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As Congressional leaders publicly duke it out over the extension of a payroll tax holiday, concern is growing behind closed doors over an expiring measure that could be even more politically explosive: unemployment benefits.
The optics of letting unemployment insurance fall to the wayside could be just as troublesome — if not more so — for both parties as the expiration of what amounts to a $1,000 tax break for about 160 million American workers.
But the path forward on jobless benefits is hardly clear. Many Republicans in both chambers are pushing for at least some tweaking of the current system. Others still are seeking a more comprehensive overhaul of the package, while a handful would be content to simply extend the current law. Both parties are concerned about how to pay for the benefits while also paying for a litany of other sun-
setting bills, from tax extenders to the Medicare “doc fix” and the payroll tax cut.
With unemployment hovering around 9 percent and the holidays approaching, both parties seem to be in a holding pattern waiting for the other chess players to make their moves before divulging the entirety of their strategies — or at least strategies that actually chart a course toward compromise.
“Members at every level are talking all the time, but right now there’s not a sense yet of a real path forward,” one Senate Democratic aide said.
On Tuesday, Senate Majority Leader Harry Reid (D-Nev.) stressed the urgency of getting unemployment benefits extended, threatening to keep his Members in Washington, D.C., until Christmas if that’s what it takes to reach a deal.
“The jobless benefits, we have to do that. It’s really important. There are two things that will really hurt the economy if we don’t do them, extending the payroll tax cuts and extending the unemployment compensation,” Reid said.
As part of their big, bundled year-end offering, House Republicans are planning to include a reform of the system that would essentially give grants to states. Such a move could give states leeway to use the money intended to go to unemployed workers to pay back overall budget deficits. While Democrats would undoubtedly balk at such a measure, any one Republican Senator, such as South Carolinian Jim DeMint, could block a bill that doesn’t include those kinds of
changes to the program.
Asked whether he would block a straight extension of current jobless benefits, DeMint said he would wait to see how the Senate proceeded on the measure, but that he would certainly vote against it.