Amid the feel-good passage of a 13th extension of the Emergency Unemployment Compensation bill, providing nearly two years of unemployment benefit in most states, conservative consultants have begun circulating on Capitol Hill studies that indicate extending unemployment insurance, or UI, encourages people not to go back to work.
On Tuesday, six Republicans joined Senate Democrats to provide the 60 votes necessary to proceed on extending the benefits for an additional three months at a cost of $6.5 billion.
Dogging the Obama administration is the annoying, persistent reality that unemployment remains a serious problem affecting millions of American workers and families.
Available data suggests the job market is continuing to suffer, with unemployment continuing to hover in the 11 to 12 percent range, if the long-term unemployed and the underemployed are included in the calculation. The labor participation rate, meanwhile, remained in the 60 percent range throughout 2013, with part-time employment staying stubbornly at the 20 percent level to which it spiked in 2009 at the height of the economic downturn.
Obama’s failed economic “recovery” has only worsened the employment and living conditions of all Americans. “At the Brink” is sobering but essential reading for Americans who care about the nation’s future.
Circulating among Republican lawmakers this week in Congress is a National Bureau of Economic Research study published by economists Henry S. Farber and Robert G. Valleta. The study demonstrates that extending unemployment insurance benefits to 99 weeks in many U.S. states in the 2009-2012 period resulted in a statistically significant increase in the duration of unemployment.
In effect, increasing the time period UI benefits are paid to nearly two years encourages workers to remain unemployed.
Conservative consultants on Capitol Hill have begun making sure Republican lawmakers and their staffs are aware of studies conducted in Germany demonstrating that reforms introduced in 2006 limiting the duration of UI benefits caused the unemployment rate among workers aged 57 to 64 to drop some 20 percent.
The obvious conclusion is that reducing the duration of UI benefits encourages unemployed workers to find jobs.
Republican staff members from the office of Rep. Dave Camp, R-Mich, chairman of the House Ways and Means Committee, passed out on Wednesday a “real world” study conducted in North Carolina.
The North Carolina study found that while extended unemployment benefit checks were paid, 44,270 more North Carolina workers became unemployed. But after extended unemployment benefit checks were suspended in the state in July 2013, employment increased by 38,235.
Camp’s office points out that the unemployment rate in North Carolina has fallen from 8.9 percent in July to 7.4 percent in November.
Camp points out the 12 previous EUC extensions have cost U.S. taxpayers some $265 billion and added $200 billion to the national debt.
Even without EUC, states are projected to spend $40 billion on unemployment checks in 2014.
“It is time to focus on policies that will actually lead to real economic opportunities for families who are trying to get back on their feet and back into the workplace,” a fact sheet circulated by Case’s staff argued. “EUC kept employers from creating jobs.”
Case is joined by Sen. John Thune, R-S.D., who argues that instead of extending unemployment insurance benefits, it is time to fix the problem by implementing policies that make it easier for employers to hire employees long-term.
As the measure to extend unemployment insurance a 13th time nears a final votes, it’s unclear whether Senate Majority Leader Harry Reid will allow Republicans to submit amendments.
So far, Reid appears reluctant to allow amendments, a decision that could force Senate Republicans to vote against the measure, with potentially harmful political consequences.
Even if the measure passes the Senate, opposition forming among Republicans in the House suggests it will face stiff Republican resistance.