Unemployment Benefits To Start Flowing Again, But Congress Left Some Economic Help Undone

Although unemployment benefits will once again start flowing to millions of jobless Americans, Congress failed to follow through on crucial pieces of their plans to aid the ailing economy.

President Obama Thursday signed hard-fought legislation Thursday that extends the emergency unemployment compensation, or EUC, program and full federal funding of state extended benefits through November 27. Because the law is retroactive, eligible claimants now may be paid for weeks of unemployment after the previous law expired on June 5.

Millions of out-of-work Americans had begun losing their unemployment benefits after the previous extension expired, causing even greater hardship for those looking for work and leaving many to face dire circumstances, such as homelessness. Republicans repeatedly blocked a new extension from coming to a vote; finally, two members of the Senate GOP broke ranks with the others, enabling the Senate to pass a new extension.

National unemployment stands at 9.5 percent, but is in the double digits in many places, including Nevada and Michigan. Long-term unemployment, or the number of Americans out of work six months or longer, is at levels unseen since World War II.

“We applaud the actions of the president and Congress to provide this important financial lifeline for more than 200,000 Pennsylvanians who otherwise would have run out of benefits by July 31,” says Sandi Vito, Pennsylvania’s state labor & industry secretary. “All eligible individuals will be notified by mail, and we are expediting claims processing to get this much-needed money to Pennsylvanians who are out of work through no fault of their own.”

Vito, however, foresees having to clear a backlog created by the expiration of benefits for many.

“We expect a very high volume of claims due to the congressional delay in reauthorizing these vital programs, so we ask claimants to please be patient and use the online services whenever possible,” she says. “We do understand how important these benefits are to Pennsylvanians, and we will do everything we can to ensure their swift delivery.”

However, in order to win votes for the continuation of unemployment insurance, Senate Democrats stripped down their legislation, which means key economic supports they argued were necessary aren’t happening.

Specifically, Congress has not extended state fiscal assistance contained within last year’s economic stimulus program, or the small but highly cost-effective TANF Emergency Fund, which together are helping create hundreds of thousands of jobs, according to Chad Stone, chief economist at the Washington-based Center for Budget and Policy Priorities.

States are continuing to lay off workers and cut spending to offset weak tax revenues, and these steps are impeding the economic recovery, Stone says. By extending state fiscal assistance, which will largely run out by December 31, Congress can help states balance their budgets with fewer job-killing spending cuts, he says.

Congress also should extend the TANF Emergency Fund, which 36 states and the District of Columbia are using to help create subsidized jobs in the private and public sectors. States estimate they will have placed about 240,000 people in these jobs by the time the fund expires on September 30, but many states plan to start shutting down their programs in the next month unless Congress extends the fund.

“Let’s hope [the successful unemployment extension] vote is a harbinger of speedy action on these two pressing issues,” Stone says.

The publisher of the news site On The Hill, Scott Nance has covered Congress and the federal government for more than a decade.

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