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Reed, Casey Seek One-Year Extension of Unemployment Benefits

Senators Jack Reed (D-RI) and Bob Casey (D-PA) want the Senate to take up and pass a one-year extension of unemployment insurance benefits from 26 to 99 weeks, but they did not sound hopeful on a conference call that this could get done before the extension lapses at the end of November.

Getting jobless benefits passed in the lame duck session is going to be a tough road. Congress has always passed emergency funding for extended unemployment benefits in a time of high joblessness, any time the topline rate is over 7.2%. But even with 59 votes, the Senate has faced an arduous series of votes to extend it out month by month this year. The last attempt in April needed multiple cloture votes, with several failing before the final success. At the time, Republicans like Olympia Snowe and Susan Collins said that would be the last extension they would vote for that wasn’t offset with some other revenue or spending cut. Ben Nelson (D-NE) has joined them, making it virtually impossible to find the votes.

Adding to this is the fact that the House and Senate will not be in session at all next week, meaning the deadline for getting this passed without a lapse in benefits for the jobless is Friday. Sen. Reed said that with respect to any vote on this, “at this point it’s not been scheduled… I can’t point to a specific time it would come up for a vote this week.” Two million Americans could lose their benefits by the end of the year if this doesn’t get extended, according to the National Employment Law Project. And after that, with an incoming Republican House and more Republicans in the Senate, it would seem virtually impossible to get UI benefits passed.

At the same time as this is happening, Republicans want to extend the high-end Bush tax cuts, at a cost of $700 billion dollars, without paying for them. So they want to allow tax cuts with little stimulative effect to go unpaid, and then insist on paying for UI extensions with major stimulative effect. “It’s like someone on a diet who orders a Diet Coke and a Big Mac simultaneously,” Reed said. “Republicans are trying to rewrite economics and reality.” Extending unemployment benefits gets money into the hands of people who need to spend it, while tax cuts for the rich often lies fallow. Economists have shown that UI extensions are far more stimulative; one report said that failure to pass an extension would shave 0.5% from GDP growth, and reduce consumer spending.

Steven Pearlstein summed it up in his column today pretty well with the headline: “GOP to jobless: Drop dead.”

Both Reed and Casey agreed that they would like a one-year extension of benefits. That would cost roughly $65 billion dollars, or less than 1/10th of what extended the tax cuts for the rich would cost. Clearly Democrats are tying UI and the tax cuts together rhetorically, but with Harry Reid already signaling that he would accept a deal on a temporary extension of all the Bush tax cuts, that loses its force. There’s a possibility that Democrats would try and tie the tax cut extension and the UI extension together. Questioned on that, Sen. Reed said, “I have not gotten into the mechanics of the details.”

Senator Casey added, “For those talking about deficits and paying for things, they often fail to realize what will injure deficit reduction will be a failure of the economy to continue to grow… You can’t have economic growth without jobs.”

Also on the call was Pat McNamara, an 61 year-old unemployed worker from Philadelphia, who gave her heart-wrenching story of unemployment. She mentioned her dog, and how he needs medication and bloodwork that she’s finding difficult to fund. “We need decent paying jobs before anyone thinks about cutting unemployment benefits,” McNamara said.

Reed basically closed the door on any Tier V funding above 99 weeks of unemployment. Large numbers of the unemployed fall into that long-term category. “Our focus is maintaining the current system, and even that is a real challenge,” Reed said.

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David Dayen

David Dayen