Unemployment Rate Set To Plunge As Bill To Restore Jobless Benefits Fails To Pass Senate

Tyler Durden's picture




 

Following last week's surprising passage of the preliminary approval to extend emergency unemployment claims, i.e. emergency jobless claims, for 3 months, when six republicans sided with democrats and gave approval to the original $6.4 billion legislation, there was an expectation that up to 1.4 million Americans would get their benefits extended once again (despite the so-called recovery in the economy, and the job market, instead of just all time high S&P500). Moments ago such hopes were dashed, when a Senate plan to restore long-term jobless benefits hit a wall Tuesday after Republicans withdrew their support amid complaints over cost and other issues.

The $18 billion bill, which would restore the benefits through the end of 2014, failed to clear a key test vote. Senate Majority Leader Harry Reid needed to attract 60 senators to move the bill forward, but the bill stalled on a 52-48 vote.

 

No Republicans voted in favor.

What happened between then and now, and why did those republicans revert back to the party line?

Reid lost their support when he amended the bill and failed to come up with a plan to offset the cost within 10 years.

 

"It doesn't look good," Maine GOP Sen. Susan Collins said before the vote and after a meeting with Reid.

 

Collins and Nevada GOP Sen. Dean Heller unsuccessfully proposed that Reid go back to the three-month extension. "We're back to ground zero," Heller said.

 

The senators are expected to return to the negotiating table. The GOP-controlled House has yet to vote on extending the benefits.

 

Reid postponed a prior vote Monday night upon realizing he didn't have enough support and said he needed time to talk with members of both parties.

It almost makes one wonder if Reid isn't trying to sabotage his own legislation. Whatever the answer, it increasingly seems that no law, retroactive or otherwise, will pass before the end of the month, which also means that up to (a record) 1.4 million Americans will fall out of the labor force, in addition to the now traditional 200K-600K people who quietly exit the labor pool every month. Which also means that, as we explained previously, since the impact on the unemployment rate could be as high as 0.8% from just the EUC expiration alone, that the unemployment rate for January could crash to under 6% just as the economy is starting to really backslide, as shown by the recent horrendous data from retailers across the board.

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Tue, 01/14/2014 - 18:28 | 4332033 Leonardo Fibonacci2
Leonardo Fibonacci2's picture

WTF is going on?  Reid is a real Effing snake!!!

Tue, 01/14/2014 - 18:30 | 4332047 nope-1004
nope-1004's picture

Unemployment is falling.  7 to 6.7.... soon to be 6.2.  Gotta save some for the coming months, you know.

 

Then, we all know what Bernocchio promised when UE gets to 6.5%, right?  NO MOAR QE.

Place yer bets.

 

Tue, 01/14/2014 - 18:31 | 4332057 The Gooch
The Gooch's picture

2014. Year of the boomerang.

 

Tue, 01/14/2014 - 18:45 | 4332105 zaphod
zaphod's picture

Falling unemployment is the cover the FED needs and requested in order to start to significantly tapper QE. My expectation is employment looks so good in "government statistics" that the FED finally pulls back QE by the end of 2015.

As much as we mock the fools that run the FED, they are more insane than stupid. They know they have to taper for real at some point or they lose control of the dollar, and with that goes their control as well. 

Of course this sets us up for an even bigger economy wide crash than 2008, but this way the FED will have room to turn up on printing press again, instead of the printing press being blamed as the original cause it is.

Tue, 01/14/2014 - 18:49 | 4332141 john39
john39's picture

somewhere out there, Orwell is rolling with laughter.

Tue, 01/14/2014 - 18:55 | 4332169 StacksOnStacks
StacksOnStacks's picture

Much Bullish!

Tue, 01/14/2014 - 19:07 | 4332208 kaiserhoff
kaiserhoff's picture

Mother of all Boools!

Or maybe just a mother.

Tue, 01/14/2014 - 19:42 | 4332302 El Oregonian
El Oregonian's picture

Did he just say "Moar Taper, or moar Paper? 'cus the printers have been well oiled and refilled with ink! FORWARD!!!

