Unemployment Benefits: Expired, But Set For an Extension Vote

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Harry Reid

File-Senate Majority Leader Harry Reid said he was optimistic that the Congress would work together to resolve the issue of extending unemployment benefits on his first day of the year back at the Senate floor. (AP Image)

Senators in Washington will vote on whether to approve a three-month extension to unemployment benefits some time Monday.

Benefits for unemployed Americans expired on December 28th. However, Congress remains divided over whether to approve a bill sponsored by Senators Jack Reed, D-R.I., and Dean Heller, R-Nev. The bill proposes a $6.5 billion extension to long-term unemployment benefits.

While jobless rates remain high in numerous states, prompting many to point to the necessity of this bill, the federal budget has already ballooned to a size that concerns a large portion of Congressional members. Republicans, in particular, are arguing that any spending on insurance for jobless Americans must be offset by cuts elsewhere.

The Senate votes on the bill Monday, and on Tuesday President Obama will hold a press event with numerous unemployed Americans in attendance.

“I’m optimistic, cautiously optimistic, that the new year will bring a renewed spirit of cooperation to this chamber,” said Majority Leader Harry Reid, D-Nev., in the first remarks of the year on the Senate floor.

Support for the Unemployed

While the initial vote is just for a three-month extension to unemployment benefits, the full cost of coverage for the unemployed, throughout 2014, would be approximately $25 billion.

Gene Sperling, one of President Obama’s top economic advisors, argued that the bill “is a temporary lifeline in difficult times,” encouraging lawmakers to vote for its passage.

In the same vein, Cecelia Muñoz, the Director of the Domestics Policy Council, stated in her weekly remarks at the White House that for “many who are unemployed through no fault of their own,” letting the unemployment insurance lapse is critically harmful. She added that extending the benefits would ultimately help the economy grow, since it would allow unemployed individuals to “make ends meet while they look for a job.” Her full remarks can be found on the White House website.

For his part, President Obama has criticized Republicans for opposing the bill, stating in his weekly radio address that refusing to extend benefits would be “punishing families who can least afford it.” 

In this Thursday, April 11, 2013 photo, people wait in line before the Dr. King Career Fair at the Empire State Plaza Convention Center in Albany, N.Y. U.S. employers added 165,000 jobs in April, and hiring was much stronger in the previous two months than first thought, the Labor Department reports, Friday, May 3, 2013. The gains trimmed the unemployment rate to a four-year low of 7.5 percent. (AP Photo/Mike Groll)

In this Thursday, April 11, 2013 photo, people wait in line before the Dr. King Career Fair at the Empire State Plaza Convention Center in Albany, N.Y. Millions of Americans have requested the extension of unemployment benefits, even though they expired December 28th. (AP Photo/Mike Groll)

According to Politico, the White House is focusing on extending unemployment insurance as a means of maintaining the current– though tentative– economic upswing.

Can We Afford More Unemployment Benefits?

On the other hand, many Republicans oppose the Reed-Heller bill. In fact, Heller is the only Republican who openly supports the bill, though four remain publically uncommitted.

As reported in Politio, House Speaker John Boehner, R-Ohio, summed up opposition to the bill by saying that any spending in the area of unemployment benefits would need to be offset by budget cuts in other areas. Given last fall’s government shutdown, and the fact that Congress passed a budget only weeks before the turn of the New Year, many in Washington and across the country are concerned about such a large expenditure.

If the passage of the bill in the Senate looks questionable, the proposal will have an even tougher time in the Republican-controlled House of Representatives.

History of Extensions

In the past, Congress hasn’t shied away from extending unemployment benefits, despite troubling economic times.

Sperling was quoted in USA Today telling reporters that “Fourteen of the last 17 times in the last 20 years that it’s been extended, there’s been no strings attached.” The White House has used this argument as well, pointing out the numerous past instances in which Congress has approved extensions for this type of unemployment insurance without requiring the budget to be scaled back elsewhere.

Currently, the average unemployment rate in the U.S. is 7%, which is the lowest it has been in several years. The country’s economy grew at 4.1% from July through September of 2013. 

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