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Working In These Times

Friday, Dec 10, 2010, 11:18 am

Jobless ‘99-ers’ Neglected in Obama’s $900 billion Grand Compromise

BY Roger Bybee

America's corporate-dominated economic and political systems both operate under a curious assumption: The wealthy must be pampered in order to invest and generate jobs, while workers and the unemployed must be punished to keep them from slacking off.

In the Grand Compromise on tax cuts and extended unemployment benefits struck this week, President Obama was somehow unable to overcome the GOP's hostility to the jobless (despite the fact that, "Sen. Chuck Grassley (R-Iowa) said Wednesday that Republicans would have allowed a short reauthorization even without the tax cut deal.")

Reflecting the pervasive GOP animus toward unemployment insurance, Sen. Jim DeMint (R-SC) openly stated his groundless criticism of supposed excess generosity to the unemployed. DeMint topped it off by proposing that the jobless pay back government benefits, showing both his cruelty and his rich fantasies about the realities of being jobless for months:

I don't think we need to extend unemployment any further without paying for it, and without making some modifications such as turning it into a loan at some point. It then encourages people to go back to work.

DEMINT, GOP DON'T UNDERSTAND LIMITS OF EXTENSION

DeMint seemingly reflected a widespread Republican view that the Grand Compromise offers a virtually endless extension of UI benefits.

In his mind, jobless families surviving on $350 weekly checks have  nonetheless managed to keep living it up, unworried about losing their homes or paying for heat and food and Christmas presents. 

Actually, the Grand Compromise entirely ignored the fate of nearly 2 million jobless and benefit-less "99-ers" living in some 30 high-unemployment states (many in the South, including South Carolina) that have hit the absolute 99-week ceiling on benefits.

The unemployment compensation benefits received in the Great Compromise deal were very modest: providing about $65 million up-front (eventual net cost to the feds: about $24 billion, according to the Economic Policy Institute) for people who had run out of benefits well before 99 weeks and who are newly unemployed and facing states with empty benefit coffers.

As Arthur Delaney of Huffington Post explains:

Two programs called Emergency Unemployment Compensation and Extended Benefits lapsed last week because Congress has not reauthorized them. The programs provide up to 73 weeks of benefits for people who exhaust 26 weeks of state benefits.

If they aren't restored, two million long-term unemployed will prematurely stop receiving benefits before the end of the month. Already 800,000 people have received cutoff notices.

Somehow, Obama wound up, at the deal's core, trading away 24 months of extended Bush tax cuts for the richest 2% for just 13 months of extended unemployment benefits. 

The roughly $65 billion in extended unemployment benefits will serve a very limited function of simply ensuring that jobless workers will not run out of benefits, at least until they either find a job (at a moment when 5 unemployed people exist for every job opening) or crash into the absolute 99-week limit.

Then, in line with the tenets of America's guiding philosophy on the different standards of incentives for the rich and workers, they will join the ranks of those who have lost benefits. Millions more willl be tossed out among the approximately 2 million 99-ers already floating in icy waters on their own, without any government lifesavers being tossed out to save them.

The Grand Compromise's total and absolute neglect of the 99-ers stands in appalling contrast to the huge benefits bestowed on those who need it least: the super rich and corporations whom the Republicans absurdly deify as much-cherished "job creators."

The real story is that the richest 1% now lap up nearly 24% of all U.S. income and Corporate America just celebrated its most profitable quarter in history and is sitting on $1.8 trillion in cash but not investing in new jobs (at least in the US).

Yet the investor class and corporations have utterly failed to live up to their "job creator" billing by the conservatives even with all the Bush tax cuts in place. As the Washington Post reported:

The past decade was the worst for the U.S. economy in modern times. It was, according to a wide range of data, a lost decade for American workers. …There has been zero net job creation since December 1999. No previous decade going back to the 1940s had job growth of less than 20 percent.

But the jobless 99-ers, who have been worn down by months and months of futile job searches, endless worrying about paying the bills and hanging on to their homes, got nothing from the Great Compromise.

Well, that punishment of a lean and mean Christmas will keep the indolent jobless on their toes looking for work instead of sitting around.

Meanwhile, the super-rich and corporations, receive a vast array of goodies under their trees. Fully one-quarter of the extended income taxes under the plan would go to the richest 1%, the New York Times reported. The super-wealthy will also benefit disproportionately from cuts in the payroll tax and enjoy a bigger exemption from estate taxes worth $68 billion a year in lost revenues. Corporations will get huge new write-offs on investments.

The Grand Compromise will add $900 billion to the deficit, thereby intensifying the pressure from Wall Street and the Right to gut Social Security and Medicare. For conservatives, the deal is a gift that will keep on giving.

All of this has rightly infuriated Vermont Independent Sen. Bernie Sanders, who has vowed to filibuster the tax cut compromise, telling MSNBC host Ed Schultz:

The issue is the insult, the outrage that they want tax breaks for billionaires but they can't in their heart come up with extending unemployment compensation so millions of families in this country can have a modicum of security.

Roger Bybee is a Milwaukee-based freelance writer and University of Illinois visiting professor in Labor Education. Roger's work has appeared in numerous national publications, including Z magazine, Dollars & Sense, The Progressive, Progressive Populist, Huffington Post, The American Prospect, Yes! and Foreign Policy in Focus. More of his work can be found at zcommunications.org/zspace/rogerdbybee.

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