Should Congress Extend Unemployment Benefits – Again?

by Darwin on November 4, 2010

One of the first things the new Congress is going to have to wrestle with is another extension of unemployment benefits.  Presently, about 2 million workers are going to see their benefits expire if Congress doesn’t act in the next few weeks.  Termed “the 99ers”, this cohort has exhausted the 26 weeks funded by the state and are about to exhaust the 73 weeks enacted to allow for federal payments.

The country is pretty divided on what to do about these seemingly indefinite extensions of jobless benefits.  Working individuals grow tired of hearing stories about people collecting benefits for 2 years and seeking more extensions.  Personally, I know of a willing stay at home mom collecting for 2 years now, and a seasonal worker who always sells Christmas trees each winter and collects unemployment each summer, both of which are cheering each extension.  They’re getting something for nothing and they’re basically scamming the system – like millions of others.  Meanwhile there are millions of legitimate stories out there of people that simply cannot find work that pays a living wage, regardless of how much lower on the skills scale it is from their last job.  I was shocked by the gravity of the situation in a once vibrant Silicon Valley segment on 60 minutes recently.  There were very successful lifetime employees of tech companies and other seemingly “American Dream” jobs that are basically homeless after exhausting their savings.  It’s real, and like any large-scale phenomena, there are scammers and there are tragedies.  So, without being able to sort out the details on a scale like this, what are we to do with the millions that are up for renewal?

Unemployment Insurance as Efficient Funding

Many economists point to the “efficiency” of unemployment insurance payments.  For the most part, the money tends to get spent and plowed back into the economy.  Unlike spending on new homebuyer tax credits, cash for clunkers, and other programs that just “pulled up” planned spending with little net benefit, or the Bush one-time tax checks of $300 where people just payed down credit card debt, economist point to the notion that these people need these dollars for basic necessitites and it gets spent.

Incentives

Conversely, there are studies (even Krugman concedes this notion) pointing to the incentive provided by the pending expiration of coverage.  I’ve seen a few different studies showing that as the window of coverage approaches an end, people are much more likely to find employment – the percentage of job acceptance activity jumps in those final weeks.  This is logical.  It makes sense to accept a lower-paying job when you know your benefits are going to expire, whereas it makes sense to hold out for a better job while receiving benefits for a prolonged period.  Granted, benefits often don’t pay anywhere near what the recipients’ prior job did, but it’s a balance of incentives.  If it’s a net wash or close to it, the incentive to accept a job is decreased.  Someone who’s unemployed now and can’t find work may be insulted by the prospect that people assume they’re not trying hard enough.  But on an aggregate basis, this is what the data shows.  But it doesn’t change the fact that there just aren’t a lot of open positions to match the skill sets and salary needs of the unemployed right now.

What’s going to be especially difficult is to say no to this next extension, while simultaneously extending the Bush tax cuts for all income levels, as Obama hinted at today.  Regardless of what seems fundamentally right or wrong, it just smells fishy to too many people when someone making $2.5 Million per year had a temporary tax cut extended while cutting off unemployment insurance to millions of Americans.  The question is, when is enough enough?  I’m not judging.  I can’t – because I’m employed, so I’m not objective.

Evidently, 99 weeks isn’t enough.

What is an appropriate number?

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{ 24 comments… read them below or add one }

1 Dean Salerno November 5, 2010 at 12:53 pm

Darwin:

You raise some good questions about the extension of unemployment benefits. But your last question of what is the appropriate unemployment benefit weeks is really not the right question. The more appropriate question is “When is the appropriate time to stop extending benefits?”. Let me explain why.

Since the full employment act of 1946, it has been the policy of the federal government to support a full employment economy within the US. The latest statistics show that there are on average 5 people applying for each job opening in the US. That means that 4 out of 5 people applying for a job will not get a job, not matter how well motivated they are.

Eliminating benefits for these people will do nothing to help them get them a job, and will negatively impact all of us, as the removal of that spending will create a downward spiral in the economy. So until we have an economy where every person who is earnestly looking for a job can find one, then we as a country have both a moral and economic responsibility to provide a safety net for those people, who through no fault of their own, are unable to find one.

