In their pro forma session, the Senate passed by unanimous consent the latest – and final – version of a two-month stopgap bill to extend the payroll tax cut, unemployment insurance and the doctor’s fix. They actually deemed this version passed pending approval from the House, which must originate any tax bills. The House followed suit, without objection, so now the bill has passed, and I would expect the President to sign it expeditiously.
I’ve been following the politics of this, which definitely track for Democrats, as John Boehner winds up humiliated by the late-game theatrics. On the policy, I wrote yesterday about the economics of the bill. There definitely are some caveats. Steve Benen mentions a few. First, this is only a two-month stopgap, and it’s unclear how Congress will react two months down the road to put together a one-year extension. Second, Benen cites Greg Sargent by saying that this is the only part of the American Jobs Act that has been able to pass. That’s not actually true, the veterans hiring piece passed. In addition, the payroll tax was one of the larger parts of the AJA. Third, Benen notes that there were concessions in the Senate bill, which he lists as the dropping of the millionaire surtax and the acceptance of an expedited decision on Keystone XL. I don’t know why anyone thought the millionaire surtax was anything but a message vote to allow Democrats to run ads next year. On Keystone XL, if we take the State Department and the White House at their word, in 60 days the permit will be denied. So let’s see.
But he’s forgetting one, and it’s actually the worst part of this whole bill. Seemingly everyone but Arthur Delaney has overlooked the fact that this short-term stopgap allows extended unemployment benefits to expire in several states.
A top ranking Democrat in the House of Representatives on Tuesday defended his party’s support for cutting 20 weeks of unemployment benefits, a position that has escaped much notice in the payroll tax cut debate consuming Washington.
Democrats want the House to pass a Senate bill that would postpone the January expiration of federal unemployment programs for two months. But even if it is reauthorized, one of those programs will automatically phase out next year, unless Congress changes federal law to allow states to keep it, a provision not included in the Senate bill [...]
The Extended Benefits program is the last stop on the unemployment insurance train for the very long-term jobless. It provides up to 20 weeks of assistance to workers who exhaust 53 weeks of federal Emergency Unemployment Compensation and 26 weeks of state benefits. But the Extended Benefits program is only available in states where the unemployment rate has risen significantly over the past three years. Unemployment has remained stubbornly high since 2008, but it hasn’t risen, which will make most states ineligible for Extended Benefits early in 2012.
In other words, the rallying cry about the 99ers is only true in high-unemployment states. And because the “look-back” on the Extended Benefits provision is three years, unemployment hasn’t increased in most of those states under the time requirements, which means that the 99ers will fall back to the 79ers. Originally, the Senate bill changed this to a four-year look-back, which would have preserved Extended Benefits in the high-unemployment states. As it is, it’s probably going to phase out, unless it gets changed in the one-year version.
The one bit of good news here is that the only member of Congress who seems to be irked by this, House Ways and Means ranking member Sander Levin, has been appointed as a conferee in the House-Senate conference on the long-term bill. Hopefully he will make this a priority. He recently called the provisions in the Senate bill “wholly inadequate.”
But 11 states will lose access to Extended Benefits in just the next two months – Minnesota, Michigan, Massachusetts, Maine, Oregon and Indiana in January, and Wisconsin, Tennessee, South Carolina, Rhode Island, and Ohio in February.
Now THAT’S a real concession. And it’s really awful. It should be a top priority to remedy this in the long-term bill, with retroactive benefits for those who will be cut off without warning in the next two months.




23 Comments

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Thanks for catching the one David. The people in Congress who allowed this are truly cruel.
not just cruel, but profoundly stupid;
every penny of the money these people get, goes immediately into the local economy, for food, rent, heat etc.
Beyond Keynesian? Has any economist with cred been consulted by the Obama Adm. on the malaise our economy is in? Short answer, NO! Even the Dems can’t/won’t allow a massive(3 trillion)public works project to be voted on or considered. In 10 years America is going to look like a 3rd world country in some vital areas of our vital logistics/transport sector. If we ever needed more proof that the 1%ers think our country is not worth putting money into this non-stimulated recovery should be the last straw.99% of the country is going to dread the phony parameters of our rigged 2 party system. We are all black rhinos, now!
Horrible news, and perhaps the 2-month window will serve as a wakeup call, with the reports of those disadvantaged providing leverage to reinstitute the full EB program before too much damage is done. (I’ve never really understood the purpose of limiting EB to selected states anyway; surely even the not-quite worst states have unemployment rates above the traditional 7.5 % threshhold, no?)
