How Bad Is It?
33 states out of money to fund jobless benefits
"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.
Financing experts suggest that states build up their jobless benefit coffers during strong economic times so that they can draw from them during downturns."
"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.
Financing experts suggest that states build up their jobless benefit coffers during strong economic times so that they can draw from them during downturns."
If anybody thinks this money is ever going to be paid back, they're crazy. There's zero chance of fattening any coffers because we're never going to see "strong economic times" again. And just when is the MSM going to drop this idiotic "recession" talk and call it by it's truthful name?
posted by nolocontendere at 4:54 AM
3 Comments:
They could end the war on drugs and use the billions allocated to the DEA every year to fight it. But then that would put a lot of drug warriors out of jobs, I spose.
Way too sensible nick!
I have been out of work for over 2 years, and my unemployment benefits have run out. My younger brother who worked for 16 years with a large SF Bay Area bio-tech firm in their manufacturing operations has also been unable to find a full time job for several years, he had had one in person interview in 2009.
There are hundreds applying for each job, so one is lucky if one even gets invited for a first round screening interview.
There were only 4 employers who participated at a tech jobfair in Silicon Valley in january, last week there was another tech jobfair and there were now finally 9 employers but the lines were stll incredibly long for the few open positions and most openings were for highly specialized engineering positions.
I have finally managed to get a part-time job with the US Census that only lasts 8 weeks. After that, I'll be looking at having to move in with friends or live in my car.
What's happening to me and my brother is happening all over the place across all segments. Even low wage hourly jobs are almost non-existent.
What's happened is that in California and I think in many other states, the conservative pro-business interests have succeeded in getting their tax rates cut and in getting loopholes written so they pay less taxes than the middleclass. So the states are screwed because those tax revenues from the wealthy and corporations accounted for probably 20 to 40% of the incoming tax revenues, thereby bankrupting states in the event of an economic downturn.
I see no signs of the economy turning around, no increased hiring except for the US Census. the wealthy have finally started buying stuff because "it wasn't cool to spend" and they had stopped out of sympathy with those who were effected, not because they suffered losses.
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