Dean Salerno
dean.salerno@marketoutperformer.com

[Reply]

James Reply:

Most people tend to say the same thing over and over on these message boards so I’ll try to give you a unique perspective.

It is not the extension beyond 99 weeks that is the upcoming issue. The “99ers” have for the most part adjusted to their lifestyle. The extension in question is to extend the current four tiers that are about to be cut off. Think of it this way… If someone has been on unemployment for 11 months and they are about to exhaust their 1st tier December 11th, that person will not be able to roll over to the next tier (Only tier 2) and only receive what is remaining on their 1st tier. The same applies to a person on tier 2 and 3. Those are the people who in most cases haven’t been afforded even half the time as 99ers. Those are the people who need an extension.

I also feel obligated to say that it seems pretty obvious that you haven’t done any research on this subject. You should take your position on this matter much more serious and understand that you are influencing a great deal of people based on what sounds like “a word of mouth” argument. You lead off with saying that you personally know someone milking the system and claim to be writing a non bias column. Your punchline is “evidently 99 weeks isn’t enough.” NOT ONE GOVERNMENT OFFICIAL HAS EVEN ONCE MENTIONED EXTENDING UNEMPLOYMENT PAST 99 WEEKS IN MONTHS. THE ONLY EXTENSION BEING DEBATED IS THE 4 TIERS.

You are obviously insensitive the the people who need unemployment and I hope that anyone seeing me call your bluff also never returns to this website…

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Darwin's Finance Reply:

@James, For someone who claims to be so authoritative on the topic, you are mistaken. There have been calls to extend the 99 weeks to 119 weeks by the press and elected officials alike. This isn’t a “bluff”, these are facts. I also wrote the article in a balanced fashion. Finally, you cannot deny that millions of Americans are scamming the system. Just like we had scammers following 9/11, Katrina and every other disaster. Human nature brings out both the best and worst in us. I have qualified my statements and provided both sides. You’re only looking at your side. You’re angry. And you’re wrong.

Take a look at this and any other number of articles on the topic:

“When congress was called back to session this week to pass the recent jobs bill, Representative Shelley Berkley (D-NV) and Representative Jim McDermott (D-WA) worked together to co-sponsor an unemployment benefits extension known as the “5th Tier” which would add 20 additional weeks of federal payments for unemployed workers in states with unemployment rates higher than 10 percent.”
http://www.examiner.com/unemployment-benefits-in-burlington/would-20-more-weeks-of-unemployment-benefits-make-a-difference

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James Reply:

Ok, you got me there…
I’m sure there are people taking advantage of the system but “millions”??? The percent of people taking advantage of unemployment is the same percent that take advantage of anything else. That just doesn’t just apply to benefits from the government (Katrina, 9/11, etc). If there is a system then there are flaws that will be exposed. If someone’s boss let them take an extra 30 minute lunch break daily and let it slide so they would still get paid, it is something most people would make a habit (these are the same hard working people criticizing the unemployed). The same concept applies to life in general. I’m sure the percentage of people who manipulate their tax returns is far greater than the unemployment scammer’s of 2010. What about the banks that took advantage of people living outside their means? That was a system and the banks were the scammers, yet people still get more upset about unemployment benefits… Why are people focusing so much on the negatives when it comes to unemployment? My goodness, it is no different than anything else. If our government can’t afford it, that is another issue but please stop making it about the scammers.
Lastly, I’m not angry, I’m passionate. LOL

James Reply:

I’m sure are a busy person and may not be able to respond but I hope you at least are able to read this.

I am very much aware that the last sentence of my first comment made me look very ignorant on the subject. It also took away from the point I was trying to make. The extensions to expire November 30th are the first 4 tiers and the EB. Extending beyond 99 weeks is a totally different issue and was ignored when the 4 tiers in question were passed back in July. When congress addresses the 4 tiers next week the 99er’s extension will be a different bill and a different vote.

Lo Andre Reply:

@Dean Salerno,

I have been on unemployment for the first time in my life since the first of June. I am in Healthcare sales and have now exhausted my unemployment benefits which were only about a fourth of what I made if even that, but it did help me continue to make my house note.

