“It’s Working”

HuffPost Hill with a little reminder:

During a press conference demanding unemployment insurance be part of a fiscal cliff deal, Chuck Schumer noted that last December, 5 million Americans relied on federal unemployment insurance, while only 2 million currently do so. “It’s working,” he said.

Sure, fewer people are on unemployment because more people have jobs, but another reason fewer people are on benefits is that Congress slashed the number of weeks available back in February.

The last time the cost for this necessary funding was the extension of the Bush tax cuts. I wonder what it will cost this time?

Meanwhile, Paul Krugman has this on a new study about the effect of unemployment:

[F]rom the Boston Fed (pdf), it looks at the recent deterioration of the Beveridge curve — the apparent worsening of the tradeoff between vacancies and unemployment. Many people have argued that this is evidence of structural unemployment, of workers not having the right skills or something like that. But the authors show that the worsening of the tradeoff seems to apply to all skill groups, all types of work, and so on. But they also find something else: the short-term unemployment rate has fallen just as we might have expected, it’s long-term unemployment that’s higher than it “should” be. And as Brad DeLong suggests, this is very much consistent with a story in which long-term unemployment makes it hard to get back into employment — exactly the kind of thing we should fear, because it means that failure to address the slump is damaging the economy’s long-run prospects.

“It’s working.”

Get updates in your inbox