2 Million Losing Unemployment Benefits in December
Extending unemployment benefits beyond the traditional 26 weeks has always been controversial. Now, as Congress failed to agree on yet another extension, you are about to find out if less could be better or worse for America.
Last night, the vote for an extension was 17 votes short of the two thirds majority required. Because this "safety net" was not extended, 635,000 people will lose their benefits by Dec. 11 and another 1.6 million by Christmas.
Those against the "safety net" point out that no extension saves America $12 billion. That's at a time when the budget deficit had edged up beyond $13.7 trillion. Also, there is the hard-nosed theory that making unemployment benefits too good or too long increases unemployment. The belief is that the jobless get picky about the kinds of positions they will accept and become chronically unemployed. If this is the case, cutting off benefits is the bad-tasting medicine they need.
Those for the "safety net" hammer the possible ripple effects of leaving the jobless financially stranded. Fewer dollars would be circulating in an economy that is essentially consumer-driven. That means less business -- which could mean less hiring. And that could slow down the recovery.