[Congressional Record (Bound Edition), Volume 156 (2010), Part 13]
[Senate]
[Pages 18620-18622]
[From the U.S. Government Publishing Office, www.gpo.gov]




                    EXTENDING UNEMPLOYMENT INSURANCE

  Mr. CASEY. Madam President, I rise today to talk about unemployment 
insurance, and I will be brief. At the end of my remarks I will be 
offering a unanimous consent request.
  First of all, I wish to cite a study just released today by the 
Council of Economic Advisers.
  I commend to my colleagues this report entitled ``The Economic Impact 
of Recent Temporary Unemployment Insurance Extensions'' dated December 
2, a report by the Executive Office of the President and the Council of 
Economic Advisers.
  I ask unanimous consent that the Executive Summary of the report be

[[Page 18621]]

printed in the Record at the conclusion of my remarks.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (See Exhibit 1.)
  Mr. CASEY. This report released today had a number of findings: First 
of all, that the emergency expansion of unemployment insurance programs 
in 2007 has benefited 40 million people in the United States of America 
who have either received or lived with a recipient of these programs. 
This figure includes 10.5 million children.
  In line with other studies that have been released, this report by 
the Council of Economic Advisers states that there are 800,000 more 
jobs and GDP is 0.8 percent higher because of the expansion of 
unemployment insurance programs. Without reauthorization through 2011, 
the one we are debating today in the Senate, at this time next year, in 
December of 2011, there will be 600,000 less jobs and GDP will be 0.6 
percent lower. So there are real consequences to the denial of this 
reauthorization going forward.
  To give my colleagues a sense of what that means in a State such as 
Pennsylvania, without reauthorization of these programs, 353,989 people 
will lose unemployment insurance coverage by November of 2011. The 
Pennsylvania economy will be severely impacted without reauthorization. 
According to the Council of Economic Advisers, there will be 31,228 
less jobs in the Commonwealth of Pennsylvania if we do not reauthorize 
unemployment insurance.
  Just to put that in perspective, in the first three quarters of this 
year, in the midst of a recovery--slow recovery but a recovery 
nonetheless--our State has gone from losing jobs in 2009 to gaining 
jobs. In the first three quarters of the year, we have gained roughly 
48,000 jobs. Without unemployment insurance, we stand to lose, as I 
said, more than 31,000 of those jobs.
  We know the unemployment rate of 9.6 percent nationally means nearly 
15 million people are out of work. If you are opposed to this 
reauthorization, you have to come up with another answer. You can't 
just say to 15 million people: Well, we couldn't get it done, or things 
interfered in Washington.
  In our State, fortunately, we are lower than 9.6. We are 8.8, 
percent. But 8.8 percent in Pennsylvania means that 560,000 people are 
out of work. It ballooned up to over 590,000 this summer, but 
fortunately that has been coming down over the last couple of months 
and, of course, we want to keep it moving in that direction.
  Let me just conclude with this thought: For the past six decades, 
Congress has provided federally funded unemployment insurance benefits. 
During every recession, the Congress has done that, and thank goodness 
they did. Finally, without this reauthorization in our State of 
Pennsylvania, 83,000 Pennsylvanians will exhaust their benefits this 
month. Of course, across the country, it is some 2 million.

                               Exhibit 1

    The Economic Impact of Recent Temporary Unemployment Insurance 
                               Extensions


                           EXECUTIVE SUMMARY

       Unemployment insurance (UI) provides a safety net for 
     workers who have lost a job through no fault of their own, as 
     long as they continue to search for new employment. During 
     normal economic conditions, firms pay into state insurance 
     systems that replace roughly half of the average individual's 
     lost earnings, up to 26 weeks. However, the federal 
     government historically funds additional weeks of benefits in 
     response to an economic downturn. The benefits allow 
     recipients to continue to support their families while 
     searching for their next job.
       In response to the recession that began in December 2007, 
     Congress expanded UI benefits by creating Emergency 
     Unemployment Compensation (EUC) and 100 percent federal 
     funding of Extended Benefits (EB). These programs provide UI 
     benefits after a worker exhausts state benefits, helping when 
     it takes longer to find a job, such as in this severe 
     downturn. These extensions began to expire on November 30, 
     2010. In this report, the Council of Economic Advisers (CEA) 
     examines the effects of the extensions thus far and the 
     potential impact on the economy if Congress fails to act soon 
     to continue these emergency measures.
       As a result of these emergency expansions to UI:
       EUC and EB have helped 14 million unemployed workers as of 
     October 2010. As of that date, there were almost 5 million 
     unemployed workers benefiting from these programs each week.
       In total, these programs have benefited about 40 million 
     people who have received, or lived with a recipient of, EUC 
     or EB. This total includes 10.5 million children.
       If these measures are not extended, the maximum eligibility 
     for benefits in most states will revert to the pre-
     recessionary level of 26 weeks. The Department of Labor 
     estimates that, relative to a month-long extension, 2 million 
     unemployed workers will lose coverage in December 2010. And, 
     relative to a year-long extension, nearly 7 million 
     unemployed workers in total will lose coverage by November 
     2011.
       Further, EUC and EB make up a substantial portion of 
     household income. Without EUC and EB, the typical household 
     receiving these benefits will see their income fall by a 
     third. In the 42 percent of households where the EUC or EB 
     recipient is the sole wage-earner, 90 percent of income will 
     be lost.
       This important income replacement allows individuals that 
     have suffered from job loss to avoid a dramatic drop in their 
     spending levels. Research studies have documented that UI is 
     an extremely effective form of support for the economy 
     relative to other government programs, both in terms of bang-
     for-the-buck and timeliness. EUC and EB recipients spend 
     their benefit checks, rather than saving them, and a drop in 
     this income will translate into a sizeable drop in aggregate 
     spending.
       Specifically, CEA estimates that:
       Employment was about 800,000 higher, and the level of GDP 
     0.8 percent higher, in September 2010 than would have been 
     the case without EUC and EB.
       Without an extension, employment would be about 600,000 
     lower, and GDP 0.6 percent lower, in December 2011 than if a 
     year-long extension were passed.
       Previously, Congress continued federal expansions of UI 
     until the economy was much further along the road to 
     recovery. With 10 consecutive months of private sector job 
     growth and half a percentage point drop in the unemployment 
     rate since its peak, the economy is beginning to recover. 
     However, the unemployment rate remains at 9.6 percent and 
     there are still 5 job seekers for every job opening. For the 
     last half-century, Congress has consistently extended UI 
     benefits when economic circumstances substantially increased 
     the difficulty of finding a job. Given the current labor 
     market conditions, failing to continue UI extensions now 
     would be unprecedented.


