Participants at the OpenCongress S.3706 American Want to Work Act blog site have become more than a little frustrated by the lack of action by the 111’TH Congress in developing and passing a bill to provide much needed relief for over 6 million 99ers. Conservatives, Liberals, and Independents alike have been discussing how to accomplish the bi-partisan goal of providing a Tier V support for 99ers (or some form of extension of benefits until new jobs can be created). The following is a launching point that describes at least a reasonable level of agreement for moving forward on this critically needed action:
1) Goal – to provide extended unemployment extensions for ALL long term unemployed in states with 6.5% unemployment or higher, i.e. re-fund Tiers 1-4/EB & fund all 99ers. As of Oct. ’10 using figures from the BLS, 6 states would be excluded using a 6.5% hurdle ( North & South Dakota , Nebraska , New Hampshire , Vermont & Hawaii ).
2) Maintain the same benefit levels (July ’10 extension cost $34 Billion for 6.751 million people for re-funding Tier 1-4/EB for an average payout of $252 per person per week for 20 weeks).
3) Provide these benefits as a general course of business as long as a states unemployment rate exceeds the 6.5% hurdle – no more playing politics with the unemployed.
4) Projected (rough estimate) ANNUAL COST; $160 Billion dollars (most economist forecast continued 9%+ national unemployment levels for as far out as 2014).
5) Find a way to pay for it or at least to pay for a significant portion of the bill.
Summary of Costs
Projected rough estimate of cost to fund unemployment extensions defined above – $160 Billion a year (52 weeks x $252 X 12,206,000* total)
*[6,206,000 (Tier 1-4/EB Oct ’10) + 6,000,000 (Est. # of 99ers)]
Some possible ways to start funding unemployment extensions and a Tier V
1) Eliminate the projected budget increases for the Department of Homeland Security & the Department of Defense – increases projected at $1 and $48 Billion respectively for a total of $49 Billion. During a period of deflation, these departments should be able to find ways to improve operations through cost savings.
2) Scale back the Wars in Afghanistan , Pakistan , & Iraq 50% – budgeted at $159 Billion for 2011, this would save roughly $80 Billion.
3) Apply unused stimulus funds to this effort projected to be around $12 Billion.
Simply taking the three steps identified above would create $153 Billion to apply towards the $160 Billion needed to support unemployment extensions and an expansion in benefits for the 99ers providing them with the critically needed lifeline until new jobs are created in the economy. Take note that we have not included any measures to eliminate tax cuts for the wealthy. It should also be noted that unemployment extensions are considered to be one of the best methods for stimulating an economic recovery. With a positive impact to the economy of almost $2 for every dollar spent for unemployment (as communicated by the Secretary of Labor) re-funding the unemployed and providing an expansion of benefits to include the 99ers is almost a no-brainer.
Many reading this will feel compelled to pick it apart, that is to be expected as it only represents a start to having the much needed conversation on what to do about the unemployment situation in America today. Opportunity starts when someone presents a plan and starts the discussion on steps to take to be able to say “yes” instead of “no.”
New Senate Makeup During Lame Duck to Have Impact on Unemployment Extension Outcome