- The Washington Times - Monday, November 26, 2012

Warning that more than 2 million Americans are poised to lose their long-term unemployment insurance, some Democrats are calling on Congress to extend the “economic lifeline” before it expires next month.

Some Republicans, though, are demanding that an extension of jobless benefits — and any other form of new spending — be offset through savings or spending reductions elsewhere in the federal budget.

In a letter to party leaders last week, Sen. Jeff Sessions said that extending the unemployment benefits another year carries a $26 billion price tag.

Couple that with the cost of keeping the 2 percent payroll tax cut on the books and averting a cut in payments to doctors who treat Medicare patients and the Alabama Republican said that the bill for new spending rises to nearly $130 billion.

“Offsets for any of these changes must also be achieved through real savings, not gimmicks,” Mr. Sessions said.

Scheduled to expire the final week of December, the fate of the unemployment benefits, which go to workers who lost full-time work through no fault of their own, are tied up in the broader discussion on Capitol Hill over the “fiscal cliff.”

Lawmakers are trying to strike a deal by Jan. 1, when the 2001 income tax rate cuts expire and the 2003 cuts to dividends and capital-gains taxes also expire. On Jan. 2, $110 billion in automatic spending cuts, known as “sequesters,” take effect under the terms of last year’s bipartisan debt deal.

The extension of benefits for out-of-work Americans has been a thorny issue on Capitol Hill, where Republicans have argued that it increases people’s dependency on the federal government and in some cases serves as a disincentive for people to find work, prolonging their unemployment.

Democrats, meanwhile, say that the unemployment benefits offer a good bang for their buck, reduce the number of Americans living in poverty and stimulate the economy.

On more than one occasion, President George W. Bush agreed to extend jobless benefits, including in 2008, when the economy slowed and the number of people filing for unemployment insurance reached a 16-year high.

Since then, President Obama and Congress have extended the benefits in 2009, 2010 and last year.

Less than a week after the 2012 election, Rep. Sander M. Levin, the ranking Democrat on the powerful House Ways and Means Committee, released a report that said that more than 2 million Americans are at risk of losing their unemployment benefits after Christmas.

“Maintaining these benefits for workers who have lost their jobs through no fault of their own is critically important to the economic security of millions of Americans, and more broadly, to the continued recovery of the U.S. economy,” Mr. Levin said, calling on Congress to “act promptly to continue this economic lifeline.”

Mr. Levin pointed out that Mark Zandi, chief economist of Moody’s Analytics, has argued that the benefits are a good investment.

Mr. Zandi told The Washington Times that he would extend the benefits as constructed for another year as part of a broader package that put the nation on a path toward fiscal sustainability that addressed the nation’s deficit.

“There is no form of government help that is more beneficial to the economy in the near term,” Mr. Zandi said.

Congressional leaders, meanwhile, have been tight-lipped about whether they plan to stretch the program another year or how they might pay for it.

Asked whether House Speaker John A. Boehner opposed an extension, spokesman Michael Steel said, “I don’t know that this has been discussed at this point.”

Don Stewart, a spokesman for Senate Majority Leader Mitch McConnell, said the Kentucky Republican is “not really negotiating in the press, so it’s hard for me to answer such questions.”

The offices of Senate Majority Leader Harry Reid of Nevada and House Minority Leader Nancy Pelosi of California did not respond to inquiries.

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