Congress Chooses To Extend Jobless Benefits Deadline
Congress voted April 15 to roll forward the last day for unemployed workers to file
for extended jobless benefits till June 2, a law President Barack Obama immediately signed into law.
This bill will restore federal unemployment benefits to over 200,000 jobless Americans who would have been ineligible for them starting April 5.
Before the change, federal unemployment benefits, which last up to 73 weeks, commence after 26 weeks of initial coverage expire. Benefits are divided into levels, and jobless applicants must apply for these benefits each time they move into a new tier.
The amendment extends several provisions until the end of May, including: COBRA health insurance; the National Flood Insurance Program and the copyright license for providers of satellite television. More importantly, it will prevent the reduction of 21% in Medicare payment rates for doctors from kicking in until May 31.
Republicans in the Senate have resisted extending unemployment benefits, saying the benefit must be paid for, though this law has enjoyed a lot of bipartisan support.
In the US, about over 11 million people are receiving unemployment benefits, with about 6 million of them enjoying extended benefits.
Though the economy is expected to slowly improve, the unemployment rate still remains at 9.7%, and the projected average unemployment period for an unemployed worker in America is 31.2 weeks.
Previously, the government had already passed two short-term extensions of the filing deadline since late December. Furthermore, both House and Senate committees also have passed bills that is pushing back the deadline to file for extended benefits until later in the year, but those measures need to be budgeted.
However, there is a problem.
Currently, of the 50 states, about 33 states and the US Virgin Islands have already used up their unemployment benefits funds and are forced to borrow from the State government to the tune of a whopping $38.7 billion to provide a temporary safety net to millions of jobless claimants.
States are going as far as cutting as much extraneous services as they can to keep afloat. From unnecessary entertainment to transport services, these cash-strapped cities are eliminating all kinds of services to save money.
Among all states, California has borrowed the most from the government, summing up to more than $8.4 billion, followed by Michigan and New York, which have loans worth more than $3 billion. Nine other states have borrowed at least $1 billion from the federal government.
"The nation's financing system for jobless benefits is under unprecedented stress," said Andrew Stettner, deputy director of the New York-based advocacy group for the unemployed. "While the recession has certainly made things worse, this funding crisis has been developing for years."
For perspective, before the recession, only 19 states have met the recommended funding level, which is one year of reserves equal to the highest amount of unemployment insurance paid out during prior recessions.
by: Huey Harden
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