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The Shrinking Unemployment Bill

June 17, 2010 - by Donny Shaw

Once again, Democrats are downsizing H.R. 4213, the unemployment insurance/tax extenders bill, in order to lessen its impact on the deficit and round up the support to pass it. The bill has been floundering in the Senate for weeks, and yesterday, it officially stalled out after the Democrats failed 45-52 to overcome an important procedural hurdle requiring 60 votes to pass.

According to Sen. Max Baucus [D, MT] and the Senate Finance Committee, these are the big changes in the revised bill:

  • Shorten the Medicare payment cut patch, or “doc fix,” from 19 months to 6 months — Doctors are currently facing a 22% cut in their Medicare payments under an automatic pay formula that Congress created in 1997. The formula has recommended pay cuts for the past 7 years, but each year Congress has overridden it by passing temporary temporary patches. By shortening the length of the current patch by 13 months, the bill, technically, costs $16.4 billion less. But these savings are pretty cheap because Congress will almost certainly be back in 6 months when this patch expires to extend it again.
  • Eliminating the Federal Additional Compensation program — This is a stimulus program that provides an extra $25 per week for people receiving extended unemployment benefits. Eliminating it saves $5.8 billion over the next ten years.
  • Changes in the carried interest tax loophole closer — One of the big revenue raisers in the bill is a provisions to partially close a loophole in the tax code that lets hedge-fund and private-equity managers pay the lower capital gains rate (15%) on the cut they take from the appreciation of their clients’ portfolios rather than the regular income tax rate (up to 39%). In the Democrats’ last revision of H.R. 4213, they softened this provision to satisfy the influential hedge fund industry. In this revision, they are tightening it back up a bit by increasing how much of their income hedge fund managers old have to pay at the regular rate. This change would bring in an extra $13.9 billion over the next ten years.

There are also several smaller changes in the revision that you can see by downloading this PDF from the Finance Committee. In total, the revision takes a little more than $20 billion off the total deficit impact of the bill. According to the Congressional Budget Office, the revised bill would cost $105 billion and its net deficit impact would be $55 billion.

The big question: are these changes significant enough to win over the 12 Democrats who voted against the bill yesterday plus at least one Republican? That’s what it’s going to take for the Democrats to break a Republican filibuster and get this through the Senate.

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Comments

Displaying 1-30 of 43 total comments.

  • sldhouston 06/17/2010 7:56am
    Link Reply
    + -1

    Hey writer… it would make it so much better if you’d actually tell us when the next vote is expected! We can discuss this all day long but means nothing when you don’t even sway the reader on when the Senate will act again on this.

    Signed,

    An unemployed expired benefit American citizen

  • Comm_reply
    donnyshaw 06/17/2010 8:11am

    Hey sldhouston… Nobody knows yet when this is going to be voted on.

  • Comm_reply
    XvxRAINxvX 06/17/2010 8:22am

    In your professional opinion a yes or a no do you think this bill will pass and how long do you think it would take for it to pass if yes. By the way i appreciate you keeping this updated throughout the day its nice to come on here and look at the updates!

  • Comm_reply
    donnyshaw 06/17/2010 8:41am

    My best guess is that this is going to pass. I think they’ll have to take out the $24 billion of state Medicaid aid as well.

  • Comm_reply
    donnyshaw 06/17/2010 8:43am

    Just in from CongressDaily:

    GOP Sens. Olympia Snowe and Susan Collins of Maine said today they would still oppose a slimmed “extender” package, casting doubt on Senate Democrats’ ability to round up 60 votes. […] “It’s moving in the right direction,” Collins said. “It’s not there yet.” Snowe said she still could not support the package and is pushing an amendment to strike a $9 billion tax increase on small professional services firms organized as “S corporations,” which Democrats say merely closes a loophole enabling firm owners to avoid paying Medicare and Social Security taxes.

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    XvxRAINxvX 06/17/2010 8:58am

    What I do not understand is why they had to add all of these extra things in the bill when americans are suffering. Why not just pass the unemployment extension and worry about the other things later? Deal with the major issue at hand first the one that needs the immediate attention!

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    chickenfighterky 06/17/2010 8:45am

    I think it will pass also but its already Thursday so thanks to the Senate we will probably go another week without benefits…

  • Comm_reply
    representativesrus 06/17/2010 8:58pm

    Basically, what I think, this is how they get their agendas passed, for their constituents, or their contributors. This is a classic example of pork barreling. Geesh, they don’t seem to care that Americans are suffering here and depending on their support.
    Next time your congressman or senator asks for your support, look and see how they have performed on this and other legislation. If they have not stacked up in the people’s favor, don’t support. And, if there is anyone on this blog that does not vote, shame on you, that is the political process at work in the trenches.

