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Unemployment Benefits Extension Clears Senate Hurdle

Tue, 07/20/2010 - 11:27am
Manufacturing.net

WASHINGTON (AP) -- A bill to restore unemployment benefits to millions who have been out of work for more than six months has cleared a Senate hurdle.

The 60-40 vote came moments after Carte Goodwin, a successor to West Virginia Democrat Robert Byrd, was sworn in. Goodwin was the crucial 60th senator to defeat a Republican filibuster that has led to a lapse in benefits for 2.5 million people.

A battle has raged for months over whether jobless benefits should be financed with additional federal debt as Democrats want or through cuts to other government programs as most Republicans insist.

After a final Senate vote, the House will take up the bill Wednesday. President Barack Obama is likely to sign it into law by week's end.

THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP's earlier story is below.

WASHINGTON (AP) -- Millions of people stuck on the jobless rolls would receive an extension of unemployment benefits averaging $309 a week under a Senate bill that appears set to break free of a Republican filibuster.

Democrats have stripped the unemployment insurance measure down to the bare essentials for Tuesday's vote, which is a do-over of a tally taken late last month.

With West Virginia Democrat Carte Goodwin poised to claim the seat of the late Sen. Robert Byrd, two Republicans will be needed to push the measure over the filibuster hurdle. Maine GOP moderates Olympia Snowe and Susan Collins are expected to provide the key votes to create a filibuster-breaking tally on a key procedural test.

The measure is expected to pass later Tuesday. The House would take it up Wednesday and then send it to President Barack Obama for his signature.

"I can't tell you how relieved we will be when Congress passes this. We have in Pennsylvania about 200,000 people who have lost their unemployment compensation coverage because of their inaction," said Pennsylvania Secretary of Labor and Industry Sandi Vito. "Folks need this money for their mortgages, for food, and so our goal is to get them their payments as quickly as possible."

If all goes as expected, about 2.5 million people will receive jobless benefits retroactively, injecting almost $3 billion into the economy once they're paid out. Instead of being dropped from a federal program that extends benefits for those whose six months of state-paid benefits have run out, millions of others will continue to receive payments that would help prop up consumer demand to the tune of about $30 billion more over the coming year.

Democrats tout the economy-boosting effect of unemployment checks since most beneficiaries spend them immediately. But the numbers amount to less than one-quarter of 1 percent of the size of the $14.6 trillion economy, and are far smaller than last year's $862 billion stimulus legislation. Republicans have blocked Democratic add-ons, such as aid to state governments, that could have meant a greater economic boost.

"It's too small to have any noticeable impact on the economy's growth rate," said Joel Naroff, president of Naroff Economic Advisors. "But the benefits do provide an important safety net for people during these difficult economic times."

Obama and his Democratic allies are pressing the issue for maximum political advantage, blaming Republicans for the impasse that halted unemployment checks for people unable to find work as the jobless rate remains close to 10 percent.

Obama launched a fresh salvo Monday, demanding the Senate act on the legislation -- after a vote already had been scheduled -- and criticizing Republicans for the holdup.

"The same people who didn't have any problem spending hundreds of billions of dollars on tax breaks for the wealthiest Americans are now saying we shouldn't offer relief to middle-class Americans," Obama said.

Republicans say they do favor the benefits but insist they be paid for with spending cuts elsewhere in the government's $3.7 trillion budget. After initially feeling heat this winter when a lone GOP senator, Jim Bunning of Kentucky, briefly blocked a benefits extension in February, the GOP has grown increasingly comfortable opposing the legislation.

The providing of additional weeks of jobless benefits in the midst of bad times has been regarded as routine, and the latest cycle of additional benefits began in 2008, the last year of George W. Bush's administration.

"For a long time, there has been a tradition under both Democratic and Republican presidents to offer relief to the unemployed," Obama said. "That was certainly the case under my predecessor, when Republicans several times voted to extend emergency unemployment benefits."

But with conservative voters and tea party activists up in arms about the deficit, conservative Republicans have adopted a harder line that has caused three interruptions of jobless benefits.

"We've repeatedly voted for similar bills in the past. And we are ready to support one now," Senate Minority Leader Mitch McConnell, R-Ky., said Tuesday. "What we do not support -- and we make no apologies for -- is borrowing tens of billions of dollars to pass this bill at a time when the national debt is spinning completely out of control."

Associated Press writer Jeannine Aversa contributed to this report.

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