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Unemployment Benefits Extension Held Up by Corporate Tax Fight

June 11, 2010 - by Donny Shaw

It has now been a full two weeks since Congress left for recess without finalizing their bill to extend unemployment benefits, and there is still no end in sight for the bill. As a result, hundreds of thousands of unemployed Americans have been suddenly cut-off from their only source of income. Most lawmakers from both parties agree that unemployment benefits need to be extended, so what’s holding up the bill?

The problem is that the unemployment benefits are attached to a “tax extenders” package containing dozens of unrelated tax breaks for industries, some designed to spur job creation and some that look outright porky. It contains stuff like a $6 billion research and development tax credit, an $868 million tax credit for biodiesel manufacturers, a $46 million credit for Hollywood filmmakers, a $131 million credit for Puerto Rican rum distillers and much more along these lines. You can download a full summary from the House Ways and Means Committee.

As Ryan Grim and Shahien Nasiripour at Huffington Post reported recently, these kinds of tax extender grab-bag bills generally pass through Congress easily. “Extending the tax-breaks each year keeps them off the long-term books,” they write. “And because most of the credits expire each year, lobbyists can argue to their business clients that their services need to be kept on retainer at all times. And members of Congress win because the lobbyists continuously shower them with corporate money.”

But this time around, with anxiety about the federal deficit running high and a very contentious mid-term season quickly approaching, the extenders bill is running into problems. In order to lessen the bills impact on the deficit, the Democrats have included a number of corporate tax increases and tax-loophole closers in the bill, and the battle now is between different industries and the lawmakers who represent them.

When the bill was forwarded to the Senate from the House on May 28, it included a tough provision to raise taxes on hedge fund managers, who for years have been using a loophole in the tax code to pay lower income-tax rates than what their secretaries pay. But the hedge fund industry has been lobbying Democrats extremely hard for the past few years against this tax increase, and earlier this week, Senate Dems caved in and softened the provisions substantially. To make up for that loss in revenues, they proposed to instead raise the amount of the tax oil companies pay are required to pay, per barrel, into the oil spill liability fund. The oil company tax hike has all Republicans objecting. The oil industry has traditionally given far more in campaign donations to the Republicans.

The unemployment benefits extension part of the bill is designated as emergency spending and is not paid for with new revenue. This whole convoluted web of industries fighting for and against tax provisions is, in some sense, completely separate from the unemployment issue. But they are linked together in order to save time — the Republicans have repeatedly used unemployment extensions to stall Senate action — and to make it possible to call the tax extenders bill a stimulus measure — unemployment benefits are the most stimulative form of government spending.

The Senate will take up the bill again on Monday, but there is still no clear path forward for how to actually wrap it up. The Republicans can (and undoubtedly will) filibuster the bill and require 60 votes for it to pass. That means that the Democrats will need all 59 of their members plus at least one Republican “yes” vote. Right now, there is no Republican support. Even if the Senate does manage to pass the bill somehow, it will have to go back to the House once again for voting. When they passed the bill in May, they did so without a single vote to spare, and it’s unclear how the changes made to the bill by the Senate will affect support for it in the House.

Meanwhile, more unemployed people lose their unemployment insurance benefits each day. According to the National Employment Law Project, the number of people losing benefits because of congressional inaction will be up to 1.2 million by mid June.

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Comments

Displaying 1-30 of 36 total comments.

Chris51 07/10/2010 7:21am
in reply to larryojay Jun 11, 2010 11:06am

Republicans filibustered UI Ext bill! They’re asking for UI Ext be paid, while at the same time they’re fighting to give their Special Interest groups special tax stimulus. Rep are trying to look like they care about the deficit, but for 10 yrs (Bush Admin) they never spoke of concerns for the huge deficit they were digging us into as they approved large spending for Special Interest. The Rep debate on these UI Ext bills are like “broken record”. They want USA to use the stimulus money that is already committed to the agreed upon projects, programs, etc. Republicans want USA to “rob Peter to pay Paul”, so they can try to prolong the problem past November election. This is how they have operated for YEARS, and we’re in worse shape now because of their IRRESPONSIBLENESS. People should not be in Leadership positions if they cant make decision for the problems at hand.
Dont take my word for it. Please read links Donny Shaw and others have provided with accurate research and reporting.

