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Jobless benefits bill puts N.C., residents at risk

Casualties keep mounting in unwise, unbalanced House bill

Add military veterans as possible losers in an unwise unemployment insurance bill N.C. lawmakers are ramming through the legislature. The bill the House approved last week takes away protections veterans currently enjoy if they’re fired for a service-related disability. Under the proposed law, such veterans would have no claim on unemployment benefits. That’s shameful.

But then again, we’ve already discovered that the legislative leaders pushing this bill have a low threshhold for embarassment. Otherwise, they would not have pushed so hard for changes in the N.C. unemployment insurance system that so blatantly put a disproportionate burden of fixing the problem on Tar Heels struggling to find work.

Lawmakers do need to tackle this issue. The state unemployment insurance system is broken. North Carolina owes the federal government $2.5 billion, money it was forced to borrow to cover jobless benefits as the state’s unemployment rate soared. But North Carolina is in this bind partly because in the 1990s lawmakers cut the unemployment insurance taxes employers pay to cover jobless benefits. When the economy soured, they did nothing as claims rose dramatically and people were out of work for longer periods.

Now, instead of devising a plan that equitably distributes the burden for paying down that debt and instituting sustainable reforms, lawmakers have come up with a bill that puts most of the payback burden on cuts to jobless benefits. House Bill 4 would reduce the maximum time an unemployed person can receive benefits from 26 weeks to 20. It also would reduce the maximum weekly benefit by a third – from $535 to $350. Businesses would pay only slightly higher unemployment taxes.

Moreover, by reducing state jobless benefits North Carolina violates terms of a federal relief package that’s providing extended benefits for those still jobless but who have exhausted state benefits. In approving House Bill 4, state lawmakers will deny federal benefits to 80,000 unemployed people in North Carolina beginning July 1. That prospect prompted Congressman David Price, D-N.C., to write legislators, noting: “Now is not the time to abandon tens of thousands of North Carolinians who have lost their jobs through no fault of their own and who stand to benefit from federal policy if their state government does not stand in the way.”

Nor is it time to further hamper the state’s economy, still struggling with unemployment over 9 percent. Some economists say this bill will take money out of the hands of N.C. residents when they need it most, money they will spend on essentials. Price said the extended benefits will provide a projected $650 million in “economic activity” in the state.

It’s not too late for lawmakers to fix this bill. The Senate, which hasn’t taken it up yet, should reconsider amendments the House rejected last week. One would make a smaller reduction in jobless benefits – leaving the maximum benefit at $425, not $350. Another would make the law’s effective date January of next year instead of July of this year. That would protect the federal extended benefits that 80,000 N.C. residents stand to lose and would do little to affect the payback timetable to the feds.

They should also make sure that veterans remain protected.

Changes are needed in the state’s unemployment insurance system. But with this bill, lawmakers risk crippling the state and its jobless who are persistently seeking work.

Don’t do it. Revise the bill.

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