Chuck Schumer: Unemployment Is 'Sticking Point' In Payroll Negotiations

Unemployment Is 'Sticking Point' In Payroll Negotiations, Schumer Says

WASHINGTON -- Congress hasn't reached a deal to prevent the take-home pay for every American from shrinking 2 percent come March because Republicans will not agree to renew unemployment insurance as part of the payroll tax cut deal, Senate Democrats said Tuesday.

"The emerging sticking point in the discussions on the large package is whether the Republicans were serious or not about extending help to those who are looking for work in this tough economy," Sen. Chuck Schumer (D-N.Y.) told reporters at the Capitol Tuesday. "If the benefits are not continued...3.1 million Americans will be cut off from the program in the next three months."

Federal unemployment insurance kicks in when workers use up state-funded jobless pay, which typically lasts 26 weeks. But federal unemployment programs, along with a 2 percent Social Security payroll tax cut and a pay boost for doctors who see Medicare patients, are set to expire at the end of the month.

Republicans want a number of reforms to the unemployment system. A Republican bill that passed the House in December would shorten the maximum duration of combined state and federal compensation from 99 to 59 weeks, allow states to drug test claimants, and deny benefits to claimants who do not have a high-school level education. A bill introduced by Senate Republicans last week would require the jobless to volunteer 20 hours a week in order to be eligible for federal benefits.

Senate Democrats have said they want the maximum duration of benefits reduced to 93 weeks -- even though legislation that Democrats supported in December has already set in motion a gradual reduction of benefits to 79 weeks over the course of this year.

Schumer suggested Democrats may be willing to compromise on some elements of the unemployment system, but he declined to be specific.

"Obviously there are negotiations going on about what form [unemployment insurance] should take, but I'm not going to get into those details now," Schumer said. "[Republicans] have all kinds of changes to UI and many of those changes are very unfavorably regarded by our caucus."

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Republicans in the House of Representatives said Monday they would be willing to handle the payroll tax cut separately from the unemployment insurance and other items, a development Schumer hailed as a retreat. He emphasized that Democrats have the upper hand in unemployment.

"The issue of unemployment benefits has already put the Republicans on the defensive," he said. "I remember in 2010, my old friend Jim Bunning, who used to have the office next door to me, being chased in and out of elevators in the Hart building when he held up unemployment benefits. It was an ugly couple of weeks for the Republicans, and their retreat there was reminiscent of their retreat yesterday on the payroll tax."

In February 2010, Bunning blocked a reauthorization of federal jobless benefits very similar to the one on the table right now. Members of his own party pleaded with him to relent; he said "tough shit" on the Senate floor, complained the debate caused him to miss a college basketball game, and flipped off ABC News as he boarded a Senate elevator.

But within a couple of months, the entire Republican party had adopted Bunning's hard-line opposition to renewing jobless pay without offsetting its cost with budget cuts or new revenue. A reporter pointed out to Schumer that after the Bunning blockade, congressional standoffs caused benefits to lapse four times and that Republicans were unafraid of the backlash.

"It is our view that given the depths of the recession," Schumer said, "given that so many people are out of work for a long period of time -- that so many middle class people, people's friends, neighbors, relatives, have lost work and need to be able to sustain their mortgage payments, college payments, etc. -- [blocking unemployment] is going to weigh very heavily on the Republicans."

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