99ers

The deficit reduction/debt ceiling agreement signed by President Obama contains no stimulus. No jobs bill, no extension of unemployment benefits. No relief for the people who have been unemployed for the longest. This is a problem because at the end of this year, existing emergency unemployment benefits are set to expire. Yet there are still millions of people who can’t find work because companies and the government are not hiring. So what will happen?

Once the emergency benefits that were part of the 2010 tax cut deal ends, anyone who’s in a given tier and still doesn’t have a job ceases to get a weekly, home saving, food providing, check. And anyone who loses their job after July 1st of this year will get 20 to 26 weeks, no more; regardless of how long it takes the economy to get back on its feet - and businesses and government to start hiring again. Millions of Americans will have no source of income, no way to pay their bills.

The Economic Policy Institute (EPI), a top nonpartisan think tank, estimates that the debt ceiling/debt reduction bill will end up costing the economy 1.8 million jobs by 2012. The deal does nothing to address chronic joblessness. According to EPI, the plan “not only erodes funding for public investments and safety-net spending, but also misses an important opportunity to address the lack of jobs.” Allowing the current spending cuts, in combination with the expiration of the payroll tax holiday and the cessation of the emergency unemployment benefits will lead to disastrous consequences.

The deal will lead to less growth, more unemployment, and more inequality. If jobs were plentiful and the unemployment rate was low these would not be pressing concerns, however, the job market is dismal. Unemployment benefits are one of the most effective ways to stimulate the economy because people without jobs spend most if not all of their money on bills, rather than save it. Approximately, 4 million people receive federally funded benefits that are scheduled to expire and another 2 million are in a position where their benefits have already ran out and need to be extended, the 99ers. Letting unemployment benefits expire could provide a hit to the economy when there is little, if any, economic growth.

So why is Congress on vacation? How do reasonable, responsible elected officials vote for and sign off on a deal that leaves 6 million Americans in peril?
Congress can fix this situation by ensuring that the “super committee” takes a look at job creation as a first priority. The Committee needs to produce a plan that creates jobs since their recommendations will be in conjunction with the already catastrophic spending cuts signed into law earlier this week.