The Unemployment Benefit Black Card

Tuesday, the U.S. Senate passed another Democratic multi-billion dollar legislative handout designed to temporarily alleviate the continuous financial burden hanging over the nation’s unemployed and fiscally irresponsible states.

Democrats–with six Republicans tagging along for the spending spree–swiped the nation’s Centurion Card to the tune of $140 billion, and went home with bags overflowing with goodies: subsides for health insurance, funds to prevent states from laying off public service employees, extensions of unemployment benefits, etc.

Senator Chuck Schumer–apparently now worried about the chattering class–patted himself on the back for a day’s work and proclaimed, “While our Republican colleagues on healthcare have been stonewall[ing], on jobs they know that they block us at their own political peril … and substantive peril as well.”

New York’s senior senator is entitled to his own opinion, but not his own facts.

This initiative can’t possibly be touted as a jobs bill when nearly 90% of the funds appropriated are unrelated to job-creation. Moreover, the Republicans who did cross party lines to support this measure, supported–what amounted to–another spending bill, and they might be doing that at their own political peril.

A Fox News poll from late February revealed nearly 80% of Americans believe government spending is out of control, and, earlier this month, Conservatives rallied behind Kentucky Senator Jim Bunning for exposing PAYGO as a fraud while Liberals plotted to borrow more money to extend unemployment benefits as opposed to using already available funds.

Granted, despite the public sentiment, many politicians don’t want to be associated with keeping food off their constituents’ tables, but, the unemployment benefit–along with home ownership and college education–has made its way onto the list of American entitlements.

While most people would prefer to have jobs instead of an allowance from Big Brother, they have become dependent upon the handout. Jerome Boyd, a 48 year-old father of four from Arlington, Virginia, recently stated, “I depend on this money. I’m wondering every other week if it is going to keep coming in or not. It’s stressful, and especially when you’re trying to look for a job, too.”

Rather than concentrating solely on job-creation, legislators have debated a manufactured-crisis and ignored the nation’s employment and economic problems for over the past year. Their only accomplishment on the jobs front has been the conversion of a once temporary benefit into charity that can be relied on for nearly two years.

How long can this last?

Neither the receivers of the benefits nor the legislators who continue to provide them seem to be aware of the states’ inability to fund this charity.

The Treasury Department’s 2009 Financial Report discloses the use of the Unemployment Benefit Black Card. The report not only shows that the ratio of unemployment fund cash outflow to cash inflow is 2:1, but also reveals that a number of states fail to meet the department’s standard of a minimum solvency ratio of 1–which determines each state’s ability to fund unemployment benefits. According to Chart 15 in the report (shown below), 21 states possessed insolvent unemployment funds, and 16 states had less than a year’s worth of benefits remaining in its coffers as of September 30^th, 2009.

This picture told a story that is now nearly seven months old, and we have no idea how much worse that story reads now.

Apparently, with the continued expectations of the unemployed and Tuesday’s vote, nobody cares.