Friday, May 13, 2011

Screw the Unemployed

The House of Representatives is finally getting around to jobs, the number 3 thing on its 2010 campaign agenda. House Ways & Means Committee Chairman Dave Camp (R–MI) has introduced the legislation, “To improve jobs, opportunity, benefits, and services for unemployed Americans, and for other purposes.” The bill does not have a number yet but according to its text may be referred to as the ‘‘Jobs, Opportunity, Benefits, and Services Act of 2011’’ or simply the ‘‘JOBS Act of 2011’’. But it does not have to do with jobs; it has to do with unemployment benefits. It cuts them back.

Despite the noble wording of its title, what the bill does is to encourage states to whittle back their unemployment insurance systems. The bill gives states the option of using federal unemployment-benefit dollars to repay federal loans or provide tax breaks to businesses. Not continuing to pay jobless benefits to long-term unemployed people somehow counts as “job creation.”

Representative Sander Levin (D-MI) put it this way, “This is the opposite of a jobs bill — it is a hatchet job on the unemployment insurance program.” The Ranking Member of the Ways & Means Committee, Levin said, “With this legislation, Republicans are proposing to end this year’s guaranteed benefit for the long-term unemployed.” If states follow Michigan’s example by cutting benefits and instead using federal dollars to repay loans rather than providing weeks of aid, it could take billions of dollars away from jobless Americans.

Even though federally extended benefits could stay in place for the remainder of the year, some states let those benefits expire, benefits already budgeted and paid for in Washington. By not passing simple legislative measures to ensure that the federal government’s share of weekly benefits continues, a number of states failed to extend those benefits, as Missouri did on April 2. North Carolina, Tennessee, and Wisconsin followed suit on April 16. As a result they all denied 20 weeks of federal benefits to their jobless women and men.

Last week Florida’s Republican-controlled House and Senate passed a compromise measure, just before the session expired at midnight, that would cut maximum state benefits from 26 weeks to 23 when the state jobless rate is 10.5% or higher. Florida has one of the highest unemployment rates in the country, 11.5%. It also has some of the lowest unemployment benefits. Republican Governor Rick Scott is expected to sign the bill.

New claims for unemployment insurance are again going up and 13.7 million Americans are looking for work. According to the Congressional Budget Office, federal unemployment insurance kept about 3.3 million people above the poverty line in 2009. Job growth is weak. At the current monthly rate, it would take more than five years to return to the pre-recession unemployment rate of 5%, back in December 2007. While more aid to states could help stanch job loss, legislative fixation on the federal deficit has silenced talk of more fiscal stimulus.

On election eve the new Republican House Speaker Boehner promised to hold weekly votes to cut federal spending, make jobs the top GOP priority and fight to repeal the health care law. Representative Darrell Issa (R-CA) called the election vote a "mandate" on limited government. Issa said the message to Washington was, "Advance an agenda that will create real jobs, not government jobs, but real jobs to get our economy moving again.” So far that has not happened.

As abortion foes continue to lobby Congress, the Republican House majority has been at odds with itself on handling the deficit and raising the debt ceiling, ignorant that the near-term fiscal situation that embroils them is largely unimportant to investors. The US Treasury has no trouble selling debt and is still able to borrow money quite cheaply. It can do so because investors continue to have high confidence that debts will be repaid in full. The make-believe fiscal crisis is largely made-for-television to create celebrities out of elected politicians.

The real crisis is unemployment. Our political class does not seem to understand that it is the millions of American men and women who cannot find work that needs their attention, not the defunding of anything having to do with abortion or repealing the Health Care and Education Reconciliation Act. America’s future is at stake. According to New York Times columnist and Nobel Laureate Paul Krugman, “The longer this goes on, the more workers will find it impossible ever to return to employment, the more young people will find their prospects destroyed because they can’t find a decent starting job.”

Congress has passed at least 113 bills so far and sent them to the Senate. Not one of them mentions of the words “employment” or “unemployment.” Only two resolutions contain the word “jobs”, as opposed to “job-killing,” and neither of them have anything to do with the public. Only the “JOBS Act of 2011” has a chance in the 112th Congress because it does deal with unemployment. It screws the unemployed.

Article first published as Screw the Unemployed on Blogcritics.

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