Secretary of Labor Hilda L. Solis
Remarks for the Honorable Hilda L. Solis
Capitol Hill Press Conference
Extending Emergency Unemployment Benefits and Payroll Tax Relief
Wednesday, November 30, 2011
Thank you, Sandy. And thank you to all of my friends and former colleagues here in the House for the invitation to join you for this critical press conference.
The clock is ticking. We have one month. In 31 days, time will run out on millions of Americans who are counting on Congress to extend their unemployment benefits and millions of workers who can't afford to see their payroll taxes go up. With so many working families hurting, we cannot afford to cut their lifeline. By helping these families, we're also helping our economy recover and grow.
Economists from both the left and right agree that we need to extend unemployment benefits and avoid a disastrous payroll tax increase. Five million Americans will lose their unemployment benefits next year unless Congress acts. Some lawmakers say that we cannot afford to extend unemployment benefits and payroll tax relief in the current fiscal environment. But I say we can't afford not to.
Two federal programs Emergency Unemployment Compensation and Extended Benefits have been a lifeline to 17.6 million Americans since 2008. If you factor in their family members, these benefits have helped provide basic necessities to 50 million people including more than 12 million children.
Unemployed workers typically qualify for up to 26 weeks of benefits. In an economy with normal labor demand, most workers can find a job within this time frame. But in periods of high unemployment, the federal government has always embraced its duty to provide additional support.
In every recession since 1957, Congress has created special programs to extend unemployment benefits. In recent history, extensions have lasted 2 to 3 years after the official end date of a recession. Extending unemployment benefits kept 3.2 million Americans out of poverty last year alone, according to the U.S. Census bureau.
A year ago, the President reached a bipartisan compromise that kept 7 million Americans from losing their benefits. If the Republicans do not join hands with us again, it will mean fewer dollars flowing to local grocers, gas stations, retailers and small businesses. It will mean more small businesses unable to make payroll. It will mean more layoffs. It will mean higher levels of unemployment, slower economic growth, and a more sluggish recovery.
We've made steady progress in our economic recovery, but there's much more to be done. There are still millions of Americans looking for work. There are still more than 4 unemployed people for every job opening. These are the everyday heroes of our recovery. They spend all day, every day, filling out applications, sending out resumes and looking for work. Now is not the time to turn our backs on them. They deserve better. They deserve action.
And Congress must act quickly. The crisis is going to evolve rapidly next year in the absence of an extension. By February, emergency UI benefits will be cut off for workers in all 50 states. By the end of March, more than 3 million workers nationwide will have lost out. This will mean all sorts of disruptions and additional administrative costs to the Unemployment Insurance system.
We know that during the 7-week delay last June and July in extending UI benefits, states faced huge burdens. Putting money into the pockets of unemployed workers will be good for state economies that are already suffering and it will help the economy as a whole.
As we fight for an unemployment insurance extension, we must also fight to persuade the Republicans to support payroll tax cuts to help middle class workers. If they fail to extend the current payroll tax cut, taxes will go up on millions of middle class workers at the worst possible time. Failure to act means a typical household making $50,000 a year will see their taxes increase by $1,000. Private sector forecast say adopting the President's payroll tax cut proposal vs. letting taxes go up for workers could mean the difference of 600,000 to 1 million jobs next year.
It's outrageous that this has become a partisan issue. Republicans like to think of themselves as the party of tax cuts. Most have sworn an oath to never raise taxes on anyone for as long as they live. Are they really willing to break that oath now and raise taxes on the middle class just to play politics? Let's hope not.
Lawmakers should do their sworn duty and act now to help our nation's unemployed, our middle class workers and our economy as a whole. Thank you.