Senate Democrats are proposing to reinstate unemployment benefits that expired on February 28 as part of a $150 billion measure intended to boost the economy.
The legislation would spend $81 billion to extend the unemployment benefits, including so-called Cobra subsidies to help the jobless buy health insurance, for the rest of this year. It also would send $25 billion to state governments to help prevent layoffs.
Jobless benefits for thousands of Americans expired after Senator Jim Bunning, a Kentucky Republican, blocked a one-month continuation designed to keep checks from being interrupted. Bunning complained that the $10 billion cost would be tacked onto the $1.6 trillion budget deficit. “I am exercising my right as a senator duly elected from Kentucky to object,” Bunning said as Democrats tried again to pass the short-term extension.
About 400,000 people will lose unemployment benefits in the next few weeks if Congress doesn’t act, according to the Department of Labor. The agency also estimated that 500,000 Americans will lose access to Cobra by the end of this month. The program allows the jobless to buy health insurance through their former employer, with the government paying 65 percent of the cost.
The Transportation Department said it was putting 2,000 employees on furlough because highway money included in the legislation blocked by Bunning was being delayed.
Senate Finance Chairman Max Baucus, a Montana Democrat, said the need for the bill was “urgent” and that it would “put cash in the hands of Americans who could spend it quickly, boosting economic demand.” It would provide unemployment benefits retroactively to March 1.
The Senate aims to send the bill to the House for approval this week or next.
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The measure includes provisions unrelated to job creation, including a $7 billion plan to prevent, for seven months, a 21 per cent scheduled cut in Medicare reimbursements to doctors.
The bill would also extend a package of miscellaneous tax cuts, including a $1-per-gallon tax credit for biodiesel fuel and a $6.6 billion credit promoting corporate research and development programmes. It would also temporarily ease corporate pension-funding requirements.