With the financial regulatory reform legislation headed to a conference committee, both the Senate and the House of Representatives will be turning their attention to a variety of bills, including one that extends several tax breaks and social safety net provisions. However, members of both parties are already approaching the bill with consternation, as they are wary of anything that seems remotely associated with government spending.
Among its important provisions, the bill would extend the enhanced unemployment insurance system that passed as part of last year’s economic recovery act. It provides up to 53 weeks of benefits, with an additional 13 to 20 weeks in states hardest hit by the Great Recession. However, Sen. Judd Gregg (R-NH), appeared on CNBC this morning to say that Congress should stop extending benefits “right now” because “at some point you’ve got to acknowledge that we’re not Europe”:
Q: Senator Gregg, is there a point, you think, when the government has to sort of end these ever-continuing claims?
Gregg: Yeah, right now. This week, however, we’re going to extend it again. And this has become counterproductive. We’re basically undermining the cyclical event. Because you’re out of the recession, you’re starting to see growth and you’re clearly going to dampen the capacity of that growth if you basically keep an economy that encourages people to, rather than go out and look for work, to stay on unemployment. Yes, it’s important to do that up to a certain level, but at some point you’ve got to acknowledge that we’re not Europe.
For one thing, Gregg really has no idea what the package does (which doesn’t stop him from going on cable news to complain about it). It doesn’t extend benefits for anyone past 99 weeks (for which some people in the hardest hit states are eligible). No one is proposing 150 or 120 weeks, as Gregg implied.
What the bill does do is ensure that people who are currently unemployed and would be eligible for extended benefits don’t suddenly have those benefits pulled out from under them. It will also ensure that people who recently lost their jobs or who lose their jobs in the coming months can qualify for the full extent of the unemployment insurance program.
Mark Zandi, chief economist of Moody’s Economy.com, was fortunately on with Gregg, and rebuked the senator. “The senator is right except that, in this environment, the job market is so bad, I think it’s still premature to give up on those emergency benefits,” Zandi said. “I mean, just a statistic, for every one job opening there’s five people that are looking for work. That is incredibly unusual, so therefore its premature to give up on those emergency benefits.”
Not only that, but in March 2010, 6.5 million people had been looking for a job . According to the Center for American Progress’ Christian Weller, “The average length of unemployment that month was 31.2 weeks, and 44.1 percent of the unemployed were out of a job for 27 weeks or more. This is a new record for long-term unemployment.” But Gregg — like so many Republicans in recent months — is willing to kneecap them just as the labor market is starting to turn the corner.
(HT: Mike O’Brien)