Perhaps the most unassuming of “fiscal cliff” policies that expire at the end of the year is extended unemployment benefits. Benefits have already been reduced from 99 weeks to, at most, 79 weeks, in the states, and they will fall to a maximum of 73 weeks by the end of the year. But a series of tiers of extended benefits supplement the state benefit level of 26 weeks up to the higher weeks of benefits because of the Great Recession and continued mass unemployment. If the program is not extended after December 31, then unemployment benefits will be cut off for millions, with the program reverting back to 26 weeks.
The National Conference of State Legislatures approved a resolution supporting the extension of unemployment insurance, suggesting that the states see this as a much more vital program than they do in Washington.
“As a means of stabilizing the economy, NCSL supports extensions of the federal-state Extended Benefits program when unemployment rates are high,” said the resolution, which also covered policy issues relating to wages, pensions, and other safety net programs. “NCLS also supports continued reauthorization of the Federal Emergency Unemployment Compensation Program when unemployment is high.” [...]
The reduced federal benefits will expire altogether in December unless Congress reauthorizes them. Otherwise, laid-off workers will have just the standard 26 weeks of benefits provided by most states, even as the average jobless spell in July had lasted 38.8 weeks, and economists expect the unemployment rate to remain above 8 percent for the rest of the year. The National Employment Law Project estimates that 2 million Americans would lose benefits immediately as a result.
Congress hasn’t allowed federal unemployment insurance to expire while the national unemployment rate is above 7.2 percent since the 1950s, but lawmakers on Capitol Hill have not hinted at any plans to preserve the benefits — and the tone of the national political discussion has been increasingly hostile to government safety net programs.
The stimulative properties of unemployment insurance – getting money into the hands of people who will spend it and allowing them the support needed for them to search for and find new work – are beyond question. But the moral undercurrent behind unemployment insurance is rarely mentioned. It is not the fault of the individual that the jobless rate has been elevated above 8% for over three years. It’s not their fault that it takes, on average, 38 weeks to find a new job. But that’s who would suffer with a cut-off from benefits, if the program were allowed to expire.
Washington lawmakers and policymakers have become inured to high unemployment. Virginia and Maryland, where most of them live, have done fine, and all their friends have jobs, after all. They could cut off unemployment benefits at any time without personally affecting them or anyone they know. It just doesn’t matter to them. Anyway, we’ve moved on to talking about the deficit and entitlements.
And that’s a major problem with the deadline approaching.