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H.R. 5618 - Extending Unemployment Benefits– A Bad Bill
The House passed H.R. 5618 on Friday along party lines. This bill would
extend unemployment benefits to November 2010. To see if your
congressperson voted for this bad legislation see this list.
I have two major objections to the bill. First is that this is not “pay
go” and second this is all about politics and an election.
The House bill was structured as an “emergency” spending bill. This
designation allows for it to be exempt from the pay go rules. I am one
of those who think that the biggest emergency the country faces is the
size of the budget deficit. This bill would add $34 billion to our debt
load. Here is how the CBO scored it.
If the Senate passes this bill it would extend benefits to the end of
November. Gee, that is a convenient time. Just a few weeks past the
critical bi-elections. This bill has little to do with structural
unemployment. It is about buying votes and trying to sustain political
control of Congress. Those that support/vote for it will say that they
are doing so to help the unemployed. Actually it is just more bad
legislation. This is about politics, not economics.
The Senate has gone on a ten-day holiday and will pick up the proposed
legislation when they return. The vote will be on party lines. As of
this weekend that means the White House has 57 of the 60 votes needed to
pass. Olympia Snowe (R. Ma.) has indicated she will support it.
Therefore they are two votes shy. If this deal clears the Senate and
becomes law it would mean that two Republican Senators had their arms
twisted, that or they had their political palms greased with some form
of side deal. Washington at its worst.
Does it matter that we are adding another $34b to our debt load when the
debt is already $14 trillion? Not really. This only increases our debt
by a ¼%. It is equivalent to about 20 days of interest. We are in so
deep at this point that $34b is a very small number. How is that
possible?
I think the outcome of this legislation is important in a number of
respects. It will influence markets and the economy.
-If passed, it will be a weight on the dollar. Outside of the US every
country is singing fiscal conservatism. We stand out in the opposite
camp. Passage of this bill will be reflected in the capitol markets.
-If enacted it will have some short-term beneficial impacts. It will
keep consumption going for a bit longer. More I-phones will be bought,
the number of defaults will be a bit less, there will be some monthly
data released that will hide some of the weakness.
-The President’s fiscal commission will release its results on December
1st. The day after the extension of benefits will expire and three weeks
after the election. There is no way this temporary extension will be
extended at that point. Either we hit a wall then or we hit a wall now.
The President and the legislative side of D.C. will not be able to avoid
the recommendations of the fiscal commission.
-If this bill is not passed it will accelerate the slowdown that now
seems to be coming at a frightening speed. Consider these two graphs of
the number of people who will be impacted. By the end of July the number
grows to 3.2mm. These are big numbers. This will show up on Wal-Mart’s
sales. It will show up everywhere. Consumption will drop. Landlords will
not get paid. Confidence will drop. Markets will drop. Federal and
State revenues will drop. Deficits will rise. Debt will rise. These
things will happen sooner versus later. H.R. 5618 just buys a few
months.
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I posit that gov't intervention has never created an environment of long-term job growth. It's the big lie; vote some liar into office because he promises jobs. WTF!
Regarding SHTF...they'll do something. I find it hard to believe they will let it unravel at its own pace because they just...can't...pass...that...bill. It's a joke that elections and votes are down to the wire these days. What an obvious farce. Is America really that gridlocked? Florida deciding who gets to be President every four years now? LOL. Sheeple sure believe it.
But what will it be? What scenario. If you have silver, semi-automatic rifles, and storable food you have much less to worry about. They'll have to actually come after you for all of this to devastate you personally. For all those waiting for a vote with no savings and no plan...sorry. Game over.
what do you think the domestic military 'll be doing then?
looking for people with guns and locking them in
others will be in gated communities with limited food and energy until some sense of new system emerges
I think they already have plans if such a thing actually occurs
Food water and seeds in your farm are good to go
From a perspective of "stimulus", I think we should all be employed by the US military and Fed Government, better pay, pensions and benefits.
We are so f*ng f*ed, comrades...If 16.5% of Americans stop getting $$ from the gvmt and
The Gekko is right on, right on. The time is up, the game is over, Nothing denominated in in paper dollars has any value anymore. Most in Congress don't know it, but they will be replaced by some sort of dictatorship because that will be the only way to control the masses when they learn that the ride is over.
But everything is denominated in $: food, shelter, medicine, energy. Check your premises.
Watch your toe. The can keeps getting bigger and harder to kick.
Cans?
Didn't they stopped kicking that a long time ago?
It's Barrels now!Kicking barrels down the road, whatsay?
Say, we really could do with a war about now, to kick off inflation, create employment, and get peoples minds off the economy. I wonder if there are any potential targets looking inviting out there.
