Competing Visions Over Emergency Unemployment Insurance in Congress

Jan 22, 2014 by AFP

By Thomas Fletcher

Under the leadership of Majority Leader Harry Reid, liberals in the Senate pulled out all the stops this past week to try to pass legislation extending recently-expired Emergency Unemployment Compensation without offsetting spending cuts. Senate Republicans held firm in refusing to vote for any extension proposal that did not include spending offsets. Instead of concentrating on getting people back to work, Senate Democrats seem more interested in increasing government spending and growing dependence on federal programs.

Earlier in the week, there had been a bipartisan consensus in Congress to extend jobless benefits with the understanding that it would be paid for with spending cuts elsewhere. The EUC extension proposal was initially supposed to be for just 3 months and cost $6 billion, but it quickly ballooned into an 11 month extension that would cost nearly $17 billion without any spending offsets. Senate Democrats seemed determined to fast-track this legislation regardless of its impact on the debt and deficit. Even worse, the majority party refused to consider any amendments sponsored by Republicans for the extension, including an amendment from Sen. Pat Toomey that would disqualify millionaires and billionaires from receiving unemployment benefits.

Part of Leader Reid’s cynical gambit to entice Republicans to agree to higher spending levels, was to extend sequestration for one year and use the “savings” to pay for an extension. Of course, this agreement to cap spending was already current law; living up to this agreement is literally the least Congress could do. Equally alarming, the additional year proposed by Senator Reid would have fallen outside the ten year budget window, leaving the Congressional Budget Office (CBO) unable to render a fiscal score. Thankfully for American taxpayers, Republicans stood firm and did not fall for the Democrats spend-now-and-pay-for-it-later rhetoric.

Given the disappointing news in the latest jobs report, getting people back to work is more important now than ever. The country is now five years into a supposed economic recovery, yet there are still millions of Americans struggling to find a job. As a result, many have given up looking for work and are leaving the labor force at an alarming rate. Meanwhile, multiple studies by esteemed economists have cast doubt on the on the effectiveness of unemployment insurance.

It’s time to try a new approach. Congress should go back to drawing board. There should be a consideration of new ideas as opposed to just repeating the same policies over and over —such as extending emergency unemployment insurance indefinitely  When it comes to helping people while they are out of work, lawmakers should seek common sense policy solutions that improve the well-being of Americans while maintaining safeguards for taxpayers.