October 3, 2009

institutionalized depression

Rather than adopting policies that would create jobs they concern themselves with policies that will incentivize unemployment. Rather than help companies, especially small businesses, they make being unemployed less burdensome. The stupidity of this approach was proven over and over again in the 20Th century and yet liberals still can not get it through their heads how destructive this is. This supposed compassion is both destructive and debilitating to not only the economy but the human spirit. They talk about being forward thinking and agents of "Change", they are in fact old and tired agents of human suffering. Nothing so destroys the human spirit than the lack of productive enterprise and a sense of dependency, yet they seek to institutionalize it.

from- WSJ

Democrats Weigh Extending Key Parts of Stimulus

WASHINGTON -- White House officials and Democratic leaders in Congress on Friday said they were weighing extending key elements of the economic-stimulus program as the nation grapples with a deteriorating job market.

Obama administration economists said they would like the enhanced unemployment-insurance program to extend beyond its Dec. 31 expiration date. They also want to maintain a program that offers tax credits to pay 65% of the cost of health insurance policies under the COBRA program, which allows laid-off workers to purchase the health plans they had through their previous employer.

White House officials said they also are examining whether to extend a soon-to-expire tax credit for first-time homebuyers, but that provision faces a stiffer headwind.

"The question is, does it need to be extended or would fiscal considerations lead us to not do so," one administration official said. "We've got a budget deficit to think about, too."

Administration officials are reluctant to call these possible moves a second stimulus package because about 60% of the initial $787 billion stimulus package remains unspent and not contractually obligated to projects. They are focused on what they call the "safety net" parts of the original package, which expire Dec. 31.

But since the extensions would require congressional action, they would likely reopen a debate about the fast-rising federal deficit and the effectiveness to date of the stimulus package.

For the fiscal year that ended Wednesday, the government is expected to post a record $1.56 trillion budget deficit. That rise is feeding criticism of the administration's spending, and sowing some worry among officials about spending.

Indeed, Republicans jumped on Friday's gloomy jobs report, calling it proof that the original stimulus plan hadn't worked. Employers eliminated more jobs than expected in September and the unemployment rate climbed to 9.8%, another sign that a rapid recovery in the labor market is unlikely.

"Today's troubling report underscores the need for Democrats in Washington to scrap their job-killing agenda and act in a bipartisan way to put Americans back to work," said House Minority Leader John Boehner (R., Ohio).

The administration countered that unemployment would be worse without the stimulus program.

Nonfarm payrolls declined by 263,000 in September, the Labor Department said Friday, noting that the largest job losses were in construction, manufacturing, retail trade and government. Economists surveyed by Dow Jones Newswires had expected a 175,000 decrease.

National Economic Council Director Lawrence Summers, in an Internet interview for Atlantic magazine, said he wouldn't be caught using a loaded phrase such as "Stimulus 2." But he hinted at the legislative discussion.

"We certainly need to continue to support people in need, whether through unemployment insurance or COBRA, which for the first time provides that people who get laid off get supported," he said.

"The administration will consider ways of making unemployment insurance be there as a safety net to the extent practical," said Alan Krueger, assistant Treasury secretary for economic policy.

Extending unemployment benefits through 2010 would cost about $100 billion, according to the Center on Budget and Policy Priorities, a liberal think tank.

The cost of the original stimulus plan is likely to shoot higher than the $787 billion estimate, as payrolls continue to be cut.

Under the stimulus program, workers who lose their jobs up to Dec. 31 would get the full, expanded 79 weeks of unemployment benefits, including the $25-a-week expansion in the program.

Those laid-off workers also would get nine months of COBRA support. So programs that nominally terminate at the end of the year would extend much of the way through 2010 for tens of thousands of Americans.

Some people close to the administration believe that when likely extensions of jobless benefits are added in, the total cost of the original stimulus program could exceed $900 billion.

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