Chris51 07/01/2010 9:55am
in reply to Chris51 Jun 30, 2010 11:03pm

Corporations have increased their cash reserves to $1.84 TRILLION, THE HIGHEST FIGURE IN HISTORY! Big business and the banks, after an unprecedented bailout by the public treasury, are hoarding the funds (Americans pay this back on their IRS tax bill). BIG CORPORATIONS EXECUTIVES ARE MAKING BIG BONUSES AND GETTING SALARY INCREASES FOR SHOWING HUGE PROFITS. The cash reserves of major corporations have jumped 26 percent in one year, the largest percentage increase in nearly 60 years. The cash reserves of working people, and particularly the unemployed, have not been so fortunate.

REPUBLICANS bloc, the SENATE vote and defeat sevaral proposed extension of unemployment benefits for unemployed workers. Many of these same Senators rushed through a $700 BILLION bailout of Wall Street in 2008 in a matter of days, cannot bring itself to support even the most meager subsistence for the unemployed workers who are the victims, not the perpetrators, of the economic crisis.
WWW.CHANGE.ORG

Chris51 06/30/2010 11:03pm
in reply to DebBrown Jun 12, 2010 6:41am

The Senate needs to be held accountable for their incompetence and lack of integrity. Shame on them for not coming up with a 100% solution for all Americans who are forced to survive on their UI.

President Obama can’t sign a bill, if Congress doesn’t get it to him. President Obama’s discussed the economy, and the need to help the displaced unemployed with UI Extentions on Monday and Tuesday. CSPAN.ORG

As of today, we have 9.7% unemployed, 55% of the workforce have taken reduced work hours, pay-cuts, unpaid leave, forced to switch to part-time, and BP Oil Corporation’s IRRESPONSIBLENESS is adding to LOST JOBS and LOST LIVES.
1.2 million who will lose their Unemployment Insurance if Republicans get their way.

The GOP have no vested interest in hearing or helping jobless people. The only communication Republicans hear is $$$$$. That’s why they listen to and only support Oil Companies, Insurance Companies, Banks, Big Corporations, and Wall Street

NewYorker82 06/20/2010 8:43am
in reply to larryojay Jun 11, 2010 11:06am

It is time to play the politics right along side with these Senators. There is a list posted on the internet of all the products made from within the states that voted NO for the unemployment extension. Literally there are hundreds of them. From Maine to Texas. From JC Penny, Papa John Pizza,Hertz car rental and so on. Just Boycott these products and then they can thank thier Senators for the boycott= trouble for them

We are at the point of having nothing to lose so now we must react. A decision for the American people in one state will and does affect others in other states. You can’t continue to expect big business to run this country. Where are they?

Once all these companies are affected by the Boycott of 15 million people and all their families and friends then maybe we will have a voice.

We have nothing to lose.

mrsbones 06/18/2010 8:23am
in reply to sansan44 Jun 11, 2010 10:04pm

Yeah me too. It makes me soo mad. I’m also mad that the local unemployment office doesn’t give you any updates other than “watch the news”. What kind of junk is that. They could save me the time and post daily updates on my homepage.

mrsbones 06/18/2010 8:20am
in reply to CuttieBiteMe Jun 11, 2010 9:18pm

I know exactly what your saying, my landlord doesn’t care what’s taking them so long. She just wants the money. same thing for the electric company. Most of the jubs around here are laying off as well. It seems congress has no idea what the real problem with the economy is. In the last year my town has lost at least 4 of it’s major companies. You can’t move somewhere to find work if you can’t afford to move. Grrrr!

bachi1314 06/17/2010 5:04pm

I serve working people that have been laid off. I help folks get information and apply for resources that are available in my community. In my 15 years I have never seeing so many folks struggling to make ends meet. Folks losing jobs and losing the American dream. It is truly a travesty that here in the strongest country in the world we forget to take care of our own. I am sure if we didn’t send all those jobs overseas we would have work here for AMERICANS. That needs to Stop or one day we will all be working for someone in China. Right now we have a chance to give folks the break they need to make ends meet. DO THE RIGHT THING AND PASS THIS, give folks hope in America. For those who don’t support 4213 shame on you. Shame on you for forget why you were elected to office. Let me remind you that you are to SERVE THE PEOPLE or we will remember in November.

wswrcs 06/15/2010 8:51am

I think we should cut congress wages and benifits to equal the unemployed. Of course we would have to remove what they are taking under the table also.

