Working In These Times
Beyond the Spin: The People Left Behind by Extended Unemployment Benefits
While Democrats have sound reasons to be glad they broke a six-week delay by the GOP in voting for an extension of unemployment benefits, 2.5 million of the long-term unemployed will still have to wait for their benefits to be restored. It could take a little while for the strapped and understaffed state unemployment agencies to sort through the retroactive claims for aid extended through November 30. (And that's not counting the 14 states that are on the brink, avoiding running out of unemployment funds by borrowing from the federal government.)
Huffington Post reports: "Because the program has lapsed for over a month, state workforce agencies need to ensure that claimants qualify for all retroactive payments. In addition, the time it takes will vary from state to state because states use various technologies, some of which are quite antiquated," said Rich Hobbie, who heads the National Association of State Workforce Agencies. In fact, the Washington Independent notes, restoring the benefits will likely turn into a logistical nightmare for many.
On top that delay, as Andrew Stettner of the National Employment Law Project, points out, the bill simply omits lifelines that were part of the original stimulus, or recovery, legislation. These include COBRA subsidies, meaning millions will lose their health insurance in the months ahead; aid to states and local governments, so as many as 900,000 front-line workers will be laid off; and an additional $25 a week in aid.
And with nearly a quarter of the nearly 15 million officially unemployed out of work for more than a year, there's still no political interest in extending unemployment benefits beyond the current 99 weeks allowed, despite the worst, most long-lasting jobs crisis since the Great Depression.
In the real world, the extension of unemployment benefits comes a bit late for people whose lives are unraveling. As McClatchy reports:
Rita Martinez of Las Vegas cashed in a $3,000 certificate of deposit last month and used the money to make her $870 mortgage payment.
"That was the last $3,000 I had to my name," Martinez said. "What I'm going to do after that, I don't know. But I don't want to lose my home. I've been here for 13 years."
A former business manager for an immigration law firm, Martinez, 57, was laid off in May 2009. Since then, her weekly $357 unemployment insurance check has helped her keep the utilities paid, food on the table and gas in her Chevy truck.
But after Congress failed to extend those benefits at the end of May, Martinez found herself without any income. As of July 16, more than 2.5 million long-term jobless Americans were in the same boat.
On Wednesday, as Congress prepares to pass legislation to restore those benefits, Martinez, was heartened, but said it will take at least a month for state officials to start generating the checks again.
"So you're talking about people going a full two or three months without any income whatsoever," she said.
Worse, as the Center for Economics and Policy Research observes in a new report (hat tip to Isaiah Poole), it could take over a decade before we return to unemployment levels we had before the crash. As Poole says, "If the economy returned to the level at which it performed during the best four years of President Bush—think top-end tax cuts, limited government infrastructure spending, deregulation and the bubble in the housing market—it would take until April 2021, taking into account labor-force growth, for the unemployment rate to get to the 5 percent it was in December 2007, before that house of cards collapsed."
While pundits and Democratic leaders give lip-service to the notion that more needs to be done as they celebrate the victory over the GOP, the reality is that there's no urgency in Washington to create more jobs, the real solution to unemployment.
Even as mainstream and progressive economists such as Nobel Prize-winner Joseph Stiglitz have issued a new call for urgent stimulus spending now and putting off deficit cutting, Washington remains fixated on deficits and long-term debt, instead of the lost revenues, economic blight and wasted lives caused by unemployment.
Who is listening to this sort of economic common sense?:
GET AMERICA BACK TO WORK
Fourteen million unemployed represents a gigantic waste of human capital, an irrecoverable loss of wealth and spending power, and an affront to the ideals of America. Some 6.8 million have been out of work for 27 weeks or more. Members of Congress went home to celebrate July 4 having failed to extend unemployment benefits....
The urgent need is for government to replace the lost purchasing power of the unemployed and their families and to employ other tax-cut and spending programs to boost demand. Making deficit reduction the first target, without addressing the chronic underlying deficiency of demand, is exactly the error of the 1930s. It will prolong the great recession, harm the social cohesion of the country, and continue inflicting unnecessary hardship on millions of Americans.
Yet, as Poole and other critics observe, the small-bore extension of unemployment, while clearly helpful, doesn't address the deeper economic chasm that is well on its way to destroying the career opportunities of an entire generation:
Congressional conservatives are pushing for a repeat of the Bush economic formula, but the Bush economic formula at its best performance means that we will be waiting 11 years before the job market reaches some semblance of near-full employment. We simply don't have 11 years to wait for the job market to recover.
In February on our site [ourfuture.org] we began calling for a plan to create 402,000 jobs a month over three years. It is true that such a level of job creation, sustained month after month, would be extraordinary by today's standards. But if President Obama and Congress had at least tried, the political arguments at center stage would be over bold interventions that would make working-class people in Nevada, Michigan, California, Rhode Island, Florida and Mississippi--all states where the June unemployment rate was 11 percent or higher--believe that some real leadership was being exerted on their behalf.
