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October 21, 2014

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UNEMPLOYMENT:

Parties dig in for another debate over unemployment benefits

’Tis the season for holiday traditions, and in Washington, D.C., lawmakers will mark the month between Thanksgiving and Christmas with their annual rite of causing national panic as they debate whether to continue funding the emergency unemployment benefits adopted in 2008 to help jobless workers through the recession.

Most of the up to 99 weeks of unemployment benefits that laid-off job seekers are entitled to will expire at the end of the year absent action by Congress.

House Ways and Means Democrats — including Nevada Rep. Shelley Berkley — have started pushing for a one-year extension of all unemployment benefits. But Republicans have begun to push back, arguing the country can’t afford to keep budgeting for checks they say encourage people out of work to take their time getting back on the job.

The parties have debated their philosophies through many rounds, yet it hasn’t resulted in a lapse of more than a week or two.

This year though, the special debt supercommittee’s failure to agree on budget cuts, combined with signs the national economy is starting to recover, have bolstered the resolve of some Republicans — including some Nevada Republicans — to call for a scaling back.

“I am concerned when I talk to employers in the community who say they are offering jobs but the deal on unemployment is better,” Nevada. Rep. Mark Amodei told Las Vegas Sun reporter Anjeanette Damon during a taping of “To The Point” this week. “I’m inclined, depending on what’s in the bill, to say at some point in time you have to say, ‘I’m sorry, you can’t just keep extending it.’ And this could very well be it.”

The unemployment benefits system adopted in 2008 is divided into tiers. Most states begin with a baseline of 26 weeks of eligibility that can be extended in some states by up to 20 weeks in times of high unemployment.

The federal government then offers four tiers of emergency benefits: 20 weeks, 14 weeks, 13 weeks and six weeks, to be given successively. The first two levels — the 20- and 14-week chunks — are available to all workers; the third, 13-week tier is available to workers in states with a three-month average unemployment rate of at least 6 percent, and the final six-week tier is available to workers in states with a three-month average unemployment rate of at least 8.5 percent.

In October, Nevada’s unemployment rate was 13.4 percent; nationally, it’s 9 percent.

“The economics are so clear, the politics just mystify me,” said Heidi Shierholz, an economist at the liberal-leaning Economic Policy Institute. “This should be an absolute no-brainer.”

Shierholz believes it is too soon to scale back the unemployment benefits, even if nationwide, unemployment numbers are slowly improving.

“What you need is for unemployment insurance to last as long as it takes for someone who’s searching for a job to find a job,” Shierholz said.

“Over the last two years, we’ve only added enough jobs each month to keep up with the normal growth of the population; we haven’t started digging out of the hole,” she explained. “The unemployment rate has come down, but it’s been entirely due to people dropping out of the labor force. It hasn’t been due to us putting a bigger share of our working-age population back to work.”

But conservative economists argue that if job numbers have been lagging, it’s because unemployment insurance is perpetuating the problem.

“When you’re providing additional benefits, some of those unemployed people will remain unemployed for a little bit longer,” said Alex Brill, a research fellow in economics at the conservative American Enterprise Institute. “You want to distinguish between what the generosity of benefits is for someone who becomes unemployed and eligible tomorrow versus someone who’s maybe been unemployed the last two years ... Do we think that person needs (almost) two years of benefits, or do we think that the economy is likely to be better in two years for that person? ... We don’t need to be assuming they’re going to need two years of benefits.”

But this isn’t just an argument about labor dynamics; the debate will also involve tension over market economics and budget demands.

Things like unemployment insurance benefits and payroll tax cuts — a proposal President Barack Obama is pushing — “gets money into the hands of people who are very likely not going to have any choice but to spend it immediately,” Shierholz explained, and hence, help drive consumption in the economy.

“That (unemployment benefits) money is currently going to the unemployed worker, so it’s currently working to generate jobs. If that money goes away, we would lose half a million jobs right away,” she said. But even if there’s more bang per buck with unemployment benefits, it’s still money the government pays out, adding to the national debt.

“The failure of the supercommittee to find any spending reductions, tax increases and deficit reductions will affect the ability of Congress to continue to spend money on a program like (unemployment benefits) without finding a way to offset the cost,” Brill said.