GAfedup 06/15/2010 6:04am

WRITE! We need to flood all of our elected officials with letters and emails telling them exactly how this affects how lives. There is a proposal to cut the $25 stimulus, they need to know that’s a days’ worth of groceries! We need to remind theses bozos that they do indeed work for us and not the other way around!

pickles 06/15/2010 4:19am

U>S SENATE AND CONGRESS NEED TO PULL THIER HEADS OUT THIER REAR ENDS AND EXTEND UNEMPLOYMENT TODAY DONT THINK ANY OF THEM WOULD LIKE THE MILLIONS OF PEOPLE IT JUST CUT OFF TO SHOW UP AT THEIR DOOR. THEY CAN GO ON VACATION WHILE PLAYING WITH PEOPLES LIVES BUT CANT MAKE THE RIGHT DECISSION OF TAKING CARE OF IT’S PEOPLE THE ONES THEY ARE TO PROTECT AND THE ONES THAT VOTED THEM IN. DONT THINK COME NEXT ELECTION THOSE WHO TOOK FOOD AND HOMES AWAY FROM STRUGGLING AMERICANS WILL BE SEEN IN CONGRESS OR THE SENATE AGAIN PERSONALY I SAY FIRE ALL OF YOU. YOU CAN PUT MONEY TO WAR AND PRIVATE ENDEAVORS BUT PLAY WITH AMERICAN LIVES LIKE A CHESS GAME.OUR GOVERMENT BAILED OUT THESE BANKS WHO WONT HELP ANYONE UNLESS THIER RICH BUT SNUBS ITS NOSE TO THE PEOPLE WHO TRUELY NEED HELP. WE DIDNT ASK FOR OUR JOBS TO BE TAKEN AWAY WE DIDNT ASK TO BE NICKELD AND DIMMED TO DEATH BECAUSE OUR GOVERMENT CHOOSES TO TURN THIER FACES AWAY FOR THIER OWN PERSONAL GREEDY NATURE WAKE UP SENATE YOUR JOBS ARE ON THE LINE

notstupid 06/15/2010 4:13am
in reply to DebBrown Jun 12, 2010 6:41am

Exactly. We are at a crossroads in America. Time to clean up and clean house. We Americans have not done our duty and held them accountable, but now we have learned. ’QUESTION WITH BOLDNESS", Thomas Jefferson.

STOPDAPRESS 06/15/2010 4:07am

CONGRESS IS FULL OF HORSE CRAP…Can’t wait until one of them become unemployed…

notstupid 06/15/2010 4:06am
in reply to MeInNH Jun 14, 2010 10:53am

They are arrogant and entitled. Time to vote them out. Their job is to serve the people, not themselves.

notstupid 06/15/2010 4:04am

WHO HAS PAID THEIR SALARIES OVER THE YEARS? WE HIRED THEM, WE CAN FIRE THEM>

jryanitpro 06/14/2010 3:27pm

Unfortunately I missed the extension by a day and it would have been my only extension as well. I have been laid off for six months after 23 years of work and now I’m have some sort of lung disease that has happened while laid off. Needless to say I’m losing my mind after losing my home, car and my four children, wife and I thankfully could move into my inlaw’s attic.

Please do something, if indeed you even read sites like these listening to everyday people

clk1255 06/14/2010 11:37am

What a twisted system that allows these other UNRELATED items to even be attached. Scrape all the other junk off the bill that is unrelated to the unemployed and PASS IT! Him haw and bicker over the other junk later. It is a horrible feeling to not know what is going to happen to you next. Or that your fate is in the hands of a bunch who could honestly care less. While they are going out to $100 suppers every night, other people are wondering how they are going to feed their kids. SHAMEFUL!

juleeann 06/14/2010 11:17am

Never got one extension either, looking for some of that HOPE and CHANGE

MeInNH 06/14/2010 10:54am
in reply to CuttieBiteMe Jun 11, 2010 9:18pm

I know this is so out of hand…how are people supposed to survive?

MeInNH 06/14/2010 10:53am
in reply to Cosmo06 Jun 11, 2010 11:52am

The took Friday off as well this week so nothing done again while millions are struggling. What is wrong with these people?

blefever 06/14/2010 9:32am

While Congress moves forward on making the R&D Credit permanent, the IRS continues to penalize tax payers who claim a Credit without supporting, project-level documentation.
Titan Armor is the R&D Tax Credit software solution that makes meeting these requirements easy and cost effective. Learn more at www.titanarmor.com.

