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$26B bill would save 300,000 government worker jobs
Senators Harry Reid and Michael Bennet vote on teachers and civil servants
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TEXT OF INTERVIEW
Bill Radke: Democrats have eked out a victory on a bill that would send $26 billion in aid to the states. They broke a filibuster last night and a final vote is expected today. The money would help states pay government workers who would otherwise probably lose their jobs in the next few months because of state budget cuts. Marketplace's Mitchell Hartman joins us live to talk about it. Good morning, Mitchell.
Mitchell Hartman: Good morning, Bill.
Radke: What is the major debate about this bill?
Hartman: Whether we can afford it, in a word. Republicans don't want to spend the money if it's borrowed. After tweaking the funding formula, though, two moderate Republicans from Maine got on board. Now the House will come back for a final vote to pass next week. Proponents say that this'll save 300,000 jobs. This is people like teachers, cops, firefighters, health care workers. They'd be getting pink slips in the new fiscal year as states face these huge budget shortfalls. And that's because of the economy, higher cbenefits osts for people who are unemployed, and also lower tax revenues coming in.
Radke: And jobs are such a big political issue right now, with lawmakers facing elections this fall. And here we're about to get a big report on unemployment tomorrow.
Hartman: Right. Economists think that the unemployment rate is actually now up to 9.6 percent. That is because people who gave up looking are now re-entering the job hunt. For some of those people, it's because their unemployment beneifts have run out. But no one thinks that unemployment is going to go down much, if at all, at least until early next year. And then there's new job creation -- it's just mediocre, Bill. Private companies probably hired 50,000 to 70,000 people in July. It's something, but it's not nearly enough to start absorbing more than two years of horrible layoffs that we've had. Economists think we probably need to be doing like 200,000 to 300,000 new jobs, and that's month after month, to just start catching up.
Radke: Right. Marketplace's Mitchell Hartman. Mitchell, thank you.
Hartman: You're welcome.
That's almost $87,000 per job. I don't see the economics of this. It's not like building a road or other infrastructure project gets some great job-generating enterprise over the hump. You're just taking everyone's tax money (now or later) and paying certain people a very nice wage. I think we're getting addicted to these artificial little fixes and will wind up with a very large hangover a few years down the road.
