Clueless About the Jobless
Republican opposition to extending unemployment benefits makes no sense.
But their pleas have fallen on deaf ears in the Capitol, where austerity—or at least austerity involving anything other than tax cuts for the rich—has made itself at home.
On Tuesday and Wednesday, Senate Republicans blocked Democratic unanimous consent requests to reinstate federal benefits for a year. Now, Senate Democrats need to break a Republican filibuster, winning two Republican votes for the extension proposal or a package containing it.
Democrats hope that they can squeeze an unemployment extension through by tying the benefits to the Bush tax cuts: Republicans either vote for the unemployment insurance extension along with the tax-cut extension, or every American gets a tax hike. But the possibility that the extra weeks of benefits will not come to a vote, and no American will receive more than 26 weeks from now on, remains present.
What would happen then, in the year after Austerity Christmas? Last summer, unemployment insurance lapsed for 2.5 million recipients during a similar congressional fight over deficit spending. Larry Summers, head of the National Economic Council, says that lapse shaved 100,000 jobs off the economy. In 2011, according to the congressional Joint Economic Committee, the loss could be 10 times greater.
"Prematurely ending the federal unemployment insurance benefits program would drain the economy of $80 billion in purchasing power and result in the loss of over one million jobs over the next year," a Joint Economic Committee report on the matter notes. "Economic growth will be reduced by as much as 0.4 percentage points between December 2010 and February 2011. In short, a failure to extend the unemployment insurance program could hamper the fragile recovery."
Annie Lowrey, formerly Slate’s Moneybox columnist, is economic policy reporter for the New York Times.
Photograph of John Shadegg by Alex Wong/Getty Images.