Federal jobless benefits, even after they were extended to 99 weeks, start running out this week. Some states supplement the federal unemployment insurance, so the actual numbers who will have no income is difficult to determine. Federal officials, however, estimate the number will easily reach 2 million within a few months.
Extensions of the insurance have been proposed several times, but each time, they have been blocked by congressional Republicans. They now say that they will consider no plan to help the jobless until the Bush tax increases are delayed for all income levels. The delay — and the GOP’s refusal to provide relief for the long-term unemployed — are necessary to reduce the deficit and create jobs, Republicans insist.
But the opposite may be more easy to justify. If 2 million checks are stopped, retail sales will reflect it, and we can expect a spike in foreclosures of both homes and retail commercial properties. And if tax cuts for the super-wealthy are continued, tax revenue will continue to lag, which is hardly a way to cut the deficit.
Who will be hurt most? People at almost all income levels from the upper-middle class on down will be affected. But hardest hit will be young people, blacks, Latinos and older people not yet old enough to collect other benefits.[Photo Courtesy Franklin D. Roosevelt Presidential Library and Museum]