Posted By RichC on July 20, 2010
Politicians in Washington DC seem to spend more time looking to gain political points on the back of those who are jobless than fixing the problem … part of which they, big government, creates. The Republicans in attempting to turn the focus on fiscal responsibility want to see and extension of unemployment benefits ‘paid for’ – meaning cuts in other spending – while Democrats seem to have no problem borrowing more money and painting Republicans as heartless. Wasn’t it just last year the President Obama stressed that any unemployment benefit extension must be paid for?
I actually struggle to rationalizing extending benefits a total of an additional 53 weeks — the basic 26 weeks are known as Unemployment Insurance (UI). One of the interesting twists in the current legislation is that in addition, the bill will make benefits retroactive – meaning eligible unemployed people who have not received benefits since June 2 will now get what they would have received if the program had continued uninterrupted – a total of 99 weeks of unemployment if extended to November 2nd. (depending on the state)
At what point does borrowing to fund unemployment slow our recovery or force us into a second recession? Maybe it’s a personal issue with me since my income has been severely impacted by near zero new sales and deep cuts in existing sales (I get paid only when jobs are sold at a profit). There isn’t a life-ring waiting to rescue me or much of a fallback position other than going deeper into personal debt, selling assets to pay bills or finding part-time work. Personally speaking, that means having to adjust and put a plan together … even if it means doing day labor for low wages. I’m not convinced that just extending unemployment benefits until November at a cost of $34 billion is going to change one’s work prospects … and having the government borrow more just slows the economy.
But I’m in the minority since today the Senate having little problem spending money they don’t have. They voted 60-40 to overcome a Republican filibuster, setting up a final vote for late this afternoon. If passed, the bill will return to the House and most likely will receive approval in that chamber. The roughly $34 billion cost of the plan will be paid for by additional borrowing and add to our growing debt. What would have been so wrong with realizing our federal spending is out of control and finding a way to prioritized things in the existing budget if the highest priority is to extend the unemployment benefits another
Below is a discussion between Karl Rove and Bill O’Reilly Monday night on this subject.