Next Round in Battle to Renew Long-Term Unemployment Benefits

March 10, 2014

Last Friday, the Bureau of Labor Statistics reported a sharp increase in the number of long-term jobless workers — 203,000 more who’d been unemployed and actively looking than in January.

This brought the average number of weeks jobless workers had been looking up to 37.1 — about 11 weeks more than most state unemployment insurance programs cover.

At least two million jobless workers have no UI benefits now, but would if Congress renewed Emergency Unemployment Compensation — and back-dated it to the end of December, when the program expired.

As I’m sure you know, Senate Democrats have been trying to pass an EUC extension since mid-December. Republicans haven’t delivered the five votes needed for the Senate to vote on the extension itself.

The ostensible hang-up is the offset, i.e., the source or sources of funds that would keep the extension from adding to the near-term deficit. But some of the potentially persuadable Republicans have further complicated matters by insisting on amendments to reform UI.

And as if that weren’t enough, they wanted the package to include a repeal of the temporary, modified cost-of-living adjustment for military pensions that was part of the December budget deal.

Well, the Senate took care of the repeal in mid-February, using a pay-for Republicans wouldn’t accept for the EUC extension. Now it’s going back to EUC again.

Majority Leader Harry Reid is calling for a six-month extension — five months shorter than the paid-for version he’d earlier proposed. He’d use savings already achieved in the new Farm Bill as the offset. Politico reports the cost at about $12 billion. That would leave about $11 billion for deficit reduction.

Seven Republicans have countered with a five-month extension. They’ve got an altogether different pay-for. And they fold in program “improvements,” including one that has little or nothing to do with unemployment compensation.

Too much to cram into one post. So I’ll deal with the pay-for here. As you’ll see, the Gang of Seven seems to have moved toward the Democratic majority. This, alas, is not an altogether good thing.

The pay-for has three parts. The first would extend so-called pension smoothing provisions that Congress earlier used to help pay for the highway bill.

Basically, pension smoothing allows employers to temporarily reduce their contributions to employee pension plans. This raises revenues for awhile because the contributions are tax-deductible.

But it then loses revenues because employers have to make up what they didn’t contribute earlier. The losses, however, fall outside the 10-year period used to estimate what federal laws will cost.

In short, it’s what the Center on Budget and Policy Priorities calls a “timing gimmick.” It also, as the Committee for a Responsible Federal Budget says, raises the risk that pension funds will need a bailout, thus further increasing federal costs.

Senate Republicans shot down pension smoothing when Reid tried to use it for a three-month EUC extension — or at any rate, they blocked the bill, claiming (rightly) that he limited their chances to amend it.

A second part of the pay-for is a modified version of an amendment Senator Rob Portman wanted to offer. In its new iteration, severely disabled workers who receive UI benefits would lose the same amount from their SSDI (Supplemental Security Disability Insurance) benefits.

This too was a pay-for Reid earlier offered — and borrowed from the President’s proposed budget. But it still “uniquely burdens” disabled workers, as Los Angeles Times columnist Michael Hiltzig says.

It also undermines the work incentive in SSDI. And it establishes a terrible precedent of raiding Social Security to fund other benefits programs, as the Consortium for Citizens with Disabilities warned several months ago.

The last part of the pay-for extends customs users fees through 2024. These are charges imposed for certain activities of the U.S. Customs Service, e.g., clearing merchandise for import.

So for better and worse, the Gang of Seven seems to have come round to a pay-for the Democratic majority could accept. But, as I said, it’s paired with some problematic “reforms” to the EUC program.

Politico reports that Reid may take another stab at passing an EUC bill this week. How far he’ll move to pick up the Republican votes he needs remains to be seen.

How far he should move is a daunting question.


Long-Term Jobless Veteran Asks the Million Dollar Question

January 30, 2014

“I’ve served my country, honorable discharge …. I’ve done everything right. College, school, no crime, no record. Pay my taxes. Make sure my daughter went to school … Got her in college.

“And I’m sitting here struggling. I’m now ready to take a street sweeper job if they would offer it to me. So I’m asking you the million dollar question. What am I supposed to do right now to keep a roof over my head, food in my stomach, clothes on my back, car insurance paid?”