Tue, 01/14/2014 - 21:35 | 4332633 CClarity
CClarity's picture

Fed can spend $85 Billion per month with no plan, but Congress can't come up with $18 Bil abd a how to pay back in 10 years.  You tell me who is running the country and who they are running it for.  It sure ain't the person who can't find a job. Nope, the objective is clearly to keep the banksters safe and the wealthy getting fine equity appreciation.  

Tue, 01/14/2014 - 19:00 | 4332182 max2205
max2205's picture

Lets see if Barry invoke executive powers to extend UE benefits. ...permanently

Tue, 01/14/2014 - 19:51 | 4332331 Nick Jihad
Nick Jihad's picture

Nope. The FSA's emolluments need to be contingent on continued loyal Demorat voting. That's why they love things that sunset after a year or two.

Wed, 01/15/2014 - 02:10 | 4333342 the0ther
the0ther's picture

I think 1984 was more about doublespeak and the perverting of basic human values. Not so about surveillance as people tend to believe.

Tue, 01/14/2014 - 18:56 | 4332170 max2205
max2205's picture

Lets see....benyellen is printing 75 bill a month....we give various country's  billions a year....

 

This won't sit well with the FSA.

 

GOP insert foot

Wed, 01/15/2014 - 01:00 | 4333240 putaipan
putaipan's picture

doesn't sit well with me.

don't call me the free shit army.

i am one of ' them'. i.e. unemployed longer than 6 months.

 

that being said-

 

believe me when i tell you-

this is a 'test'.

you are focused on on fat ellen/yellin's qe tapering...

the real issue is sufferring.

(because of my mini-prepping and my momma's generosity. i will not suffer) but-

 

 

THIS SHIT AINT IN THE NEWS!

try drudge. amy. google. amazonian/washington times ....

IT AINT A STORY.

they are testing the waters.

no response and they will proceed.

 

p.s. - thanks tyler fer the update.

Wed, 01/15/2014 - 09:48 | 4333733 corporatewhore
corporatewhore's picture

i have been in your shoes and can "feel your pain" along with the pain of so many AMERICANS.  At the same time Congress can't get relief to those AMERICANS suffering I see in the headlines we continue to grant 380 million to syria for some ridiculous reason.  Corporations get many times more relief than individuals.  It's sickening and I am no leftist nor a member of the card carrying FSA.  I just want justice for all Americans.  In a nation that has prided itself on its ability to lift its own  I am disgusted.  But why should I be?  Nothing has changed.  It's just that we're all waking up to the fact that our politicians are there just to get rich.  The guise of Democrat or Republican is meaningless.  They've all sold out to corporations and special interest groups.  And look who our top nominees may be in 2016--Hillary (who has no more interest in the downtrodden than the man in the moon unless it feathers her nest/nest egg) or some retread out of that other party pretending to have diametrically opposed philosophical beliefs (see big fat Christie).

Rant off.  It's time for my medications.

Tue, 01/14/2014 - 20:22 | 4332388 Wait What
Wait What's picture

Fed will need another 900 words to explain why it's moving the goalpost. "we said 6.5%, but we really meant 6, er, 5%." At what point do quantitative measures become irrelevant and the Fed just shoots from the hip?

Tue, 01/14/2014 - 18:48 | 4332119 knukles
knukles's picture

OK
Soooooooooooooooooo

U drops due to the Continuing Claims Sophist Adjustment Factor as said poor starving motherfuckers and leeches both become undifferentiated and thus Uncountable Once Again Part 2 so the rate drops like the glide path of a crow bar.
Great.
The Fed then finds it reasonable in their Altruistic (toward their owners, only) Heart of Hearts to cut to the Big Taper just when the markets would get spooked the most, followed ever so shortly by even worse numbers on the economy in spite of bad weather which won't last forever and ever to blame the economy upon, causing mass confusion, despair, angst, agata and increased Tums sales.

