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33 States Out Of Unemployment Money

From CNN’s Money.Com:

33 states out of money to fund jobless benefits

By Hibah Yousuf, staff reporter

April 8, 2010

NEW YORK (CNNMoney.com) — With unemployment still at a severe high, a majority of states have drained their jobless benefit funds, forcing them to borrow billions from the federal government to help out-of-work Americans.

A total of 33 states and the Virgin Islands have depleted their funds and borrowed more than $38.7 billion to provide a safety net, according to a report released Thursday by the National Employment Law Project. Four others are at the brink of insolvency.

Debt-challenged California has borrowed the most, totaling more than $8.4 billion, followed by Michigan and New York, which have loans worth more than $3 billion. Nine other states have borrowed at least $1 billion from the federal government.

"The nation’s financing system for jobless benefits is under unprecedented stress," said Andrew Stettner, deputy director of the New York-based advocacy group for the unemployed. "While the recession has certainly made things worse, this funding crisis has been developing for years."

At the onset of the recession, only 19 states met the recommended funding level, which is one year of reserves equal to the highest amount of unemployment insurance paid out during prior recessions

Federal and state governments collect money for unemployment benefits by taxing employers on a small portion of their employee wages. While total wages and weekly jobless benefit levels have been rising, governments haven’t increased the taxable base wages at the same pace.

Instead, they adopted a "pay as you go" approach, keeping taxes and fund levels low during good times and raising taxes and cutting benefits when strapped for cash. That left many states with insufficient jobless funds to weather the recession.

Of the 13 states that will likely be able to fund jobless benefits without borrowing from the feds, 10 of them followed the recommended financing tactic. That readied them for the recession, the National Employment Law Project concluded in its study.

"The current crisis should compel policy makers to forge a new path to forward financing of the unemployment insurance program," Stettner said. "As the broke funds of 33 states makes clear, unemployment insurance reserves need to be stocked up before recessions hit so that states are prepared."

Obviously this is just a press release from the National Employment Law Project, a “New York-based advocacy group for the unemployed.”

And just as obviously they and CNN want to use this ‘crisis’ as a way to increase taxes still more.

(They complain that the unemployment tax didn’t go up at the same rate as wages. But aren’t they a percentage of the wages?)

But still. It is quite sobering to see so many states on the brink of not being able to pay unemployment benefits.

Especially since the recession has been over for such a long time now.

This article was posted by Steve on Friday, April 9th, 2010. Comments are currently closed.

13 Responses to “33 States Out Of Unemployment Money”

  1. Right of the People says:

    Maybe the Dimocraps should dip into their 770 Billion dollar slush fund, AKA TARP, and help these poor states out.

  2. Liberals Demise says:

    But………….the recession is receding…………..It’s over!!
    DingleBarry says so!!

    • JohnMG says:

      Well, LD, we can’t ALL have gub’mint jobs. Sumbody gots ta pay TAXES.

      Tag: You’re (an’ the rest of us) it!

  3. U NO HOO says:

    let me think, well try to think, 26 weeks was the norm, then they went an additional 13,…up to a total of 99 weeks and we’re broke?

    Gollleeee Sgt. Carter.

    Sham Wow, i’ve fallen into debt and i cantst get up…

  4. mr_bill says:

    Isn’t that convenient, the feds vote for (unprecedented) unemployment extensions and the states have to pay for it. Now the states can’t pay for it and borrow from the feds. I think its worth noting that the 3 most liberal states are the biggest borrowers (New York, Michigan, and California) – liberalism in action.

    The Congress keeps heaping unfunded mandates on the states, they did it with the porkulus bill, obummercare, unemployment. There are only a few forseeable outcomes to this kind of policy: states become bankrupt, federal bailout of the states (with increased federal control and elimination of states’ rights), or complete collapse. WHY would anybody do the things our Congress is doing unless they wanted these outcomes? The answer is crystal clear.

    • Rusty Shackleford says:

      All ruggedly by design. Fed money=Fed control. It’s really not that hard, mathematically speaking.

  5. U NO HOO says:

    Wait until college students can’t get government loans because Obama’s er China’s stash is empty and file for unemployment because they are under 26 and don’t have to work and…

  6. Howard Roark says:

    Lest we forget, the Cloward-Piven strategy calls for the destruction of capitalism by overwhelming the government bureaucracy with impossible demands for more resources, resulting in economic crisis, chaos, and the collapse of society.

    Everything here is happening according to design. Barry distracts us for the past 15 months with health care hysteria while the states are sucked dry of funds, causing massive needs for further bailouts.

    Next, it will be amnesty. Then gays in the military. After another 18 months of ignoring the elephant in the room (jobs), Barry will indignantly claim that "the private sector isn’t living up to its pledge", and start the campaign to seal the coffins of employers (claiming they aren’t providing insurance for all possible needs, that they aren’t providing a living wage for all of their employees, that they don’t offer enough "flex time" to single mothers, etc.) with only a year left in his presidency.

    Once he thinks the Americans are broken and despirited enough, he will then ride in on a white horse, promising the rescue we’ve all been needing: gov’t takeover of the rest of our economy. He knows we’re still holding on for dear life right now (witnessed by the growth of the Tea Party, loud town hall meetings, etc), so, you see, it isn’t quite the right time, just yet.

    King George had a tin ear when it came to taxing the colonists to pay for England’s wars, and we saw how a small group of patriots began to teach him a lesson the world wouldn’t forget. Barry has listened well to his Alinsky-ites for proper navigation past those gritty, stubborn, flag-wavers he so detests. "Let them stew a bit longer. Then they’ll be begging me for relief."

    I am refusing to fall in line. I am moving next week for greener pastures. Eighteen months of this Florida joblessness has hurt, but hasn’t broken me. I have been living hand-to-mouth, surviving on anything I could find from house repair to car detailing to computer repair, but none of it was a steady income. Thank God I didn’t have any kids at my age of 42. If it hadn’t been for the fact that my fiance’ is from here, living with her mom (who needs her rent every month), I would have been GONE when it all began. As it is, she is very ready to go, now. We leave in a few days and I can’t wait.

    • proreason says:

      Smart move HR. Good to hear from you again. It’s hard to stay optimistic…..but you have to.

      Good point on Cloward-Piven. We have to keep in mind that much of what they do is smoke and mirrors. The ultimate objective is to collapse the country and suck it dry. Your reminder was helpful.

      Consider keeping an address in Florida since your vote might be more valuable there than in some western state that is a lock for the good guys.

    • Howard Roark says:

      Thank-you, PR. I’m glad to be back here among friends. A bit of despair crept into my heart for the last year, but things are looking up. Would you believe that I’ve already been receiving phone interviews from IT staffing firms from where we’re going? Just got through filling out paperwork for background, credit checks, and it looks like I’ve already got a job waiting on me! It’s part time for now, but I’m not complaining. It’s a blessing and an open door. Onward and upward.

      I DO so wish I could keep a Florida addy, but, alas, it just wouldn’t play well for all of the paperwork I need to complete for where we’re going. I’m telling everyone I know down here to vote against Crist and for Rubio as I go.

    • Right of the People says:

      HR keep up the good fight, the Dimocraps can’t win if we don’t let them. Let’s take this sucker back.

  7. MinnesotaRush says:

    Well, whatta ya’ mean, outta money!?!?

    That new “Miller Jobs Bill” is going to flood 70 billion into the “save the jobs” field. Use some of that!

    Oh yeah! That’s just for the gubmint jobs. Never mind.

    $70 billion just don’t go too far these days, ya’ know.

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