The question of whether to renew unemployment benefits for more than one million Americans has surfaced as part of federal budget negotiations.
The benefits, meant to be temporary, have been extended repeatedly, most recently through Dec. 28.
“If we allow these extensions to expire, it’s going to cause a lot more pain for Americans,” says Elise Gould, an economist at the Economic Policy Institute. She says the whole economy would take a hit if the unemployment benefits aren’t extended because unemployment checks are spent right away.
A former head of the Congressional Budget Office, Robert Reischauer agrees.
“The money comes in and it goes out very rapidly for food, clothing, gas for the car and so on,” he says.
That money ripples through the economy, and the White House argues that without that spending, 240,000 jobs will be lost next year.
It adds up to make a tough vote in Congress, says Douglas Holtz-Eakin, another former Congressional Budget Office director and an economic adviser for Senator John McCain’s 2008 presidential campaign.
“When push comes to shove, saying I’m not willing to fund the unemployment insurance for those who have been out of work for two years — pretty tough vote to take,” he says.
Or, as Reischauer puts it: “They certainly don’t want to be Scrooge in the middle of the holiday season.”
Because tales of the hardships of those denied benefits could haunt re-election campaigns like the ghost of Christmas past.
If you’re a member of your local public radio station, we thank you — because your support helps those stations keep programs like Marketplace on the air. But for Marketplace to continue to grow, we need additional investment from those who care most about what we do: superfans like you.
Your donation — as little as $5 — helps us create more content that matters to you and your community, and to reach more people where they are – whether that’s radio, podcasts or online.
When you contribute directly to Marketplace, you become a partner in that mission: someone who understands that when we all get smarter, everybody wins.