Lawmakers playing political chicken with unemployment extension

The battle continues behind the scenes on Capitol Hill as Democratic leadership tries to pass another extension of unemployment benefits, with or without various other provisions as part of a larger package that includes tax reforms and funding boosts for states facing economic and fiscal disaster.

One day after declaring that the unemployment extension should and would remain part of the larger jobs bill (aka the extenders bill), Sen. Debbie Stabenow (D-Michigan) shifted strategies and introduced a new bill that deals solely with unemployment benefits. Will her new bill get to the floor for a vote? Maybe not, according to a report at Open Congress, summed up well here:

Stabenow introduced her bill this week and now it’s up to Senate Majority Leader Harry Reid (D-Nev) to see it brought to the floor for either debate or a “unanimous consent” vote.

Reid has said that he prefers to keep the unemployment benefits extension included in the broader “American Jobs and Closing Tax Loopholes Act of 2010″ and that he intends to set that bill aside and move onto other business for the next few weeks in order to pressure Republicans to vote for the entire package of provisions when he does bring it to the floor.

The real question is whether either bill can be passed without complying with so-called pay-as-you-go rules in which the costs would be offset by cuts elsewhere or by revenue increases or some combination and not come as a result of deficit spending, as the Republicans are demanding. House Speaker Nancy Pelosi suggested last week that Democrats may have to give in on that issue and take the money from another program or identify cuts or tax increases to pay for it, but so far no language has been introduced to do so.

Failure to pass the bill will not only harm those depending on unemployment benefits — 1.2 million Americans will do so on Thursday — but also may increase the rolls of unemployed Americans. As The Hill notes, unemployment benefits provide nearly $7 billion a month in national spending. Every dollar given in unemployment compensation is worth $1.90 in economic stimulus, according to the CBO.

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Ed Brayton

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