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U.S. Senate takes up bill again extending aid to jobless
Benefits retroactive for those cut off
Tuesday, July 20, 2010

As the U.S. Senate today considers whether to reauthorize emergency unemployment benefits, 195,000 Pennsylvanians have a real rooting interest in the outcome.

If Congress does not approve an extension, those people will see their unemployment insurance compensation cut off by the end of the month -- before reaching the 99-week coverage period that had been offered during much of the recession.

The unemployment benefits have been a matter of pointed debate nationally and on the state level. President Barack Obama on Monday called passage of the extension "essential." Last week, the issue erupted in the Pennsylvania governor's race when the candidates sparred over the impact of unemployment benefits on workers' motivation to find jobs.

Some 2.5 million people nationwide have seen their weekly checks interrupted since an earlier extension of the jobless aid program expired June 2.

States are responsible for the first 26 weeks of benefits, but the federal government stepped in last year to fully fund up to 73 additional weeks of benefits under the terms of last year's economic stimulus bill.

Pennsylvania started phasing out benefits on June 5.

Legislation to reauthorize the extension has been before the U.S. Senate since May with the Democrats unable to get the 60 votes they need to close debate on the bill. But that might change today when Carte Goodwin, who was tapped by West Virginia Gov. Joe Manchin to fill the late Sen. Robert Byrd's unexpired term, is sworn into office.

The vote on unemployment benefits is scheduled 15 minutes after Mr. Goodwin, a Democrat, is sworn into office.

If the Senate passes the current measure, the House is expected to clear it for the president's signature as soon as Wednesday.

The bill contains a provision that people who had their benefits cut off because of the expiration will receive them retroactively.

David Smith, a spokesman for the state Department of Labor's Center for Workforce Information and Analysis, said unemployed workers in Pennsylvania have been informed that if they have not exhausted the full 99 weeks, they should continue to file biweekly claims even if their benefits have been cut off.

Meanwhile, debate over the impact of extensive unemployment benefits continues.

In a policy paper, Lawrence Mishel and Heidi Shierholz, of the Economic Policy Institute in Washington, describe a trickle-up effect on the economy from providing benefits to unemployed workers.

Mr. Mishel and Ms. Shierholz argue that since people who are unemployed are having difficulty maintaining their standard of living, "Any assistance they receive will be spent on necessities, not saved. The spending that results as the unemployed pay their rent, buy groceries and so on saves and creates jobs throughout the economy."

But at the conservative think tank The Heritage Foundation, the calculations are quite different.

James Sherk, a senior policy analyst, said that while everyone understands the economy is bad for job-seekers, long-term unemployment benefits discourage them from taking jobs they might be able to land.

"When you extend the duration of unemployment benefits, you extend the length of time people stay unemployed," he said.

It's not that people don't look for jobs, but that they look for jobs in their field or equivalent to their last job, rather than taking any job even if it means a vast reduction in their income. "When you have [benefits] for two years, they spend the first year or year-and-a-half looking for jobs that don't exist," he said.

Rather than receiving unemployment benefits, he said, people who are out of work for more than a year or 14 months should take advantage of other parts of the social safety net, such as the Supplemental Nutrition Assistance Program, formerly known as the food stamp program, and other aid for low-income families.

To others, unemployment benefits are not seen as something the nation should forgo.

"Extending aid to workers who've lost their jobs because of Wall Street greed is our moral obligation and an economic imperative," said Richard Trumka, president of the AFL-CIO.

"We live in a consumer-driven system that cannot afford to have 15 million people stop spending."

Ann Belser: abelser@post-gazette.com or 412-263-1699. The Associated Press contributed.
Washington correspondent Daniel Malloy writes the "Pittsburgh On The Potomac" blog exclusively at PG+, a members-only web site of the Pittsburgh Post-Gazette. Our introduction to PG+ gives you all the details.
First published on July 20, 2010 at 12:00 am