By Elizabeth Tandy Shermer, February 2010
The issue of unemployment benefits – including their length, eligibility, and expense – has become a controversial political issue in recent years. It has dominated headlines, newsfeeds, and blogs especially during the Great Recession when Congress continually debated whether to extend Unemployment Insurance to employees who had exhausted their UI benefits.
Beginning in 2008 persistent, long-term unemployment drove Congress to extend jobless benefits far past the normal twenty-six week guarantee. This legislation provoked bitter fights between legislators. Republican Senators, joined by Joe Lieberman (I-CT), Ben Nelson (D-NB), and a handful of conservative Democrats (but without Maine Republicans Susan Collins and Olympia Snow) temporarily scuttled an extension on June 30, 2010. The bill was passed less than a month later, by a vote of 60-40 in the US Senate. Two independents, Lieberman and Vermont’s Bernie Sanders, and two Republicans, Collins and Snow, joined fifty-six Democrats in voting “Yes.” Nelson was the only Democrat to vote with the Republicans. President Obama signed the bill into law on July 22, 2010.
During the debate, opponents proclaimed themselves dedicated to keeping deficits down, concerned that spending would delay economic recovery, and positive that extending benefits would keep the unemployed from seeking work. “…it could jeopardize the recovery and would add to our already enormous deficit, likely to be around $1.4 trillion for the second year in a row,” Nelson explained in a statement, “Congress should provide additional unemployment benefits but not as a bailout to the states that worsens the deficit and passes the bills onto our children.” Jon Kyl (R-AZ) asserted that unemployment insurance “doesn’t create new jobs. In fact, if anything, continuing to pay people unemployment compensation is a disincentive for them to seek new work.”
These arguments were hardly new. In the earliest debates over state and federal programs, and even after unemployment insurance was included in the broad 1935 Social Security Act, economists, manufacturers, bankers, and other business owners and managers have decried the jobless benefits, no matter how modest, as a job killer, a detriment to recovery, an unmanageable burden, a government overreach, and an entitlement that encourages Americans to stay home and not look for a job.
These opponents are, quite simply, crying wolf. Since enactment, unemployment benefits have proven critical to economic stability, individual livelihood, and long-term prosperity. Hence, keeping and extending this insurance is vital to Americans living through any downturn and to the nation’s lasting economic stability.
