Unemployment Extension Considered by Congress
Sep 21st, 2009 | By Rob | Category: Congress, economy
I put down my keyboard for a few days after the President signed the congressional legislation offering the nation credit card reform. The result has been a long vacation and four months of silence on this website. When I woke up this morning, I noticed a brief news story regarding consideration of the extension of unemployment benefits by the House of Representatives. It seemed like the perfect opportunity to strike a few keys again and post something about it here. I apologize for the long length of time between posts. I’ll try to keep it much shorter in the future.
Why would I care enough about unemployment to break the silence here? Unfortunately, I’ve had a great deal of experience with unemployment. I’ve filed for unemployment twice and spent a shockingly high percentage of time after college graduation living on a government paycheck. Based on this experience, I fully support efforts to extend the length of time in which individuals are covered by unemployment. I also support efforts to increase the amount payable weekly on unemployment, but like Congress I’ll leave that debate for another time.
The nation’s unemployment is also a highly appropriate topic to be discussed here. Bankruptcy, foreclosure, and defaults on credit card debt are often tied to the loss of income when one’s job disappears. And if individuals are to tackle their debt problems, they need jobs that are stable and pay a sufficient amount to allow them to pay their creditors.
It is also an interesting time for the debate about unemployment benefits to be happening. AIG shares soared today on rumors of a proposal to (again) restructure the government’s deal with AIG. There has been discussion about the credit markets easing one year after they froze following the collapse of Lehman Brothers. And this recession has already lasted well past the average length of a recession (about a year). Is the wave of articles about unemployment in newspapers and the increase in the nation’s unemployment rate simply a lagging indicator from the recession that some believe is ending or simply the start of what some fear will be a double dip recession?
From the figures that I have seen discussed in news stories, 400,000 on unemployment will run out of benefits by the end of September. By the end of 2009, that number could rise to 1.5 million.
Congress has already done some great things for the unemployed so far, like extending benefits from 26 weeks to a maximum of 79 weeks, as well as subsidizing health insurance coverage through COBRA. At the same time, it is hard to argue about the greatness of a system that pays an average of $300 a week. I also don’t think that anyone can argue that there have been sufficient efforts to help the unemployed from losing their homes to foreclosure.
The House bill sponsored by Representative McDermott would extend unemployment benefits for another 13 weeks in states with unemployment rates above 8.5 percent. Let’s pass it and start considering how to reform the system so that half a million people can worry about finding a good job and keeping their home rather than simply surviving.
