Obama Aides Act to Fix Safety Net

Published on The New York Times, by JACKIE CALMES, Oct. 5, 2009.

WASHINGTON — With unemployment expected to rise well into next year even as the economy slowly recovers, the Obama administration and Democratic leaders in Congress are discussing extending several safety net programs as well as proposing new tax incentives for businesses to renew hiring.

President Obama’s economic team discussed a wide range of ideas at a meeting on Monday, following his Saturday radio address in which he said it would “explore additional options to promote job creation.” But officials emphasized that a decision was still far off and that in any event the effort would not add up to a second economic stimulus package, only an extension of the first … 

… As the White House and Congress proceed with discussions of what to do next, Congress is working to stretch unemployment compensation for people who have been out of work for up to 79 weeks, or a year and a half. The House passed a bill for 13 additional weeks of aid for jobless workers in the 27 states with unemployment rates of 8.5 percent or higher, but some senators want an extra 12 weeks of benefits available in all states.

With the safety net programs due to expire after Dec. 31, the White House and Congress have contemplated for some time that they would probably have to renew them.

Besides the extended unemployment and food stamp benefits, they would keep alive a subsidy for people who lose their jobs and opt for the Cobra program, which lets them buy continued health care coverage under their former employers’ insurance plans. The subsidy covers up to 65 percent of the insurance premiums for most workers.

As Democrats have found, aiding those who have lost their jobs is simpler than preventing more layoffs and creating new jobs.

“There may not be anything we can do,” said a Democratic Congressional leadership aide who spoke on condition of anonymity because he was not authorized to discuss the matter. “Under any circumstances, it’s going to take a while for jobs to recover.” (full text).
(John Harwood contributed reporting).

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