In healthcare sales there are 100′s of resumes submitted for one job. I get called for first interviews along with 39 other people and it is about a 10 interview process for just one job. It takes several months to go through the process and I have made it down to 2 candidates a couple of times and they selected the other person…….not bad out of hundreds of candidates, but still no job.

I am not sure what everyone is talking about b/c I have not been on unemployment for 99 weeks or 2 years and have no idea how those people do, but I am someone that wants a job and is applying for everything even jobs that I am over qualified for- which is why I don’t get those jobs. I need this extension to continue making my house note and without it my home and others like me will have homes that go into foreclosure thus bringing down the housing market even further.

I know alot of people in healthcare like me that are hurting and need this money and we would much rather have our old jobs with our old paychecks and are trying very hard, but the number of unemployed are working against us.

[Reply]

2 ctreit November 5, 2010 at 12:56 pm

This is one of many tough questions we are facing right now. I am leaning towards ending benefits for one major reason. When you are out of the workforce, you lose your skills. The longer you stay unemployed, the less likely it is that you will find an adequate job. Therefore, it makes sense to me to force unemployed people into new jobs or new careers even if the new jobs pay less than their previous jobs did (but probably a lot more than unemployment does).

On the other hand, the problem with this strategy is that many people probably can’t switch jobs/careers right now since they are stuck geographically as about 1/4 of homes are underwater. Workers can’t afford to move. The US used to have the advantage of a very flexible workforce that can move to where the jobs are in this huge country. That is not the case now which makes the unemployment problem a bit more complicated.

By the way, I think that any individual case of abuse can be countered with an individual case of legitimate hardship. Such individual cases are (ab)used for demagoguery but not for rational deliberation. The aggregate matters, not an alleged “welfare queen in Chicago.”

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3 Evan November 5, 2010 at 1:29 pm

I have no idea what is an appropriate number but something in my gut says 99 weeks is too damn long. We aren’t in a depression – if you can’t find a job in your field and within your town – its time to pick up a different field and move.

[Reply]

Tiffany Reply:

Most people can’t move as they lack the money and resources to do so. I personally am on unemployment and have decided to go back to schoool so I can find a better paying job. My regular unemployment will exhaust just before Christmas. I still have at least two to three semesters left. My question to you is- Is it fair to me that my unemployment will exhaust after November 30th and I won’t even be able to file for the 1st tier? I think it’s highly unfair to say this person was on unemployment before I was, so they have received additional tiers and I’m only allowed to file for the regular state unemployment compensation of 26 weeks.

[Reply]

Darwin's Finance Reply:

@Tiffany, That does not seem fair – the economy hasnt improved – and therein lies the problem. How to unwind this. In 5 years, will we still be paying at 99 weeks or more?

[Reply]

Evan Reply:

@Tiffany,

It does sound really unfair. So let’s get rid of the complexity and cut everyone off after the same time you are cut off.

[Reply]

4 Will November 5, 2010 at 4:06 pm

As someone who lost their job in the last 6 months and, who’s unemployment will run out a few weeks after the extension ends, who didn’t make millions of dollars before hand, I could use another extension.

Cutting off EUC during the coldest months of the year, combined with the fact that seasonal work will be ending after December, is a bad idea IMHO.

This isn’t about people “scamming the system”, its about those that are a creation of the job market. By all means, increase the hours worked required to become eligible, or put a larger gap between eligibility.

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5 Investor Junkie November 7, 2010 at 9:51 pm

I believe that we are focusing on the wrong end. We need help private businesses create jobs! Give incentives, tax rebates, make it easier to create jobs. All I see is government is doing the exact reverse. This has been last on the list from this administration. It was all about getting health care, financial reform, bailing out underwater home owners, etc.

Constantly giving out more money to the unemployed in the long run does nothing to help the situation and just prolongs the inevitable. In the long run this just transfers the money from the productive to the unproductive.

Should their be unemployment insurance? Most definitely yes, but no more than 1 year.

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6 Paul November 9, 2010 at 1:38 pm

They should give out benefits until the jobs return. How many weeks is irrevelent.

