Ahead of Thanksgiving, Casey Urges Vote to Preserve Unemployment Insurance

WASHINGTON, DC—U.S. Senator Bob Casey (D-PA) has organized an effort joined by 28 senators to call for a vote to preserve unemployment insurance for another year.  Without action, these benefits for workers who lost their job through no fault of their own will begin to expire on Tuesday, November 30.  In a letter to be sent to Senate leadership, the senators urge a continuation of the unemployment benefits program through December 31, 2011.

“As we prepare to celebrate Thanksgiving, two million Americans and 83,000 Pennsylvanians are forced to worry about losing vital support next month that helps them keep food on the table and pay their bills,” said Senator Casey.  “Unless Congress acts to preserve these benefits these families and the economy will suffer.”

According to the U.S. Department of Labor, if Congress fails to take action, two million workers will lose their unemployment benefits this December.   Each month after that, over one million more would fall off the rolls.  By April 2011, six million workers would be without benefits.

The senators wrote: “Currently, the national unemployment rate is 9.6 percent.  At the current rate, without a reauthorization, we would cut the life line that millions of Americans use to stay afloat.  Equally importantly, we would endanger our fragile economic recovery by reducing the amount Americans spend on groceries, utilities and other basic needs.”

Preserving unemployment benefits will not only provide vital assistance to laid off workers and their families, it will have a significant benefit to the economy.  Goldman Sachs has said that an expiration of unemployment benefits would cause economic growth to fall by half a percentage point.  The Economic Policy Institute has said that extending benefits would increase the gross domestic product by 0.7 percent and create the full-time equivalent of 723,000 jobs.  A U.S. Department of Labor report commissioned by the Bush Administration found that unemployment benefits in the saved 1.6 million jobs per quarter and lowered the unemployment rate by 1.2 percent.

The letter is signed by Senators Daniel K. Akaka (D-HI), Mark Begich (D-AK), Barbara Boxer (D-CA), Sherrod Brown (D-OH), Roland W. Burris (D-IL), Benjamin L. Cardin (D-MD), Christopher J. Dodd (D-CT), Dianne Feinstein (D-CA), Al Franken (D-MN), Kirsten E. Gillibrand (D-NY), Tom Harkin (D-IA), John F. Kerry (D-MA), Amy Klobuchar (D-MN), Frank R. Lautenberg (D-NJ), Patrick J. Leahy (D-VT), Carl Levin (D-MI), Robert Menendez (D-NJ), Jeff Merkley (D-OR), Barbara A. Mikulski (D-MD), Patty Murray (D-WA), Jack Reed (D-RI), John D. Rockefeller IV (D-WV), Bernard Sanders (I-VT), Jeanne Shaheen (D-NH), Debbie Stabenow (D-MI), Tom Udall (D-NM), Sheldon Whitehouse (D-RI) and Ron Wyden (D-OR).

The text of the letter to be sent to the Senate Majority Leader and Chairman of the Finance Committee is below:


The Honorable Harry Reid
Majority Leader
United States Senate
S-221, U.S. Capitol
Washington, DC 20510

The Honorable Max Baucus
Chairman, Finance Committee
United States Senate
511 Hart Senate Office Building
Washington, DC 20510

Dear Majority Leader Reid and Chairman Baucus,

We are writing to urge a reauthorization of the current federal unemployment benefits programs through December 31, 2011.  As our nation continues to battle high unemployment rates, we must act immediately to continue vital safety net coverage for those most in need.

With nearly 15 million Americans unemployed and the number of unemployed expected to remain high beyond 2011, a long-term renewal of the Emergency Unemployment Compensation program and full federal funding of the Extended Benefit programs are necessary to keep our economy on the road to recovery, as well as to keep food on the table and a roof over the head of families across America.  

For the past six decades, Congress has provided federally funded unemployment insurance benefits during every recession.  Further, federal unemployment insurance benefits have always been provided until the economy was on a stable path of growth.  In fact, the highest unemployment rate at which federally funded unemployment benefits were not extended was 7.2 percent.  Currently, the national unemployment rate is 9.6 percent.  At the current rate, without a reauthorization, we would cut the life line that millions of Americans use to stay afloat.  Equally importantly, we would endanger our fragile economic recovery by reducing the amount Americans spend on groceries, utilities and other basic needs.  A reduction in consumer spending would cause a direct negative impact on the economic recovery.  Goldman Sachs has estimated that if federal unemployment benefits are allowed to expire, growth would fall by half a percentage point.  An end to this vital safety net program would not only harm millions of Americans, it would also be counterproductive in spurring economic growth.

According to the U.S. Department of Labor, if Congress fails to take action, two million workers will lose their unemployment benefits this December.   Each month after that, over 1 million more would fall off the rolls, and by April 2011, 6 million workers would be without benefits.  When there is a single job for every five unemployed workers, ending federally funded unemployment insurance programs will only send more Americans on the path to poverty.  

We understand the fiscal concerns that arise when debating a continuation of unemployment insurance programs.  However, a broad spectrum of economists has stated that these benefits have a significant stimulative effect and a greater impact on gross domestic product than most other federal programs.  In fact, the Economic Policy Institute has stated that an extension of federally funded extended benefits would increase gross domestic product by 0.7 percent and save or create the full-time equivalent of 723,000 jobs.  A U.S. Department of Labor report, commissioned during the Bush Administration, has found that unemployment benefits during the most recent recession saved 1.6 million jobs per quarter, lowered the unemployment rate by 1.2 percentage points, and reduced the decline in gross domestic product by 18.3 percent.  Based on this information, now is not the time to end federally funded unemployment benefits.

Federally funded benefits will begin to expire on November 30th.  Due to the impending date, we request action be taken immediately to reauthorize these important benefits through December 31, 2011.  We thank you for your consideration of our request.  As we recover from the worst recession since the 1930s, we are committed to ensuring our constituents are able to properly provide for their families.    

                                                                        
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