerned about how much of this the federal government's going to micromanage, who in the administration is going to make some of those decisions. So I'm willing to look at it. But I'm not ready. I'm not all on board yet.

SEANA SMITH: Senator Roger Marshall, great to speak with you. Thanks so much for taking the time. We hope to have you back on Yahoo Finance again in the future.