  • Comm_reply
    donnyshaw 06/17/2010 9:24am

    Sorry… to clarify, I only think this will pass if they take out the $24 billion in Medicaid money as well as what they have taken out in the new revision.

  • Comm_reply
    chickenfighterky 06/17/2010 9:27am

    Thats fine, I’m healthy but hungry lol….

  • Comm_reply
    KASwann 06/17/2010 10:49am

    I would hope they do something soon. AS a person who is unemployed ( NOV 2009) I just ran out of the 26 weeks of benefits and fell thru some sort of crack, there were no benefits * Tier 1,2,3,4 or whatever available because I signed for my last week May 29th.
    I find this pretty unfortunate as there are MANY others been on unemployment , looking for work? maybe? and have drawn up to 99 weeks and here I was laid off late last yr. and get a whopping 26 weeks of benefits and now what? Pretty sad. I am hoping this gets passed soon, they figure a way to get the people that have been off for 2 yrs back to work or in trade schools etc. Take away the 25 bucks a week bonus I don’t really care… but give me my regular benefits please until I can find a new job.

  • Comm_reply
    JParvin07 06/18/2010 5:44am

    I am in the EXACT same boat as you Swann, Same dates ect. I was able to claim but was told I will not be getting any money as of now but to keep claiming. I am very scared, this is my only income & now it’s gone…no warning! The week prior I reiceved a letter that put my mins at ease (lol..yea ok) that I was fine & would be getting my benifits without any delay and now this! What a kick in the butt to all of us in this boat. I wonder if the people who voted NO could live with out a any money comming in, how would they fare?

  • Comm_reply
    Chris51 06/30/2010 7:14am

    • It’s the Republican party who is busy watching out for Wall Street/Corporations.
    Shame on Congress for not coming up with a solution for ALL its’ displaced hard working Americans.
    • 9.7% unemployed = 1.2 million Americans, and 55% of the workforce have taken reduced work hours, pay-cuts, unpaid leave, forced to switch to part-time. The BP Oil Corporation’s irresponsibleness is adding to lost jobs and lost lives.

    Yesterday, President Obama’s discussed what was happening with corporations, the economy, and the need to help the displaced unemployed. Watch his entire interview on CSPAN. He gets it.

    CNN and FOX only report on self-interested, with their main story and topics cycling 24 hours. Go to CSPAN
    CSPAN: http://www.c-span.org/Watch/Media/2010/06/29/HP/A/34826/Pres+Obama+Remarks+on+the+Economy.aspx

    wwww.change.

  • Comm_reply
    Chris51 07/08/2010 7:29pm

    GOP are determined to bloc everything the President is trying to do for the USA right now. He has a vested interest, and seems to take pride in doing the best job he can while in office.
    We are in trouble as long as Republican politicians continue favoring their special interest.
    How can any CEO or Owner of business get anything done if half of his managers or executives stand in his way just to be defiant.

    President Obama speech on CSPAN today, while in Kansas City, MO to support a future candidate. Was right on.
    If you are an unemployed American, and are thinking no one understands the difficulties of being jobless. Obama speech articulated the financial and emotional struggles well. Hat’s off to the President for saying what needed to be said.

    http://cspan.org/Watch/Media/2010/07/08/HP/A/35248/Pres+Obama+Remarks+at+Fundraiser+for+Missouri+Senate+Candidate+Robin

  • Comm_reply
    Chris51 07/08/2010 7:29pm

    Senator’s excuse for not passing is a false statement.
    Read all about it:
    The funding argument is even harder to swallow. I’d be more sympathetic with these new converts to fiscal responsibility if they were as enthusiastic about paying for extending $32 billion worth of special interest tax breaks as they are about funding the unemployment extension. If I understand correctly, these lawmakers insist that Congress fund every dime of added jobless aid, which nearly all analysts agree will help boost the economy. But they feel no need to pay for continuing these special interest tax breaks, which will not.
    Full Story:
    http://www.csmonitor.com/Money/Tax-VOX/2010/0707/Senate-struggles-with-unemployment-benefits

  • Spam Comment

  • Comm_reply
    Chris51 07/01/2010 9:49am

    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

  • tillie01 06/17/2010 8:00am

    Let’s take away $100.00 a month extra from the unemployed. Lets give congress $100.00 and tell them to go to the grocery store and purchase food for their family for one month on that $100.00 See how far they get. Also Hollywood is very important, I’ll remember that when I am homeless and fill up my station wagon with my belongings, children & animals. I’ll ask my family if they would like to go and see a movie because it’s so important that we help hollywood keep up thier lavish life style. We wouldn’t want them to live in anything less than a million dollar home, and forbid that they should have to drive a chevy. Oh and we can’t let them do without thier diamond. No less than 10 carrots. As John Stassel says (GIVE ME A BREAK)

