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Senate passes $149 bln for jobless aid, tax breaks
People looking for jobs meet professionals from more than 30 employers at the UJA-Federation of New York's Connect to Care job fair in New York, in this file image from March 2, 2010.
Credit: Reuters/Shannon Stapleton/Files
WASHINGTON |
WASHINGTON (Reuters) - The Senate on Wednesday passed a $149 billion package of jobless aid and tax breaks, as Democrats continued efforts to lower the 9.7 percent unemployment rate before congressional elections in November.
The measure, approved by a vote of 62 to 36, now heads to the House of Representatives, where many Democrats have pushed for more aggressive job-creation measures in the face of the worst U.S. economic downturn since the 1930s.
Democrats say job creation is their top priority this year as they head into an election season that could possibly cost them control of Congress.
Both chambers have now passed two job-creation bills, but they have yet to resolve their differences and finish legislation that President Barack Obama can sign into law.
Democrats passed an $863 billion stimulus measure last year to battle the recession. That effort created up to 2.1 million jobs, according to the nonpartisan Congressional Budget Office, but the high price tag has prompted a growing voter backlash.
The bill passed on Thursday by the Senate largely continues existing government policies. Jobless workers would see their unemployment benefits and healthcare subsidies extended to the end of 2010, while businesses would once again benefit from $25 billion worth of tax breaks that expired at the end of 2009.
The bill's $149 billion in new spending is partly offset by $37 billion in revenue raised by closing tax loopholes.
That could conflict with President Barack Obama's plans to use the new revenue to help pay for his proposed healthcare overhaul.
HELP FOR STATES
Cash-strapped states would get $25 billion to help cover their portion of the Medicaid government-run healthcare program for the poor.
More help could be on the way for states, which face yawning budget deficits and, unlike the federal government, must balance their budgets each year.
Representative George Miller, a senior House Democrat, introduced a bill on Wednesday that would give state and local governments an additional $98.5 billion to help avoid layoffs of teachers, police officers and other public employees.
Other House Democrats say Congress should boost transportation spending to put more construction workers back to work.
Both the House and the Senate have approved a $13 billion payroll tax cut for businesses that hire unemployed workers, but the Senate needs to approve the measure again before Obama can sign it into law.
White House economic adviser Christina Romer said on Tuesday that a similar hiring credit proposed by Obama would generate 250,000 jobs at a cost of $13 billion.
The U.S. economy has shed 8.4 million jobs since entering the recession in December 2007, though the pace of job loss has slowed since the recovery began in the second half of last year.
More than forty percent of unemployed Americans have been out of work for at least six months, the usual cutoff for jobless benefits. Congress extended the program to cover those out of work for nearly two years in some high-unemployment areas, but millions could still exhaust their benefits starting next month without a further extensions.
Unemployment aid does not directly create jobs, but economists say it is one of the most cost-effective ways to stimulate the economy because recipients spend the money quickly.
But it is not cheap. Extending benefits through the end of the year would cost $70 billion. Many Republicans voted against the measure, arguing that spending in other areas should be cut to cover all of its costs.
Republicans also say job creation has been hampered by a climate of uncertainty due to as-yet-unfinished Democratic initiatives like the effort to overhaul the healthcare system.
(Additional reporting by Lisa Lambert and Emily Kaiser; editing by Paul Simao)
What next must happen is for Congress to realize that it MUST come through with a COL for Social Security or face the prospect of learning to say “Would you like fries with than?”–COL crosses party lines and, while if you are not affected you might be inclined to think that this is a good place to save money–if you ARE affected it is easily the straw that breaks the camel’s back–LOTS of Congress men are about to become ex-congressmen.
It is simply incredible that nothing will stop the Democrats from spending. We don’t have the money for any more of this wasted spending. We must get these pathological spenders out of there before we collapse.
Interesting, they spent $863,000,000,000.00 dollars to create 2,100,000 jobs. That’s about $410,000.00 per job. They could have simply paid the unemployed $40,000.00 per year for the next 10 years and it would have been more effective.
If they are so concerned about helping the long-term unemployed, then how can they not be addressing those who have been unemployed and job-searching the longest? As the story notes, there are millions of people, despite today’s actions, who will run out of benefits (hitting the max of 79 or 99 wks) as soon as NEXT MONTH if they don’t address this specific issue, and consider adding another tier of benefits. I’m sorry, but if we can afford to send money to Haiti and put money into arts programs (Smithsonian, etc.), then I have to believe that the resources are there SOMEWHERE to make sure that we help these people get by — and contribute in some way to the economy. We can’t just have people falling off the rolls with NO source of income after having busted their butts for nearly two years and not finding work. These people are not only financially strapped, but emotionally, I know those that I know are on their LAST NERVE. I shudder to think of the consequences of NOT addressing this need for an add’l tier…I hope we will see more news on this issue ASAP…it’s a heartbreaking situation for so many.