Last week, Nevada Sen. Dean Heller filed an unemployment insurance bill to extend the full 99 weeks of benefits for another year, and pay for it by instructing the Obama administration to “determine and identify” where the country could pull $44 billion out of the budget.

The details of where to pull money to pay for benefits elsewhere is always the difficult part. But the supercommittee’s failure might help.

“There are buckets of money and savings that can be plucked out of the supercommittee’s deliberation, and used to offset other things,” Brill said. That money can be used to reduce the deficit or pay for other things, like unemployment benefits.

“There’ll be some who argue ‘just to cut ’em off.’ I think what will happen is they will pass a compromise that does extend the benefits but starts to curtail them,” Brill continued.

Gary Burtless, senior fellow in economic studies at the Brookings Institution, said that “In 2009 … I was cautious about the idea of extending benefits to 99 weeks, because there is a possibility that you’re not going to have enough money to keep on funding these 99 weeks of benefits.”

Still, that length of time puts “the United States exactly in the middle of ... rich industrialized countries.”

The duration of benefits should cover the length of time it might take for an unemployed worker to find a job: In Nevada, that’s about 35 weeks.

But that only counts workers who find a job during the 99 weeks they’re considered part of the labor pool. The average would rise dramatically if it included those counted as part of the “real” unemployment rate — a Labor Department measure that counts not only “active” workers, but also the total number of part- and full-time workers.

As of the end of September, that figure in Nevada was 23.3 percent — meaning there are an almost equal number of uncounted jobless workers as there are counted in the official unemployment statistics. And these workers have been unemployed for 100 weeks or more and are depending on the full 99 weeks of benefits that some say it’s time to curtail.

“Does anyone seriously think it’s going to be much easier to find a job in January 2012 than it was in January 2011 or January 2010? That’s the thing that is so disturbing, really — the job market has not improved enough that it is significantly easy enough for the unemployed and the long-term unemployed to find a job,” Burtless said.

Whenever Congress decides it’s time to scale back the unemployment safety net, there’s a difficult transition coming.

“Congress is going to face the gross unfairness that workers who had the good fortune to be laid off early in the recession got 99 weeks worth of benefits, and workers that got laid off early in the recovery would only get 26 weeks of benefits — or maybe only 39 weeks or maybe only 52 weeks of benefits, but at any rate, significantly less than you’re going to make available right now, even (if) it will be just as hard to find a job two years from today as right now.”

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  1. One thing they need to look at: when a single job is offered and there are hundreds, if not thousands of people applying for that one job--this has pretty much been the standard. We really need more jobs, as many jobs have been outsourced overseas to other countries. This is a prevailent problem!

    You have those who had steady jobs, been working for years, but had their salaries and benefits CUT, and they had to secure one or two moonlighting jobs just to make ends meet. This is a problem, as it puts them in line as competing for jobs that others with NO job are vying for.

    There is no doubt that un and underemployment plagues Nevada, and the state needs exceptional help from Congress.

    Blessings and Peace,
    Star

  2. "I am concerned when I talk to employers in the community who say they are offering jobs but the deal on unemployment is better," says Amodei.

    Exactly what type of compensation is being offered? How much is being paid and for how many hours? Are there really 100s of jobs available but no takers? If so, describe those jobs and don't just imply they exist. If Amodei knows of jobs, he should post them, their conditions and wages on his website.

    You will hear the Conservative words: "Make America Competitive with the World". That means no minimum wage, anything goes. That's Amodei's direction.

    Those that have want to have it all with underprivileged children filling the military ranks. They need only walls and police to protect themselves and wage slaves to build riches. History is proof positive.

    Creating the newest class of American, the "permanently underemployed" helps reduce wages and funnel money upwards. Today, we are allowed to exist for the livelihood of our owners, like sheep, and that can only change at the polls.

  3. "But Republicans have begun to push back, arguing the country can't afford to keep budgeting for checks they say encourage people out of work to take their time getting back on the job."