But on a personal note, I’m quite thrilled that this was taken care of before the weekend. No interruption for we “26ers” who are exhausting our state benefits; I can transition automatically to Federal now. Safe through May, and likely the year. One week of ultra-austerity (as this check has to go to the rent, in its entirety), one week where I’ll at least have food stamps, and then I’m liquid, baby! Yesss! (I’ll try not to spend the whole $500 in one place.) And, as I won’t reach “79er” status until the end of 2012, hopefully I’ll have an incoming Dem Congress to ensure the Rs extend EB for me and those in my situation. (Or, y’know, have a JOB by then…) Thanks for putting up with my whining this week, working Lakers.
(And a virtual toast to fellow-sufferer JohnJ; hang in there, bro.)
Lets see a 60 day extension of the payroll tax cut, and a 60 day timeline for the Keystone pipeline. Am I the only one that sees the payroll tax cut as the next hostage for the pipeline?
Obama isn’t even trying to hide his next cave in.
Did anyone else here hear Obama pontificating on the “good” which extending the payroll tax cut would do? He claimed to have overwhelming, flooding mail from folk so eager to have their feet cut off in order to enjoy their momentary perks. The examples he gave included these: a guy who would now be able to go out for pizza with his daughter. Another guy who would now be able to visit his father in an adjoining state four times a month instead of three. Three days paid for of heating costs for a third – that one at least sounds worthwhile until you realize at the same time that low income folk are being denied heating allowances by this generous government we have. Now, gee, they get three days worth.
FOR THE RECORD here is an excellent summary of the actual longterm travesty this payroll taxcut extension represents, courtesy of poster Progressive 101 at commondreams.org:
“Before Obama, Social Security was just funded by Americans through payroll deductions and by employers with matching contributions and was a self-contained program. However, when Obama added the payroll tax cut, he swapped part of the payroll funding for funding by US tax dollars (or promises of them). The result is SS is now contributing to the national debt and makes it a legitimate target of deficit reduction talks (previously SS was part of the discussion but the talks were illegitimate). As others have noted, Corporate media ignores educating Americans on the impact these short term “tax cuts” have on long term social security. I was actually hoping the House Repubs would hold their ground on this one even though their intention was not saving SS. Even though the US can’t afford it, Obama could have easily proposed the same tax cut using income taxes instead of SS taxes. This will be part of Obama’s legacy.”
For the record, this WILL be part of Obama’s legacy. They seem to get it over at commondreams.org, and a majority of posters here do as well. Only the important news disseminators are doing a REALLY bad job, and as a senior citizen, I do protest and am beginning to feel unwelcome here.
I will further add that the only one I have seen discuss this major problem ANYWHERE is Bernie Sanders.
Thank you, Senator Sanders.
Oh, Goodie!
Just in time for the Holidays. I’m sure they can explain it all to their constituents. I hope Mick Mulvaney changes his robocall Townhall meeting set up. Either that, or people will be standing in line at his home to discuss the rammifications.
We need more Bernie Sanders and Claude Peppers in Congress!
The MSM are a total failure. Our rep is one of the tea party and when
asked to respond about his vote parrots the line about job creators,reducing
taxes etc. It is never pointed out in the “interview” that his vote has
hurt many of the people he represents- a rural area with many unemployed
or older folks barely making it.
(((juliania)))
If you are already a senior citizen then you are likely safe. It’s my generation and the generation following that is going to be well and truly screwed. My generation may grumble enough since WE were the initial group that had our taxes raised to create a surplus. The next generation? I suspect they are too much in survival mode to realize that today’s “cushion” is coming at the expense of the program they’ll expect to hold in their retirement.
I know it isn’t a consolation but I suspect that even if over 80% of us complain about changes to Social Security that they are coming down the pike anyway. We’ll be ignored just as we have been on immunity, bailouts, war and taxes. What we really need to reform is Congress.
IMHO you don’t need to apologize we are in this together no?
You are not unwelcome here Juliana and I feel the same way about the payroll tax cut. It is BS and have said so repeatedly. People will understand when the deficit talks heat up again and voila SS will be a part of the discussion. Thanks for sticking to your guns.
What do you call something when it is beyond pathetic? We aren’t even supposed to take the Democrats seriously anymore. Millionaire tax was a sham. Tar Sands Pipeline will be approved by Obama, only question is when. And the only thing good about the bill — the unemployment insurance — was cut, too.
Here is my question: Why did the GOP let Obama take a victory lap on this? Maybe I’ve passed from cynicism into paranoia but I smell a rat here. What deal did Obama and the GOPers really make?
Why did the GOP allow a victory lap? It feeds into the narrative that there are 2 parties with competing interests instead of one party out to screw 99% of us to benefit the ruling 1%. It’s a very important narrative in an election year dontcha know.
