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Democrats Skirt Their Own Law To Extend UI/COBRA Benefits

February 17, 2010 - by Eric Naing

Just days after President Obama signed “pay-go” legislation into law, Democrats want to bypass it to extend unemployment and COBRA healthcare benefits.

The “pay-go” rule basically requires Congress to find the money to pay for its non-discretionary spending – ostensibly through spending cuts, tax increases or other revenue enhancements.

The measure, however, contains an important loophole. Anything deemed emergency spending does not fall under the pay-go rule.

This loophole is a reason Republicans cite for their unanimous opposition to pay-go. The loophole is also what Democrats plan to exploit in order to extend unemployment and health insurance benefits.

Included in a $154 billion jobs bill (H.R.2847) passed by the House last December, were billions for a six-month extension of the unemployment insurance benefit and COBRA health care subsidy. An accompanying Senate jobs bill including similar extensions was recently scrapped. Senate Democrats instead plan to pass a standalone UI/COBRA bill, though with a shorter three-month extension to bring down the price tag.

Instead of finding a way to pay for these extensions, The Hill reports that Sen. Harry Reid [D, NV] wants to classify them as emergency spending – thus circumventing the pay-go requirement.

Reid spokeswoman Regan LaChapelle explains:

[Reid] believes that providing assistance to families who have suffered a job loss is critical to getting the economy back on track. Extending unemployment compensation and COBRA health insurance premium assistance are important for these families and certainly meet the definition of ‘emergency spending’ contemplated in the pay-go legislation.

Hot Air’s Ed Morrissey isn’t buying Reid’s explanation:

This is why efforts like pay-go are nothing more than a farce, and usually a fraud. The entire point of pay-go is to keep Congress from spending money it’s not receiving. Carving out exceptions to spend more money demonstrates the ineffectiveness of pay-go to slow down spending.

The porous nature of the pay-go law demonstrates how politicians often use budget gimmicks to appear like something is being done about spending. For more information, the Atlantic’s Michael Kinsley has a helpful rundown of pay-go and other budget gimmicks.

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Comments

  • craines 02/18/2010 2:05am

    READ this! For some of us without jobs as soon as the UI run out we will miss our first house payment. And the rest of the bills will go unpaid, it’s the middle of winter, there are no jobs.

    Republicans just don’t care period. Harry Reids trying to keep our heads above water until we can get this thing turned around. No one wants to live like this.

    We are going to end up with Tent Citys all over American and the strain on hospitals and local communities will cost way more than the UI.

    People that have jobs and health insurance seem to be the ones that
    believe there beyond being on the street. I know a lot of people right now that are losing everything. There hard working Americans.

    CR

  • dartcanyon 02/22/2010 6:14am

    “[Reid] believes that providing assistance to families who have suffered a job loss is critical to getting the economy back on track. Extending unemployment compensation and COBRA health insurance premium assistance are important for these families and certainly meet the definition of ‘emergency spending’ contemplated in the pay-go legislation”. If this is true then why did he take it out of his scaled down bill?? Sounds like a liar/forked tongue. He needs to get out of office NOW.

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