We’ve been treated recently to some good economic news in the form of a decent jobs report, but we’re a long way from a robust recovery. Now is not the time to allow unemployment benefits to expire.
More than a million people nationwide, including 44,000 in Michigan, could lose unemployment benefits just after Christmas if Congress doesn’t vote to extend the Emergency Unemployment Compensation program before breaking for the holidays.
House and Senate Democrats have proposed a $25 billion, one-year-extension of the program, but Republicans have shown little interest in going along. With the clock ticking, it appears less and less likely that Congress will extend the program before it expires Dec. 31.
U.S. Sen. Rand Paul (R-Ky.) argues that extending the benefits would be a “disservice” to jobless individuals.
“When you allow people to be on unemployment insurance for 99 weeks, you’re causing them to become part of this perpetual unemployed group in our economy,” Paul argued on “Fox News Sunday.”
That’s a popular line of argument, but it doesn’t hold up under scrutiny. The Center on Budget and Policy Priorities, in fact, issued a report in November that found that emergency unemployment benefits actually contribute to job creation.
Unemployment benefits don’t just offer a lifeline for long-term unemployed; they also stimulate economic activity. The Congressional Budget Office has estimated that extending the benefits for another year would create 300,000 jobs. Every dollar spent on unemployment compensation creates $1.52 in new economic activity.
Yes, there have been signs that the labor market has improved. Unemployment hit a five-year low in November, with the economy adding 203,000 jobs while the unemployment rate dropped to 7 percent.
But the nation remains very much in a jobs crisis.
In a Nov. 7 report, the Economic Policy Institute found that the “ratio of unemployed workers to job openings is 2.9-to-1, as high as the highest the ratio ever got in the early 2000s downturn.”
There’s no real evidence that extending unemployment benefits creates a disincentive to work, particularly in periods of high employment.
These are hard times for many Americans. Cutting emergency unemployment compensation will only make them harder, and will hurt the nation’s recovery, as well.
— BATTLE CREEK ENQUIRER