CHN: Kicking the Jobless When They’re Down

Unemployment Insurance Expires; But Some Jobs Measures Advance in Congress
On March 10, hopes were high that unemployed people would no longer have to worry from week to week that the federal Unemployment Insurance program would soon expire.  On that date, the Senate passed legislation (H.R. 4213) that included extensions through the end of 2010 for UI and COBRA health benefit subsidies, as well as a six-month extension of additional federal aid to states to help with rising Medicaid costs.  The legislation had bipartisan support, with a vote of 62-36 (all Democrats except Ben Nelson (D-NE) voted for it; all Republicans opposed it except Bond (R-MO), Collins (R-ME), Murkowski (R-AK), Snowe (R-ME), Vitter (R-LA) and Voinovich (R-OH)). But differences between the House and Senate about how to pay for other provisions in the bill prevented speedy enactment.  The House passed another 30-day extension, to give time to resolve these differences.  The Senate needed unanimous consent to take up the temporary extension before leaving for a two-week recess.  It didn’t get it.

As a consequence, federal Unemployment Insurance benefits will expire, with the latest short-term extension due to end on April 5.  The Senate adjourned on Friday, March 26 and is not scheduled to return until April 12.  That means the federal program will not be in effect for up to two weeks, depending on how quickly the Senate completes work on the extension on its return.  A cloture vote (to cut off debate) is now scheduled to take place on April 12; under Senate rules, debate could continue another two days before proceeding to a vote.  Since the House has already passed this extension, H.R. 4213 would become law if adopted unchanged by the Senate.

This time, Senator Tom Coburn (R-OK) was the one man standing in the way of continued unemployment benefits.  He objected to taking up the bill, seeking to replace it with legislation that would pay for its $9.2 billion cost by taking away unspent economic recovery funds.  The House and Senate leadership were not willing to use these funds.  Many economists believe that unemployment insurance is one of the most effective means of boosting the economy, because people out of work will spend their benefits quickly.  Taking money out of other recovery measures to pay for UI would reduce the economic benefit.

For each week that the extra weeks of federal benefits are not available, approximately 200,000 long-term unemployed workers will have to go without assistance, according to an earlier analysis by the National Employment Law Project (estimates by state at  Four in ten of the unemployed have been out of work for six months or more, a level far higher than the norm.  State unemployment aid generally runs out after six months; the long-term jobless depend on federal benefits.

Other Legislation With Jobs Provisions

Multiple pieces of legislation are moving in the House and Senate with the intent of spurring job creation.  They include heavy doses of business tax breaks, many of which are not judged to be especially effective at creating jobs.  The latest to pass one chamber is The Small Business and Infrastructure Jobs Tax Act of 2010 (H.R. 4849), which passed the House on March 24 by a vote of 246-178.  Of particular importance to low-income advocates, this legislation includes $2.5 billion to continue the Temporary Assistance for Needy Families (TANF) Emergency Fund for one more year.  States can use the TANF Emergency Fund to provide one-time or recurrent benefits if they are spending more on their caseload, to help states willing to let more families receive benefits or to increase benefits in light of the severe recession.  The Emergency Fund can also be used to create subsidized jobs, and about half the states are using the funds for this purpose, with about 100,000 jobs expected to be created by September 30.  The President had proposed extending the Emergency Fund in his FY 2011 budget (see HNR, March 1, 2010, The President’s Budget:  Important Strides Forward After Years of Cuts:  H.R. 4849 would allow the funds to be used to employ workers in needy families whether or not they are receiving TANF cash assistance, and also for low-income workers who are exhausting all UI benefits, whether or not they have children.

Out of a $16.8 billion in total funding through the Small Business and Infrastructure Jobs Tax Act, $13.2 billion is for bonds used by state and local governments to build or rebuild infrastructure.  The bill will be taken up by the Senate after it returns from the April recess.

On the same day, the House passed the Disaster Relief and Summer Jobs Act of 2010 (H.R. 4899) with a vote of 239-175.  The bill includes $600 million for summer jobs for youth, enough for temporary jobs for about 300,000 young people.  Requests by advocates and by the Congressional Black Caucus had been for $1.2 billion or more.  Last summer, economic recovery funds were used to hire more than 300,000 youth (with two-year funding of $1.2 billion).  With one in four youth unemployed in February, and 42 percent of African American youth out of work, the need for summer and year-round job funding is critical.  The rest of the $5.1 billion bill would be provided to the Federal Emergency Management Agency (FEMA) for continuing aid for communities hit by Hurricane Katrina and other disasters.  This too needs quick action in the Senate, since localities need at least some time to plan before the summer arrives.

As reported above, the Senate had passed the American Workers, State, and Business Relief Act of 2010 (H.R. 4213) on March 10.  Besides extending UI, COBRA health benefit subsidies, and increased aid to states for Medicaid costs, the legislation also included extensions of many tax breaks and the continued postponement of a scheduled cut in Medicare payments to physicians.  The House and Senate will have to resolve their differences on how to pay for the $140 billion bill after the recess.

Advocates are planning to devote much attention to the Local Jobs for America Act (H.R. 4812), introduced by Rep. George Miller (D-CA) on March 10.  This far-reaching legislation would create or save 1 million jobs over two years at a cost of $100 billion.  The legislation would provide 100 percent federal funding for two years for local government jobs and for jobs in the non-profit sector.  Many of these jobs would be targeted to low-income people and communities.  During the recess and beyond, an effort will be underway to attract more House co-sponsors (there are already 105).

(For more information about the jobs legislation, see HNR, March 12, 2010, Unemployment Insurance Back on Track; Jobs Bills Move in Senate and House.)

Labor and Employment
unemployment insurance