Laid off from her temp job in Virginia last March, Lynette Green moved with her two kids to Atlanta in June in search of a job. She ran through her state unemployment payments and got a federal extension.
“The benefits are very important; they help me pay my bills,” said Green, 32, who lives in Atlanta’s West End and finally found work three weeks ago. “I used the money mainly for my kids, for their transportation and clothing when they started school.”
Extended federal unemployment benefits, which can last up to 73 weeks, expire Dec. 31. The U.S. House will vote Tuesday on continuing to pay the benefits through January 2013.
Supporters of the extension say it's needed in the toughest job market in generations. Those who want to reduce the benefits, mainly Republicans, say payments that can run nearly two years are disincentives to work.
Georgia, with 10.2 percent unemployment, benefits mightily from the payments. Roughly 112,000 Georgians receive federal jobless assistance, the Georgia Department of Labor reported Monday.
Another 71,000 receive checks from the state, which offers up to 26 weeks of benefits. And, without another federal extension, most would see their benefits dry up early next year, according to the Georgia Budget and Policy Institute.
“We can’t turn our back on those who were laid off by no fault of their own,” said Clare Richie, a senior policy analyst with the nonpartisan think tank. “The payments help thousands of families make ends meet until they can find another job.”
But not everyone is urgently seeking employment, said Savannah Republican U.S. Rep. Jack Kingston.
“Reducing the time I think is a way to increase employment,” Kingston said. “In talking to hundreds of employers, that’s what we’re getting. And I know that a lot of advocates of extending unemployment with no strings attached, I can promise you they’ve never sat and talked to series and series of employers who deal with this on a daily basis.”
Authored by House Republican leaders, the bill now under consideration would reduce the federal extension from 73 weeks to 33 weeks and allow states to scale back their programs. Under current policy the benefits would drop to 53 weeks because unemployment is declining. The $34 billion cost is offset by spending cuts and fee increases elsewhere in the bill.
Atlanta Democratic U.S. Rep. John Lewis spent time talking with the jobless Monday morning, hosting federal officials at the Atlanta-Fulton Central Library to explain how to apply for federal jobs. Lewis, who plans a series of such events, said he met plenty of high-skilled unemployed workers who defy stereotypes, including a former college professor. He disputed Kingston’s contention that benefits are keeping people out of the workforce.
“These men and women, mothers and fathers, they didn’t lose their jobs by any fault of their own,” Lewis said. “It’s because of the downturn in the economy, and people want to work. They want a job and we need to help them. They need to pay their rent, pay for their children’s education, pay for food, pay their mortgages, automobile notes. They need help and this is the right time to do it.”
The bill faces an uncertain path this week. It contains a slew of year-end business, including an adjustment in Medicare payments to doctors and an extension of the Temporary Assistance to Needy Families program. It offsets the spending with fee increases at government-backed mortgage lenders Fannie Mae and Freddie Mac, reduction in Medicare benefits to high-income seniors and a pay freeze for federal workers, among other provisions. And it pushes a pair of controversial Republican priorities loathed by environmentalists: Approving an oil pipeline from Canada and rolling back emissions regulations on industrial boilers.
The White House has threatened to block the measure, and the Democrat-controlled Senate is likely to send back a much different bill than what the House passes.
The bill includes a number of reforms to the unemployment insurance program, including requiring beneficiaries who lack a high school degree to be making progress towards a GED.
It also allows states to drug test recipients of unemployment benefits. Kingston advocated for that provision, and he introduced a bill last week to require drug tests for all federal unemployment beneficiaries. He said he heard from employers in his district that many job applicants were flunking their drug tests.
Lewis called the provision “unfair” and “discriminatory” toward the unemployed, while Kingston said it is unfair to give benefits to people who are “taking themselves out of eligibility on a voluntary basis” for jobs, most of which require a drug test nowadays.
Kingston added that providing another benefits hurdle will save the government money.
A 2008 study funded by the conservative Heritage Foundation found that extending unemployment benefits causes people to stay out of the workforce longer and stimulates the economy at only a fraction of benefits' cost to federal coffers.
But many economists argue that unemployment benefits translate into federal dollars well-spent . Richie and national labor experts say benefits forestall poverty, stimulate the economy and keep people on the job.
State and federal benefits kept 3.2 million Americans from the poor house last year, according to the Economic Policy Institute, a left-leaning Washington think tank. The nonpartisan Congressional Budget Office estimates that every dollar of unemployment payments generates up to $1.90 in economic growth.
Continued federal payments would save or create 560,000 jobs nationwide, EPI calculates, 15,000 in Georgia alone as recipients buy groceries, pay rent and ride MARTA.
“Most economists agree that unemployment insurance benefits are one of the most effective stimulus programs we have because the money goes directly into the local economy,” Richie said. “It just makes sense if we have the opportunity to help families and the economy.”
Green started work three weeks ago as a server in a Buckhead restaurant. She dreaded the possibility of a 2012 without work, or benefits.
Congress “should do the extension; it would benefit a lot of people until they get stable employment,’ Green said. “I hope they listen. Jobs out there are hard to find right now.”
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