We already are at war with 2 countries. The war in Afghanistan is now the longest war in American history. War was Bush's answer to impending austerity, and look where that got us. War is not the answer. What people need is an attitude adjustment, that GDP doesn't go up at a 45 degree angle, and that the resources we consume are scarce and we aren't as rich as we thought. My 2 cents.
Obama gets to blame Bush for everything. If blaming the prior POTUS after 1. 5 years is acceptable then Clinton is to blame for 9/11.
EK,
3.2 million Americans,going hungry,no hope, most armed could start the beginnings of one viewable from lot's of D.C residents living rooms.....and elsewhere.
The Big O's plans coming to fruition.,,,,,,,,,,,how ya like the view?.Question is what happens when another 3-5 milion wanna play too?.Could be what it takes to regain what's been taken illegally.
Ruh-Roh!!!!!!!!!!
Venezuela. The biggest military pushover per barrel.
Perhaps, even, the faintest of rationales. Chavez called our leader a bad name once, I think.
Canada is the most obvious for a start. Close and quick.....rationale; no one was looking, one stop shop for banks to commodities and big bang for ROI.
ten years and Canda and US will be one but probably by a mutal agreement initiated by the US, unless China or Goldman buy Canada first. Virtually unlimited quantities of what will be the most valuble comodities by 2025, water and oil, all located in a defenseless country.
Agreed, with the caveat that Leo emerges from the punishing shadows of ZH to lead Quebec to political and financial independence from Canada and the US, a cutting-edge, self sustaining eco-ecomomy designed around renewable energy - solar and hydro, and a sophisticated French/European culture that soon after becomes the envy of Manhattanites.
Please do not forget my kind words when you become famous and powerful again Leo (if, you ever read this of course). I have always dreamed of working at Chez Paris.
Anti-riot payments, pure and simple.
3,200,000 people cut off UI by the end of July. Assuming this does pass the Senate. How many people would lose their benefits by the new cut off date in November? How many would go cold and hungry in the winter?
I heard rioting in the cold & snow is damn hard work. Maybe TPTB heard the same thing.
Exactly.
You may be right but it still hasn't stopped another $30 bn being thrown at Afghanistan;
http://maxkeiser.com/2010/07/03/if-it-quacks-like-a-welfare-duck/
And what about millions that were shipped in, IN TRUCKS, that has disappeared?!
DavidC
This money is sacrosanct. It's not like it is intended for a bunch of grubby, boombox toting unemployed who, in any case, bear personal responsibility for their own failure. Here, I'll put the first junk.
Who gives a sh&t about a lousy 30 billion, when the Opium trade alone yields hundreds of billions in profits to the US banksters?
America became in 2 years time a socialist police country. It amazes me that it al went so fast. What amazed me most this week was the restrains on the BP coverage. America actually made a law against free information act and nobody reacted.
It's scarry to see that America is slowly changing into everyting is used to hate. And now America is fast becoming a socialist state without the experience how to control it, it's just a matter of time before it crumbles all together.
Not socialist-- Corporatist. First and foremost the government serves the corporate crooks who own it-- not society or the public at large.
Police states are only objectionable to the media if a Repub is in office.
Otherwise, as you noted, it is passed over silently.
The media (ZH and few others excepted) is substantially owned and operated by and for the benefit of the same corporate crooks who own the govt. Keeping the public ignorant and uninformed with lies and general dissembling is job #1 for today's lamestream media. This is not about dems or reps, it's about the friggin' money. Who's dishing it out and who's taking it in. Institutional corruption non pareil driven by greed and sociopathy the exact opposite of classical socialism.
http://calltoaccount.wordpress.com/
Dear Sudden Debt,
think of the gov't restraining your access to the Gulf as a blessing. At least you will enjoy less exposure to the Hydrogen Sulphite and Benzene gases. If you wish to experience noxious gases, attend in person a Pelosi speech.
Obviously, one of the, if not the, major points in this extension is that concurrently Obama is talking amnesty for illegal or undocumented workers, a la Ronnie the Supply-Sider Reagan (Exec. Order. 12615 - establish an office of privatization, to privatize everything, etc.).
With growing unemployment, does any member of the citizenry really believe America needs more workers? (Other than that jackhole Peter G. Peterson, and his uncle David Rockefeller, of course.)
I've asked this question on various 'unemployment forums'. Why are the unemployed , in their fax and letter campaigns to Congress, not making E-Verify at least as important as extending benefits?