Fucking Wonderful
And they tell me there are no more fundamental at work
Let me tell you, every day Mrs K sets me straight about what's what in life...

PS  Those people on CNBS are morons.  For some unknown reason (I was possessed momentarily) I tuned to them this a.m. and the fellow from ECRI (ERCI?) the economic people was talking about the massive divergence between the household and business surveys and how the business is the one fucked with but always has to reconcile with the household and that the household was already in the shitter and those idiots wouldn't let him speak.
It's like a yell at one another fest.
Nof fucking wonder their viewership is rock bottom.

Tue, 01/14/2014 - 18:53 | 4332162 666
666's picture

I have a dream... where the gubmint creates another CCC like in the 1930s and the unemployed worked for food and shelter. Then I woke up and remembered unemployment benefits are automatically deposited into the person's bank account while he watches pay TV while lying in bed with his beer and chips.

Tue, 01/14/2014 - 19:02 | 4332185 walküre
walküre's picture

At least the unemployed sitting on the couch is not costing us more. The unemployed sitting around on various aircraft carriers or sitting in barracks are costing us alot more in ammo (practice or mission, what's the difference) and fuel (to move equipment).

Government cannot afford to maintain either group without $75 billion a month life support from the Fed.

Rome is broke.

Tue, 01/14/2014 - 19:09 | 4332216 kaiserhoff
kaiserhoff's picture

Glide slope of a crow bar.  That's an image I can use.

    Thanx, knucks;)

Tue, 01/14/2014 - 18:32 | 4332063 boogerbently
boogerbently's picture

....So,

If we abolish unemployment compensation, we will have full employment !

Tue, 01/14/2014 - 18:35 | 4332080 Leonardo Fibonacci2
Leonardo Fibonacci2's picture

No we will have more homeless people!

Tue, 01/14/2014 - 18:43 | 4332102 Keyser
Keyser's picture

With progress like this, the unemployment rate will soon go negative. 

Tue, 01/14/2014 - 18:50 | 4332150 knukles
knukles's picture

Yes!

The New Fully Employed Idle Homeless

Sat, 01/18/2014 - 13:42 | 4344087 boogerbently
boogerbently's picture

Being paid 2X a minimum wage, to stay home.

Tue, 01/14/2014 - 18:41 | 4332108 aVileRat
aVileRat's picture

If the 1970's USA & UK are anything to go by, expect to see the black economy explode in green shoots. Literally.

Would not be suprised if breaking bad becomes a case study for the 55% and growing over the next 3 years. Of course this would naturally play into their story arc for more gov. oversight and social workfare because the 'bush era' social fabric is "torn beyond repair".

 

Wed, 01/15/2014 - 02:07 | 4333337 the0ther
the0ther's picture

I wasn't around then so please explain. Were there more whores? Gambling? Contract murders? Sure as shit could not have been more drugs than what we have now.

Tue, 01/14/2014 - 18:45 | 4332128 Al Huxley
Al Huxley's picture

I don't think anybody really counts homeless people though - not in any statistic that's watched on a regular basis anyway, so that doesn't matter.  Anyway, its all a matter of categorization - start splitting the homeless into 'permanently homeless', 'voluntarily homeless', 'temporarily homeless', 'shelter-impaired', etc... and soon that stat will be also muddled to meaninglessness.

Tue, 01/14/2014 - 18:51 | 4332154 knukles
knukles's picture

"shelter-impaired"

Al you're one sick puppy
XOXOXOXOXO

Tue, 01/14/2014 - 18:55 | 4332168 akak
akak's picture

"Differently domiciled"

Tue, 01/14/2014 - 19:17 | 4332233 kaiserhoff
kaiserhoff's picture

Futon challenged.

Did anyone, anywhere, ever get a good night's sleep on one of those damned things?

Tue, 01/14/2014 - 22:45 | 4332858 Tijuana Donkey Show
Tijuana Donkey Show's picture

Yes, in my 20's, with a hot blonde, after being drained of every ounce of spare fluid in my body. I would have slept on a bed of nails after that....