The desperate woman whom I’m quoting was addressing a spokesperson for Senate Minority Leader Mitch McConnell.

She was part of a group of advocates and jobless workers who were delivering petitions, representing some half million signatures, urging the top Republican leaders in both the House and Senate to let Congress members vote on a bill to renew Emergency Unemployment Compensation.

McConnell’s spokesperson says to her, “I can only tell you what we do here in the Senate. I have no control over your life.”

But his boss sure does. If he hadn’t locked horns with Senate Majority Leader Harry Reid, a bill renewing EUC would now be awaiting an uncertain future in the House.

As things stand, more than 1.6 million long-term jobless workers and their families may have no source of cash income. Nearly 72,000 more are likely to lose their benefits by the end of this week. And no one, to my knowledge, is predicting an end to the stalemate.

Majority Leader Reid offered the Republicans two options. The first, which had earlier gotten enough Republican votes to open debate, would have renewed EUC for three months, back-dated to when they expired.

Costs for this version — about $6.4 million over 10 years* (less than 0.014% of the federal budget) — were not offset.

Well, Republicans insisted on an offset. The second version, which would have renewed EUC through November, provided one — and cut back on the number of weeks the program would cover.

Republicans didn’t like this bill either. They wanted to propose other offsets in the form of amendments, but only for the three-month, stopgap bill.

Reid limited the number of amendments they could offer — presumably so they couldn’t tie up the process indefinitely.

He also insisted that any amendment would have to pass with 60 votes. McConnell understandably objected because 15 Democrats would have had to vote in favor, assuming all Republicans did.

So Republicans wouldn’t provide the votes needed to move forward on either bill.

It’s hard to know whether they’re sincerely trying to get a bill they could vote for or, as Washington Post blogger Greg Sargent has suggested, reframing the debate as an issue of fiscal responsibility so as to mask their party’s ideological hostility to any EUC renewal.

What’s not hard to know is that some of the amendments they’d proposed seem like what are commonly called poison pills, i.e., amendments deliberately designed to repel a bill’s supporters. More about these in a separate post.

Arthur Delaney at Huffington Post reports that Senator Jack Reed, who’s been leading the charge for EUC renewal, has been talking with “a handful of Republicans” about a pay-for “that would make them happy.”

They may strike a deal, but like as not, it will be for three months — until the end of March, assuming it’s retroactive. The Republican majority probably won’t like it. Some Democrats may not either, considering what would make some in that handful happy.

So will we have another kerfuffle over amendments? And if not, what are the prospects in the House, when Speaker John Boehner has put additional conditions on a renewal?

I can’t help feeling that the desperate woman and all the other jobless workers who’ve got the same million dollar question are pawns in a partisan strategy that has little or nothing to do with fiscal responsibility.

* The Congressional Budget Office conventionally projects costs over a 10-year period and takes account of any expected revenue increases that a measure like this would produce. The estimate thus does not mean that the federal government would continue to incur costs. It does, however, reflect some out-year revenue increases.


Senate Votes to Debate Long-Term Unemployment Benefits, But Renewal Far From Certain

January 8, 2014

I spent part of last Thursday participating in a Twitter blast at Republican Senators whom lead advocates had targeted as potential votes in favor of reviving the recently-expired Emergency Unemployment Compensation program.

For those unfamiliar with this tactic, it involves recruiting as many Twitter users as possible to send messages within a brief period of time. Everyone who follows them sees the messages and can join in by simply clicking the retweet link at the bottom.

Our blast targeted 14 Senators. We had sample tweets we could adapt, including the number of jobless workers in the state they represent who’d just lost their benefits.

Some of those Senators just voted to begin debate on a bill to renew the long-term unemployment benefits. Without their votes, the bill would have languished — perhaps indefinitely.

The tweet blast was interesting to me for several reasons.

First, it shows how social media like Twitter have become such an important element in advocacy campaigns. They not only rally supporters and provide a means of sharing information. They are themselves a way of communicating messages to policymakers.

