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US Senate passes jobless benefits bill

2010-07-22 11:23

WASHINGTON - The US Senate voted on Wednesday to extend unemployment benefits for millions of Americans who are out of work for more than six months.

The Senate approved the bill by a vote of 59 to 39, with two Republicans breaking the party line to vote for the measure.

The bill, with a price tag of 34 billion dollars, would restore benefits to more than 2.5 million unemployed people who have seen their checks cut off since the emergency program expired June 2.

There are three main levels to unemployment insurance right now in the US The first is basic states benefits that usually last for 26 weeks or about six months. After that, unemployed workers can apply for long-term federal jobless benefits, formally known as Emergency Unemployment Compensation, which is addressed by this bill. And the last level is joint state-federal extended benefits.

The House of Representatives has already passed an unemployment-benefits extension. But because the Senate's version is different, it must do it again. The House will take up the measure on Thursday for a final vote.

If the extension is finally approved, unemployed workers would be able to draw up to 99 weeks of aid through November averaging $309 a week. That includes 26 weeks of basic aid offered by states, plus long-term federal payments.

The Obama administration has signaled that it may seek another renewal of benefits in November if unemployment remains unacceptably high.

Currently, the unemployment rate stands at 9.5 percent and about 14.6 million people are out of work. The duration of unemployment is even more worrisome. About 43 percent of unemployed workers had been out of work for six months or more and 29 percent of unemployed workers had been jobless for more than a year, according to a report by the Congress' Joint Economic Committee.

The Senate on Tuesday cleared a major procedural hurdle to move ahead on the bill, ending a seven-week impasse over the legislation. By a vote of 60 to 40, Senate Democrats overcame Republicans' blocking tactics called "filibuster," by which minorities in the chamber can talk a bill to death.

Republicans insisted that they are not against extending jobless benefits, but the bill should be paid for by cuts in spending or tax increases, in a way not to further burden the federal budget.

The US federal budget deficit topped one trillion dollars in the first nine months ended June this fiscal year, according to the Treasury Department. The red ink in fiscal year 2010 is expected to be around $1.5 trillion.

Democrats justified the bill by emphasizing the plight of the unemployed. They also argued that people who receive the benefits would spend the money immediately, which would spur consumer expenditure and the overall private demand.

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