For Immediate Release: December 12, 2011

House bill cuts federal UI benefits, stigmatizes joblessness, penalizes workers with least education

The House of Representatives today is scheduled to review a bill introduced by Rep. Dave Camp (R-MI) that puts ideology before the broader needs of the public, CLASP, the Center for Law and Social Policy said today.

While the bill extends the payroll tax deduction, it limits the availability of federally funded unemployment assistance, includes punitive provisions for the least skilled jobless workers and inexplicably ties needed UI benefits and payroll tax reductions to permits for the Keystone pipeline.

Current law provides federal unemployment insurance benefits for up to 99 weeks, depending on the pervasiveness of unemployment in the state. The so-called Middle Class Tax Relief and Job Creation Act of 2011 reduces this to a maximum of 59 weeks in hardest hit states.  Such a move fails to consider the weak jobs market and the harm reducing unemployment benefits would inflict on families and the national and local economies. Unemployment has been above 8 percent since April 2009, and the percent (43 percent in November 2011) of unemployed workers who have been without a job for six months or more has remained at record levels for 31 months.

"Reducing workers benefits does not solve the long-term unemployment crisis," said Neil Ridley, a CLASP senior policy analyst. "It is illogical to reduce benefits at a time when long-term unemployment has broken records and is setting new ones."

The bill also includes provisions that would reduce access to and stigmatize those who receive unemployment insurance. It denies unemployment insurance benefits to the most vulnerable workers, those without a high school diploma or GED, if they can't demonstrate they are enrolled in a program leading to a credential. Workers with less than a high school diploma are unemployed at significantly higher rates than workers with a bachelor's degree (13.2 percent v. 4.4 percent).

"There certainly is an argument to be made that more workers need to complete high school and earn postsecondary credentials," Ridley said. "But establishing a blanket policy that denies unemployment insurance benefits to low-skill workers, who have lost their jobs and would otherwise be eligible, just because they don't have a high school diploma and without ensuring they have access to education opportunities is punitive and misguided."

The bill also allows states to require drug testing as a condition of receiving unemployment insurance, a condition that is highly controversial and likely unconstitutional when imposed on all applicants or recipients.

"Drug testing unemployment insurance recipients is part of a strategy of blaming the jobless for their predicament, rather than economic conditions," said Elizabeth Lower-Basch, CLASP Senior Policy Analyst.  "It's an insult to unemployed workers - and a massive waste of taxpayer money - to test millions of people for drug use with no reason other than stereotype to believe they are using drugs."

Finally, the bill includes provisions that would restart the Keystone pipeline project, alter environmental regulations and auction broadband spectrum. President Obama has said he will veto the measure and Senate Majority Leader Harry Reid has said the bill with Keystone in it "wastes valuable time because it will not pass the Senate."

On Dec. 31, federal unemployment insurance benefits are set to expire, which means nearly 2 million will be cut off from unemployment insurance early next year if Congress doesn't act within the next 19 days. Lawmakers should not make an extension of unemployment assistance contingent upon other political demands. They should heed the immediate needs of their constituents who are worried about how they will meet their basic needs if they can't find a job and lose their unemployment insurance, and they should pass a clean bill that extends unemployment insurance and the payroll tax cut, vital lifelines for families struggling in this tough economy.  


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