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Nearly One Million US Workers Cut Off Unemployment Benefits

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With 12 Democrats joining a unanimous Republican bloc, the US Senate voted Wednesday to defeat a proposed extension of unemployment benefits for workers who have been jobless for nearly two years. The bill would have extended unemployment benefits for those out of work more than six months, until November 30.

In the two and a half weeks since June 1, when the last extension expired, some 903,000 workers have seen their benefits cut off. By June 26, that number will top 1.2 million.

Meanwhile, the Labor Department reported that the number of new claims for unemployment compensation jumped to 472,000 last week, the highest figure in several months.

The result is that a Congress that rushed through a $700 billion bailout of Wall Street in October 2008 in a matter of days, and authorized a further financial windfall to the banks and speculators five months later, cannot bring itself to support even the most meager subsistence for the unemployed workers who are the victims, not the perpetrators, of the economic crisis.

The vote was taken under Senate rules, not to pass the legislation itself, but to "waive budgetary discipline" and allow passage by a simple majority rather than 60 votes out of 100. The result was 45 in favor and 52 against, with three senators absent. Senate Majority Leader Harry Reid had already abandoned an effort to adopt a cloture motion, closing debate, for lack of the necessary 60 votes. Three months ago a similar extension bill passed the Senate easily.

The unemployment extension is part of a larger bill that includes additional aid to state governments to cover Medicaid, the healthcare program for the poor, and to offset a potential 21 percent cut in reimbursements to doctors who treat Medicare patients.

The House of Representatives passed a version of the bill May 28 costing $113 billion, but without the Medicaid assistance to the states. The Senate version includes the Medicaid support, and costs a total of $140 billion, which sparked the unanimous no vote of the Republicans, as well as the opposition of the 12 Democrats, mainly conservatives, but including liberals like Russ Feingold of Wisconsin.

According to press reports, leading Senate Democrats are seeking to win votes from the bill's opponents by eliminating a $25 a week increase in jobless benefits that was part of the 2009 stimulus package. In other words, either all 10 million jobless workers would see a $25 cut in benefits, from checks averaging $309 a week, or benefits for the 5.7 million long-term unemployed would be cut off completely. Either way, those deprived of work by the economic crisis of capitalism, the most vulnerable section of the working class, will be made to pay.

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One of the dozen right-wing Democrats who voted against the bill, Senator Ben Nelson of Nebraska, reiterated his opposition to Capitol Hill reporters. He cited concerns about the federal deficit, after rejecting a new version of the bill that would cost $20 billion less.

"Borrowing and deficit spending at the point of an economic crisis--and we were in a severe one in late 2008 and early 2009--is one thing," Nelson said. "But when you're in an economic recovery, as we are today, borrowing and deficit spending is another thing."

Another Democratic "no" vote, Senator Mary Landrieu of Louisiana, told Fox News through a spokesman that she was particularly opposed to a provision in the bill that would have raised taxes on the oil and gas industry from 8 cents a barrel to 49 cents, raising $18.3 billion to replenish the Oil Liability Trust Fund.

Besides the oil industry tax, there is enormous business opposition to a proposed increase in the tax on the compensation of hedge fund managers--much of it currently taxed not as income but at the much lower capital gains rate--as well as a tax increase on investment partnerships. Lobbying against this provision was said to be especially heavy on the part of companies like Blackstone.

A Republican alternative, introduced by Senator John Thune of South Dakota, would have extended jobless benefits and selected tax credits for business, but at the price of a 5 percent across-the-board cut in all federal discretionary spending (with the military-intelligence apparatus excluded, of course). This was defeated by a 41 to 57 margin.

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Big business politicians of both parties have expressed their disdain for the unemployed, suggesting that extended unemployment benefits, now set at 99 weeks, are encouraging jobless workers to stay home and not look for work. Georgia Republican Congressman John Linder said that extended benefits were "too much of an allure."

Senator Diane Feinstein, a multi-millionaire Democrat from California, complained, "We have 99 weeks of unemployment insurance. The question comes, how long do you continue that before people just don't go back to work at all?" California has a 12.6 percent unemployment rate, with 880,000 workers unemployed for 27 weeks or more, and receiving extended benefits.

Senator Claire McCaskill, a Missouri Democrat with particularly close ties to the White House, voted against the unemployment extension and backed the $25 a week cut. "This is not something that can go on indefinitely," she said. Otherwise, "it begins to look like a brand-new level of entitlement program, which is something that we really can't afford to do right now."

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Patrick Martin writes for the World Socialist Website (wsws.org), a forum for socialist ideas & analysis & published by the International Committee of the Fourth International (ICFI).

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"While the treatment of the unemployed is the most... by Aurora on Monday, Jun 21, 2010 at 2:20:47 AM
.. is that when money is directed to the already-w... by Aurora on Monday, Jun 21, 2010 at 3:19:19 AM
You apparently do not understand basic difference ... by TomK on Monday, Jun 21, 2010 at 1:56:13 PM
Manymembers of Congress, in particular, oppose aid... by Aurora on Monday, Jun 21, 2010 at 2:31:56 PM
Paul Krugman, yes I know him well.Paul is a classi... by TomK on Monday, Jun 21, 2010 at 6:19:36 PM
.. and is still racing out: http://costofwar.com/... by Aurora on Monday, Jun 21, 2010 at 11:57:36 PM
You can check out the cost to your ownstate.Or, sa... by Aurora on Tuesday, Jun 22, 2010 at 1:02:57 AM
Excerpts:Meanwhile, most of the world's people rea... by Aurora on Monday, Jun 21, 2010 at 2:52:26 PM