There is no quicker way to provide jobs for hundreds of thousands of Americans than to require employers use E-Verify to establish the bona fides of their employees and discharge those who cannot show legal residency. Could do it in less than a month.
In 1993 the Superconducting Super Collider Project in Texas was cancelled, due to it's high cost, 12 billion smackers. The tunnel circumference would have spanned 53 miles. It would have been the largest particle accelerator by far in the world.
Seems like we've just gone down hill since then.
That was one of the first signs we were eating our seed corn. We've been beaten out by the EU and the Large Hadron.
+|cos(x)+i sin(x)|
You are so right! As a side benefit perhaps one of their super-potent collisions could have caused Texas to disappear.
perch,
Yep, sure wish I could get rights to the tunnel......make a hell of a shelter for lots of folks.........
Imagine the numbers that could set up inside it.
Those voting Aye on this definitely view it as an "emergency". That designation has nothing to do with helping main street America except to head off the emergency of lost congressional elections due to an infuriated electorate kicking encumbents off the taxpayer funded gravy train.
Thanks for your continuing great articles Bruce. Keep up the good fight.
At this point it doesn't really matter...Armageddon will come whether they vote for it or not. In fact, at this point this may even be a "good" bill as it will give some souls who are not prepared a few months to get their affairs in order.
Agree 200%, Unemployment checks will keep them from suicide or killing others
People have nowhere to go for money now- and whtabout their families
Benifits need to be extended in some form for now but alternative plans should be on the table along with it
I'm sure there are many unemployed who are grateful for the midterm elections. They're not so stupid as to think this is not a political ploy, but it helps them nevertheless. I guess this is where liberals and conservatives really show their stripes. Conservatives look at the "macro" picture, sort of like Jesse Helms bellowing on about the "buhgit". Liberals can't stand seeing pain.
conservatives are for a war we can't afford, spend money on military we don't have, in-debt our grandchildren to chase after a few hundred Al Q in Afghanistan...nobody bothers the miliray about deficit spending, nobody cares that Blackwater - Xe went from nothing to mega-corporation in a decade on tqaxpayer dime...
liberals instead are for social programs we can't afford
neither party is for balance budgets, 2000-2006 should have proved that, even if you ignore war costs, budget not remotely balanced...Dems won't balance it either.
but of course, Repubs are superior in everyway, except they never prove it...
this is so utter crock.. so and so can't stand seeing pain.. Is not increasing taxes not a pain the Red boils their blood over?
'My profit margins for my buisness have been reduced to a mere rich mortal - I cannot forge on with these liberal chains if I wish to live as a God... I must close my shop until a more corporate welfarish wind comes again..."
Amen. Tired of hearing ass-hats like Santelli (who's never worked for a living) complain about the extensions.
These people didn't offshore or TARP their own jobs into oblivion. That was Bush. OK, Obam sucks. But Bush was still worse.
GG,
This a hell of a good way to get rid of these states laiblities.
As they will get the hell out'a dodge,( Lord, Texas look out!) and move to other states, that have at least a shot a $7.25 job, and welfare bennies.,.
I'm all for whatever doesn't cause a panic, or delays it. Every day is another day to prepare for the Bonfire of the Fiats. At this point I'm comfortably numb to kicking the can. After all if it all came down in 08 all I would have had is a few Krugerrand and Russian coins my grandparents left me.
In the scheme of things it doesn't matter.After you diagnosed with a dozen forms of terminal cancer why bother to stop smoking?
Double ditto GG. They pass the spending for the “war” - might as well pass this also and bring on the collapse all the sooner. Let the band keep playing as the ship sinks.
Considering CONgress and the private Fed gave TRILLIONS to the banksters, the least they can do is throw a few chewed bones to the great unwashed. As they say at GS, suck it up, birdies and fishies.
It's dismaying to read Bruce's recent posts and the fatalistic responses from savvy commenters like GG above.
Reality is painful, thats why most folks avoid it...
First, good to see you back around, Hulk
Second, +1. "Reality is painful, that's why most folks avoid it..."
That's why we have gotten to the point where no matter who we vote into office, we travel faster and faster towards the brick wall. Nobody wants it to be said that they were the ones responsible for the crash. Assigning blame is easy. In reality, nobody could stop it if they wanted to. That ship sailed decades go.
I don't know anybody here who wants to see people suffer or go without. But the truth hurts, and we CANNOT afford to keep giving people money we don't have for work they haven't done.
Good luck everyone, and happy 4th.
Happy 4th Colonel
Semper fi
Love ya hulk but hate your marine logo. Try out a better one for any situation involving killing.
nunquam fidelis
It's not high minded but it's achievable for all of humanity.
Semper fi devil dog.