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Darwin's Finance Reply:

@Paul, That is a completely open-ended, vague solution that could never be enacted. The country needs to have some serious consideration of what to do, for how long, how to fund it, and when to shift into another system (i.e. welfare, food stamps, etc.)

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7 JBN November 9, 2010 at 2:23 pm

I’m as conservative as they come, but it is very important to have unemployment and continually limiting it by so many weeks is just scaring people. No one is getting rich on $200.00 a week. I’m not aware of bums and scammers on the system like we see through county wellfare programs. Also, unemployment is the only income for many single people who have been looking for jobs, even way below their previous income and still can’t even get an interview. There are hundreds of people competing for most jobs out there, so anyone who doesn’t know what I am talking about obviously has been with the same job with the same company and has not made any changes, nor has been forced to. If it is so easy out there, quit and see what options you have. Don’t talk about it, DO IT…… I didn’t think you would.

[Reply]

Darwin's Finance Reply:

@JBN, I did make it a point to highlight the plights of millions of Americans and no, it’s not easy. However, there needs to be a serious conversation about an exit strategy. An open-ended indefinite extension is not practical or affordable.

[Reply]

Tiffany Reply:

Nor is President Obama taking trips to India that apparently cost $200 Million/ per day!

[Reply]

Darwin's Finance Reply:

@Tiffany, For one, that’s a rumor. Next, when was Obama ever hailed as an example of fiscal restraint? Finally, completely irrelevant.

8 Firedancer November 9, 2010 at 6:07 pm

I am one of the “99ers”. It is true, there are people that do take advantage of the system and it angers me because there are FAR MORE that have geniunely tried to find a new career. I had a fantastic professional white collar career at General Motors for 14 years! I lost my job with hundreds of others in the same position. I was and still am devistated! I have tried and tried to find something new and keep hearing the common excuses. Overqualified, Overqualified, Overqualified!! So here I am in my mid 30′s, ambitious to work with a great work ethic and keep hitting dead ends everytime I feel that I’ve gotten a great lead. I need to work, I need health benefits, I did not choose this.

I have taken a part time seasonal mininum wage job just to get out of the house!! I’m basically making HALF of mininum wage because unemployment deducts for any wages earned. That is why people that are unemployed typically either go for another good career or nothing. Who wants to work for $4.00 an hour? Seriously.. Its a huge hit to my ego. Our jobs our a big part of who we are, our livelyhood. This was not a gift, should not be envied nor criticized.

I started working at age 14 and worked from little childhood jobs to my professional career . I paid into the system so do I deserve 99 weeks or more of unemploymet? You bet!! I worked hard for the benefit and am definitely entitled to it because it was NOT my choice or fault with how my professional career turned out.

If the government does not extend these benefits then it will hurt everyone.
Millions of people with no money for food and bills. Expect foreclosures to rise even higher, crime rates to exceed limits and economic distress in any way possible. We would basically become as economically sufficient as a third world country. So until the economy can pick up and offer more jobs to help that number decrease more and more, then there really isn’t a valid argument.

People need to come together. Period. Stop criticizing and understand the seriousness of things and how it will effect the overall picture including them. If you had a family member or close friend in distress you would help them in any way possible. So I’m a stranger but I am in that position and who in the hell would ever choose a life of meaning and luxury living upper middle class to lower class? Seriously…I didn’t want to give that back, I worked to hard for it!!

[Reply]

Darwin's Finance Reply:

@Firedancer, I’ve very sorry to hear about your plight. What you described could completely be me. I played by the rules, have a great career and for now, things are fine. But that could change in an instant. So, it must be very frustrating – the whole situation. I’ve done my best to qualify statements.

But some of the things you said do beg some serious questions –

If your industry is decimated, do you anticipate getting a similar job in the same location in the near future? Very possibly not. Have you considered moving?

Additionally, I applaud your initiative in getting out and working, even though the benefits are virtually none, as you stated. Because of the way the system works, there is very little financial incentive to work. You have overcome any temptation of exploiting the system, and as an able-bodied motivated individual, you’re out there working anyway. But this illustrates a larger point – there are millions of people in the exact same situation. It certainly demonstrates how just by the nature of the way the system is set up, there are many people NOT doing what this gentleman had the initiative to do.

