Today, the U.S. Senate takes up the bipartisan budget proposal crafted by Sen. Patty Murray and Rep. Paul Ryan. The compromise between the Washington Democrat and Wisconsin Republican passed with a substantial majority in the House. Senators in both parties have been making the task more difficult than expected, especially in gathering the 60 votes necessary to move the bill to final action on the floor.
The thinking is, surely, the votes will be there, as they should be, the measure containing enough positive elements. Start with removing the threat of a government shutdown for two years and easing the bite of the wrongheaded sequester, the harmful automatic spending reductions.
Ideally, the budget package would include an extension of federal unemployment benefits, due to expire three days after Christmas. It does not. In that way, approval of the plan must be followed soon by renewing assistance to the long-term jobless. If action won’t take place this year, with the House having gone home, it should be a first priority in the new year.
An argument goes that somehow jobless benefits deter people from finding work and thus weaken the economic recovery. Not exactly. Unemployment compensation does allow workers to search more efficiently, or at times wait for a job that better fits their skills. If that means finding a position in a bit longer time, it shouldn’t obscure the much greater benefit overall of the aid, or the hard realities of the labor market.
The unemployment rate has dropped to 7 percent, yet that number still stands roughly two percentage points higher than at the start of the recession. More telling is the rate of labor force participation, dropping sharply with the recession, and remaining as depressed today. Consider the 4.1 million long-term jobless, without work for more than 26 weeks, an extraordinarily high number compared to past recessions, three unemployed workers for every job opening.
Studies highlight the broad value of unemployment compensation. Mark Zandi of Moody’s Analytics calculates that each dollar in benefits triggers $1.55 in economic activity. The Congressional Budget Office cites the boost to demand and employment, or what are lacking today.
At some point, federal jobless benefits must be halted. They already have been scaled back, from a maximum of 99 weeks to 73 weeks. This isn’t the moment for the program to stop, more than 36,000 Ohioans facing a cutoff in 11 days, 129,000 by the end of next year. These workers lost their jobs through no fault of their own. They deserve better from lawmakers in Washington.