Hornbecks3 06/14/2010 6:17am
in reply to mrsbaker07 Jun 14, 2010 5:41am

So Did My Husband He Never got 1 Extension , We need This now !

Hornbecks3 06/14/2010 6:14am

They Need To Pass This Now , It Has Been Way To Long People need help in America . GET IT DONE TODAY !!!!! WE WILL REMEMBER IN NOVEBER !! WHO HELPS THE AMERICAN PEOPLE WHO ARE WITHOUT WORK < AND WHO BLOCKED THE HELP AND HOW LONG IT TAKES YOU TO DO SOMETHING !!!!!!!!!!!!!!!!!!!!!!!!!!!!

mrsbaker07 06/14/2010 5:41am
in reply to WbGoerg Jun 13, 2010 11:06am

This is ridiculous!! I missed th dead line by one day. I can’t stand congress they don’t care about anyone but them selves and even that is questionable!!

WbGoerg 06/13/2010 11:06am

I bet you they would care if I walked into their office with a big check. The only way to get anything done by our government is to pay those corrupt jerks off. I should run for office..I’d get rich.

DebBrown 06/12/2010 6:41am
in reply to DebBrown Jun 12, 2010 6:34am

I agree… and there are plenty of unemployed workers who are looking for a job! Any idiot can do the work of Congress.

DebBrown 06/12/2010 6:39am
in reply to Cosmo06 Jun 11, 2010 11:52am

None of them care… at all. Seriously, I wonder what would happen if every single day tens of thousands of unemployed workers in every city walked into government locations to request and complete job applications and continued to do this every single day until jobs become available. I’d have to say this might generate a few government jobs since they could not possibly handle the work needed to provide applications to all the applicants.

DebBrown 06/12/2010 6:34am
in reply to tillie01 Jun 12, 2010 5:30am

We people should NOT gripe about a $46 million Tax Credit for Hollywood or $131 million credit for Puerto Rican Rum distillers or any of the obvious garbage attached to this bill… We should gripe THAT OUR GOVERNMENT ILLOGICALLY ATTACHED THIS OBVIOUS GARBAGE TO THE BILL knowing that by attaching it, they would surely halt or delay a bill that is vital to the survival of many American’s and their families. THAT IS DISGUSTING. THAT IS UN-AMERICAN.

DebBrown 06/12/2010 6:17am
in reply to sansan44 Jun 11, 2010 10:04pm

How can these people sleep at night? Well… I think the answer is obvious… THEY DO NOT CARE about the United States of America or it’s citizens… They’re destroying America legally and we have no recourse. I wonder what would happen if EVERY PERSON AND FAMILY WHO BECOMES HOMELESS BECAUSE OF THIS AND HAS NO WHERE ELSE TO GO SPENT THEIR TIME IN THE STREETS IN AND AROUND THEIR SENATOR’S HOMES. Or better yet… head on down to Washington and spend your days on the steps of Congress… millions of us could go inside every day and request applications for employment… EVERY DAY UNTIL JOBS BECOME AVAILABLE. At night… well where do families go when they’re homeless? I don’t think there are any designated streets… so the street of the Congress building is as good as any, right?

tillie01 06/12/2010 5:30am

This is simply politicians using Americans as hostage. Why is the unemployment benefits bill mixed in with other bills? It is a major problem in the U.S. and it should stand alone. Holding Americans without a job and no income as hostage to get other bills past. I am sickened by the way congress works and the saying for the people, should read for ourselves. It’s time we clean house in congress and get rid of all the fat cats. Since they work for we the people we should put them on a short leash, no more giving themselves raises and cut down on time away from the job they were voted in to do.

daughter1 06/12/2010 1:56am

What you people really should gripe about is the $46 million Tax Credit for Hollywood film makere, $131 million credit for Puerto Rican Rum distillers and some of the other things in this article. If they would concentrate on one thing that is important like you who are out of work because of them you would not have tp wait. What’s up with all the money going out to rum and movies. Since when is it the onus of the tax payer to support these private businesses. You folks need to wake up and start looking at what is going on. If they would stop throwing our tax dollars away we could afford to pay the important things.

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