The Emergency Unemployment Compensation Act of 2002

Congressional Record
107th Congress
Second Session
Wednesday, October 2, 2002
The "Emergency Unemployment Compensation Act of 2002" is sorely needed given the current state of our economy, whose decline since January 2001 is truly staggering. It's absolutely critical that we in Congress, at a minimum, do what we can to help every day Americans hurt by this downturn, especially the increasing number of people who are unemployed and having trouble getting back into the workforce.

Currently, over 8 million Americans are unemployed. Since January 2001, the national unemployment rate has risen from 4.2% to 5.7%. According to the Center on Budget and Policy Priorities, between May and July 2002, approximately 900,000 workers exhausted all of the additional weeks of Federal unemployment benefits that they received as a result of the economic stimulus legislation Congress enacted last March. By the end of this year, that number will swell to 2.2 million. In total, more than 2 million private sector jobs have been lost since January 2001. For the first time in 50 years the number of private sector jobs has actually declined.

The legislation we introduced last week would do something about these problems by providing all states with an additional 13 weeks of temporary extended unemployment benefits. It would also authorize states with the highest levels of unemployment to get funds for an additional 7 weeks of benefits on top of the 13.

This is especially important to my home state. Michigan has one of the higher unemployment rates nationwide – currently 6.2%. That's the seventh highest unemployment rate in the nation, and is almost a full percentage point higher than what it was in January 2001. More than 60,000 workers in Michigan currently receive Federal unemployment benefits, and an additional 50,000 Michigan workers have already exhausted their benefits. Michigan's median household income fell by 4.1% last year. Only four other States fared worse. In the country as a whole, median household income fell 2.2% last year, the first drop since 1991. So this legislation is crucial for Michigan's hard-pressed workers and their families, as well as our nation's.

This is not just about doing what is fair and what is right and what is equitable. While these reasons alone ought to be sufficient, providing additional benefits is a good stimulus for our ailing economy. The money we are talking about here is money that will be spent. Those eligible to receive these benefits are people trying to make ends meet on a day-to-day basis – people who need money to put food on the table, buy a prescription drug, make their car payments, and pay their rent or mortgage. They will spend the money. According to a 1999 Department of Labor study, every $1 dollar invested in unemployment insurance generates $2.15 in Gross Domestic Product. So this bill will put money into the hands of people who need it, people who will spend it. That's good for our economy since it helps sustain the jobs that other people do have.

There may be some Members who argue that we cannot afford to extend unemployment benefits. I think we all should be concerned about our current budget situation – the ten year surplus has declined by $5.3 trillion, or 94%, since January 2001. But our budget problem doesn't come from extending desperately needed benefits to out-of-work Americans. The major problem is last year's $1.4 trillion tax cut, which provides more benefits to the top 1 percent of all taxpayers than it does to the bottom 80 percent of all taxpayers combined. According to analysts who have reviewed CBO numbers, last year's tax cut is the single largest cause of our evaporated surplus.

September 11th and its aftermath had an enormous impact on an economy that was already sputtering. The economy hasn't recovered and there are signs that it won't for a while longer. The tax cut has blown a hole in our budget. Yet it's not just the centerpiece of the Administration's economic policy; it's the only piece. Since Congress passed a bipartisan extension of benefits in March, nearly two million people have exhausted those benefits without finding new jobs. The ability for them to receive additional benefits has expired. Yesterday, Senator Wellstone attempted to pass this bill by unanimous consent, but was prevented from doing so by our Republican colleagues, who objected to the bill. This issue should be one of our top priorities. We should not leave this year without extending these benefits for America's unemployed. I am hopeful that Democrats and Republicans in Congress will be able to come together as we have done in the past and support the "Emergency Unemployment Compensation Act of 2002."