I don’t judge those out of work, I thank my lucky stars every day that I have a job. I do just ask the question though, what is the exit strategy? If UI is going to be extended multiple times, why not just put a time period out there, enact legislation and be transparent about it. As of now, each time a new cohort comes up on the 99 weeks, there’s going to be this wrangling over votes, costs, earmarks, and all the other nonsense. It’s just not an efficient, fair or cost-effective way to deal with this crisis.

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9 Investor November 9, 2010 at 9:46 pm

It’s called unemployment INSURANCE. It’s just like any other insurance where you continue to pay and pay before something bad happens in order to cushion the blow if something bad should happen in the future. If you paid for fire insurance year after year and then your house burned down, should you collect money back from the insurance company? Yes, of course. Same with unemployment insurance. A portion of workers’ paycheck is deducted for unemployment insurance year after year while they’re employed so if they become unemployed, they’ll simply be collecting back from what they previously paid in. If you work for 30 years and pay unemployment insurance year after year, but somewhere along the line become unemployed and collect 99 weeks of benefits, in the long run you’re still paying much more to the gov’t than taking out.

As a side note, the author, who calls himself Darwin, should firstly, use his real name, and secondly should not write about topics of opinion like these in the same website as other articles about investing and financial guidance. Political opinion and investing advice are two arenas that should be kept separate.

[Reply]

Darwin's Finance Reply:

@Investor, Your insurance example doesn’t really make much sense. I pay insurance on a house to have full replacement cost covered once. While you don’t have a specific proposal, it appears as though you favor indefinite UI. That’s like getting a new house every year for life. You only get one house. Not infinite houses. Anyway, it doesn’t address the core issue of how much is enough.

On the content, I can write about whatever I like :> Great part about blogging. However, I don’t see how this is a political issue. It is a fiscal issue for the country. UI is about money. Our national debt is about money. There are plenty of other websites to talk about Sarah Palin, guns and abortion. This topic is completely related to finance.

As far as my name (coming from a guy named “investor” no less), who cares? My opinion’s the same either way and so is yours.

[Reply]

10 Deanna November 10, 2010 at 5:33 am

Darwin,

You said that you pay house insurance and if something happens then you have full cost replacement but you only get one house, well what if they only paid you for one room of a house? It would be the samething, because we have worked longer then 26 weeks or 46 weeks which is what I will get if they don’t extend the ui benefits after November. I was employed at my last job for 12 years, don’t get me wrong I don’t expect to get 12 years of ui but I do believe that I deserve more than 46 weeks. In my opinion since they allowed some of the unemployed to receive 99 weeks of ui benefits then I deserve the samething if it would take me that long to find gainful employment, which I hope that it doesn’t because I graduated from college this past May with a degree in Accounting and my last job I worked in the Accounting Dept., and I didn’t do that to flip hamburgers at Burger King. And by the way employees don’t pay ui insurance, it is something that the employer pays but a lot of companies, such as the one I was employed with, does count that as one of your benefits.

[Reply]

Evan Reply:

@Deanna,

Not to be an ass, but:

“And by the way employees don’t pay ui insurance, it is something that the employer pays but a lot of companies, such as the one I was employed with, does count that as one of your benefits.”

Doesn’t even make sense. Are you ending a question with a period. Pun intended.

Notwithstanding, if employers do pay unemployment insurance…don’t you think they would have less money to hire the next great accountant? Or do companies just print money, are greedy, and don’t want to hire yet another employee they have to spend money on?

[Reply]

Evan Reply:

@Evan,

Rereading the comment I may be wrong in that it wasn’t a question I apologize.

[Reply]

11 Marguerite November 10, 2010 at 11:13 am

Your comment that people receiving unemployment benefits are receiving “something for nothing” is very inaccurate. I have worked for 28 years and my employers have paid unemployment insurance so that in the event I need it – it is there. Isn’t that what they pay into the system for? Welfare recipients receive something for nothing for a lifetime and that doesn’t seem to bother anyone. They don’t have to wait for Congress to decide whether or not they’ll extend their benefits.

