(snip)"From the WSJ:
On Thursday, Senate Democrats failed to secure the 60 votes needed to break off a GOP-led filibuster. Sen. Ben Nelson (D., Neb.) voted with Republicans in a 57-41 roll call. Senate Majority Leader Harry Reid (D., Nev.) said this third vote on the matter would be the last, allowing the Senate to move on to modest legislation cutting taxes for small businesses.
The collapse of the wide-ranging legislation means that a total of 1.3 million unemployed Americans will have lost their assistance by the end of this week. It will also leave a number of states with large budget holes they had expected to fill with federal cash to help with Medicaid costs.
Up in the air are other provisions that were to be included in the legislation, including some $50 billion in new taxes designed to help offset its cost. They included an increase in levies paid by private investment groups, including hedge-fund firms and real-estate partnerships, a provision long sought by some Democrats that will likely return another day.
Under a program initially enacted last year—which expired June 2—jobless workers could receive up to 99 weeks of aid, including 26 weeks of basic assistance provided by states plus longer-term federal payments. The Labor Department estimates that the long-term unemployed, meaning those out of a job for at least six months, make up 46% of all jobless workers in the U.S.
And like every other stimulus program, there are those who focus on possible cons from the program end...
There are economic risks in ending benefits. Workers receiving them tend to funnel money back into the economy immediately, helping prop up demand and jobs.
In addition, said Harvard economist Lawrence Katz, if workers are unable to find work and no longer eligible for unemployment benefits, some will turn to other government programs, such as disability and Social Security. "If you're really concerned about the long-term deficit, you should be really concerned about the long-term unemployed," Mr. Katz said.
and pros...
Other economists argue that extended benefits have played a part in keeping people out of the labor force. "There's a very large body of research that says that more generous benefits and benefits that last longer…encourage people to stay out of work longer," said Bruce Meyer, an economist and public policy professor at the University of Chicago.
James Sherk, a labor economics analyst at the conservative Heritage Foundation think tank, said that while it could be argued that the benefits made available last year were too extensive, cutting off workers who expected to receive the full 99 weeks of benefits isn't ideal either. "You don't sort of pull the rug out from someone halfway through," he said.
In our view, what will happen is that the 1.3 million who had gotten used to receiving benefits (and for whom we certainly feel sorry, as once again expectations and reality under the current administration diverge in a dramatic fashion) and had no desire to look for work, will immediately flood back into the labor force to find some job, any job, that pays even remotely as well as what the government did. What this means is that the total labor force (which incidentally dropped by 322,000 From April to May) of 154.393 million, is about to grow by at least 1.3 million, and as much as 2 million, in July. And since census employment peaked, and the number of employed will stay flat (at best) at 139.420 million, the expansion in the total labor force, will increase the unemployment rate by almost 1% in just a month, growing from 9.7% in May to 10.5% in July. That number will be reported in late August.
But by then the sequel to the Great Depression v2 movie will be playing in every theater across the land, and this number will be the least of our worries."(snip)
from
I'm really at a loss as to what to make of this, but the following facts are inescapable ...
Dumping 2 million+ long term unemployed off the federal extended unemployment benefits program will cause a significant increase in the official gov't U1 unemployment statistc
Dumping 2 million+ long term unemployed off the federal extended unemployment benefits program will reduce annual federal deficit spending by some 60 billion dollars.
Dumping 2 million+ long term unemployed off the federal extended unemployment benefits program will increase personal bankruptcy filings, will increase foreclosures / short sales etc. by those long term unemployed ( i.e. an acknowledgement that some number are permanently 'unemployable' ).
It remains to be seen how many of these long term unemployed will then add to their state's deficit by signing up for welfare / medicaid / disability etc. This will obviously make budget shortfalls worse in states with the highest unemployment rates and most generous welfare / medicaid / social welfare benefit offerings.
It is also possible, absent a weekly ~$300 unemployment check, that some number of these long term unemployed will opt to accept whatever sort of jobs are locally available at whatever market based pay rate is available, that some number of these long term unemployed will opt to relocate to a different city / state where economic conditions are better, etc.
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