President Obama Signs Unemployment Benefits Extension

Congress broke a two-month-long stalemate on July 22, 2010, when the House of Representatives voted to extend unemployment benefits through November 2010 for long-term unemployed workers. President Barack Obama quickly signed the measure into law.

The legislation (H.R. 4213) will restore jobless benefits to more than 2.5 million unemployed Americans whose benefits expired on June 2, 2010. According to the law, these workers must reapply for long-term unemployment benefits to receive their payments retroactively. Sources familiar with the issue say that it could take up to several weeks for many jobless workers to receive their retroactive payments as state unemployment insurance funds scramble to restore the benefits.

The Senate broke the deadlock and a contentious debate in Congress when it voted 59-39 on July 21, 2010, to extend the benefits. Following the Senate action, the House moved quickly the following day to approve the extension measure by a vote of 272-152.

Under the extension, federal unemployment payments to long-term jobless workers will last up to 73 weeks. The long-term unemployment benefits begin after the 26 weeks of state-funded jobless benefits expire.

With the nationwide jobless rate hovering around 9.5 percent, Republicans and Democrats agreed that the government needed to provide an aid extension to the long-term unemployed. But a contentious debate on how to pay for the extension stalled the proposal for nearly two months.

Republican senators, who were joined by moderate Democrat Sen. Ben Nelson of Nebraska, argued that the proposal, if not funded properly, would add nearly $34 billion to the ballooning U.S. deficit. They pushed for a proposal that would require the federal government to pay for the extra benefits by using leftover and unspent money from the 2009 economic stimulus package.

Democrats argued that emergency extensions of unemployment benefits have always been funded through government borrowing—even when the extensions were signed into law by Republican presidents.

Originally, the benefits extension was part of an approximately $200 billion package of tax breaks and job programs sought by the Obama administration to help stimulate the struggling U.S. economy. Republicans and conservative Democrats balked at the price tag and demanded that the cost of the proposal be scaled back.

To ensure passage of the legislation, Democratic leaders scaled back or removed dozens of programs from the proposal, including a health insurance subsidy for the unemployed and an additional $25 per week income supplement for laid-off workers.