I know this is obvious, but it’s really quite new. Back in the day, as my husband says, the closest advocates could get to a Twitter blast was mass fax messaging.

When I worked on Capitol Hill, I collected duplicative messages off the fax machine daily — and dumped them, as instructed. No one could know they’d been sent or received except subscribers to the mass fax services. Well, that was then.

And now Twitter and the like have also become something that many elected officials apparently see as advantageous to their own campaigns. After all, we couldn’t blast at the Senators if they didn’t have Twitter accounts.

Second, the blast shows how much so many have invested in preserving EUC. I recall few, if any campaigns pursued so energetically and with as much coordination among so many and diverse organizations.

The blast was just one small piece of a campaign that has included, among other things, polls (see here and here), online petitions, outreach to local media, link-ups to jobless workers they could talk to, op-eds, a wicked TV ad, several toll-free numbers to Congressional offices and a plethora of action alerts to generate e-mails and/or calls.

And we couldn’t have blasted the Senators with tweets that spoke directly to what the end of EUC has meant for their constituents if the U.S. Department of Labor hadn’t earlier produced state-by-state estimates of the number of jobless workers who’d immediately lose their benefits.

These perhaps because Democrats on the House Ways and Means Committee asked for them. Washington Post blogger Greg Sargent reported that they were also compiling county-by-county figures, some of which I’ve seen in the press.

In short, each Senator was on notice of what his/her vote would mean back home — and at the risk of cynicism, how a vote against renewal could be messaged there.

Well, the Senate voted yesterday — not to renew EUC, but to debate the proposed short-term extension. The motion squeaked through with just the 60 votes needed — all Democrats present, the two Independents and six Republicans.

But the Republicans won’t necessarily vote to renew the EUC program. They still insist that the cost of any renewal be offset — and only by spending cuts, The New York Times reports.

Democrats worry that these would offset the economic boost that EUC benefits deliver — the equivalent of 240,000 jobs, assuming a year-long extension.

And it’s hard to know whether an offset would satisfy. Senator Susan Collins, who’s tried to broker a deal, reportedly wants to condition receipt of the longest-term unemployment benefits on enrollment in a job training program.

Without these changes, Republicans may block a vote on the EUC bill itself.

Over on the House side, Speaker John Boehner has again let it be known that he’d consider a renewal if it’s paid for and paired with “other efforts that will help get our economy moving again.”

Specifics from two of his colleagues include eliminating “back-breaking, job-breaking regulations,” approval of the Keystone pipeline and tax policy changes.

Not a recipe for a swift renewal — or any perhaps.

But one never knows about these things. What we do know is that many of the 1.3 million or so jobless workers and their families who’ve lost their benefits could be in dire straits. And even a bill that restores those benefits won’t undo the damage, though it would stave off more.

As Labor Secretary Thomas Perez said, many have gone “from a position of hardship” to a “catastrophe.” You can’t retroactively feed a child or reverse an eviction for unpaid rent.

No one in Congress can claim ignorance of this — or of the catastrophes the big numbers represent.

On the one hand, I’m enormously impressed by the strategies, coordination and sheer size of the renewal campaign — most impressed perhaps by its success in getting stories of struggling workers into the news.

On the other hand, I’m depressed that the human suffering just doesn’t seem to matter — at least, not enough to enough Republicans in Congress.

We should have had a year-long EUC extension before they went home for the holidays. As it is, they seemingly won’t go for a swift, simple three-month renewal to tide their long-term jobless constituents over during the back-and-forth on a longer-term deal.

Ah well, it’s not over. I’m inclined to think that Republican leaders will decide that leaving so many jobless workers and their families in the lurch is bad for the brand.

But meanwhile catastrophes loom — approximately 72,000 more every week.


What Will Jobless Workers Do Now?

December 12, 2013

Wonkblogger Brad Plumer teed up this question in response to the imminent expiration of the Emergency Unemployment Compensation program.

As I (and many others) have written, 1.3 million jobless workers will lose their federally-funded unemployment insurance benefits on December 28, unless Congress renews the program.

By a year from now, about 3.5 million more will have had no EUC to turn to when they’ve searched, without luck, for work longer than their regular state UI program covers.

