Obama: Unemployment Insurance Must Be Part Of Fiscal Cliff Deal

President Barack Obama speaks about the fiscal cliff as he takes questions from reporters, Wednesday, Dec. 19, 2012, at the W
President Barack Obama speaks about the fiscal cliff as he takes questions from reporters, Wednesday, Dec. 19, 2012, at the White House in Washington. (AP Photo/Charles Dharapak)

President Barack Obama warned Republicans in Congress not to let unemployment insurance expire for the long-term jobless at the end of the year.

During a press conference on Wednesday, Obama criticized House Speaker John Boehner's so-called Plan B proposal to hike taxes only on incomes above $1 million, a level far above that of the $400,000 stipulated in the president's most recent offer.

"The speaker is now proposing what he calls Plan B, so he says, 'Well, this would raise taxes only on folks making a million dollars or more.' What that means is an average of a $50,000 tax break for every millionaire," Obama said. "At the same time we are not providing unemployment insurance for 2 million people still out there looking for work."

The Ohio Republican's "Plan B," which Obama has promised to veto should it reach his desk, ignores impending reductions to unemployment insurance, along with a host of other scheduled spending cuts and proposed reforms to social insurance programs that have been at the center of "fiscal cliff" talks.

Federal unemployment insurance, which kicks in for workers when their state benefits are exhausted after six months, is scheduled to expire on Dec. 29. The National Employment Law Project, a worker advocacy group, estimates more than 2 million Americans will immediately stop receiving the benefits unless Congress acts.

Obama's comment Wednesday reflects the fact that the federal benefits have been a high priority for Democrats in recent negotiations over the fiscal cliff. The White House has proposed keeping the jobless aid through next year at a cost of $30 billion. Republicans have been almost silent about the benefits, which some observers take to be a sign that they won't put up much resistance to keeping the compensation in a final deal.

"We applaud President Obama for insisting that a year-end fiscal agreement include a renewal of federal unemployment insurance, and for making clear he will veto House Speaker John Boehner’s so-called 'Plan B' proposal for failing to include a reauthorization of federal jobless aid," NELP director Christine Owens said in a statement. "It would be truly and unbelievably cruel to push millions of unemployed job-seekers off this year-end cliff."

On Tuesday, congressional Democrats held their second press conference at the Capitol to demand a reauthorization of the long-term unemployment insurance, which lasts up to 47 weeks in states with high unemployment rates.

"This is the real cliff," Sen. Jack Reed (D-R.I.) said. "At the end of the year, 2 million people will be in financial free-fall unless we step up."

A nonprofit called the Philadelphia Unemployment Project traveled with dozens of laid-off workers to the Capitol, where three of the workers spoke about losing their jobs and their fear that they'd lose their economic lifeline next week.

"Unemployment benefits have allowed me to pay my mortgage and my car payment, auto insurance and utilities," said Tracy Mulvehill, a Philadelphia resident who lost her office manager job in March. "If I am still out of work by New Year's Day, I will lose my benefits, and that will cause me to lose my home and everything I've worked so hard for all my life."

A White House fact sheet on Boehner's proposal estimates that keeping lower marginal tax rates on earners' first $1 million, rather than just their first $250,000, amounts to a $50,000 tax gift to millionaires, compared with Obama's original proposal.

"That violates the core principles that were debated during the course of this election, and that the American people determined was the wrong way to go," Obama said.



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