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Tuesday, December 11, 2018

Eight Reasons Why Extending Unemployment Benefits Will Boost the Economy

Unemployment insurance will keep families — and our economy — afloat.

In the aftermath of the super committee’s collapse, Democrats are going to have to fight to get unemployment insurance benefits extended. This is one of many “orphan programs” left behind that are set to expire at the end of the year. Since it looks like there is going to be a debate over whether or not to extend the benefits, what can we say with certainty about the costs and benefits of extending unemployment benefits?

1. Even considering the cost, unemployment benefits are a deal. Extending unemployment benefits would cost around $44 billion for one year. (Source: CBO.) Specifically, “CBO estimates…$44.1 billion would stem from the one-year extension of EUC and EB provisions. That extension would allow people who exhaust their regular unemployment compensation during calendar year 2012 to receive up to 53 weeks of EUC, and would make it easier for states to provide up to an additional 20 weeks of benefits under EB (depending on the states’ laws and unemployment rates).” Given that interest rates are so low, and real interest rates are even negative, this is a great value.

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