Advertisement
YOU ARE HERE: LAT HomeCollectionsFixme

The Jobless Need Help Now

March 15, 2004

In the movie "50 First Dates," Drew Barrymore's character wakes up each morning with no memory of what occurred the previous day. Every day she meets Adam Sandler and falls in love with him all over again. Critics found it dreadful.

Congress has been acting as if it suffers from a similar ailment, one that most economists find as horrible as Barrymore and Sandler's performances: Each session it forgets about the deficit, then embraces new tax cuts. But last Thursday, Congress started to take its critics to heart and step away from tax-cut delusions.

The Senate rebuffed President Bush's plans for making $1.7 trillion in tax cuts permanent, approving a "pay as you go" amendment. The measure would require that any new or extended tax cuts be paid for by reducing spending, raising taxes or otherwise garnering new revenue. Centrist Republicans Lincoln Chafee (R.I.), Olympia J. Snowe and Susan Collins (both of Maine) and John McCain (Ariz.) joined Democrats in backing the amendment. Sens. Pete Domenici (R-N.M.) and Lindsey O. Graham (R-S.C.) bailed out at the last minute under intense White House pressure. The amendment might not make it past a final House-Senate budget agreement, but it shows that the ground is shifting quickly.

The next step that lawmakers should take is to help keep the hope of real job growth alive by restoring the temporary unemployment benefits it allowed to lapse in December. The United States has lost more than 2 million jobs since Bush entered office. Though the unemployment rate has held steady at 5.6%, the number is deceptive. According to the Bureau of Labor Statistics, about 392,000 unemployed people quit looking for work in January. The overall size of the labor force has actually declined in six of the last eight months.

Once people drop out of the labor market, it's difficult to get them back. They increase the burden on social services and may end up in the underground economy -- which means they no longer pay many taxes. Economists say the unemployment rate would be more than 7% if those who had stopped looking for a job were included.

Temporary federal supplemental insurance helped the unemployed in previous recessions bridge the gap when they exhausted state benefits and hadn't found a new job yet. Such payments, unlike many of the Bush tax cuts, do stimulate the economy by pumping money to individuals who spend it immediately on basics like groceries and clothing. In January alone, Labor Department data show that about 350,000 unemployed across the nation exhausted their benefits. California has more than any other state, nearly 60,000.

Congress should not withhold temporary benefits that, because they come from a dedicated rainy day fund, won't even add to the deficit. Bush and his presidential rival, Sen. John F. Kerry (D-Mass.), can argue loftily about taxes and trade, but the unemployed need a helping hand now.

Advertisement
Los Angeles Times Articles
|
|
|