                            I. INTRODUCTION

       As a form of insurance against job loss, employers pay 
     taxes into state government unemployment systems at rates 
     based, in part, on past usage of the system. State 
     governments then provide weekly payments of $300, on average, 
     to workers who have lost a job through no fault of their own, 
     replacing roughly half of an individual's lost earnings. 
     Typically, unemployed workers can receive up to 26 weeks of 
     benefits, as long as they continue to search for work. In an 
     economy with normal labor demand, one would expect most 
     unemployed workers to find a job within this time frame. 
     However, in December 2007 the United States began to slide 
     into a deep recession. By October 2009, the unemployment rate 
     was 10.1 percent, and there were more than 6 jobs seekers for 
     every job opening, compared to just 1.5 prior to the 
     recession.
       Recognizing that unemployed workers would have a 
     significantly harder time finding jobs, Congress created 
     Emergency Unemployment Compensation 2008 (EUC) in June of 
     that year. This swift action put unemployment benefits in 
     place much earlier than has been done in previous 
     recessions--almost one year before GDP stopped declining. 
     These early efforts by Congress resulted in UI playing a 
     greater role in stabilizing the economy, as suggested in a 
     recent Department of Labor report.
       As the labor market worsened, Congress further extended and 
     expanded the program, particularly for unemployed workers in 
     the hardest-hit states. As part of the American Recovery and 
     Reinvestment Act, Congress provided for 100 percent federal 
     funding of Extended Benefits (EB), a program usually funded 
     jointly by the state and federal governments. Individuals are 
     eligible for EB once they exhaust their EUC benefits if their 
     state meets certain unemployment-based triggers. All told, an 
     unemployed worker could receive up to 99 weeks of coverage in 
     those states with the highest rates of unemployment. (See the 
     Appendix for more detail on these programs.)
       Importantly, the current tiered structure of EUC and EB 
     allows for a natural phasing down of coverage as economic 
     conditions improve. Many of the eligible weeks of benefits 
     are determined at the state level by thresholds based on 
     states' unemployment rates; the maximum length of coverage 
     provided by these federal programs is shorter in states with 
     better economies. Beyond this natural phase down, however, 
     the legislation authorizing these programs began to expire on 
     November 30, 2010 and the millions of Americans receiving 
     coverage through these programs have already begun losing 
     benefits.


                   Unanimous-Consent Request--S. 3981

  Mr. CASEY. So with that, I ask unanimous consent that the Finance

[[Page 18622]]

Committee be discharged from further consideration of S. 3981, a bill 
to provide for a temporary extension of unemployment insurance 
provisions; that the Senate proceed to its immediate consideration; 
that the bill be read a third time and passed; and that the motion to 
reconsider be laid upon the table, with no intervening action or 
debate; and any statements related to the bill be printed in the 
Record.
  The PRESIDING OFFICER. Is there objection?
  Mr. ENSIGN. Madam President, reserving the right to object, because 
the Republicans want to extend unemployment benefits without increasing 
the deficits, would the Senator agree to include an amendment proposed 
by Senator Brown that would offset the cost of the bill with unspent 
Federal funds, the text of which is at the desk?
  Mr. CASEY. I would not. I object to that for the simple reason that 
the construction of that amendment involves dollars already allocated 
to Federal programs across the board. Although the money has not been 
spent yet, it has been allocated. If there is a concern, as there seems 
to be--and I would categorize it as an alleged concern--about the 
deficit, there doesn't seem to be the same concern about running up the 
deficit not by billions but by hundreds of billions to extend tax cuts 
to Americans above the $250,000 income tax bracket. So if there is that 
concern about the deficits, I wish that logic and concern was applied 
to the tax cut debate.
  Mr. ENSIGN. Further reserving the right to object, first of all, I 
would love to offset the tax cuts with spending reductions in areas 
across the board because I think the deficit is a problem. Because the 
Senator from Pennsylvania just wants to increase the deficit with 
unemployment benefits, without offsetting it, without spending cuts, I 
am forced to object.
  The PRESIDING OFFICER. Objection is heard.
  Mr. CASEY. I yield the floor.
  The PRESIDING OFFICER. The Senator from Nevada is recognized.
  (The remarks of Mr. Ensign pertaining to the introduction of S. 4004 
are located in today's Record under ``Statements on Introduced Bills 
and Joint Resolutions.'')
  The PRESIDING OFFICER. The Senator from Iowa.

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