Senate negotiations over the upper chamber’s version of a tax extenders bill — which extends both unemployment benefits and several popular tax credits — are now in their third week, with a resolution seemingly not much closer than it was at the beginning of the process. Senate Democrats are now on their third version of the legislation, with each of the previous two unable to muster enough votes to invoke cloture.

Of course, the holdouts want to see cuts in the bill’s overall cost before giving it their approval. “The thing that I’m concerned about is the deficit,” said Sen. Joseph Lieberman (I-CT). “We’ve come to a time when we’ve just gotta keep saying no, and as a result we passed the so-called doc-fix and it was paid for.”

But Speaker of the House Nancy Pelosi may hold the Senate passed doc fix — which prevents a cut in Medicare reimbursements to doctors — hostage until the Senate acts on job-creation legislation:

“I see no reason to pass this inadequate bill until we see jobs legislation coming out of the Senate,” she said. “House Democrats are saying to Republicans in the Senate: Show us the jobs!”

As Congressional Quarterly’s Emily Ethridge put it, “frustration over the Senate’s inaction is increasing among House Democrats, who have taken several politically difficult votes only to see the legislation languish in the other chamber.” There’s good reason for this frustration, as the deficit hysteria gripping the Senate is not only leaving the House hanging, but is not doing any good for the economy.

When faced with legislation that will create and save jobs by boosting demand in the economy, it’s seemingly conventional wisdom in the Senate that the right thing for a “moderate” member to do is demand that the bill be cut somewhere. This is the same dynamic that ultimately won the day during debate over the economic recovery act, when Sens. Ben Nelson (D-NE) and Susan Collins (R-ME), among others, simply asked that the overall price of the bill come down, somehow.

In this instance, it seems that aid to states is going to be the victim, even though such aid is one of the most stimulative steps that the federal government can take (though it isn’t at stimulative as extending unemployment benefits, which the Senate also can’t seem to do).

As Matt Yglesias put it, “skimping on short-term stimulus doesn’t reduce the growth rate of health costs nor does it slow the aging of the population, so you’re not achieving anything on long-term fiscal challenges.” However, short-term deficit spending can put people back to work, which leads to tax revenue for the Treasury, more demand, and ultimately a stronger economic recovery. So Pelosi is right to be frustrated and to take steps to force action on the part of the Senate.

Our guest blogger is Andrew Jakabovics, Associate Director for Housing and Economics at the Center for American Progress Action Fund.

Today’s weak existing home sales data provides yet more evidence that we’re going to have to get a lot smarter about dealing with foreclosed properties. Despite reporting a 19.2 percent increase in existing home sales over May 2009, the seasonally adjusted annual rate of 5.66 million homes sold represents a 2.2 percent decline over April.

The real takeaway from today’s release, however, is that the backlog of unsold homes will continue to be a problem. The National Association of Realtors reports nearly 3.9 million homes in inventory, which is equivalent to 8.3 month’s supply at May’s sales pace. While down slightly from April, May’s inventory is otherwise at its highest level since last August.

With the expiration of the homebuyers’ tax credit, which largely served to steal sales from future months, the expectation is that coming months’ reports will be even weaker than May and June. Moreover, there is growing recognition that inventory levels will rise as more homes move through the foreclosure pipeline. Bank repossessions hit a record high for the second month in a row in May, with over 90,000 properties completing the foreclosure process.

In addition, through the end of April, the eight largest servicers have canceled nearly 200,000 trial modifications under the Home Affordable Modification Program. While nearly half these borrowers have been given alternative modifications, foreclosure has been initiated or completed in seven percent of the cases, and 26 percent remain in limbo.

As more borrowers fall out of the trial modifications or default on their modified loans, the volume of loans in the foreclosure pipeline will inevitably rise. Indeed, in the first quarter of 2010, Fannie Mae and Freddie Mac took over foreclosed properties at a rate of one every 90 seconds.

In short, it is unrealistic to expect to find enough families to buy and live in these houses as owner occupants. Read more

Recently, even though deficit hysteria has gripped lawmakers when it comes to sorely needed job creation efforts, the Congress has seen fit to approve spending on weapons systems that the Pentagon has said publicly that it doesn’t want. For instance, at the same time that it was jettisoning subsidies that help laid-off workers buy health insurance, the House of Representatives approved a second engine for the F-35 fighter that Defense Secretary Robert Gates has called “costly and unnecessary.”

