Letting Jobless Benefits And The Payroll Tax Cut Expire Could Cost The Economy More Than Half A Million Jobs

According to Politico, one of the “wish list” items that Democrats suggested during the super committee negotiations that finally ended yesterday was the implementation of President Obama’s American Jobs Act, which amongst its many provisions would extend both unemployment benefits and a cut in the payroll tax. Republicans, of course, dismissed this proposal entirely. But letting those two provisions expire on schedule in 2012 could put more than half a million Americans out of work. According to Macroeconomic Advisers, allowing the payroll tax cut to lapse “would reduce GDP growth by 0.5 percent and cost the economy 400,000 jobs.” Letting unemployment benefits expire, meanwhile, “would result in the economy being slower by an additional quarter of a percent and cost 200,000 jobs.”