    The Tea/Republican Party BELIEVES every single person out of work and receives unemployment benefits are burden to society, lazy, and want free money on the public dole. The Tea Party infection of the Republican Party constantly throws out there they must save money, even if it kills people by starving them off through willful neglect. In their narrow view of financial matters, they don't care, they saved money.

    In the meantime, the filthy rich get more tax breaks/cuts they don't need nor deserve. That money saved is immediately handed over to the so called "job creators."

    The statement that we can't afford it is patently false. The country cannot afford to not provide unemployment benefits. Because that is the only definitive way that will assist in getting people back to work, along with a proven method to inject money back into a faltering economy. Most leading world economists agree on this course of action.

    I notice my temporary (I will be moved from CD3 to CD1) Congressman Joe "Pay Per View" Heck is silent. Probably because he's waiting to hear from Speaker Boehner on what to do. Congressman Heck, in his whole short incompetent life in Congress so far, has done absolutely nothing for Nevada. Bank on that trend to continue.

    The Tea/Republican Party is going to make it an easy choice for the American people in the November 2012 elections. Their stupidity ensures their complete and eventual obliteration from American politics.

    Get registered to vote, people.

    They need to all be voted out. Don't go for their dirty tricks like divide and conquer, voter confusion and especially their flawed propaganda and rhetoric they repeat and shout from rooftops all the time.

    People need to wake up to the fact the Tea/Republican Party don't run on common sense solutions. They have been on record and they continually follow a course where they hate the average American. They hate teachers, police, firefighters, ALL workers, unemployed, Latino Americans, immigrants (whether they are legal or illegal, don't matter), alternative lifestylers, abortion doctors, women (because they have a fetus and womb and they simply want to be in charge of it), the list goes on and on. The only ones they don't hate are the ones who have a lotta money. And they promise not to hate them as long as they throw it at them.

    Vote them economic animals out of power. That's the only thing that will stop this madness.

  4. the US spends the least amount on social protections as percentage of GDP out of all wealthy highly industrialized countries in the OECD. the US also provides the least amount of protections for it's workers out of all country's in the OECD. 50% of the job losses that have occurred in the OECD as a result of the recession have been in the US while we only have 25% of the population in the OECD. the GDP barely decreased during one of the worst recessions along with the fact that large US firms have reported record profits while other large firms in other wealthy OECD country's have reported losses of 10%.

    Las Vegas is an expensive city to live in. Unemployment maxed out at $400/wk is only $10hr so the jobs are paying less than that. $400/wk is money for an 18 year old but for a middle aged person you can't pay any bills with those kinds of wages not in 2011.

  5. <<When my sister turned him down, he filed a complaint with Unemployment which now is "under investigation' and my suspend her current benefits>>

    smartone:

    Sis should have carefully read the handbook she received from DETR. It is very plainly stated that if you refuse a job (or even an interview for a job), your benefits are suspended indefinitely until a hearing is scheduled. Her employer was in the right of what he did. Employers, too, have to fill out forms DETR sends them and in this instance, she was in clear violation of the easily understandable language in the handbook. Employers have to fill out forms every time someone refuses a job or an interview.

    She is screwed to be honest with you. The hearing judges at DETR are on the side of the employers. In this case - it is pretty cut and dry Sis messed up. When this happened to me, I just refused an interview and eventually lost my hearing and all my benefits unless I was able to fulfil what was ordered of me, ie for 10 weeks, make the same or more money then my weekly benefits. That is very hard to do, trust me.

    Sorry to say but....She will NOT get her unemployment back. She will be very sorry she didn't accept her old job back.

  6. An addendum to my post: Whether you are offered a permanent job, a permanent job with less pay, a job you were laid off from and your employer calls and offers you your old job back with or without changes or a temp job for a day or 5 months or any interview - after my hearing with DETR, the hearing judge told me "Any job is better than NO job". They are not interested in listening to your reasons why you did not accept what was being offered, be it a job or an interview, and how legit or great those reasons are. (I thought I had solid reasons for resinstating my unemployment, one being chronic health issues which requires daily meds. So because of losing the unemployment, I could not pay for my Cobra any longer so I lost all my health insurance coverage but they just didn't feel the health reasons were good enough). They want people to WORK no matter what the employment is and yes, stop living off of unemployment.