Judith Miller's (former?) paper sez:
Over the coming months, as many as 1.5 million jobless Americans will exhaust their unemployment insurance benefits, ending what for some has been a last bulwark against foreclosures and destitution.
...
Tens of thousands of workers have already used up their benefits, and the numbers are expected to soar in the months to come, reaching half a million by the end of September and 1.5 million by the end of the year, according to new projections by the National Employment Law Project, a private research group.
Yikes.
Here is the breakdown:
Economists expect unemployment to increase over the next number of quarters -- perhaps into 2010, perhaps into 2011 -- regardless of what we might see otherwise in GDP growth.
We've been experiencing very high rates of joblessness now for quite some time. The blow to the consumer economy, however, has been cushioned by the rolling extensions to unemployment benefit terms granted by states and the Federal government.
In some states, a combination of unemployment benefits, benefit extensions and emergency extensions can reach nearly 80 weeks. That's one and a half years.
Despite this, some 1.5 million workers are expected to exhaust their benefits before finding a job in 2009 alone -- something that will likely destroy the household finances of many, cause an increase in foreclosures and cause further stresses to state aid programs, especially related to housing and nutrition.
In addition, as unemployment benefits are discontinued, the economy will experience collateral damage in terms of impairment of consumer demand.
This is not really good news.
Democrats in Congress, including one Washington representative so beloved by members of the Daily Kos community, are starting to stir on this:
Representative Jim McDermott, Democrat of Washington and chairman of the House Subcommittee on Income Security and Family Support, said he would introduce a bill in September to provide yet another 13 weeks of coverage in states with unemployment rates of 9 percent or higher. "Legislators will line up quickly when they start getting calls from desperate constituents," he said in a telephone interview.
Extending benefits will be vital ... and expensive. The estimated cost here could be up to $70 billion. (That's a lot of money -- though really just a drop in the bucket compared to what we're extending on an on-going basis to Goldman Sachs and similar business.)
At some point, though, it's going to be cheaper for government to simply act to preserve and create jobs ... Cheaper than indefinitely extending the dole for millions of Americans who desperately want to work.
So far, no interest in doing that has come from either Congress or the White House. But it will come ... eventually.
In the mean time, however, it is hard to see how this will not negatively impact the economy going forward. It's all interlinked -- employment, wages, consumer spending, foreclosures and, ultimately, banking and Wall St. finance. Until we do something to shore up wages and address joblessness, the economy will continue to operate under duress.