Unemployment benefits extension no help for growing numbers of jobless
Friday, July 23, 2010 at 8:55 am
Late Thursday afternoon, President Obama signed into law a bill granting workers out of a job for more than 26 weeks additional unemployment insurance payments, paid for by the federal government. The benefits had been in place since November 2009, but had lapsed for seven weeks — an unprecedented hiatus, given the 9.5 percent unemployment rate. The bill, held up in the Senate by Republicans concerned about the deficit, makes benefits retroactive to June 2 and forward to Nov. 30. In states with higher than 8 percent unemployment, workers will continue to receive up to 99 weeks of benefits.
Around the country, the 99ers — those who have exhausted the maximum number of weeks of federal and state unemployment benefits — rejoiced.
“I’m thrilled to death — this is helping two million people,” LaDona King, a 50-year-old from San Diego, said shortly after passage. “That’s very important. That’s not a small thing, by any means. Of course it is overdue — this initially passed in the House on March 10.”
King — a blogger and radio host who under the name Paladinette doggedly advocates for the interests of the unemployed, and 99ers in particular — hopes that help is coming for her next. Indeed, though she makes some money writing about the concerns of the unemployed, King is a 99er herself. (She notes that the $200 a month or so she gets for her writing disqualifies her from food stamps, leaving her to utilize food banks when she needs to.)
She lost her job as a compliance specialist at a Southern California subprime lender a few years ago. That kicked off a string of bad luck: She nearly died when a drunk driver hit her, and was unable to look for work. Her father passed, and she cared for him in his final months. She ended up so depressed as to be suicidal, uninsured and unable to access mental health services. The third and fourth tiers of extended benefits — passed last November — were lifesaving.
“I am still so upbeat, and so grateful,” she said cheerily on the phone. “It’s great when people help people. What I’m really concerned about is the families giving their children up to the state because they can’t take care of them. It’s the people who aren’t healthy. It is the lack of mental health services.”
Now, King advocates for 99ers, pressing members of Congress to extend benefits beyond 99 weeks and to create additional job-training and public works programs to get them back to work. She believes that though Congress has not helped the 99ers yet, the effort has proven successful. “Two months ago, nobody knew who the 99ers were,” she says. “Everybody thought it was some city’s AAA baseball team.”
And she puts the odds at better than 50-50 that Congress will pass something, anything, to help the swelling ranks. “A number of members have told me that there are people working on legislation for the 99ers, that they want to start something,” King says. “I call 25 to 30 a people a day on this on Washington. Thank God for unlimited long distance!”
But even the most active members of Congress on the unemployment issue say there will be no bill to help 99ers by adding a fifth tier of benefits — the most direct way to keep families and individuals out of poverty. “What we’ve seen in this fight is the difficulty of just expanding the program that we have,” says Ed Shelleby, a spokesman for Rep. Jim McDermott (D-Wash.), the head of the Subcommittee on Income Security and Family Support of the Ways and Means Committee.
The Ways and Means Committee originates most bills concerning unemployment, Social Security, Medicare and Temporary Assistance for Needy Families, or welfare benefits. Thus far, McDermott is the only member of Congress to have held hearings addressing the plight of the 99ers specifically, and Shelleby says that the congressman “recognize[s] the need to help long-term unemployed folks legislatively” and believes that after unemployment insurance ends “we can’t let millions of people fall off a cliff.”
Still, he notes, “We have to face reality.” The most probable route forward would be expanding existing programs. An additional tier of unemployment benefits is out — something Democratic Senate staffers confirm. But senators including Debbie Stabenow (D-Mich.) and Charles Schumer (D-N.Y.) have said they are working on some provisions to aid the long-term unemployed. Senate Majority Leader Harry Reid (D-Nev.) has said he supports expanding benefits or creating programs for 99ers. The problem will be finding the money to offset the cost of the programs, and convincing spending-phobic Republicans — who increasingly argue that benefits should be cut to encourage people to go back to work — to vote for them.
The House is not looking at a fifth tier of benefits, instead reviewing public works programs and other ways to subsidize job creation. Shelleby said the expansion of the TANF Emergency Contingency Fund might be one route forward. “That was put in place after the recession hit to help states, basically to aid them in subsidizing jobs,” he said. “It has hugely bipartisan support.” But the fund is only $5 billion — a pittance even compared with the $34 billion benefits extension just passed, itself a pittance of the $150 billion jobs bill Democrats hoped to pass. Quintupling it, if even possible, might have only marginal effects on aid for the 99ers.
The Senate inaction comes as the government reassesses the severity of the long-term unemployment crisis. Previously, the economists estimated the number of 99ers to be around 1 million. (In June, the Labor Department said that 4.3 million Americans have been unemployed for more than one year.) But the number is hard to tally. There is no way to track exactly what happens to individuals when they stop collecting benefits — whether they make it back to work, or stop looking for a job, or continue the job search. And with the recession lagging on, some Labor Department economists believe the number might be as high as two or three million — a population the size of Dallas, and bigger than the U.S. military.
And no matter how big that population is now, economists fear it is set to grow. Ninety-nine weeks ago, the recession had been ongoing for about eight months. But employment is a lagging indicator. It takes some time for businesses to notice the downturn in sales, and to make the choice to start reducing their workforces. That started happening in 2008 — when the pace of layoffs climbed precipitously. In the first eight months of 2008, employers laid off 1.2 million workers. In the final four months, they laid off 2.4 million.
More layoffs two years ago translates into more 99ers now. And with job growth lagging far below levels needed to reduce the unemployment rate, the jobs situation continues to look parlous.
Still, King remains upbeat, and maintains hope that Congress will have to address the plight of 99ers at some point.
“There’s a lot of people suffering. I have to believe they’ll try their best to do something,” she said. “Because there are millions of us waiting to vote in the fall, as well.”