[Reply]

12 Tiffany November 10, 2010 at 12:04 pm

THIS RIGHT HERE IS THE ISSUE!!-

Mumbai, India – This week the President of The United States is visiting India. It is the largest and most expensive visit of a President of the United States ever. The estimated costs of this operation is $ 200 million per day. The United States have never spend this kind of money on any foreign visit. 40 planes, 3 armored cars and 34 warships, including an aircraft carrier accompany Barack Obama on his trip to India this week. the majority of the White House staff will travel with the President of United States.

[Reply]

13 Deanna November 11, 2010 at 12:07 am

Darwin,

Maybe it is different in your state, I don’t know but in Tennessee your employer provides insurance to help protect you when you become unemployed through
no fault of your own. Tennessee employers pay the full cost of unemployment insurance for their
employees. Nothing is deducted from your pay to cover the cost of this insurance, therefore my last employeer paid into this for ME for 12 years.

[Reply]

Darwin's Finance Reply:

@Deanna, Here’s a recent article in WSJ showing how UI is really being paid. 41 states (and counting) have exhausted their funds, are broke, and are borrowing the the federal govt to continue to fund the state portion. So, no, this is not self-funding – or sustainable.
http://online.wsj.com/article/SB10001424052748703374304575622791171310532.html

[Reply]

14 John November 11, 2010 at 5:24 pm

It is the employers who pay for unemployment insurance. The government doesn’t pay for UI. They government is merely the administer by collecting the insurance premiums from employers and then distributing the money back to the previously employed employees. In fact, by being administrator, the government is actually making a profit on unemployment insurance by holding onto the money and earning interest on it before it is paid out.
Not all unemployed people are eligible to receive UI. It is only for those people who were previously employed for a certain time and therefore caused premiums to be paid into the system on their behalf. Therefore it’s actually a system that pays for itself and is profitable for the government.
For people who point and cry at the level or duration of UI benefits, they are not only ignorant to the way this program works, but on top of that are being penny wise pound foolish. Meaning they’re scrutinizing the little money spends while overlooking the huge macro spends. If the government is spending $200 million per day on Obama’s trip, then that dwarfs the spending of UI. Not to mention that UI is not even entitlement spending to begin with. It’s a self-funded and profitable insurance program.

[Reply]

15 Darwin's Finance November 11, 2010 at 10:38 pm

John,
Gotta correct you on a few things. Primarily, the govt pays for nothing – the taxpayers do. Next, UI standard is from the state – 27 wks. However, the federal govt has passed multiple add-on extensions. These are unfunded transfers from the federal govt (taxpayers) to the unemployed. That is the issue – the 99 and above, not the initial 27 weeks.

The system does not “pay for itself”. Any payment from either corporations or taxpayers is paid for by – workers and corporations.

This nonsense with Obama’s trip? (I seldom defend him). One could point to any number of things – Oh! Look what that football player makes! Oh! That idiot from the Jersey Shore makes 15 Million in endorsements! The list goes on. These are completely irrelevant and Obama could travel the world all year round at that cost and barely scratch the surface of the Billions we’re spending on indefinite extensions should they continue.

That’s not to say people aren’t struggling and need a helping hand. But these are the facts.

[Reply]

16 DKD November 12, 2010 at 5:20 am

So what you are saying is that employers only pay 26 weeks for UI insurance for their employees? No they do not, employers have to pay UI insurance as long as their employee is working for them. And then you say that it is the tax payers that is paying for the additional weeks, well guess what? People receiving UI benefits are tax payers also but they can not claim EIC on UI pay but those people who work for little pay and claim EIC on their income taxes gets all of the money that was held out of the pay for taxes and a lot more on top of that. And those that receive welfare don’t have to pay taxes at all so why isn’t people mad at them? I say they should stop the EIC and welfare and give people a chance to find gainful employment.

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Darwin's Finance Reply:

@DKD, Umm, no. The UI goes toward the standard state 26 wk. If you believe this is “self-funding” why does each federal extension add to the federal deficit? This is kind of a pointless argument. Whoever pays, is it right to have extensions forever? NO.

Apparently, there are enough entitled people visiting the post that they are naive enough to believe this is both acceptable and sustainable.

