As the deadline to approve the payroll tax cut extension looms 10 days away, White House officials are speaking out to urge Republicans in the House of Representatives to approve the measure that only days ago was hailed as a bipartisan compromise when it passed in the Senate. However, the White House says Republicans have now changed their tune.
National Economic Council Director Gene Sperling spoke to reporters on a conference call today on why the White House feels it is so urgent that this extension passes, highlighting the importance of continuing the unemployment insurance benefits.
“This is critical to millions of working families and it is critical to our economy and job growth as well,” he explained. “To understand how important it is for the House of Representatives to immediately agree to the bipartisan Senate compromise, one should know that by the week ending January 14, 697,000 Americans who are unemployed and still out pounding the pavement looking for work to support heir families will be abruptly cut off of unemployment insurance and lose their benefits… By the week ending March 3, 2.66 million Americans out pounding the pavement out looking for work will see their unemployment benefits cuff by no fault of their own.”
U.S. Department of Labor Secretary Hilda Solis also weighed in on why she thought the Republicans withdrew of support for a measure their leader had just approved, saying, “The Tea party is throwing the Senate bipartisan compromise over the side of the boat” to the detriment of American workers.
Consumerist asked how extending unemployment benefits will help job growth, as the White House Council of Economic Advisers says failure to pass the extension will harm that job creation.
“What the congressional budget office and other economists understand is that nobody lives check-to-check more than a family who is struggling through unemployment, and so that unemployment check is used right away for for the basic necessities of life –food, rent, clothing, healthcare,” says Sperling. “So it not only is a lifeline to the families that are still struggling to find jobs, it is money that goes into the economy right away, every dollar virtually, and that leads to more demand, for services, more customers and more small business shops, and ultimately that leads to more growth and more hiring when you’re still trying to get your economy back to full strength.
Adds Solis, “Each additional dollar that is extended through unemployment insurance benefits, it generates two additional dollars.” She points to last January’s growth in the job market as a result of extending the payroll tax cuts and unemployment benefits in December 2010.
“As a result of those measures we know that it works as a stimulant to help stir and motivate the economy,” she explains. “They do spend that money, they need it now, because they continue to be attached to the job market, they spend that money to put gas in the car and go find jobs.”