  • chickenfighterky 06/17/2010 8:29am

    Hey tillie I understand where your comming from. I just exhausted tier 2 of my unemployment 2 weeks ago and am waiting to see whats going to happen. But to be honest I’m fairly certain the members in the Senate are pretty detached from whats at stake here. I really dont consider myself to be a member of either party because it seems like both sides have their own agenda. The Dems. have gotten complacent with sandbagging and screaming “Emergency” and the Rep. have the piggy bank in a choke hold. I belive the straw that broke my back was yesterday when Sen. Durbin had the floor and went on about a 4 or 5 min. rant about some movie he was reminded of. I mean seriously Dick? This is the same guy that kept Sen. Bunning on the floor for several hours back last March because “It was the right thing to do” or so he said. I belive the right thing to have done would be sure up this matter before you go on a 10 day vacation. I dont wanna hear about a movie I want to hear this bill pass.

  • jgpt777 06/17/2010 8:31am

    Someone has started a petition on change.org to vote out all of the senators who voted against the extension. The petition is at:
    http://uspoverty.change.org/petitions/view/vote_hr_4213_opponents_out_of_office_in_november

    Please sign it and forward to anyone else who might be interested in signing it. Also, if you have facebook, twitter, etc, you might want to consider posting it there.

  • Comm_reply
    seanurse 06/17/2010 10:56am

    hi jgpt777 i have been all over change .org as i am a member and they dont have your petition. please let me know if it is different then above. I would really like to sign and participate.

  • domer4 06/17/2010 8:35am

    What a friggin joke. This is a slap in the face to all Americans who worked hard and payed into these benefits. I just finished Tier 2 and going on my second week of no UI money. The trickle down effect of this is going to really bad for this country.

  • jgpt777 06/17/2010 8:37am

    PLEASE GO TO THIS SITE AND SIGN THIS PETITION TO VOTE OUT SENATORS WHO VOTED AGAINST THE EXTENTSION

    http://uspoverty.change.org/petitions/view/vote_hr_4213_opponents_out_of_office_in_november

  • chickenfighterky 06/17/2010 8:40am

    To be honest domer there will be no “trickle down effect” cause to be honest we are at the very bottom of the barrel so to speak. lol….

  • Comm_reply
    yourjoedaddy 06/21/2010 2:55am

    Man I feel ur pain! I am also up in the air.I have never collected anything from the gov and could get some benifits. I am well educated and just want a chanch to get something going. Not a hand out but a hand back! I know that my well fare will b a we’ll care sometime! I am so upset that the well off senate members can not feel for us “The Voters”. I will remeber u senate!!! I know u shound look out for the well being of the “Many”. BUT!!! These are not ordinary times.The money u stick into the econ stays there (HERE). It is not a war where we Americans do not c it! HELP US!!!!!!!!!

  • tiredofbeingtired 06/17/2010 8:52am

    I appreciate the fact that someone is keeping us abreast of what’s going on in regards to this bill, because the only thing the media cares about right now is oil in the gulf, not that it isn’t a problem, but a sliver of knowledge on any other subject would be nice. Thank you to those the report on this story, because it is needed.

  • Comm_reply
    KASwann 06/17/2010 10:54am

    I agree….. yes the oil in the gulf is a problem but so is the unemployment rate and the people without benefits. The gulf and their oil mess will just further the loss of jobs and this bill needs to be passed now not a month down the road. The gulf cleanup in underway and there isn’t much more that can be said or done about that as far as I am concerned.

  • general 06/17/2010 8:53am

    Thats right senators rep and dem alike keep hanging this up over your precious deficit while you have no problem finding money to help every third world country and fund 2 not 1 but 2 wars billions a day but when it comes to helping americans who are unemployed you worry about deficits not to mention the 185 billion to AIG who has yet to pay it back Yeah wanna fix the deficit stop giving tax breaks to your rich friends who most likley got rich off the working people who are now taking the brunt of so called resession that sounds alot better than calling it what it really is a full blown DEPPRESION.

  • Spam Comment

  • sandyhavran 06/17/2010 9:36am

    Maybe we need a peoples party! Dem’s, Republican’s, Independents, they are all out of touch. They have no clue what reality is for most americans, nor do they want to. They listen to money, because it speaks to them and their next campaigns. They days of Walter Cronkite and unbiased news are gone. We will only hear what the owners of the media outlets want us to hear. Unemployment is not a choice! I have worked since age of 16,over 38 years, now I am in a crisis that Congress created. Hell yes I will vote against any nay voter on this bill. I am keeping tabs, I’ll even volunteer for their opponnet, regarless of party.

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