[Reply]

17 Christopher November 12, 2010 at 6:27 pm

You’re missing an important point. This isn’t about giving anyone more than 99 weeks; apparently it wouldn’t do that at all. I have had 26 weeks and –because my 26 weeks expire ONE DAY after the deadline, I will not get any more unless government extends it. That is what extensions are about–so people currently unemployed can move into the next “tier” when their unemployment runs out. Those who have only had 26 weeks will get no more than that; those who have had only 46 weeks will get no more than that.

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18 jim November 12, 2010 at 9:03 pm

Personally I think there should be a limit. 2 years seems like a reasonable time to cut it off.

That claim that the Obama trip to India cost $200M a day is just a myth. There is NO basis in reality for that claim. It doesn’t even pass a common sense check.

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19 DKD November 13, 2010 at 6:06 am

Thank you Christopher and Jim, that is exactly my point also. I never did once say that I should have UI FOREVER, I agree 2 years should be the cut off but not 26 or 46 weeks.
Darwin, you asked why does extensions add to federal deficit, well I have something for you to think about. What about people that work for 35 to 40 years and they retire without ever needing to collect on UI insurance that THEIR EMPLOYERS paid in on them for 35 to 40 years? Where does that money go to?

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20 Christopher November 13, 2010 at 12:06 pm

Let me be more specific: I became unemployed in the week of Monday May 24th; therefore I am entitled to only 26 weeks of benefits. People who became unemployed on the week of Monday May 17th, by contrast, will be receiving 46 weeks of benefits. Mine runs out just on November 28th, the day the last extension expires; theirs will run out on November 23rd, enabling them to extend. That is ridiculous. There should be a clear stable number of weeks for everyone. So again, to paint this as being about whether people who have had 99 weeks ought to get even more is really inaccurate.

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Darwin's Finance Reply:

@Christopher, Please see my prior comments, explained there – I agree your situation is not equitable and some benefit from the luck of timing more than others. It was exit strategy/big picture – links included as well above.

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21 jim November 15, 2010 at 6:19 pm

DKD asked:
“What about people that work for 35 to 40 years and they retire without ever needing to collect on UI insurance that THEIR EMPLOYERS paid in on them for 35 to 40 years? Where does that money go to?”

The money collected in any given year is used to pay benefits to unemployed people. It is a pay-go system generally and there is no individual piggy bank with each persons name on it.

Its like other forms of insurance.

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22 Tamara Stinson November 15, 2010 at 6:29 pm

With all the cutbacks in after school programs, senior programs, and son on, why not put the unemployed to work to help those who need it. This could be on a part time basis so they could still look for work. Most jobs these days must be applied to on the internet, followed by a phone call. A good worker would take pride in his job to help and may restore some of his self esteem. Just a thought.

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23 jiggz26 November 22, 2010 at 3:16 pm

First of all lets be realistic.
They say there not going to extend unemployment but they will why reason number 1 there are no jobs so where are the unemployed supposed to go back to work too
another reason is if they do not extend unemployment million of people would probably be kick out of there homes wont beabale to feed there children.and it would probably be the reason why there be breedlines
and the homless rate would sky rocket along with crime
i hope that the new congress thinks twice about doing something so stupid
If it wasnt for unemployment this recession would look awhole lot worse picture family sleeping outside children geting sick from not being feed enough and being out in the cold people would roit steel ,rub and everything else.
i think they need to keep extending it until there are enough jobs

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24 Valerie December 1, 2010 at 4:35 pm

I myself have been unemployed for 12 months now i will find myself off of the 2 tier and the end of dec.I think as a fair decision everyone should be able to get a chance to finish all tiers if they need too. We are still in a high recession. I myself if i dont get another tier i have training benefits to back me up so it is not as big of a deal for me but i still believe its unfair because i was laid off in nov of 09 instead of jan of 09 i get less weeks on unemployment when the unemployment rates were probably worse in november 09 then in january 09. Yes they have improved some but nationally we still have a high unemployment rate. I myself choose to go back to school to become a nurse and was given extra time but i still believe someone needs to fight for everyone else out there!

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