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December 07, 2010

About the Unemployment Insurance Extension

I've been seeing this error in media reports and the blogosphere all day, particularly from folks like Hugh Hewitt complaining about the absurdity of 13 more months of "paid unemployment" tacked onto the existing 99 weeks, so just as a point of clarification:

The tax deal would extend the federal unemployment payments scheme for another 13 months. It would not add 13 months of payment eligibility to the current 99 weeks authorized by federal law. I agree with Hewitt that 161 weeks of unemployment insurance would be absurd. Fortunately, that's not part of the tax cut deal.

Some unemployed are eligible for unemployment insurance benefits. First come 26 weeks of state benefits. Then, if the individual is still unemployed, he may apply for federal benefits. These federal "extensions", referred to as "tiers", get progressively shorter from 20 weeks at Tier 1 to 6 weeks at Tier 4. Then come 20 weeks of "Extended Benefits" which were tacked on by Obama last year. When an individual finishes his 20 weeks of Extended Benefits, he can't get any more federal unemployment assistance. The 99 weeks number comes from adding up the state benefits, plus the Tiers and EB.

However, the program was not funded past this month. The funding scheme was set up so that individuals can finish receiving assistance for whichever tier they are on, but cannot apply for the next tier after November 30. EB payments are to halt completely on December 12.

The Tax Cut Deal:
The deal provides:

The framework agreement extended unemployment benefits at their current level for 13 months, through the end of 2011. This will save millions of Americans searching for work from losing their unemployment benefits in the coming months and will help create hundreds of thousands of jobs.

Setting aside the puffery in the second sentence, this says that the unemployment scheme I described above will be continued until January 2012. In other words, individuals will still get their four tiers and EB payment, if the deal passes Congress. That's 99 weeks, in accordance with federal law.

It does not say that the EB payment or the Tiers are getting lengthened or that another type of extension (Extended Extended Benefits?) is being added to the scheme. Rather it says, the benefits will continue "at their current level" for 13 months.

Here's some background on unemployment insurance that describes the scheme and its imminent expiration.

So far, the Hill, OpenCongress, and Las Vegas' KTVN have correctly described the unemployment insurance extension. Other media, including CNN, ABC News, and Fox News keep incorrectly reporting that the unemployment insurance extension in the deal will add 13 months of coverage to the existing 99 weeks.

Incidentally, I'm probably being too hard on the folks, including in the media, maybe, who didn't understand this proposal. Obama's own description of it was ambiguous. For example, at the press conference today, right after the "hostage-taker" slur, he said "There are people right now who, when their unemployment insurance runs out, will not be able to pay the bills."

A plausible interpretation of that sentence is that "when their 99 weeks run out, they will not be able to pay the bills." This interpretation implies that the tax cut proposal will extend the 99 weeks.

Though plausible, that is not the correct interpretation. Rather, he means "when their state unemployment insurance runs out or their Tier 1 benefits or Tier 2 benefits run out, they will not be able to pay the bills because they won't be able to apply for federal jobless insurance or Tier 2 benefits or Tier 3 benefits, etc., respectively."

He doesn't say it that way because, obviously, it's not very pretty, and more importantly because he gets political points for sounding like he's even going to help the folks who have run up against the 99 weeks.

Is there hope for the 99ers, as they're now being called? Not on the horizon:

Administrator Cindy Jones says the deal announced Monday would only continue the 99 weeks of eligibility for another year, not extend benefits to those who've reached that threshold.

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posted by Gabriel Malor at 05:45 PM

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