CHN: Unemployment Insurance Back on Track; Jobs Bills Move in Senate and House

Senator Bunning (R-KY) temporarily derailed attempts by the Senate to pass a short-term extension of federal Unemployment Insurance benefits.  His actions allowed the program to expire on February 28th.  But two days later Senator Bunning abandoned his stalling tactics and an extension through April 5, 2010 of UI and COBRA health insurance subsidies passed 78-19.  Bunning’s actions put more than 200,000 long-term unemployed people at risk of losing benefits.  Longer term extensions of UI and COBRA are pending in a bill now moving through Congress.  (See below.)
In the meantime, the House, under pressure from more conservative Blue Dog members, refused to clear a separate $15 billion jobs bill, H.R. 2847, passed by the Senate on February 24th , without first making minor changes to the bill and bringing it into compliance with House pay-as-you-go budget rules.  The bill passed the House 217-201 on March 4th costs $17.6 billion.  The bill’s key provision exempts businesses from paying the 6.2 percent Social Security payroll tax if they hire workers who have been unemployed for at least 60 days.  The legislation also gives businesses an additional $1,000 credit for each new worker who remains on the job for a full year.  The Senate will need to vote to accept the House changes before sending the bill to the President for his signature.  To expedite final passage, the Senate leadership has invoked cloture, with the vote to end debate scheduled for March 15.  (See more information on UI and COBRA and the jobs bill in Human Needs Report for March 1, 2010).

In the face of a persistently high 9.7 percent national unemployment rate and a loss of over 8.4 million jobs since the recession began in December 2007, the strategy Senate and House Democratic leaders have adopted is to address this economic reality with a jobs agenda consisting of a series of bills with job-creation components.  Within days of passing its first jobs bill, H.R. 2847, Senate Democrats brought the second bill in their jobs agenda to the floor.  The American Workers, State, and Business Relief Act of 2010, H.R. 4213, includes an extension of UI and COBRA through the end of 2010, a six-month extension of aid to states to help offset their rising Medicaid costs, postponement of the scheduled cut in Medicare payments to doctors, and a retroactive extension of dozens of tax provisions including the research and development credit, deductibility for state sales taxes, and energy-related credits.  In recent years this ‘extenders’ package has been renewed annually, but in 2009 was allowed to lapse on December 31.  The $140 billion bill offsets the cost for the tax extenders with revenues from elsewhere in the tax code.  UI, COBRA and the aid to states to help pay for Medicaid is considered emergency spending and does not need to be offset according to pay-go budget rules.  The bill passed the Senate on March 10th by a vote of 62-36 with six Republicans joining all but one Democrat (Senator Nelson (NE)) in supporting the bill.  (The six Republicans were Senators Bond (MO), Collins (ME), Murkowski (AK), Snowe (ME), Vitter (LA) and Voinovich (OH)). The House will decide whether to vote on the bill as passed by the Senate or include provisions which focus more directly on creating jobs from the Jobs for Main Street Act of 2010 it passed in December.  (See more information on the Jobs for Main Street Act of 2010 in the Human Needs Report for December 23, 2009).

During floor debate on H.R. 4213 an amendment sponsored by Senators Sessions (R-AL) and McCaskill (D-MO) that would have capped discretionary spending for four years at 2010 levels narrowly failed to get the 60 votes needed, 59-41.  A discretionary cap would damage many programs critical to low-income families that are just beginning to recover from cuts made by the Bush Administration and prior Congresses.

A second amendment sponsored by Senators Murray (D-WA) and Kerry (D-MA) to extend the TANF Emergency Fund and provide funding for summer employment for youth failed to get 60 votes, as required by Senate rules (the vote was 55-45).  The TANF Emergency Fund received $5 billion over two years from the American Recovery and Reinvestment Act and is being used by states to provide subsidized jobs to at least 100,000 low-income parents and basic assistance to poor families with children hit hard by the recession.  The Emergency Fund is set to expire on September 30, 2010; the six-month extension provided by the amendment would cost $1.3 billion.  Currently there is no money for the summer employment program for youth, the group with the highest unemployment rate.  Another $1.3 billion in the amendment would have created up to 500,000 jobs for disadvantaged youth.  Advocates hope that when the House considers H.R. 4213, it will add funding for the TANF Emergency Fund for a year and for the summer jobs program.  If that fails, efforts will be made to attach these provisions to the next jobs bill in the Congressional lineup.

Before work is completed on either of the first two jobs bills, both the Senate Finance and Small Business Committees and the House Ways and Means Committee are working on the third bill in their jobs agenda that will focus on small businesses. Advocates and many economists believe that these three bills rely too heavily on tax breaks for business that are unlikely to be effective at creating jobs. The bills lack a direct job creation approach that could be well-targeted to help communities devastated by the recession.  In response, advocates are quickly lining up in support of the Local Jobs for America Act, H.R. 4812, introduced on March 10th by Representative George Miller (D-CA), Chairman of the House on Education and Labor.  The bill directs $100 billion in federal spending to state and local governments over the next two years to save or create 1 million jobs.  The legislation is designed to create jobs quickly in the public and private sectors with 100 percent federal funding for two years.  The jobs would provide modest wages plus health insurance.  Twenty-five percent of total funds in the bill may go to community non-profits.  This legislation could move as a separate bill or be added to another bill moving through Congress.

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