The recent standoff in Congress over how to extend the payroll tax cut and emergency unemployment insurance was nothing short of ridiculous.
Publicly, both Democrats and Republicans portray this as a debate over the length of time to extend the payroll tax cut. However, these publicized debate parameters mask a fight of much greater significance. While the public’s focus is distracted by arguments over the time frame, Democrats and Republicans are negotiating sweeping reforms to the unemployment insurance system.
These reforms would slash the period of eligibility from 99 weeks to 59 weeks, would make it easier for employers to deny benefits by terminating employees rather than laying them off, would make people without a high school diploma or GED ineligible to collect benefits and would shift the multimillion-dollar cost of pre-employment drug testing from corporate ledgers onto the public.
These reforms will prevent many thousands of Americans from collecting desperately needed benefits. This will significantly weaken consumer spending and will consequently hurt the slow but accelerating economic recovery.
Democrats have two bad choices: Let the Republicans gut unemployment insurance under the guise of reform, or let much-needed tax relief and unemployment benefits expire. Both options will do irreparable harm to the economy.
It seems that whichever option Democrats choose, Republicans will succeed at making working-class Americans suffer in the lead-up to the 2012 election.