House Speaker John Boehner has seized on the latest jobs report as a new reason to shrug off “calls for more emergency government ‘stimulus,’” understood by one and all as a reference to the EUC program.

House Minority Leader Nancy Pelosi has said that Democrats won’t vote for a budget deal without the EUC extension, though it wouldn’t have to be in the budget bill itself.

But as Washington Post blogger Greg Sargent observed, the Democrats might back down rather than vote against a bill that offers some sequestration relief. For most, that now seems a virtual certainty, as Pelosi’s response to the deal suggests.

Not to detract from the potential immediate crisis, but Plumer’s question raises a broader issue. What will long-term jobless workers do when their UI benefits expire, as they will for some even if Congress extends the EUC program.

As Plumer indicates in a followup post, we can be pretty certain that most of the workers who lose their UI benefits won’t try to use SSDI (Social Security Disability Insurance) as a safety net, notwithstanding debunked reports to the contrary.

They may just drop out of the labor force, Plumer says. Robert Oak at The Economic Populist reports that more than 3.1 million did over the course of the last year alone.

What happens to them then?

If they’re in their early 60s, like one of the “real people” ThinkProgress editor Bryce Covert profiles, they may apply for early Social Security retirement benefits.

They’ll receive less than they would if they waited until they reached full retirement age — and perhaps less than they received from the EUC program, as would be the case 62-year-old Covert interviewed. But they may have no choice, given the barriers older job-seekers face.

They’re a relatively small portion of the unemployed workers the Bureau of Labor Statistics counts, however. Uncounted, for all age groups, are those who haven’t recently looked for work. There are more than 5.6 million of them, according to the Economic Policy Institute’s latest estimate.

Surely some stopped looking when their UI benefits ran out. Not before, of course, because you’ve got to be actively looking to get them. Yet we know the job search gets increasingly futile.

Some employers, it seems, won’t even consider someone who’s been out of work for more than six months. That’s less time than most states’ regular UI programs cover.

Time was when there was some interest in the really long-term unemployed — the 99ers, so called because the combination of state and federal UI benefits provided 99 weeks of coverage in states with the highest unemployment rates.

Now they’re invisible, Daily Kos blogger Bud Meyers says. By and large, I think this is true.

But New York Times reporter Annie Lowrey recently told the painful story of a woman who’s now “broke and homeless” because she hasn’t been able to find any job at all since she was laid off from a mid-level position in 2008.

A veteran Lowrey also interviewed hasn’t had a job since he came back from Iraq in 2007. “I’m just trying to hang on until my retirement kicks in,” he says. But he’s only 57.

Economists Dean Baker and Kevin Hassett — not a pair you’d ordinarily expect to find co-authoring an op-ed — call the persistent high rate of long-term unemployment “a national emergency.”

They run through research findings indicating a range of human costs, e.g., a higher male mortality rate (due partly to suicides), serious illnesses, divorces, an impact on what children in the family will ultimately earn.

A recent report by the Urban Institute and First Focus identifies a variety of harms to children that can account for the lower earnings — most, if not all of them related to family income loss.

To poverty, in fact, since the poverty rate for parents who’ve been unemployed for more than six months nearly triples, even when the value of safety net benefits is counted as income.

There’s no dearth of sensible ideas for what our government could do to address the long-term unemployment crisis. Baker and Hassett itemize a whole policy package.

I’ve seen many others. Most, if not all reflect a consensus on some measures, e.g., subsidized employment, direct government hiring, larger (and better) training programs.

All these would, of course, be good for the economy — more consumer spending, so more jobs created, even beyond those the government itself might fund. There’d thus be more tax revenues as well.

But it’s the “human disaster” flagged in the Baker-Hassett headline that concerns me here.

When people drop out of the labor force, they don’t drop off the face of the earth. Our failure to avert the damages so many have already suffered is, to my mind, a shame, since the single largest reason is our federal government’s short-sighted focus on reducing spending.

At the very least, Congress can act immediately to extend a lifeline to the long-term — but not longest-term — jobless workers who haven’t dropped out.

But it also ought to do something to help them — and the rest — find gainful work again.


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