Instead, Democrats are congratulating themselves that they have successfully gotten extended unemployment benefits past the "hell-no-you-can't" Republicans, but are not marshaling themselves or the progressive base in fighting what should be the real war: a program that moves the economy toward that 400,000-jobs-a-month goal through investments in infrastructure, investments in people, clean energy legislation and rational tax policies.
"Many lawmakers, policymakers, and economic commentators do not appear to recognize the depth of the current labor-market recession," CEPR's report says. But it's not too late for them to present an anxious public with a clear choice between the policies that will extend the nightmare of long-term joblessness into the next decade and policies that will get the working class working again.

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Comments
Dear Art:
Thanks for once more pointing out the “fierce urgency,” as President Obama would put it, of addressing the needs of the jobless and under-employed.
Our crisis is not just an economic one, but a moral test as well. Will the resources of the world’s mightiest economy be harnessed to provide meaningful, well-paying jobs for all and restore balance to an increasingly plutocratic system?
Or will we stand passively by and witness human potential being shrunken and distorted because it is so yoked to the demands of global corporations? Will we remain silent as these corporate giants like Goldman Sachs, GE, and countless others have hollowed out both the US productive economy and American democracy?
Corporate America has increasingly shown its disinterest in creating jobs in America and its indifference to the fate of the bottom 80% who lives are increasingly insecure and precarious. The evidence of recent decades is crystal-clear on Corporate America’s secession from their responsibilities to the American workers and American communities from whom they extracted such vast wealth before heading overseas.
Unless working people can force the Democrats to aggressively fight for a major job-creation program of the kind that Art Levine laid out, we are destined for a prolonged and painful period of high unemployment. (To understand the full implications, check out Don Peck’s superb and absolutely must-read Atlantic article at www.theatlantic.com/magazine/archive/2010/.../7919/).
Thanks again, Art, for your hard-hitting reporting that not only are millions being left out of the economic “recovery,” but millions of others are now being neglected by a far-too-weak extension of unemployment benefits.
Best, Roger Bybee
I can not believe, that On top that delay, as Andrew Stettner of the National Employment Law Project, points out, the bill simply omits lifelines that were part of the original stimulus, or recovery, legislation. These include COBRA subsidies, meaning millions will lose their health insurance in the months ahead; aid to states and local governments, so as many as 900,000 front-line workers will be laid off; and an additional $25 a week in aid.
Probably this info will help me to write my college essay
Dear William:
Good luck on your essay!
If you’re writing about the plight of the unemployed, you will find many valuable items scanning workinginthesetimes.com and Don Peck’s superb and absolutely must-read Atlantic article at http://www.theatlantic.com/magazine/archive/2010/.../7919/.
The extent of suffering in former factory towns abandoned by ruthless and rootless employers is documented in many places, among them my pieces on various Wisconsin cities including Janesville, Kenosha, Racine, and Kimberly, all available on my website (type in “Z Space” and “Roger Bybee.”) and pieces on Wausau and Racine on workinginthesetimes.com.
Several points are worth underscoring:
1) When banks are in crisis, there is no delay in coming up with $750 billion or more (with the total cost well in the trillions.)
Yet working families—whether employed (often under-employed or having endured wage cuts) or unemployed—receive no such bail-out.
2) The Republicans held extension of unemployment benefits hostage to the elimination of higher taxes on hedge-fund managers, which shows their fundamental loyalties.
3) However, the Democrats as a whole have not been heroic.
a) They have neglected to put forward public-sector jobs programs at a time when corporations are not hiring (see my recent post on the “strike” by private sector employees)
nor are they willing thus far to propose an adequate stimulus.
b) Programs to prevent home foreclosures have been a dismal failure, as I have discussed in a couple workinginthesetimes.com pieces, and have also been addressed by Art Levine and others. These programs have been fundamentally flawed by requiring banks’ voluntary agreement to accept a reduced mortgage, and the banks would rather see families homeless than accept a write-down.
c) Major banks—including those receiving bailouts—continue to sit on their money drawing interest from the Federal Reserve rather than lend it out (see a superb article by Nomi Prins that I have referenced numerous times) and actually stimulate the economy. Yet the Obama administration has failed to challenge the banks on this.
d) The off-shoring of US jobs continues at a high rate, but without facing either legislation backed by the majority of Democrats (78% of all Americans oppose US jobs being relocated overseas) or President Obama calling them out for criticism. These firms are undermining the US productive base at a time of national economic crisis, and ought to face some consequences, yet the Democrats have generally been far too timid.
Again, good luck! Best, Roger
In today’s economy, global recession has become a biggest threat to world. Due to this global recession, unemployment has become a serious and top most problem in many part of the world and we are counting on the national government to take a look with this matter because it is indeed alarming and stressful to most individual who wanted to work yet there are very limited opportunity. I am sure no one who want to suffer from this kind dilemma so urgent action has to be taken. I hope that there’s a way for US to recover from the great depression that they had once suffered. Lets all be united in trying to eliminate the the bleak economy.
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