Tue, 01/14/2014 - 19:30 | 4332265 Reckonball
Reckonball's picture

"Residentially challenged"

Tue, 01/14/2014 - 19:31 | 4332271 Anusocracy
Anusocracy's picture

Repatriated to nature.

Tue, 01/14/2014 - 19:34 | 4332279 kaiserhoff
kaiserhoff's picture

As in "gone feral?"

Why does Detroit leap to mind?

Tue, 01/14/2014 - 19:33 | 4332275 Strider52
Strider52's picture

The "Calorie-Challenged"

Tue, 01/14/2014 - 20:34 | 4332462 GeezerGeek
GeezerGeek's picture

Homeless people are not counted when a Democrat is in the White House, only when a Republican is. Same as IRS scandals, DOJ scandals, NSA spuing, etc. That's why Christie is the main topic of conversation these days - he's a Republican, even if In Name Only. After all, tying up traffic and having a lady die is much more important than four Americans dying in Benghazi, or Border Patrol agents dying because of Fast & Furious. Gotta keep these things in perspective, Al.

Tue, 01/14/2014 - 21:11 | 4332563 shermacman
shermacman's picture

The homeless are not burdened with the struggles of everyday life! Like Nancy Pelosi said, they can become artists! Like Harry Reid said, they can write cowboy poetry! Like the NYT said, they can have more time to be with their kidz! 

Tue, 01/14/2014 - 23:12 | 4332942 Oleander
Oleander's picture

Show your EBT card and get in to museums for $2, at least in Ma. Great family time with the kiddies.

Tue, 01/14/2014 - 23:01 | 4332913 hesk
hesk's picture

FEMA Camps for all. The cots are ready

Tue, 01/14/2014 - 18:36 | 4332084 cougar_w
cougar_w's picture

Apparently. But if they do that, then they should rework the Census figures to exclude the unemployed. Places like L.A. don't need as many Representatives in Congress if everyone there is unemployeed.

Tue, 01/14/2014 - 18:54 | 4332167 knukles
knukles's picture

Yeah, but LA's unemployed are represented by the truly incompetent... But that'd be a Max of Waters under the bridge, no?

 

Tue, 01/14/2014 - 19:57 | 4332343 Nick Jihad
Nick Jihad's picture

If Maxine is dumb, what do you call people who assign powerful committee chairs by seniority?

Tue, 01/14/2014 - 20:38 | 4332468 GeezerGeek
GeezerGeek's picture

Politicians. 

Wed, 01/15/2014 - 07:53 | 4333555 Pumpkin
Pumpkin's picture

Well that not fair at all!  I am employed and I don't want any 'representatition either'!

Tue, 01/14/2014 - 18:37 | 4332092 PopeRatzo
PopeRatzo's picture

Don't forget child labor.  Until we get those kids (and old people) working, we won't really have full employment.

And why in the 21st century should we need more people working harder for longer hours?  Didn't we have some sort of Industrial Revolution a while back?

Tue, 01/14/2014 - 18:53 | 4332164 The Gooch
The Gooch's picture

There are a few "representatives" already pounding that drum. I can't wait until mine turn 12 and I put mom back to work. 

Earn your keep, bitchez.

 

Tue, 01/14/2014 - 20:04 | 4332362 Nick Jihad
Nick Jihad's picture

We don't need the kid's labor. We just need their youthful, budding, dewy-cheeked credit, to borrow against.

Tue, 01/14/2014 - 18:33 | 4332065 Sudden Debt
Sudden Debt's picture

3.5% is the lowest it can statisically go. But the way Obama is fixing the economy, people will need to start working 76 hours a week so the unemployment rate doesn't go negative...

Tue, 01/14/2014 - 18:42 | 4332114 Haager
Haager's picture

And a lot of them won't be able to pay the rent - because thiis time wages will also go lower as does the number of unemployed (in the statistics). Short term bullish, medium long riots and long term it's destructive.

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