Deficit peacocks — who like to use the deficit to score political points but aren’t actually interested in reducing the deficit — treat defense spending as a sacred part of the budget that can’t touched. In fact, Sen. John Thune (R-SD) proposed legislation last week that would have slashed funding for federal agencies to ribbons, cut public sector pay, and potentially caused a two and a half month government shutdown, while leaving defense spending untouched.

Back in reality, there’s no way to reduce long-term structural deficits (not to be confused with short-term deficits, which are necessary to boost economic recovery) without looking at the Pentagon. In a speech today, House Majority Leader Steny Hoyer (D-MD) rightly pointed out that talking about deficits without talking about the Pentagon is simply not possible:

Any conversation about the deficit that leaves out defense spending is seriously flawed before it begins…The savings in front of us deserve a careful look and a thorough debate; but I fear that if we can’t decide what we can afford to do without today, we’ll be forced to make much more draconian cuts in the years to come. Of course, we must conduct such a review with the intent of maintaining a strong and sufficient armed force to deter and defeat any enemy that puts our nation and our people at risk. We can do both.

As Alex Seitz-Wald wrote in the Progress Report, “in the last 10 years, the defense budget has nearly doubled to $549 billion, an increase of $252 billion…Although in real terms baseline defense spending is now higher than at the height of the Reagan buildup, and total defense spending now exceeds what we spent any time since World War II, the Obama administration projects continuing real increases in the baseline defense budget.”

It’s not like there aren’t plenty of weapons system that can go by the wayside without compromising military readiness. Gates has called for an end to the Airborne Laser (ABL) program, for instance, which is supposed to use 747s mounted with laser beams to shoot down missiles. “I don’t know anybody at the Department of Defense who thinks that this program should, or would, ever be operationally deployed,” Gates has said.

The Sustainable Defense Task Force has put together a whole host of steps that could be taken to reduce defense spending, including reducing the U.S. nuclear arsenal, pulling troops out of Europe and Asia, and canceling programs like the MV-22 Osprey and the Expeditionary Fighting Vehicle, both of which are long delayed and aren’t useful. If you can’t acknowledge that significant savings can be found in the defense budget, which the Task Force’s report proves there are, then you aren’t serious about erasing the deficit.

The Labor Department is set to issue a ruling tomorrow stating that the Family and Medical Leave Act — which provides up to 12 weeks of unpaid leave for workers to care for a sick child — applies to same-sex partners and their children. The ruling “tackles a question not explicitly addressed in the 1993 Family and Medical Leave Act,” and also states that worker need not have legally adopted a child to use the time off.

Jennifer Chrisler, executive director of the Family Equality Council, “estimated that 1 million lesbian, gay, bisexual and transgender families were raising 2 million children.” The Labor Department’s ruling makes it explicit that “if you act like a parent, do the work of a parent and raise a child like a parent, then you are a parent for the purpose of the Family and Medical Leave Act,” she said.

This is a good step by the Obama administration, and is part of an ongoing effort to ensure that benefits in the workplace to not exclude gay workers or their families. But the federal government is still stuck guaranteeing only unpaid sick leave, when it really should be able to guarantee paid sick leave for all workers.

The United States is all alone in the industrialized world in not mandating some sort of paid sick leave, which nearly 50 percent of private sector workers do not have (including 86 percent of food service workers and 78 percent of hotel workers). Lost productivity due to sick workers attending work and infecting other employees costs the U.S. economy $180 billion annually.

Lack of paid leave not only means sick employees coming in to work, but sick children being sent to school by parents who can’t afford to take time off to care for them. In fact, according to a new survey conducted by the National Opinion Research Center at the University of Chicago “nearly twice as many workers without paid sick days (24 percent) have sent a sick child to school or daycare than workers with paid sick days (14 percent).” 16 percent of those polled “say they have lost a job for taking time off from work to care for a sick child or family member, or to cope with their own illness.”

“This new survey shows conclusively that our nation is paying a high price for not allowing workers to earn paid sick days,” said Deborah Leff, president of the Public Welfare Foundation. “It demonstrates that not having paid sick days drives up the costs of health care and causes more people to go to work sick, creating public health risks for everyone.” In order to rectify this situation, Congress could pass the Healthy Families Act, which would guarantee seven paid sick days to all employees at firms with more than 15 employees, which could also be used to care for sick children or family members.

Again, the Labor Department’s step is laudable and necessary. But the U.S. is still light-years behind the rest of the world in terms of taking care of its workers, gay and straight alike.