Legislators agree to extend federal unemployment insurance
The new year has arrived and the federal government seems to have avoided crossing the much dreaded “fiscal cliff.” It has taken federal lawmakers several months to resolve the prospective problems presented by the fiscal cliff, many of which are associated with the enactment of the Budget Control Act of 2011, a legislation designed to address several economic issues by introducing new taxes and other measures. One of the issues of contention that kept a resolution from gaining approval before the arrival of 2013 was the federal unemployment insurance program.
Many still rely on insurance benefits
Though the U.S. has shown significant recovery from the economic crisis that took hold of the country in 2008, there are still several thousands of people without jobs throughout the country. Many of these people rely on federal unemployment insurance benefits because they have exhausted the benefits they can receive from their state. Several federal lawmakers have been eager to end the benefits that these people receive because of the enormous financial burden it is placing on the federal government and, by extension, taxpayers.
Unemployment insurance extended through 2013, at the cost of $30 billion
Despite the eagerness from lawmakers to cut unemployment insurance benefits, legislators have agreed to extend the unemployment insurance program through 2013, at a cost of $30 billion. The price tag, while seemingly daunting, will not actually impact taxpayers, however, as lawmakers do not plan to raise taxes in order to support the extension of federal unemployment insurance. Instead, the cost of the extension will simply be added to the national deficit, which will likely be addressed at the end of the year.
2 million people lose benefits at end of 2012, but can still receive benefits retroactively
The federal unemployment insurance program actually lapsed on December 29, 2012, meaning that more than 2 million U.S. citizens lost the benefits they receive from the program. As soon as the unemployment insurance program is re-established, which is expected to occur as soon as the House of Representatives signs off on the fiscal cliff plan, benefits can be paid retroactively to those that need them.