Quoted in two articles in the Daily Item

Quoted here and here

The Daily Item, Sunbury, PA


November 30, 2010

Worker has request for Santa: a job


133,000 Pennsylvanians to lose aid as federal programs expire

By Evamarie Socha

The Daily Item



— SHAMOKIN — The only hunting David Bidding was doing Monday was job hunting, the Shamokin man said with a slight laugh while filling out paperwork at the Northumberland County CareerLink office.



Smart move: About 133,000 Pennsylvanians will be cut off prematurely from supplemental unemployment benefits in December after federally funded programs run out today, based on U.S. Labor Department data from the National Employment Law Project.



Federal benefits run up to 53 weeks and begin after state unemployment compensation ends, usually at 26 weeks.



After December and the initial cut, more than 1 million more people per month will fall off the rolls. By April, unless the employment picture improves, 6 million workers will be without federal benefits.



"These are people who will see their unemployment end ... where it wouldn't have if Congress had acted" to extend the benefits, said George Wentworth, senior staff attorney with the employment law project, based in New York.



Meanwhile, U.S. Sen. Bob Casey, D-Pa., announced Monday that he will hold a conference call today to discuss the need to preserve unemployment insurance as well as tax cuts.



"Without action, unemployment benefits for workers who lost their jobs through no fault of their own will begin to expire," Casey said in a statement. His office estimates about 83,000 Pennsylvanians would be left "without vital support to help them keep food on the table and pay their bills next month."



The U.S. House of Representatives failed to pass a $12.5 billion bill Nov. 18, after a vote of 258-154 fell short of the needed two-thirds approval. This means about 2 million people nationwide will lose their benefits after today.



The news that federal unemployment benefits likely will end today wasn't what Bidding wanted to hear.



"At this point, anything is a hit," said the 36-year-old who has been out of work for about two years since losing his job when Fleetwood Motor Homes left Paxinos in December 2008.



The national unemployment rate is near 10 percent, according to the Labor Department.



The federal Emergency Unemployment Compensation program began in July 2008, adding 13 more weeks of benefits to those out of work whose state benefits ran out. At the time, unemployment nationwide was about 6 percent.



As the recession deepened and the national unemployment rate kept rising, Congress passed legislation several times to increase the number of weeks for benefits.



Wentworth said that because of how the law works, the phase-out is graduated in two categories:



n"‰Workers who are exhausting their 26 weeks of state benefits. They will not get federal help at all. "People who got their last regular state check last week don't have a program to go on to if Congress doesn't reauthorize the law," Wentworth said.



n For those on federal extensions, there is a four-tier system that potentially could carry them for 53 weeks. Under the law, these people will "collect the balance of whatever entitlement tier they're on" and that is that, he said.



For instance, someone on the first tier is eligible for 20 weeks of benefits. If that person is on week 10 of 20, he'd get 10 more weeks of benefits and then be cut off, Wentworth said.



The extended benefits program in Pennsylvania also will end, Wentworth said, and that will be a hard stop. Basically, the state will stop that program after the last check is cut Saturday.



Thirty-five states operate the extended benefits program, which gives an additional 13 to 20 weeks of unemployment compensation beyond the EUC program. Extended benefits are normally funded half by the federal government and half by the state.



Under the Recovery Act, Congress authorized full federal funding of the extended benefits program, but when that authority expires today, most states will stop operating it.



Wentworth said that according to his group's projections, come today, 22,000 people in Pennsylvania will exhaust their benefits. In December, another 58,000 will be in that spot.



How it came to this has been a politically contentious issue about paying for the program, which cost about $5 billion per month, Wentworth said.



"But historically, whenever national unemployment has been high, Congress has enacted these additional federal benefits," doing so eight times since the 1950s, he said.



"They've always done it as emergency spending, which means they didn't look to have corresponding offsets in the budget; the idea is you have an economic emergency and it's a stimulus. You want to get money into the economy to mute the impact of the stimulus funding. That seems to be what the debate is about now."



But there may be a better employment outlook ahead, said Matt Rousu, associate professor of economics at Susquehanna University, Selinsgrove. He feels in the next six months to a year, the unemployment rate should drop some.



"Firms have money to spend," he said. "A lot of the reason businesses weren't hiring was the uncertainly about what new laws are passed," such as the health care bill and tax cuts and how those would affect business.



Rousu said that with the Republicans holding the majority in Congress, fewer things will be passed. "It's the sweeping legislation where people don't know what's in it (that scares business)," he said. "I expect we'll see much less of that."



The debate, however, doesn't matter much to Bidding, who said he's interested in any kind of work available to him now.



"When you go from lower from what you were getting to making nothing, what are you supposed to do?" he asked.






November 30, 2010


National debt is big concern, prof says

By Evamarie Socha

The Daily Item



— How long is too long to collect unemployment benefits?



That seems to be the question surrounding the latest debate over extending unemployment compensation. Although Congress has prolonged the aid four times in the past year — most recently in July at $34 billion — paying these benefits has become an ethics issue as well as a political one.



"It's kind of the same argument as last time: the benefits and the drawbacks" to extending the benefits, Matt Rousu, associate professor of economics at Susquehanna University, Selinsgrove, said Monday.



"Reasons you would oppose the extension are you think it gives bad incentives, that people wouldn't look as hard for jobs," he said. "The other is the cost. If we do this, it adds to our debts. We're at a time in this country where everyone seems much more concerned for national debt."



The drawbacks, Rousu said, are that a family who loses the funding also won't have as much money, and therefore will have fewer purchasing opportunities, so the economy is not stimulated.



Congress' timing in ending the funding surprises George Wentworth, senior staff attorney with the National Employment Law Project, an employment advocacy group in New York.



"Congress has had eight programs in 50 years and has never cut one of these when unemployment was this high," he said, noting it cut funding once before when unemployment was at 7.2 percent in 1985.



But unemployment wasn't as long then, either. Long-term unemployment today averages 27 weeks, a record, Wentworth said. More than 42 percent of the unemployed have been jobless more than six months, and close to 23 percent have been out of work a year or more.