At the end of the spring the Congress will be pushed to extended the Bush tax cuts and we will have the Obama dance about how he wants only to extend then for those under $250,000, but must extend them for all because the GOP are so mean.
In a better world, Obama would say the Bush tax cuts would expire and then propose new tax cuts – he would become the tax cutter, just as he has become the tax cutter in the payroll tax cut fight.
How hard would it be for Obama to propose a child credit increase equal to or higher than the Bush tax credit increase, or a 10% and 25% tax bracket that disappears as it would be accomplished by a credit that disappears with increasing income, or a Marriage fix, or an updating of Alt Min Tax deduction levels with them tied to inflation in the future, or a cut to the taxes of those under $100,000 corresponding to the 2% SS payroll tax cut, as he lets the SS cut expire? Indeed a removal of the cap on SS taxable wages offset by a cut in the income tax for those under $250,000 seems a no-brainer.
None of these are hard to write up – I worked in tax and would need about a week to write a bill ready for the sharp eyes of the legal staff to cross the t’s and dot the “i”‘s.
But Obama’s goal is to protect the rich while pretending to help the 99%. So the above will not be done.
Meanwhile, the TV/radio are reporting that those robo calls advocating Hillary in 2012 are by a GOP outfit trying to get a third party going. I knew the Dem establishment were not that smart- not ready to replace Obama in a Dem primary. .
You must be paranoid like me. Because that’s exactly what I think.
Sometimes paranoid is just good sense.
I’ve been a “paranoid, shreiking holdout” since before the 2008 elections. Also bitter. *sigh*
I keep hoping that we’ve reached a tipping point and the majority of this country realizes that it’s being played by BOTH parties.
Yes, the “payroll tax holiday” is ridiculous; I’ve said this since Obama tried sell it as “something for working people” when he gave millionaires an income tax cut (by not allowing the 2001 tax cut to expire), an inheritance tax cut (ditto) and a dividend tax cut last December. It’s quite obviously a way to shuffle the books around and argue that Social Security is “broke”. If he really wanted to reduce the bite that FICA takes on the working poor, the way to do that would be to graduate the tax…I (when I was working) would pay 4.2% of my paycheck, someone making the cap max ($110,000) would pay the old 6.2%, and Alex Rodriguez or the Koch Brothers or whomever would pay 9.2% of that first $110K, or something similar. Or just raise the cap.
But Obama clearly wants to turn SS into a “welfare” program, destroy its political support and “reform” it out of existence. The good news is that existing seniors such as yourself would be grandfathered, but it’s not looking very good for future generations. You’re right to be concerned, especially at the MSM’s embrace of the spin on this. But don’t give up hope; many in the younger generations (and generations younger than my own, for that matter) know what’s at stake, despite O’s barely mentioning UI and acting like slashing direct SS funding by 30% was a “good” thing. (Still, if it helped to get the UI extensions passed, then I’m at least glad of it in the short term, I guess.)
Peace.
I see a recurring pattern here from all this negotiating…in order for anything remotely helpful or beneficial to the 99% to be passed, well some faction or program that also benefits individuals in the 99% must be also sacrificed. The ruling class that primarily represent the 1% must never sacrifice… Ever! It’s all a shell game but it always ultimately leads to more sacrifice by the serfs….one way or another….they continue to chip away at those programs that may benefit the lowly serfs.
Thanks, guys, luv you all! I realize what they are saying about those already getting Social Security, and that, as I’ve indicated before just seems so unfair to me. It will drive a wedge between those of us who live long enough and our children coming along and wishing they had what we have – I wish they’d have what I have! It ought not to be even being considered at such a critical time when it has been such a lifeline for so many.
You know what the problem is? Obama NEVER talks about “the poor”. He never does. It is only the “middle class” he deigns to address, and pretty soon there will be no real middle class because they’re sliding down to my level. And when they get here, it will be so much worse for them than it is for me – I hate to think! My children are in that category. Already they are scrimping and actually needing my support, some of them. That would be laughable if it weren’t a matter of grim necessity. How they will fare when I am gone and no jobs as that is determined to be also a nonissue by our emperor I cannot bear to think.
The same thing happened with a program about shopping trends last night on the PBS Newshour. Smart little piece about how the big end department stores are doing fine with rich shoppers spending away. And the dollar stores are going great as the middle class now shops there instead of Pennys. The poor? Nary a mention. They don’t exist. So, don’t talk about the 99% if you are not even mentioning the entire 99%!
The title of the 99% has been hijacked by the bottom 40%.