On July 1st, the House passed the Restoration of Emergency Unemployment Compensation Act to restore and extend emergency unemployment benefits–not only a much-needed lifeline for Americans who have lost jobs through no fault of their own and their families, but also a proven boost to our struggling economy.
83% of House Republicans voted no on the bill and Senate Republicans have obstructed the legislation repeatedly claiming that these emergency benefits for those out of work due to the Bush recession must be paid for. At the same time, Republicans approve of extending Bush era tax cuts for the rich without paying for them.
In an interview with Fox News Sunday, Senate Republican Whip Jon Kyl (R-AZ) highlighted the GOP's hypocrisy of denying an extension of unemployment benefits while “digging the hole deeper” through an extension Bush era tax cuts for the rich:
WALLACE: We're running out of time, so how are you going to pay $678 billion just on the tax cuts for people making more than $250,000 a year?
KYL: You should never raise taxes in order to cut taxes. Surely congress has the authority and it would be right, if we decide we want to cut taxes to spur the economy, not to have to raise taxes in order to offset those costs. You do need to offset the cost of increased spending. And that's what republicans object to. But you should never have to offset cost of a deliberate decision to reduce tax rates on Americans.
As the Washington Post stated in an editorial this morning:
Eventually, Mr. Kyl trotted out the tired and unsubstantiated argument that the tax cuts for the wealthy must be extended because otherwise “you’re going to clobber small business.” Mr. Wallace persisted: “But, sir, . . .how are you going to pay the $678 billion?” — at which point Mr. Kyl descended into nonsense…
Huh? No one’s talking about cutting taxes on the wealthy to stimulate the economy. The issue is whether the tax cuts for the wealthiest Americans should be extended, adding another $678 billion to the deficit over the next decade. The tax cuts, it’s worth remembering, passed originally in 2001 with the argument that the surplus was so large that rates could be cut with budgetary room to spare. Now that the fiscal picture has deteriorated so badly, the questions remains: How are you going to pay the $678 billion? And if you don’t, how are you going to justify the added damage to an already grim fiscal outlook?
Since Senator Kyl and his Republican colleagues have blocked the unemployment extension bill, over two million workers have lost their unemployment insurance. 3.2 million people will lose their benefits by the end of the month. Here’s how many American workers are without their economic lifeline right now:
The Republican refusal to act is also bad for our economy. Analysis from the nonpartisan Congressional Budget Office (CBO) finds that extending unemployment benefits is one of the most cost-effective and fast-acting ways to stimulate the economy. Moreover, economists agree that extending these benefits will create jobs and decrease the chances of slipping back into a double dip recession. Blogging on WhiteHouse.gov today, Dr. Lawrence H. Summers, Director of the National Economic Council, explains:
But unemployment insurance puts money in the pockets of the families most likely to spend the money — which in turn expands the economy and creates jobs. The nonpartisan Congressional Budget Office has identified increased aid to the unemployed as one of the two most cost-effective policy options for increasing economic production and employment.
Missed unemployment insurance payments since May total over $10 billion — enough to have created 100,000 jobs. An abrupt and premature withdrawal of relief is not only something families cannot afford, it is something that the economy cannot afford at a time when the economy is at a critical juncture. The economy is finally creating jobs, but not nearly fast enough to close the 8 million-job gap opened by the recession.
If you’re wondering how extending unemployment benefits (which Republicans believe should be paid for under the guise of fiscal responsibility) and tax cuts (which, as Senator Kyl explained, they don’t think should be paid for) compare in terms of the impact on our deficit, Ezra Klein of the Washington Post has compiled a graph: