Blumenauer, House Democrats push to extend unemployment benefits
Job seekers wait in line to see employers at the National Career Fairs' job fair in New York last month. Congressional Democrats are pushing to extend unemployment compensation for approximately 2 million long-term unemployed. The benefits expire Dec. 29.
WASHINGTON - House Democrats, including Rep. Earl Blumenauer of Oregon, are demanding that unemployment benefits for the long-term jobless be part of any deal to avoid the "fiscal cliff."
In many ways their demand to extend unemployment benefits for another year is the replay of an annual battle.
Democrats say the funds provide critical protection for people who have been unable to find work. Republicans and other critics say the benefits are designed to expire and the $30 billion cost is excessive at a time when budgets must be cut.
Democrats disagree, with some saying their decision on whether to support a final fix to the fiscal cliff will hinge on whether the benefits are included.
"We shouldn't allow the long-term unemployed to be pawns in this game," Blumenauer said in an interview. "It's hard to think of something that is more crucial to people who are in financial distress,"
All benefits are set to expire Dec. 29. If they aren't extended, 2 million people will lose benefits nationwide, including 32,400 in Oregon and 43,300 in Washington state, according to the federal Labor Department.
But unlike previous years, the unemployment fight is part of a complicated package that Congress is desperate to assemble to forestall $700 billion in budget cuts and tax increases that the non-partisan Congressional Budget Office says could push the country into recession.
Democrats have long supported maintaining assistance for workers who have been unable to find work for more than six months, arguing that the federal spending stimulates the economy because the money is spent immediately on food, fuel, housing and other essentials.
They also believe coupling it with the fiscal cliff gives them additional muscle because the potential consequences of failure are stark.
Democrats on the House Ways & Means Committee, including Blumenauer and ranking member Rep. Sander Levin of Michigan, are spearheading the effort. On Monday, Levin said the extension of unemployment benefits must be part of any deal.
That was the same day the committee's Democrats released a report detailing in personal terms the damage if unemployment benefits aren't renewed.
"We cannot forget the human cliff looming for more than two million Americans scheduled to lose their economic lifeline during the upcoming holidays," Levin said in a statement accompanying a six-page report. Levin is one of the Democrats insisting his support for a final deal is contingent on extending unemployment benefits.
Blumenauer says unemployed workers shouldn't become "pawns" in the larger political battle over the fiscal cliff.Michael Lloyd/The Oregonian
How it might play out is hard to predict, however. Negotiations over the rescue from the fiscal cliff are in their early stages.
Emergency Unemployment Compensation has been offered since 2008 when President George W. Bush signed it into law. It has been renewed at various times since. It's also been scaled down to save money, Democrats say, noting that benefits were cut 31 percent when it was renewed in February. It is the only source of income for millions of workers who have exhausted state unemployment benefits.
There are many moving parts comprising the fiscal cliff, meaning there are many potential combinations for a deal. The components are:
- The expiration of Bush-era tax cuts on income, investments, married couples and families with children and inheritances. In addition, some 26 million taxpayers face the alternative minimum tax next filing season, which would raise their taxes by an average of $3,700. Cost through September: $330 billion.
- A $55 billion, 9 percent cut in the defense budget next year and another $55 billion in cuts to domestic programs, including a 2 percent cut to Medicare providers.
- The expiration of unemployment benefits for the long-term jobless. Cost: $26 billion.
- A sharp cut in reimbursements for doctors participating in Medicare. Cost: $11 billion.
- The expiration of Obama's temporary 2 percentage point cut in payroll taxes. Cost: $95 billion.
- A variety of smaller tax cuts for both businesses and individuals collectively known as tax "extenders." They include a tax credit for research and development and a deduction for sales taxes in states that don't have an income tax. Cost: about $65 billion.
Blumenauer said he are other Democrats are willing to consider proposals that reshape the program as long as core benefits are preserved. "We've been open to compromise," he said. "But I would hope this is not something people would go to war over."
