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Whither the Unemployment Benefits Extension?

February 22, 2010 - by Donny Shaw

According to the National Employment Law Project (NELP), 1.2 million unemployed Americans will run out of unemployment insurance benefits in March if Congress fails to pass a new extension. Yet, as the Democrats pared down their jobs bill to get it the support it would need to pass through the Senate, an extension of unemployment benefits was one of the things that was thrown by the wayside.

Later this week, Senate Majority Leader Harry Reid [D, NV] is expected to bring an extension to the floor for a vote, but it will be absurdly small, lasting only 15 days. That won’t do anything to change the fact that, as the unemployment rate remains stuck at 10 percent, more than a million unemployed Americans will be cut off from federal aid next month.

Unemployment insurance advocates are pushing for a much longer extension, possibly lasting as long as 12 months. Besides the lifeline that the benefits provide for unemployed workers, advocates point to their stimulative effect on the economy. “The Congressional Budget Office estimates that UI benefits generate up to $1.90 in GDP per every dollar spent, making the UI provisions the most cost-effective policy for stimulus efforts in 2010,” NELP writes. “According to the Economic Policy Institute, extending the ARRA’s provisions for the duration of 2010 would generate an additional 800,000 needed jobs, since safety net spending results in greater disposable income for recipients to use on goods and services.” NELP estimates that without long-term congressional action, 5 million Americans will run out of unemployment insurance benefits by June.

So, why is Sen. Reid pushing such a small extension? Arthur Delaney for Huffington Post reports:

Since there’s no real opposition to extending benefits — not even from Republicans — NELP’s Conti suspects Reid wants to keep UI separate in order to use it as a vehicle for future jobs measures.

“If Senator Reid’s office is doing this so they can continue to have a legislative vehicle to move the rest of their jobs agenda, it’s very, very shortsighted in terms of what the unemployed need, as well as what state agencies need,” said Conti. “It will be a disaster for everybody.”

In other words, Reid may be using the 15-day extension to create the need for another extension in a couple of weeks so that he can attach to it any provisions that he fails to move in the “jobs bill.”

But this strategy clearly risks the long-term extension not getting done before the short, 15-day extension expires. As we learned in October — the last time Congress debated extending unemployment benefits — the whole process can easily get dragged out for more than a month, and probably will be. The bill Congress was debating in October ended up being passed in the Senate by a unanimous 98-0 vote. There was no Republican opposition to the extension then, but the Republicans still managed to delay final passage of the bill for more than a month by repeatedly objecting to unanimous consent agreements and forcing extended debate periods.

As the final vote on passage in October made clear, it’s a strategy that was used to eat up the majority party’s time more than it was to thwart the actual unemployment measure. And with the Democrats still trying to do health care, financial reform, and other things the Republicans oppose, you can bet that the Republicans will once again use this opportunity to stall the Senate’s work as long as they can. Especially, if Reid adds other, potentially contentious jobs provisions to the long-term extension.

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