What's fix for N.C. jobless benefits crisis? - Harry Payne
Published December 5, 2012
What's fix for N.C. jobless benefits crisis?
Be very afraid of lawmakers’ plan for unemployment insurance
By Harry Payne
Special to the Observer
Originally Posted via Charlotte Observer: Tuesday, Dec. 04, 2012
At the start of the black-and-white TV movie on Saturday morning’s “Shock Theatre” that blinked on before the sun or the parents arose, there was always a moment that kept us kids barricaded behind the safety of cushions or a blanket. Right after the loud scary music and the Japanese titles, there appeared a misty Yokohama Harbor, with ships resting at anchor while a city slept. The camera focus narrowed on where neither ship nor shore could be seen and came to rest on the deepest part of the harbor.
The bubbles coming to the surface of the water tipped us that what was coming was gonna be big, green and ugly, and whatever emerged was surely destined to wade ashore to stomp all over the lives of innocent people who slumbered unaware.
There’s good reason to believe something scary and possibly devastating will soon come out of the state legislature, but lawmakers have been careful to make sure the public doesn’t know details of what is soon to come ashore. For the past nine weeks, a small committee of legislators, aided by Chamber of Commerce consultants, has been working to devise a bill that determines who will repay the current $2.4 billion debt owed to the federal government for unemployment benefits paid out during the recession. They haven’t revealed the terms or shape of what is coming, but what little we know and recent history makes us fearful for those without a cushion.
In simple terms, 34,476 of the state’s almost 200,000 businesses have not paid the $2.5 billion in unemployment insurance premiums necessary to cover what their layoffs cost the system and state. These 1/6th of our employers now have large negative accounts for money they owe the system. The state borrowed from the federal government to cover that shortfall. That debt was caused by a whopping series of unjustified premium reductions given to employers in the 1990s, followed by unemployment from two recessions that lawmakers could not have foreseen. That collision of events drained the state’s unemployment insurance trust fund – a fund of reserves meant to cushion employers from having deeply negative accounts.
Now the same business groups responsible for the excessive cuts to unemployment insurance premiums that drained the reserves want the very victims of this economy to pay the cost of re-filling it by forfeiting benefits. Ideas that have been advanced seem to be about forcing “self deportation” of people from the unemployment insurance system, expediting their family crisis and devastation. Squeezing those seeking unemployment benefits harder will not create jobs. The economy pushed hundreds of thousands of North Carolinians out of their jobs, but legislators seem not to notice that the same economy has put re-employment out of reach of so many.
There have been no public discussions or involvement of workers or their advocates in the committee’s work to date, but we know the Chamber’s consultants have suggested slashing the maximum benefits to workers by almost one third and requiring a sacrifice of their last five weeks of eligibility for benefits. The same legislative majority delayed benefits to almost 50,000 families in an effort to force Gov. Bev Perdue’s hand on a veto of a bill that did not involve unemployment insurance.
Next year, when the legislature and the governorship will be controlled by the same party, there will be little chance of veto and no good reason to hide or hurry a major bill through a committee or the process.
These bubbles tell us what is coming will be big and scary. If it rushes ashore and stomps on the lives of innocent, vulnerable working people already in crisis, it’s going to be ugly. In the near-silence of having been told so little, we have heard only the familiar horror-show soundtrack.
Harry Payne is a former N.C. labor commissioner and currently senior counsel for policy and law for the Workers Rights Project at the N.C. Justice Center.
Read more here: http://www.charlotteobserver.com/2012/12/04/3706067/whats-fix-for-nc-jobless-benefits.html#storylink=cpy
December 6, 2012 at 11:31 am
JACK TURNER says:
Nobody in his right mind is in favor of giving away money where it was not earned or due. That principle applies to the countercyclical employment programs in each state for covered persons of the unemployment insurance laws.
However all such programs, while originally well intended, becomes the fodder for political and business tomfoolery. Doublespeak and outright falsehoods abound and the recent reports in the RN&O are no exception.
Firstly, the vast majority of unemployed workers want real jobs, and a real paycheck. Can anyone honestly say that the thousands of NC jobs that flew the coop under NAFTA and related legislation to virtual slave labor countries was the wish of the US workforce? Just ask your textile workers ! Yet these people, sold down the river, now are being punished for conditions they did not create, or want.
In the second place, the statement that workers do not pay unemployment insurance has been tossed around for years. While technically true, where does anybody think the money remitted by the employer comes from ? Worker productivity, of course ! In fact, except for a very small employer, most of the wealth produced is by the workers. So, it is their money after all.
Thirdly, business profits have been rising for decades. For many business that went off shore, profits have been astronomical. The reason is that that such operations do not pay all the benefits needed to attract US workers. This is confirmation of just who really pays for such protections as the unemployment insurance program.
Lastly, while the United States has wealth, it is not unlimited. Notwithstanding the globalization that has been created in business, I still believe we should take care of our own before we prance around the world casting our money to just about anyone. That leads me to the observation that it is almost is treason for the US government to give away our money, and then characterize the NC unemployment program as being "In debt" to the feds ! What hubris !
I wish that leadership would emerge that would set our priorities straight for our country. Assisting deserving, formerly productive US workers is our duty, our sacred duty. They are no different in the civilian war on poverty than the military veteran is on the defense of our country.
That is my $0.02 worth
Jack Turner
Richmond
